Toronto Hullmark Centre | 167.94m | 45s | Tridel | Kirkor Architects

[sunnyraytoronto]

NYCC has the lowest vacancy outside the greater core .... demand is very stable in the area, just like Yonge and Bloor, but the current rental rates (higher than anywhere outside the greater core) still do not justify new developments from a developers perspective, that is the cost of building a new office building (higher now than 10/15 years ago ... when the last office went up in NYCC) is more than what a developer can expect to take in over time.

This is why you don't see any new office developments in Bloor / St. Clair either, as these 2 submarket have externally low vacancy rates as well (even lower than NYCC) only second to the financial core it self.

I think this will continue for the foreseeable future, the reason being lately we are seeing more firms want to move to the core, some of these are actually within the 416 and a few in the 905, hence most of the demand is there, for companies who want back offices in accessible areas you have NYCC and soon VCC, I think these two markets will compete with each other, more so then VCC competing with downtown or other parts of hte 905, as rents in VCC will be higher ..

So if you are trying to imply there is little demand for NYCC offices, that's very far off base, but there probably isn't demand for new space ... but, as I've said on many occasions now, this is not typical office space (exactly like the condo office building going up in Yorkville) and these are a completely different local market.

Anyway no point in continuing this ..

Taal, when was the last time you were in the Yonge - Sheppard area? If you think North York Centre has low office vacancy rate, then you missed all the office for lease signs found in front of practically every commercial office building in North York Centre (see attached photos). Besides the government office buildings (Joseph Sheppard - Canada building, North York Civic Centre, Toronto District School Board, Toronto Catholic District School Board), I can only find 3 office buildings that don't appear to be looking for tenants (40 Sheppard West, MadisonCentre & shorter north tower of Sheppard Centre).

Actually, the last complete office building built in North York Centre was the 20-storey Transamerica building 10 years ago. Renamed Aegon Centre and about 15% empty! GWL Realty is new office building management. The Cadbury sign that was on Yonge Street is now gone.

VCC,... seriously! VCC was originally Vaughan Corporate Centre until they realize they can't get office development so they renamed it Vaughan City Centre. Actually, given what's in the area, it should be Vaughan Costco Centre.

There you go again, comparing apples to oranges,... first comparing offices at Queen, downtown & RichmondHill VS HullmarkCentre & EmeraldPark,... now NYCC offices to VCC, St.Clair&Yonge, Bloor&Yonge. This is the HullmarkCentre thread, not a GTA office comparison thread.

The only relevant market for the offices at HullmarkCentre are the competing office spaces within North York Centre area. So let's look at the office vacancy (with size including office condo size) of all commercial office buildings along Yonge Street from Highway 401 to North York City Centre (Empress-ParkHome) and along Sheppard from Beecroft to Kenneth. This will give us an idea of the local office market that HullmarkCentre new 12 storey office condos will have to compete with.

The following are office space for lease in North York Centre - this is not an all inclusive list.

4576 Yonge Street, Ste 406
(fromer) Warner Bros. Building
2,781 Sq. Ft
HeadLease
$15.50

4576 Yonge Street, Ste 701
(former) Warner Bros. Building
6,285 Sq. Ft
HeadLease
$15.50

4711 Yonge Street - Proctor & Gamble building
$19 CAD /SF/Year
10,074 - 21,694 SF (3 Spaces)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

EmeraldPark - offices
see previous post of new office for sale sign

HullmarkCentre - offices
see previous post on office for lease and for sale
http://www.hullmark.ca/?hullmark=Office&map


40 Sheppard Ave West (PEO)
No evidence of looking for tenants

25 Sheppard Avenue West, Ste 1000
Nestle Building
14,075 Sq. Ft
HeadLease
$20.00

25 Sheppard Avenue West, Ste 660
Nestle Building
4,855 Sq. Ft
HeadLease
$20.00

25 Sheppard Avenue West, Ste 690
Nestle Building
7,159 Sq. Ft
HeadLease
$20.00

2 Sheppard Avenue E - Sheppard Centre south tower
$20 CAD /SF/Year
16,191 SF (1 Space)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

45 Sheppard East
Suite/FloorSize (s.f.)Type of ContractLength of TermDescription
Suite 400 3371 For Lease Any
3,371 square feet of office space improved.
Suite 409 3594 For Lease Any
3,594 square feet of office space with leaseholds in place.
Suite 500 4312 For Lease Any
4,312 square feet of office space divisible.
9th Floor - ExecuSpace Small Office 100 Serviced Suites Any
Business Centre Office from 100-300 square feet.
9th Floor - ExecuSpace Large Office 300 Serviced Suites Any
Business Centre Office from 100 to 300 square feet.
9th Floor - ExecuSpace Small Suite 700 Serviced Suites Any
Business Centre Suite on the 9th Floor.
9th Floor - ExecuSpace Large Suite 1300 Serviced Suites Any
Business Centre Suite on the 9th Floor.
Suite 510 1871 For Lease Any
1,871 square feet of office space on the 5th Floor.
- See more at: http://torontoofficespace.com/build...-north-yonge-gta-north-9#sthash.RwDwQVTP.dpuf

47 Sheppard East
Full - government offices

90 Sheppard Avenue E
Negotiable
3,779 - 17,709 SF (2 Spaces)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

100 Sheppard Avenue East, Ste 500
14,193 Sq. Ft
HeadLease
$15.50

100 Sheppard Avenue East, Ste 801
2,137 Sq. Ft
HeadLease
$15.50
http://matrixlistings.cwcanada.com/...de=ON&PostalCodeTxt=&x=60&y=9&PageNum=2&Sort=

110 Sheppard Avenue East, Ground Floor
4,654 square feet on the Ground Floor.

110 Sheppard Avenue East, Suite 201
9,245 square feet on the 2nd Floor.

110 Sheppard Avenue East, Suite 300
5,600 square feet on the 3rd Floor.
- See more at: http://torontoofficespace.com/buildings/search#sthash.4fXotVXs.dpuf


4950 Yonge - Madison Centre
appears to be full with exception of 22nd floor business centre for short & long term office space rental

5000 Yonge Street - Aegon Centre/Transamerica, 14th Floor
10,471 square feet of office space on the 14th Floor.

5000 Yonge Street - Aegon Centre/Transamerica, 17th Floor
10,963 square feet of office space on the 17th Floor.

5000 Yonge Street - Aegon Centre/Transamerica, Suite 1401
7,613 square feet of office space on the 14th Floor.

5000 Yonge Street - Aegon Centre/Transamerica, 15th Floor
15,807 square feet of office space on the 15th Floor.

5000 Yonge Street - Aegon Centre/Transamerica, Suite 2100
25,740 square feet of office space on the 21st Floor.

5000 Yonge Street - Aegon Centre/Transamerica, 22nd Floor
2,500 square feet on the 22nd Floor.
- See more at: http://torontoofficespace.com/buildings/search#sthash.4fXotVXs.dpuf

5001 Yonge Street, Ste 204
Royal Bank Building
2,547 Sq. Ft
HeadLease
$20.00

5001 Yonge Street, Ste 305
Royal Bank Building
6,771 Sq. Ft
HeadLease
$20.00


5070 Yonge - EmpressWalk - Scotiabank building, 3rd Floor
8,098 square feet of office space on the 3rd Floor.

5070 Yonge - EmpressWalk - Scotiabank building, Suite 702
3,620 square feet of office space on the 7th Floor.

5070 Yonge - EmpressWalk - Scotiabank building, Suite 806
1,181 square feet of office space on the 8th Floor.
- See more at: http://torontoofficespace.com/buildings/search#sthash.4fXotVXs.dpuf


North York City Centre - Note: some office "condo"

5140 Yonge Street
Sylvia MacLeod Leasing Consultant, Broker GWL Realty Advisors Inc. 416-359-3036 sylvia.macleod@gwlra.com
Suite Rentable Area (sf) Availability Description
1505 1,035 Immediate
1515 505 Immediate
1525 1,130 Immediate
Operating Costs/Mgmt Fee: $10.92 psf Realty Taxes: $7.94 psf

5150 Yonge Street - Retail
Sylvia MacLeod Leasing Consultant, Broker GWL Realty Advisors Inc. 416-359-3036 sylvia.macleod@gwlra.com
Suite Rentable Area (sf) Availability Description
C12A 427 Immediate
C13 1,556 Immediate
C29 3,043 Immediate
C30 2,024 Immediate
C31 989 Immediate
C32 507 Immediate
C33 441 Immediate
C35 955 Immediate
C37 575 Immediate
C38 601 Immediate
C40 428 Immediate
C42 743 Immediate
C43 1,935 Immediate
C45 373 Immediate
Operating Costs/Mgmt Fee: $8.32 psf Realty Taxes: $7.75 psf

5160 Yonge Street - Office
Sylvia MacLeod Leasing Consultant, Broker GWL Realty Advisors Inc. 416-359-3036 sylvia.macleod@gwlra.com
Suite Rentable Area (sf) Availability Description
1830 2,014 Immediate Base building.
1002 3,269 Immediate Improved.
1005 1,715 Immediate
Operating Costs/Mgmt Fee: $11.35 psf Realty Taxes: $7.70 psf

http://www.gwlraleasing.com/?provin..._no_vacancy=&show_no_vacancy=on&Submit=SEARCH

5 Park Home Avenue
$20 CAD /SF/Year
5,002 SF (1 Space)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

5 Park Home Avenue
Negotiable
17,912 SF (1 Space)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

 

[Automation Gallery]

when was the last time you were in the Yonge - Sheppard area? If you think North York Centre has low office vacancy rate, then you missed all the office for lease signs found in front of practically every commercial office building in North York Centre (see attached photos). Besides the government office buildings (Joseph Sheppard - Canada building, North York Civic Centre, Toronto District School Board, Toronto Catholic District School Board), I can only find 3 office buildings that don't appear to be looking for tenants (40 Sheppard West, MadisonCentre & shorter north tower of Sheppard Centre).

Gee sad, youd never think that just 15km south there is a office construction boom going on

 

[sunnyraytoronto]

Gee sad, youd never think that just 15km south there is a office construction boom going on

The sad part is those photos were taken on a quick walk around the Yonge-Sheppard area - and most office space don't advertise by signage like houses with mls listings. A very quick search on the web generated some more office space listings but it certainly wasn't a thorough search.


Downtown office market if fueled by the hot financial service sector and synergy of having those companies and companies that serviced them in close proximity to each other.

North York office market gets lots of government offices that don't care about generating synergy,... some backend-support type offices,...

Yonge-Sheppard area has subway, highway 401 but no GO train line,... if there was a GO train line then the area would be an office powerhouse,... ok, maybe not a powerhouse,... but certainly much more desirable than current.

Here in North York Centre, city planning had to cry and beg to get that 1 office floor in Emerald Park (still for sale) and 12 office floors in HullmarkCentre (many still for sale and lease as per hullmark.ca website) was considered a victory after almost 20 years of negotiations! The south-west corner of Yonge&Sheppard is zoned for offices and OMERS office building (Nestle twin) was approved but developer never went through - now another office building is being proposed but city planning haven't seen any application yet. North-west corner of Yonge&Sheppard is city owned property, city wants office tower but no market so city allow small retail space (Fed-Ex, 7-11 & McDonalds) on 15 year lease until local office market improves.

That's the reality in North York Centre,.... 1 new complete office building (Aegon-Transamerica at 5000 Yonge) since amalgamation in 1998 but over 60 new condo towers along Yonge corridor from 401 to Finch hydro corridor. North York Centre is a vertical sleeping community! And people wonder why the TTC Yonge subway line is at full capacity,... everyone from North York Centre is going downtown for work!

 

[salsa]

Yonge-Sheppard area has subway, highway 401 but no GO train line,... if there was a GO train line then the area would be an office powerhouse,... ok, maybe not a powerhouse,... but certainly much more desirable than current.

Etobicoke Centre is an office powerhouse?

 

[howl]

For lease signs are not a good indicator of vacancy rates or economic vitality in a small geographic area. As businesses expand they often outgrow their old spaces and move to a larger office nearby. Sometimes in a healthy economy the landlord won't re-lease the old space to just anybody - its a better long-term strategy for them to wait for that one good prestige tenant who will take the space for a long time. In a downward moving economy the landlord is much more likely to just lease the place out to anyone who will take it. A certain amount of empty office space is a sign that things are changing in the area, but not necessarily for the worse, it may be in the process of changing for the better.

North York City Centre is the perfect location for many commercial offices since it is both on the subway and the 401. However these factors also make it a prefect location for residential development. Right now residential development is more profitable so that is primarily what is being built. Once things swing back in favour of commercial development being more profitable I'll bet you'll see some substantial new office buildings going up in that area.

 

[sunnyraytoronto]

For lease signs are not a good indicator of vacancy rates or economic vitality in a small geographic area. As businesses expand they often outgrow their old spaces and move to a larger office nearby. Sometimes in a healthy economy the landlord won't re-lease the old space to just anybody - its a better long-term strategy for them to wait for that one good prestige tenant who will take the space for a long time. In a downward moving economy the landlord is much more likely to just lease the place out to anyone who will take it. A certain amount of empty office space is a sign that things are changing in the area, but not necessarily for the worse, it may be in the process of changing for the better.

North York City Centre is the perfect location for many commercial offices since it is both on the subway and the 401. However these factors also make it a prefect location for residential development. Right now residential development is more profitable so that is primarily what is being built. Once things swing back in favour of commercial development being more profitable I'll bet you'll see some substantial new office buildings going up in that area.

I'll bet you'll be wrong because,.... the problem is with condo towers currently grabbing all the prime Yonge-Sheppard land with direct subway connections; these prime locations won't be available for office development if and when the North York Centre office market ever recovers. Condos at prime locations that should be office space include:
- HullmarkCentre 35+33 storey condo & 12 storey office @ southeast corner of Yonge&Sheppard
- EmeraldPark 32+40 storey condo with 1 storey office @ near southwest corner of Yonge&Sheppard
- GibsonSquare - 42+42 storey condo @ northwest corner of Yonge&ParkHome/Empress at NYCC TTC subway station
- EmpressWalk - 34+34 storey condo towers @ southeast corner of Yonge&Empress/ParkHome at NYCC TTC subway station

NOTE: southwest corner of Yonge&Sheppard zoned for office with old 15+ year OMERS office tower (Nestle twin tower) approved but new developer would have a strong case to rezone for tower with majority condo usage vs office especially with HullmarkCentre and EmeraldPark right across the street.

ShepparCentre (northeast corner of Yonge&Sheppard) mall renovation and new 39 storey condo tower currently being proposed is first in-fill application in NorthYorkCentre area; prime land that could be used for office building.

Keep in mind area in Yonge Corridor between Doris & Beecroft from Highway 401 to Finch hydro corridor zoned for high density development as per North York Secondary Plan mainly taken up by condo. Very few lots left to be redeveloped for office or condo usage especially south of Empress/ParkHome (NorthYorkCityCentre) closer to Highway 401. What's really left are less desirable lots in the middle of NYCC and Finch subway station. Land usage for Yonge corridor north of Finch hydro corridor is currently being examine under North Yonge Study - but there haven't been anything significantly different from North York Secondary Plan with regards to office usage.

NOTE: The original North York Secondary Plan from the city of North York was for only office towers along Yonge Street and condo towers behind Yonge Street along Doris and Beecroft within the North York Service Ring Roads. Once EmpressWalk was allowed to put condo on Yonge Street,...


As for residential condo development being more profitable than office,... agree, for both developer and city. For each condo tower city gets about $2million in property tax revenue annually (VS about $50,000 when that same land had only about 10 bungalows) but with city tax-break subsidy for office development namely no property tax for 10 years there's little financial incentive for city to encourage office development.

 

[taal]

Taal, when was the last time you were in the Yonge - Sheppard area? If you think North York Centre has low office vacancy rate, then you missed all the office for lease signs found in front of practically every commercial office building in North York Centre (see attached photos). Besides the government office buildings (Joseph Sheppard - Canada building, North York Civic Centre, Toronto District School Board, Toronto Catholic District School Board), I can only find 3 office buildings that don't appear to be looking for tenants (40 Sheppard West, MadisonCentre & shorter north tower of Sheppard Centre).

Actually, the last complete office building built in North York Centre was the 20-storey Transamerica building 10 years ago. Renamed Aegon Centre and about 15% empty! GWL Realty is new office building management. The Cadbury sign that was on Yonge Street is now gone.

VCC,... seriously! VCC was originally Vaughan Corporate Centre until they realize they can't get office development so they renamed it Vaughan City Centre. Actually, given what's in the area, it should be Vaughan Costco Centre.

There you go again, comparing apples to oranges,... first comparing offices at Queen, downtown & RichmondHill VS HullmarkCentre & EmeraldPark,... now NYCC offices to VCC, St.Clair&Yonge, Bloor&Yonge. This is the HullmarkCentre thread, not a GTA office comparison thread.

The only relevant market for the offices at HullmarkCentre are the competing office spaces within North York Centre area. So let's look at the office vacancy (with size including office condo size) of all commercial office buildings along Yonge Street from Highway 401 to North York City Centre (Empress-ParkHome) and along Sheppard from Beecroft to Kenneth. This will give us an idea of the local office market that HullmarkCentre new 12 storey office condos will have to compete with.

The following are office space for lease in North York Centre - this is not an all inclusive list.

4576 Yonge Street, Ste 406
(fromer) Warner Bros. Building
2,781 Sq. Ft
HeadLease
$15.50

4576 Yonge Street, Ste 701
(former) Warner Bros. Building
6,285 Sq. Ft
HeadLease
$15.50

4711 Yonge Street - Proctor & Gamble building
$19 CAD /SF/Year
10,074 - 21,694 SF (3 Spaces)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

EmeraldPark - offices
see previous post of new office for sale sign

HullmarkCentre - offices
see previous post on office for lease and for sale
http://www.hullmark.ca/?hullmark=Office&map


40 Sheppard Ave West (PEO)
No evidence of looking for tenants

25 Sheppard Avenue West, Ste 1000
Nestle Building
14,075 Sq. Ft
HeadLease
$20.00

25 Sheppard Avenue West, Ste 660
Nestle Building
4,855 Sq. Ft
HeadLease
$20.00

25 Sheppard Avenue West, Ste 690
Nestle Building
7,159 Sq. Ft
HeadLease
$20.00

2 Sheppard Avenue E - Sheppard Centre south tower
$20 CAD /SF/Year
16,191 SF (1 Space)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

45 Sheppard East
Suite/FloorSize (s.f.)Type of ContractLength of TermDescription
Suite 400 3371 For Lease Any
3,371 square feet of office space improved.
Suite 409 3594 For Lease Any
3,594 square feet of office space with leaseholds in place.
Suite 500 4312 For Lease Any
4,312 square feet of office space divisible.
9th Floor - ExecuSpace Small Office 100 Serviced Suites Any
Business Centre Office from 100-300 square feet.
9th Floor - ExecuSpace Large Office 300 Serviced Suites Any
Business Centre Office from 100 to 300 square feet.
9th Floor - ExecuSpace Small Suite 700 Serviced Suites Any
Business Centre Suite on the 9th Floor.
9th Floor - ExecuSpace Large Suite 1300 Serviced Suites Any
Business Centre Suite on the 9th Floor.
Suite 510 1871 For Lease Any
1,871 square feet of office space on the 5th Floor.
- See more at: http://torontoofficespace.com/build...-north-yonge-gta-north-9#sthash.RwDwQVTP.dpuf

47 Sheppard East
Full - government offices

90 Sheppard Avenue E
Negotiable
3,779 - 17,709 SF (2 Spaces)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

100 Sheppard Avenue East, Ste 500
14,193 Sq. Ft
HeadLease
$15.50

100 Sheppard Avenue East, Ste 801
2,137 Sq. Ft
HeadLease
$15.50
http://matrixlistings.cwcanada.com/...de=ON&PostalCodeTxt=&x=60&y=9&PageNum=2&Sort=

110 Sheppard Avenue East, Ground Floor
4,654 square feet on the Ground Floor.

110 Sheppard Avenue East, Suite 201
9,245 square feet on the 2nd Floor.

110 Sheppard Avenue East, Suite 300
5,600 square feet on the 3rd Floor.
- See more at: http://torontoofficespace.com/buildings/search#sthash.4fXotVXs.dpuf


4950 Yonge - Madison Centre
appears to be full with exception of 22nd floor business centre for short & long term office space rental

5000 Yonge Street - Aegon Centre/Transamerica, 14th Floor
10,471 square feet of office space on the 14th Floor.

5000 Yonge Street - Aegon Centre/Transamerica, 17th Floor
10,963 square feet of office space on the 17th Floor.

5000 Yonge Street - Aegon Centre/Transamerica, Suite 1401
7,613 square feet of office space on the 14th Floor.

5000 Yonge Street - Aegon Centre/Transamerica, 15th Floor
15,807 square feet of office space on the 15th Floor.

5000 Yonge Street - Aegon Centre/Transamerica, Suite 2100
25,740 square feet of office space on the 21st Floor.

5000 Yonge Street - Aegon Centre/Transamerica, 22nd Floor
2,500 square feet on the 22nd Floor.
- See more at: http://torontoofficespace.com/buildings/search#sthash.4fXotVXs.dpuf

5001 Yonge Street, Ste 204
Royal Bank Building
2,547 Sq. Ft
HeadLease
$20.00

5001 Yonge Street, Ste 305
Royal Bank Building
6,771 Sq. Ft
HeadLease
$20.00


5070 Yonge - EmpressWalk - Scotiabank building, 3rd Floor
8,098 square feet of office space on the 3rd Floor.

5070 Yonge - EmpressWalk - Scotiabank building, Suite 702
3,620 square feet of office space on the 7th Floor.

5070 Yonge - EmpressWalk - Scotiabank building, Suite 806
1,181 square feet of office space on the 8th Floor.
- See more at: http://torontoofficespace.com/buildings/search#sthash.4fXotVXs.dpuf


North York City Centre - Note: some office "condo"

5140 Yonge Street
Sylvia MacLeod Leasing Consultant, Broker GWL Realty Advisors Inc. 416-359-3036 sylvia.macleod@gwlra.com
Suite Rentable Area (sf) Availability Description
1505 1,035 Immediate
1515 505 Immediate
1525 1,130 Immediate
Operating Costs/Mgmt Fee: $10.92 psf Realty Taxes: $7.94 psf

5150 Yonge Street - Retail
Sylvia MacLeod Leasing Consultant, Broker GWL Realty Advisors Inc. 416-359-3036 sylvia.macleod@gwlra.com
Suite Rentable Area (sf) Availability Description
C12A 427 Immediate
C13 1,556 Immediate
C29 3,043 Immediate
C30 2,024 Immediate
C31 989 Immediate
C32 507 Immediate
C33 441 Immediate
C35 955 Immediate
C37 575 Immediate
C38 601 Immediate
C40 428 Immediate
C42 743 Immediate
C43 1,935 Immediate
C45 373 Immediate
Operating Costs/Mgmt Fee: $8.32 psf Realty Taxes: $7.75 psf

5160 Yonge Street - Office
Sylvia MacLeod Leasing Consultant, Broker GWL Realty Advisors Inc. 416-359-3036 sylvia.macleod@gwlra.com
Suite Rentable Area (sf) Availability Description
1830 2,014 Immediate Base building.
1002 3,269 Immediate Improved.
1005 1,715 Immediate
Operating Costs/Mgmt Fee: $11.35 psf Realty Taxes: $7.70 psf

http://www.gwlraleasing.com/?provin..._no_vacancy=&show_no_vacancy=on&Submit=SEARCH

5 Park Home Avenue
$20 CAD /SF/Year
5,002 SF (1 Space)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

5 Park Home Avenue
Negotiable
17,912 SF (1 Space)
http://looplink.toronton.cbre.ca/xN...MMoneyCurrency=CAD&RentPer=PY&SRID=5069235520

err ... all the space you cite ... is not a lot (the total area has more than 9 million, you'll see reports talking about 11 or so but I'm just talking about NYCC) ... for the size of this market ... check out the last q3 2014 toronto office report and see for your self ... look at total "availabe vacany" not "direct vacany", direct only includes space directly from land lords i.e. not subleases, availibity rate is the total amount of space.

Here:
http://www.slideshare.net/cfives5/toronto-office-market-report-q3-2014

Look for "central north" that is essentially just NYCC .. about 10% is from elsewhere in the area but there is very little in comparison to NYCC.

Feel free to find other reports, and you'll see the exact same thing ... total vacancy in the 6-8% range ... which is just about the lowest in the GTA ...

 

[sunnyraytoronto]

err ... all the space you cite ... is not a lot (the total area has more than 9 million, you'll see reports talking about 11 or so but I'm just talking about NYCC) ... for the size of this market ... check out the last q3 2014 toronto office report and see for your self ... look at total "availabe vacany" not "direct vacany", direct only includes space directly from land lords i.e. not subleases, availibity rate is the total amount of space.

Here:
http://www.slideshare.net/cfives5/toronto-office-market-report-q3-2014

Look for "central north" that is essentially just NYCC .. about 10% is from elsewhere in the area but there is very little in comparison to NYCC.

Feel free to find other reports, and you'll see the exact same thing ... total vacancy in the 6-8% range ... which is just about the lowest in the GTA ...

That report has vacancy rate of 2.3% for North York Centre VS 3.5% for Downtown. Availability rate of 5.4% for North York Centre VS 7.7% for Downtown. If that report is accurate, then we should be seeing an office building boom in North York Centre, not downtown.

Interestingly, in that report, the new supply includes 4050 Yonge (northwest corner of Yonge & Wilson/YorkMills) which was supposed to include TTC new headoffice but TTC backed out. City approval granted and development was supposed to finish next year,.... haven't even took out the parking lot yet. Another stalled office project near North York Centre like OMERS (Nestle twin tower).

Speaking of which,... Also, in that report, new supply includes former OMERS site at 4800 Yonge (southwest corner of Yonge & Sheppard) 25 storey office building for which city planning hasn't even seen an application yet.

Also, in that report, new office supply includes HullmarkCentre at 2 Anndale Drive - technically that's the south condo tower; HullmarkCentre Office space is in north tower. And they have HullmarkCentre as 10 floor office building but it's really 12 floors office building with 33 storey condo on top for 45 storey. Not that I'm trying to poke holes into that report (even though it's funny that an idiot like myself can find so many factual errors in a report written by so called experts in the field),... just trying to bring the discussion back to HullmarkCentre for which this thread is about.

 

[taal]

Yes its accurate ... if you don't believe look up the 5 or 6 other reports for this quarter reporting the same information.

The new supply cited is only mentioned in the sense a developer has had at some point 'interest', other reports do a better job of breaking it down into 'firm' proposals.

This is verging on tiring so this will likely be my last post on the mater ... as I've repeatedly explained why there have been no new office developments and probably won't be ... I don't count hullmark as new, as you've accurately pointed out the developer was forced to include this.

Here goes; Commercial tax rates in Toronto are high, (this is a city wide rate that applies equally based on property value, just like residential tax rates), that in it self doesn't matter, we can have philosophical arguments about whether residential or commercial properties should be fronting the majority of the burden but the key is ... Toronto rates are much higher (2x if not more compared to the suburb in question) than the 905. Note other Canadian cities, Vancouver and Montreal have slightly higher commercial rates, actually among the worst in North America (when comparing to similarly sized cities) but in those areas the suburbs are in a very similar boat.

These taxes are paid for by tenants; A tenant is typically pay as follows: net rental rates + operating expenses = gross rental rates (i.e. the total payment required) ... 'operating expenses' include taxes the landlord pays to the city.

Now take 2 similar properties on either side of Steeles (yes NYCC doesn't quite fit that but the concept applies) such that the buildings and location are for argument sake equivalent ... for the landlord on the south side of Steeles to attract tenants they MUST charge a lower net rental rate, as they know the tenant has to pay a higher operating expenses on the south side of steeles but overall they are only willing to pay the same rent for both properties ... as I stated they're eqivlant buildings, if the one south of steeles charged more the tenant would simply move to the north side of steeles.

So, this is exactly what happens throughout all of Toronto, from a 'tenants' point of view NYCC is attractive for this very reason, they are not directly impacted by the higher tax rate ... so, who is and how ? The developer / property owner ! They're taking in less money for their Toronto property in comparison to properties in the 905 ... So of course the landlord wants to charge more (i.e. a higher net rental rate) even though it makes the gross rental rate higher (only due to the tax difference ... not something else e.g. the quality of the building). In the core, they can do just this, they can charge a high enough net rental rate (because tenants are willing to pay for this) to justify the cost of building and maintaining a new office property. In NYCC and Y&E and Yonge and Bloor, they just can't. This is why all these areas have very low availability rates, among the lowest in North America for a comparable city, yes you see just about 0 new development.

Now with all that said, say the tax rate differential completely disappears tomorrow, do I think we would see a new office building in NYCC, probably, 1 or 2 maybe, but that's probably it. On top of the entire argument above one needs to consider the demand side of things, I've said many times in NYCC it is very stable (again low rate) and could probably justify a few more buildings (if the developer would make any money from it) but at the end of the day its still a limited pool.

Only so many tenants need to be located on a subway, if you don't need / want to be, well of course other cheaper options in the 416 (or better yet the 905 ... where the argument I make above is much more applicable, properties are literally on the border between the 416 / 905).

Add to all this, a lot of tenants think rates downtown will drop over time given how much new developments there are, and slowly they have been, in class B / C buildings, moreover add to this the desire to be downtown, many companies that want to locate in a urban location would favour downtown vs nycc, and may be willing to take a class B/C property over class A+ ... just about all NYCC properties are class A or higher.

 

[sunnyraytoronto]

Taal, thanks for your insightful contribution to this thread,... sincerely. While we don't see eye to eye on everything, your insight is definitely more than welcome.

I always thought NYCC office area needed a theme (so similar companies can benefit from synergy) like downtown financial district, insurance companies on hospital row, hi-tech office/campus, etc,... not just don't need to be downtown but need to be on subway line.

Your area of Yonge & Eglinton faces many of the same issues we face in NYCC, how to get more office VS condo development near subway station. In addition, with Eglinton Crosstown coming online soon, there'll be greater pressure for increase density all along Eglinton.

 

[interchange42]

If you're not seeing eye-to-eye with Taal when talking about commercial real estate, you'd better get glasses. This is Taal's expertise and business, if you hadn't guessed.

42

 

[ProjectEnd]

The TTC maintains 5 trains for Sheppard, given its unique 4 car setup. They park 1 at Davisville, and store 4 on the line itself. Only 4 are used in daily service, the one at Davisville is used as a "backup".

Subways! Subways! Subways!

Thank god that's over (hopefully).

 

[taal]

Taal, thanks for your insightful contribution to this thread,... sincerely. While we don't see eye to eye on everything, your insight is definitely more than welcome.

I always thought NYCC office area needed a theme (so similar companies can benefit from synergy) like downtown financial district, insurance companies on hospital row, hi-tech office/campus, etc,... not just don't need to be downtown but need to be on subway line.

Your area of Yonge & Eglinton faces many of the same issues we face in NYCC, how to get more office VS condo development near subway station. In addition, with Eglinton Crosstown coming online soon, there'll be greater pressure for increase density all along Eglinton.

Thanks Sunny ! I apologize for the first part of most I didn't mean to come off like that and actually believe we are on the same page regarding many matters.

I completely agree that NYCC and Y&E would benefit from a higher concentration of commercial usage; For NYCC in particular that was actually the plan as well ! Mell pushed hard for that, and to certain degree you can call it a success but in the early days there were plans for much more office development then you see today !

Y&E is a tough area, more so than NYCC, and more so as of late, but if you think it through it makes sense; Its so close to downtown, and is fairly built up, such that developing commercial properties in the area is still a very expensive endeavor, so rental rates have to be sufficiently high, in the past they were low enough such that 'back offices' would locate area, as opposed to say the 905 as you see more often. But now, as it becomes increasingly attractive to locate downtown (in the sense that employees, younger ones at least, favor this) the small savings in rental rates to locate at Y&E aren't justified and companies would rather locate downtown. Quite a few of the relocations from the area have been just that, companies moving, not to the 905 but rather downtown.

I really don't think the crosstown line will contribute much to this in a positive or negative way, this will likely be the case for the Sheppard subway as well; You can argue SCC is an even worse example when compared to NYCC, where there's less office development (and the last office to go up has been decades I believe) and to add to this, here the availability rate is indeed high. As an FYI the 2 highest availability rates in Toronto are the SCC and broader area (at about 12-15%) but the worst by far is the Airport corporate center east (i.e. the 416) where you are talking about 20/30%+, this area in particular, is the best example by far of my earlier post as to the problems, as Airport coprate center West (literary across the street) in the 905 has much lower vacancy rates.

Just so I stop derailing this thread and get us back on topic ; - )

Anyone checked out the whole foods yet, I did last week, its really nice, but didn't seem very busy, I really wonder how all these grocery stores will fair once we have metro across the street ! Should be interesting. How are others liking the wholefoods.

 

[drum118]

The land TTC sits on and own on the n-w corner is being held by TTC regardless if it takes 25 years for office space since it will generate more money for them than a condo.

Haven't been in Whole Food since open day and it wasn't busy then. Not my store and over price.

The new entrance from the subway is finish, but not open the last time I pass it

NYC and SCC have never achieve the goals there were to see to the point SCC will never see it.

I know from my walk about of the area, lots of for lease signs up as note to the point some of the smaller building will get raze and become a condo or a mix building.

The amount of office space being built in the last 5 years and continue to be is something since most of it die in the late 80's, especially DT.

 

[taal]

The land TTC sits on and own on the n-w corner is being held by TTC regardless if it takes 25 years for office space since it will generate more money for them than a condo.

Haven't been in Whole Food since open day and it wasn't busy then. Not my store and over price.

The new entrance from the subway is finish, but not open the last time I pass it

NYC and SCC have never achieve the goals there were to see to the point SCC will never see it.

I know from my walk about of the area, lots of for lease signs up as note to the point some of the smaller building will get raze and become a condo or a mix building.

The amount of office space being built in the last 5 years and continue to be is something since most of it die in the late 80's, especially DT.

Lets not rehash the whole 'for lease signs' convo, a building will put one up if there is one office available, which may implying it it 99% full or 1% full, and a lot of times, landlords ** never ** take down the signs, as to always be on the look out for future tenants even if the building is 100% occupied.

Anyway, I agree there are a lot of development sites, particularly north of Empress fronting Yonge on the east side (less so on the west side now), I wouldn't be surprised if slowly those get bought up and turned into condos, just like we are seeing on the west side of Yonge now. Actually, I"m a little surprised with how long this is taking !

I think a lot of folks say the NYCC condo market is slower than in the past, I think that may be true, but a lot forgot about the massive developments south of Sheppard near the 401 which I'm sure took a while to sell out completely, and of course hullmark / emarld park now as well.


I don't quite understand your last comment ( or was it a question ? I'm not entirely sure )

The amount of office space being built in the last 5 years and continue to be is something since most of it die in the late 80's, especially DT.

Your right there was a huge glut after the 80s, though the reason was the 80s ended a period of a spur office development (even more so than we see today) in the core, and clearly a lot of it ill convinced as vacancy rates stayed astronomical (relatively speaking) for a decade downtown. Hopefully we won't see that again but there is a lot of talk of it as of late, I'm a little more optimistic when it comes to the core though.