[Surrey] GEC Education Centre | 165m | 49 fl | Proposed

[simgu]

Originally Posted by Shift

Looks like they are getting ready to tear down the building. Signage has been removed from exterior / painted over.

They painted and clean the building... doesn't look like they are getting ready to tear down..... I. Presentation centre??

[osirisboy]

Originally Posted by simgu

They painted and clean the building... doesn't look like they are getting ready to tear down..... I. Presentation centre??

Why wòuld they have a presentation centre for what will be rental?

[EhJay]

And why paint a building that you're going to tear down?

[osirisboy]

Originally Posted by EhJay

And why paint a building that you're going to tear down?

Maybe it's not starting for a while and they leased the building out

[jollyburger]

From August:

CIBT REPORTS COMPLETION OF SALE OF A GEC® PROJECT FOR $55.5 MILLION
AUGUST 14, 2018

Vancouver, B.C. August 14th, 2018 – CIBT Education Group Inc. (TSX: MBA, OTCQX International: MBAIF) (“CIBT” or the “Company”) is pleased to report that one of the real estate limited partnerships in which it holds an interest has completed the sale of one of the GEC® branded Vancouver properties (the “Property”) for a gain of approximately $20 million after an investment period of 41 months. This GEC® project was acquired by the limited partnership in February 2015 for $29.5 million. An additional $6 million was spent on a variety of value added services such as rezoning, re-design and retrofit for higher density usage and approximately $0.5 million will be spent on certain upgrades in the coming few months.

As part of the sale, a CIBT subsidiary, Global Education City Holdings Inc., signed a contract to sublease the building for five years. Another CIBT subsidiary, Global Education City Management Corp., will continue to provide its valued-added rental services to the domestic and international students residing at the Property. The Property will continue to operate under the GEC® brand and management for the five years following closing.

“CIBT Education Group is once again pleased to report the exit of another earlier investment with a substantial return to CIBT and the other limited partners,” commented Toby Chu, Chairman, President and Chief Executive Officer. “With two successful exits now under our belt, we have built a reputation amongst our investors as being the go to source for high quality student housing investment opportunities, and the result has been a high rate of reinvestment into new GEC® projects. Going forward, our plan is to focus on managing the current GEC® portfolio, while acquiring new projects of a larger size and scale so that we can maximize efficiencies and scale our bed count at a faster rate. As an example, this project that was just sold is comprised of approximately 74,000 square feet with 210 beds. Our focus in the coming years will be the development of the Global Education City® project in Richmond and the Education Mega Center® in Surrey, which comprise over 412,000 to 550,000 square feet of space, over 1,000 to 1,200 beds per project and a total combined development budget of $570 million. While our focus will be on larger projects, we will continue to proactively evaluate and add medium size buildings to our portfolio ranging from 60,000 – 80,000 square feet within Metro Vancouver.”

About CIBT Education Group:
CIBT Education Group Inc. is one of the largest education and student housing investment companies in Canada, focused on the global education market since 1994. Listed on the Toronto Stock Exchange and U.S OTCQX International, CIBT owns business and language colleges, student housing properties, recruitment centres and corporate offices at 43 locations in Canada and abroad. Total annual enrollment for the group exceeds 15,000 students. Its education providers include Sprott Shaw College (established in 1903), Sprott Shaw Language College, Vancouver International College and CIBT School of Business. Through these schools, CIBT offers business and management programs in healthcare, hotel management, language training, and over 150 career, language and vocational programs. CIBT owns Global Education City Holdings Inc., an investment holding and development company focused on developing education related real estate such as student hotels, serviced apartments and education super centres. Total portfolio and development budget of projects under the GEC® brand is more than C$1 billion. CIBT also owns Global Education Alliance (“GEA”) and Irix Design Group (“Irix Design“). GEA recruits international students on behalf of many elite kindergartens, primary and secondary schools, colleges and universities in North America. Irix Design is a leading design and advertising company based in Vancouver, Canada. Visit us online and watch our corporate video at www.cibt.net.

http://www.cibt.net/blog/2018/08/14/cibt-reports-completion-sale-gec-project-55-5-million/

[Blease]

What does this statement about the GEC actually mean? Can someone deconstruct it, Shift?

[officedweller]

The first paragraph refers to the sale of one of GEC's existing operations in Vancouver
- maybe the former Best Western on Granville Street or the VIVA Tower on Howe Street.

GEC will continue to operate the building that was sold for 5 years.
(i.e. like most hotels are owned by consortiums or pension funds, etc. and are managed and operated by hotel companies under various banners. Concord Pacific owned the Westin Bayshore, for example.)

I think this means that GEC will have more money to build the Richmond and Surrey projects.

[Cypherus]

Basically they are saying they have been successful in attracting and retaining investors because of a positive history of successful returns, and that they will continue to focus on big projects like GEC Education Centre in Surrey to continue that trend. So good news when the company is financially viable and attractive to private investors looking to wet their beaks.

[jollyburger]

Originally Posted by officedweller

The first paragraph refers to the sale of one of GEC's existing operations in Vancouver
- maybe the former Best Western on Granville Street or the VIVA Tower on Howe Street.

GEC will continue to operate the building that was sold for 5 years.
(i.e. like most hotels are owned by consortiums or pension funds, etc. and are managed and operated by hotel companies under various banners. Concord Pacific owned the Westin Bayshore, for example.)

I think this means that GEC will have more money to build the Richmond and Surrey projects.

It was Viva. Granville was November 2015.

VANCOUVER HOTEL TO CONVERT TO STUDENT HOUSING
FEBRUARY 11, 2015

A 17-storey luxury hotel in downtown Vancouver, known as the Viva Suites Hotel, has been acquired by CIBT Education Group’s (CIBT) wholly owned subsidiary, Global Education City Holdings Inc. (GEC), with the intent to convert it into a 230-bed student housing development for foreign students. The total value of the project, including purchase price and renovations, is approximately $37-million. “This latest acquisition marks the third investment by GEC totaling $113-million within seven months with another...

[Nites]

Originally Posted by osirisboy

Maybe it's not starting for a while and they leased the building out

If that was the case the Surrey Central Hockey League would have stayed longer. If it gets leased to someone else I'm sure it would piss off the previous owner/renter.

[officedweller]

Originally Posted by jollyburger

It was Viva. Granville was November 2015.

Cool, thanks for the research.

[simgu]

Any update? There is a big sign on the building about one of the candidate for mayor...

[Shift]

The building is now being used as the campaign office for Bruce Hayne - running for Mayor. That is why it was painted.

[Hooknose]

I know that this forum is for the Stardust redevelopment only but I am curious. So far there is just two buildings (each 50 stories plus) built or proposed and a whole of "no news" on all the rest of the parcels between Civic and KG Highway from 102 to 104.
Shouldn't there be 6 buildings under construction, not just one more ? There is building all around the prime parcel but nothing in the middle.
Talk about a hole in the donut.

[rickvug]

Originally Posted by Hooknose

I know that this forum is for the Stardust redevelopment only but I am curious. So far there is just two buildings (each 50 stories plus) built or proposed and a whole of "no news" on all the rest of the parcels between Civic and KG Highway from 102 to 104.
Shouldn't there be 6 buildings under construction, not just one more ? There is building all around the prime parcel but nothing in the middle.
Talk about a hole in the donut.

Good observation. I honestly don't know why but I have a hunch. The best way to summarize is to use a terrible old saying: “Pioneers take the arrows, settlers take the land”. These sites have the highest FAR in the plan and are designated as mixed use. If I was a land holder I'd be hesitant to sell what I know to be the best site until more of the area is built up around it, maximizing my return. If you're going to build you will want to go really big and it will be more complicated that just selling some more condos due to the office component. This is in contrast to your typical condo project where the chance of the property being worth much, much more in the future is lower as there's a relative abundance of sites with the same designation.

Again, this is just my hunch. Would love to hear from someone more informed.

[Hooknose]

Originally Posted by rickvug

Good observation. I honestly don't know why but I have a hunch. The best way to summarize is to use a terrible old saying: “Pioneers take the arrows, settlers take the land”. These sites have the highest FAR in the plan and are designated as mixed use. If I was a land holder I'd be hesitant to sell what I know to be the best site until more of the area is built up around it, maximizing my return. If you're going to build you will want to go really big and it will be more complicated that just selling some more condos due to the office component. This is in contrast to your typical condo project where the chance of the property being worth much, much more in the future is lower as there's a relative abundance of sites with the same designation.

Again, this is just my hunch. Would love to hear from someone more informed.

Not a bad analysis. I wonder what the truth is. Prices have been rising and some property owners may wish to step off the train and pass the properties to more experienced hands. I would bet that really serious long term players are all nibbling at the edges.

[rickvug]

Originally Posted by Hooknose

Not a bad analysis. I wonder what the truth is. Prices have been rising and some property owners may wish to step off the train and pass the properties to more experienced hands. I would bet that really serious long term players are all nibbling at the edges.

I've heard that concrete construction is now $400+ per sqft. I'd imagine that costs are even higher for commercial and the returns are tied to capitalization rates vs. sale prices. With construction costs so high and the need to show a yield on rental income I'd imagine that it is difficult to make commercial construction viable even with nominal land costs. However, if these costs are are all static, the land values can very quickly rise once all over factors are "in the black" (ie. project is viable with zero land cost). At that point the market price per sqft increasing even 10% could have a massive impact on the land value as the cost of construction remains constant.

[GMasterAres]

I also think you need to build a critical mass. Vancouver has historically been the central business/commercial area of Metro-Vancouver as a whole. I've said it in other threads where statistically that has been largely shifting over the past few decades to the point that is not as much the case today, but it is still the prime AAA business center of the region.

For commercial to be viable you need to either (a) have something the other areas don't or (b) have a critical mass to support the commercial ventures that may move into your developments.

Up until recent years, Surrey has had neither a nor b. It was and largely today still is, a bedroom suburb of the region. Where people live. Over the past decade though things have been shifting. You've had a large swath of industry migrate South of Fraser with Surrey, Delta, and Langley containing a vast majority of industrial land. There is less and less industrial land in Vancouver itself, and a shifting amount in Burnaby, New West, and Coquitlam.

Second, with the innovation boulevard, RCMP E-division, and SFU, there other other unique draws making Surrey Central more attractive to certain industries.

On item B, condos have been going up and surrounding 4-6 storey buildings, in addition to the overall increase in population in Surrey and Langley. That is starting to create that critical mass where those living in and around Surrey Central are wanting more and more to live and work in the same city. Again drawing business this direction.

There are several companies that have migrated from Vancouver to Surrey now for the simple fact 75+% of their workforce lives in Surrey and Langley. Their own workforce dictated the move of the business.

So to me, both a and b, along with the financial factors that have already been mentioned above, are why we see more development on the fringe and less in the central core. The demand for commercial space is increasing but it is still not there to the levels where we'd be seeing some larger commercial only towers going up in the central core.

To me the mixed use is a good sign if things keep moving ahead because that is the natural progression. Residential only (bedroom community) --> Mixed Use with some commercial/retail (starting to shift into a core on its own) --> distinct larger commercial developments (a city the stands on its own regionally).

Honestly, and I may be proven wrong when history is written, but I think a SkyTrain extension to Langley Center will spark a boom for Surrey Central just like Expo Line did for the Metrotown area and Millennium Line has done for Brentwood.

[Hooknose]

Honestly, and I may be proven wrong when history is written, but I think a SkyTrain extension to Langley Center will spark a boom for Surrey Central just like Expo Line did for the Metrotown area and Millennium Line has done for Brentwood.[/QUOTE]


Absolutely correct. Surrey central would boom.

What most people don't get is that a RR transit is two way. People don't just go from "outside" to "inside". They also travel from inside to outside, if that is where the jobs or the shopping is.

How many people each week, take the Canada Line from downtown to Richmond to eat the great Chinese food.

Linking to Langley would make Surrey Central a mid point (like Metrotown, the busiest station on the line) and mid point get it coming and going.

When they extend the M Line to UBC, one day, there will be people who choose to work in Coquitlam and live at 10th and Alma.

The more critical nodes on a system, the more it becomes a "freedom machine" which allows people larger and larger opportunities to live and live well.

So by all means, LANGLEY OR BUST.

[rpvan]

It's too bad this project has seemingly stalled. I'm optimistic that they'll ramp this up later in the spring or summer though. What have they done with the property since the election? Some mentioned it was being used as a campaign office back in October.

All in all, it's good to see another project (along with the civic hotel) in the works to be built right along the "spine" street of the Downtown Core. However, I'd hope to see more development just to the north soon as well. A line of old rundown buildings are pasted along the east side of City Parkway currently.