skyscraper_1
Nov 1, 2007, 4:50 PM
Halifax real estate business overcomes planning woes — annual report
By BRUCE ERSKINE Business Reporter
Thu. Nov 1 - 7:21 AM
The commercial real-estate market in Halifax remains strong, despite the lack of a coherent municipal development plan, says Bob Mussett, senior vice-president with CB Richard Ellis Ltd. in Halifax.
"The issue that jumped off the page in 2003, and I’m sorry to say still does in 2007, is the mess that is the HRM development policy," he said Wednesday in Halifax while delivering the firm’s fifth annual regional market outlook.
"By making development so very difficult in this city, we’re effectively telling the development community, both locally and from afar, not to bother — we have no interest in innovation or creativity."
Development in downtown Halifax has been subject in recent years to opposition from heritage groups that have fought high-rise projects they say are out of sync with the city’s historic character. That opposition has led, in part, to urban sprawl that has taxed municipal services.
Mr. Mussett said the opposition to increased downtown density is ironic, since density would help address increasing concerns about sustainable development.
"More aggressive density and height allocations will in fact set the stage for economically sustainable development, saving historic buildings, not demolishing them, adding housing and people to the centre of the city, creating new employment opportunities," he said.
"Density is green, higher buildings housing more people will limit the urban sprawl. HRM’s long-term plans say we need 25,000 more people living on the peninsula. That would be great and I agree, but that will only happen with a dramatic change in our approach."
Mr. Musset said the real estate sector is facing increased consumer pressure to be more environmentally sensitive and that greater downtown density would decrease the need for cars and transportation systems that contribute to global warming.
"You’re either going to put 25,000 people on the peninsula or you’re going to put them outside of the city somewhere and they can drive in every day," he said. "It’s our choice."
Despite those concerns and other issues such as the U.S. subprime mortgage crisis, Mr. Mussett said 2007 has been a good year for the local industry and that 2008 looks promising.
"Record corporate profits have been the main driver for real estate in the last year," he said, noting that the office vacancy rate in Halifax’s central business district has dropped from 13.5 per cent to 5.5 per cent in the past three years.
"This, we expect, will drop further," he said, adding that HRM’s overall office vacancy rate is projected to decline from 8.5 per cent to 8.1 per cent by the end of the year, driven by the arrival of financial services companies such as Citco and Butterfield and mixed commercial-retail developments such as Dartmouth Crossing.
Blake Hutcheson, CB Richard Ellis’s president and CEO for Canada and Latin America, said Canada’s economic and real estate fundamentals are strong but he advised caution, noting that the subprime mortgage issue has prompted a U.S. housing slump that is hurting Canadian exporters and could affect the entire real-estate industry.
"It doesn’t take long in the information age for Wall Street to pick up on a weakness and all of the sudden the real estate market isn’t just residential, it’s commercial, it’s everything that touches real estate," he said, noting that while business is still good, CB Richard Ellis’s stock price has dropped 40 per cent in the past three months, from $42 to $25 a share.
"That is indicative of what’s happening right across the board. The elephant in the room is that issue. We’ve got to focus on it. It’s very real."
http://www.thechronicleherald.ca/Business/975728.html
By BRUCE ERSKINE Business Reporter
Thu. Nov 1 - 7:21 AM
The commercial real-estate market in Halifax remains strong, despite the lack of a coherent municipal development plan, says Bob Mussett, senior vice-president with CB Richard Ellis Ltd. in Halifax.
"The issue that jumped off the page in 2003, and I’m sorry to say still does in 2007, is the mess that is the HRM development policy," he said Wednesday in Halifax while delivering the firm’s fifth annual regional market outlook.
"By making development so very difficult in this city, we’re effectively telling the development community, both locally and from afar, not to bother — we have no interest in innovation or creativity."
Development in downtown Halifax has been subject in recent years to opposition from heritage groups that have fought high-rise projects they say are out of sync with the city’s historic character. That opposition has led, in part, to urban sprawl that has taxed municipal services.
Mr. Mussett said the opposition to increased downtown density is ironic, since density would help address increasing concerns about sustainable development.
"More aggressive density and height allocations will in fact set the stage for economically sustainable development, saving historic buildings, not demolishing them, adding housing and people to the centre of the city, creating new employment opportunities," he said.
"Density is green, higher buildings housing more people will limit the urban sprawl. HRM’s long-term plans say we need 25,000 more people living on the peninsula. That would be great and I agree, but that will only happen with a dramatic change in our approach."
Mr. Musset said the real estate sector is facing increased consumer pressure to be more environmentally sensitive and that greater downtown density would decrease the need for cars and transportation systems that contribute to global warming.
"You’re either going to put 25,000 people on the peninsula or you’re going to put them outside of the city somewhere and they can drive in every day," he said. "It’s our choice."
Despite those concerns and other issues such as the U.S. subprime mortgage crisis, Mr. Mussett said 2007 has been a good year for the local industry and that 2008 looks promising.
"Record corporate profits have been the main driver for real estate in the last year," he said, noting that the office vacancy rate in Halifax’s central business district has dropped from 13.5 per cent to 5.5 per cent in the past three years.
"This, we expect, will drop further," he said, adding that HRM’s overall office vacancy rate is projected to decline from 8.5 per cent to 8.1 per cent by the end of the year, driven by the arrival of financial services companies such as Citco and Butterfield and mixed commercial-retail developments such as Dartmouth Crossing.
Blake Hutcheson, CB Richard Ellis’s president and CEO for Canada and Latin America, said Canada’s economic and real estate fundamentals are strong but he advised caution, noting that the subprime mortgage issue has prompted a U.S. housing slump that is hurting Canadian exporters and could affect the entire real-estate industry.
"It doesn’t take long in the information age for Wall Street to pick up on a weakness and all of the sudden the real estate market isn’t just residential, it’s commercial, it’s everything that touches real estate," he said, noting that while business is still good, CB Richard Ellis’s stock price has dropped 40 per cent in the past three months, from $42 to $25 a share.
"That is indicative of what’s happening right across the board. The elephant in the room is that issue. We’ve got to focus on it. It’s very real."
http://www.thechronicleherald.ca/Business/975728.html