Winnipeg | True North Square | 86.9M | 77.8M | 25F | 17F | 22F | 17F | 19F | U/C

[NK59]

Originally Posted by bomberjet

I'm all for True North Square. But how about they fill the vacancies at CentrePoint first, before getting going on more office space downtown.

Disagree... Let them build before the demand if they want. It's their money!

[Simplicity]

Originally Posted by NK59

Disagree... Let them build before the demand if they want. It's their money!

That's not entirely true. The risk of not being substantially occupied falls to the city - the benefit rolls to the developer. The tax incentives are calculated out using a nominal vacancy rate to get at the property's potential taxable value to the city with those funds then being advanced to the developer (this is known as the SHED TIF). If those values don't play out, as in, if there's more vacancy, or a lower lease rate, then those funds are rebated by the developer. The city only collects the taxes the building actually generates and then has to close the gap between the subsidy and the actual value. Sort of like what's happening at Centrepoint right now given their large vacancy rate.

The only somewhat mitigating factor - if you can call it that - is that the Province has kicked in a large sum of money to finance the SHED TIF. But I might call that cold comfort.

[buzzg]

Originally Posted by bomberjet

I'm all for True North Square. But how about they fill the vacancies at CentrePoint first, before getting going on more office space downtown.

Only 1.5 floors of office space are left, everything else is taken so that's really not that bad. Especially since they're not crazy big floor plates. They were probably holding out to see if someone would take it all, but they probably won't have a problem filling it if they divide it a bit.

[bomberjet]

There's 2 floors out of 5 that have yet to be leased. Of course I'd love to see TNS go ahead from a fancy building perspective!

[wags_in_the_peg]

today's freepress ""We're dealing with six serious parties," Scott Stephanson said in an interview Wednesday ",

The 19-storey tower will be about 300,000 square feet and will include a 14-storey tower on top of a five-storey podium. The retail tenants, one of which could be a grocery store, will be on the bottom two floors, Stephanson said, and the rest of the building is expected to be office space.

The nine-storey tower on the former Carlton Inn site will be about 270,000 square feet, and most of that is also expected to be office space.

The third tower -- a hotel/condominium complex to be built at the south end of the MPI property -- will include a main-floor lobby area, 21 floors of hotel rooms and six floors of condos.

Stephanson said True North is negotiating with an experienced hotel developer that would build and manage the hotel.

[bomberjet]

Sounds pretty sweet. Lots of office space to be filled though.

[Simplicity]

Downtown Winnipeg has ~8.5MM square feet of office space. Of the 8 major centres in Canada, it has the lowest average rents (lower than Halifax!). As of Q2 of this year net absorption was negative ~33k square feet and that the ~81k square feet of Centrepoint that hit the market this year. Vacancy is at 11% and climbing.

Naturally, we move the market by ~6% and add 500K of subsidized office square footage.

[esquire]

Originally Posted by Simplicity

Downtown Winnipeg has ~8.5MM square feet of office space. Of the 8 major centres in Canada, it has the lowest average rents (lower than Halifax!). As of Q2 of this year net absorption was negative ~33k square feet and that the ~81k square feet of Centrepoint that hit the market this year. Vacancy is at 11% and climbing.

Naturally, we move the market by ~6% and add 500K of subsidized office square footage.

As excited as I am to imagine this new complex once it is complete, it does give me the same feeling I get when I put down my credit card to make a pricy and irresponsible purchase. There is really no justifying it.

So which buildings will get hit hardest by the construction of TNS? I'm assuming there will be some inflow from the suburbs, but I'm sure some will be coming from likely class B downtown buildings?

[Simplicity]

Originally Posted by esquire

As excited as I am to imagine this new complex once it is complete, it does give me the same feeling I get when I put down my credit card to make a pricy and irresponsible purchase. There is really no justifying it.

So which buildings will get hit hardest by the construction of TNS? I'm assuming there will be some inflow from the suburbs, but I'm sure some will be coming from likely class B downtown buildings?

You've gotta start with those already comfortable paying the high rents and those are the Class A tenants. I doubt we'll see any major tenants coming from the suburbs 'cause they're there for a reason. And if this thing is truly going to be 27 storeys high, you're going to need more than a couple small suburban firms moving to make it work - you need the whales. Even a large tenant like Stantec is a middling tenant in a building like this.

First thing you'd be looking at are the large law firms. Aikins, TDS, Pitblado - those guys need the high end space to justify their billings. I don't doubt at least one of them is already in talks. But then you have CN, BMO Nesbitt Burns, CRA, Deloitte, Ernst & Young - Those types of operations. They want the address and they're used to paying ~$35-$40/ft (including additional rents). And both 201 Portage and 360 Main do quite well given they're about the only Class A office space in the city aside from maybe Hydro (which we really shouldn't count), so that tenancy exists and at low vacancy rates. But that's the thing about Class A space - it's both a quantitative and qualitative assessment. Those are both just barely Class A buildings by any other city's standards, but because they're both new(ish) and tall, they're Class A here. Anything else more grandiose would immediately replace them. Which is fine. Provided that that space isn't subsidized by both the municipal taxpayer and the provincial one. Government offices don't require Class A space.

I just don't see Class B tenants - or enough, anyway - deciding that their businesses benefit to the point where rents would literally double for them. If this thing gets built, it's taking the existing Class A tenants, and that's it. Notwithstanding, of course, that it would be beneficial to move Birchwood Cushman, Stevenson, Nova-Con, etc. into the building (which would leave other vacancies behind), but even those companies would take a floor at the most and probably only half.

I think Cory made the point that MPI or somebody could move, but their building is perfectly fine.

[Riverman]

Originally Posted by Simplicity

And both 201 Portage and 360 Main do quite well given they're about the only Class A office space in the city

Isn't the Richardson building class A?

[Riverman]

Originally Posted by esquire

As excited as I am to imagine this new complex once it is complete, it does give me the same feeling I get when I put down my credit card to make a pricy and irresponsible purchase.

Can we have some examples, just for interest sake?

[CoryB]

A 19-story tower would be similar in height to the Carlton Square properties. The 28 floor hotel/condo would be similar in height to the Portage and Main corner. I thought the Carlton Inn site would have a bigger residential component. The addition of all that office space without any real new demand seems to suggest it is either going to site vacant or other vacancies are going to being popping up. Perhaps there will be a wave of medical professionals looking for new downtown office space...

[lilwayne]

Originally Posted by CoryB

A 19-story tower would be similar in height to the Carlton Square properties. The 28 floor hotel/condo would be similar in height to the Portage and Main corner. I thought the Carlton Inn site would have a bigger residential component. The addition of all that office space without any real new demand seems to suggest it is either going to site vacant or other vacancies are going to being popping up. Perhaps there will be a wave of medical professionals looking for new downtown office space...

they did state that they have 6 major parties involved right?

they are involved in serious and advanced talks with atleast 6 companies right now retail and office plus they already have a hoteller.. soo I mean come on dude if 4 out of the 6 parites are demanding office space there is demand... but ya I mean 2 towers of that height would be amaazzzingggg.. our skyline would be significantly different than it is now.... especially if sky city and this go through that would be 6 massive bldgs. around mts center in a 6 year period... mb hydro bldg., alt hotel, glasshouse, so po square hotel, so po square office condo and sky city\


do people here stop reading artcles


he 6 office tenants STILL IN ADVANCED TALKS TO TAKE UP SPACE AT THE SQUARE

[Simplicity]

Originally Posted by lilwayne

they did state that they have 6 major parties involved right?

they are involved in serious and advanced talks with atleast 6 companies right now retail and office plus they already have a hoteller.. soo I mean come on dude if 4 out of the 6 parites are demanding office space there is demand... but ya I mean 2 towers of that height would be amaazzzingggg.. our skyline would be significantly different than it is now.... especially if sky city and this go through that would be 6 massive bldgs. around mts center in a 6 year period... mb hydro bldg., alt hotel, glasshouse, so po square hotel, so po square office condo and sky city\


do people here stop reading artcles


he 6 office tenants STILL IN ADVANCED TALKS TO TAKE UP SPACE AT THE SQUARE

I'm sure you're like 12 so I'm not going to bother with this too much, but as a rule going forward in life, don't believe everything you read. Do your own critical thinking. All 6 of those tenants - whether they exist or not (and I'm betting maybe half of them actually do) - will be moving from one building to another.

If somebody lets the lease expire on an existing space and takes up in a new one, they aren't creating any increased aggregate demand. they're actually creating less relative demand and you're helping to drive down the aggregate value of rents. The rest of the story is over your head so I'll stop there.

[buzzg]

Originally Posted by Simplicity

If somebody lets the lease expire on an existing space and takes up in a new one, they aren't creating any increased aggregate demand. they're actually creating less relative demand and you're helping to drive down the aggregate value of rents. The rest of the story is over your head so I'll stop there.

Exactly. It's the same as how the government (especially in MB) LOVES to talk about "jobs created" when the majority of them are just people leaving/finishing other jobs to take them. Not actually NEW jobs or added value, just new job vacancies.

[CoryB]

Originally Posted by lilwayne

they did state that they have 6 major parties involved right?

1. MPI
2. The currently unnamed hotel.
3. True North Sports and Entertainment
4. Longboat
5. Ticketmaster
6. Birchwood Auto Group

I am not saying those are the six "major parties" but that list gives you an idea how claiming you have six parties involved could only tell a small part of the picture.

[lilwayne]

and the way politics work here and as much influence as chipman has on the city I am hundred percent sure they conferred with him before making any decision. I'm sure he gave the go ahead to choose that location because he knew that it was important to revitalize that part of graham.. it would only increase the value of his properties if something decent is added to or built on that ugly surface lot around medical arts bldg... who else would be interested on building there other than a crown corp...

[bomberjet]

If those companies are moving from the burbs, I have no problem with that. The engineering ghettos of southwest Winnipeg for example. Thousands of smart, well paid individuals, driving their cars from one end of town to the other. Move that shit downtown already.

[Simplicity]

Originally Posted by bomberjet

If those companies are moving from the burbs, I have no problem with that. The engineering ghettos of southwest Winnipeg for example. Thousands of smart, well paid individuals, driving their cars from one end of town to the other. Move that shit downtown already.

You know what had net positive absorption over the last year? Suburban office space. These engineering firms are catering to their clientele.

[bomberjet]

Originally Posted by Simplicity

You know what had net positive absorption over the last year? Suburban office space. These engineering firms are catering to their clientele.

I recently changed companies and am now located downtown. Moved from the south end ghettos. It's quite convenient to walk 10 mins to meet with clients. In winter the skywalk is also convenient.

It's a hastle to now have to schedule my car trips. "Okay tomorrow I have a meeting I need to drive to. Make sure GF doesn't need the car, so I can take it with me. Make sure to expense my $10 parking fees. Drive to never never land for the meeting. Etc."

I find it's a battle between management and employees. Not to envoke a blanket statement on all people. But I find older, wealthier management are more likely to prefer suburban locations. My GF's company is relocating to south Pembina office space. She would prefer downtown, as would about 75% of the staff. It's the older, management folk who live in that area and want to drive to work that ruin it for the rest of them.

Anecdotal, but ts generally true from my experiences. Same goes for the old company I worked for. They chose to relocate a few years back to the south end because the managers lived in Lindenwoods and White Ridge.