cmd uw
Active Member
Would agree with you 100%.^^
imho cwb in manulife would be a better deal for downtown overall…
Would agree with you 100%.^^
imho cwb in manulife would be a better deal for downtown overall…
I also agree with you 100%....should remain residential. Plus the last thing our office market (and almost every other) needs is more space TBH.Yeah, I hope it means the planned tower becomes 25-40 stories of more reasonable rentals ($1400-2300s). Area needs more bodies and the premium stuff is over saturated.
Because that's just what ICE District needs... another bank.If CWB decides to move their HQ to Manulife then what happens to their ICE District tower? Will they open a bank branch in ICE District instead, or abandon it altogether?
Timing isn’t everything it is the only thing.for the big players, it’s never just the value of the asset today and whether it’s at a historic high or a historic low. it’s about the value of the asset in 10 years vs the value of potential alternative investments in 10 years (or whatever their investment horizon is) whether those alternatives are industrial space in the golden horseshoe, canadian or international equities, canadian or international bonds, canadian or foreign currencies.
at $120 psf (if that is the number), selling the building today would net roughly $100 million. reinvested at 10%, that would be worth roughly $235 million in 10 years.
leasing the current vacant space could well cost $25 million. releasing the current leased space as leases expire could well cost another $25 million while capital upgrades and renovations could easily require another $50 million.
the building would then have to be worth at least $335 million - or $390 psf - at the end of that 10 years (the $100 million they could get for selling it today, the $100 million it will cost to own it over the next 10 years, plus the $135 million they could earn elsewhere over those 10 years) for it to make sense not to sell it for $120 psf today.
i wasn’t meaning to imply that aimco earned 10% per year over the past 10 years so that should be their hurdle rate going forward (i don’t know what their returns actually were over the past 10 years)Timing isn’t everything it is the only thing.
Just because something performed at 10% over the last 10 years doesn’t mean it will do the same over the next. Just saying given AIMCOs past performance they are a day late and a dollar short
Personally I'm doubtful vacancies would grow any more than they already have. You're seeing the tail end of covid, less work from home, population growth in the region, and continued scale up efforts for startup firms, which over the mid term will create demand for office.What's going to happen to any of our office towers as vacancies grow and valuations go down? Downtown accounts for 10% of our City's tax base. If the tax base shrinks it will affect all taxpayers.
Cut and paste in almost all other downtowns right about now. The office asset class isn't that hawt right now...in fact, it's the exact opposite.Valuations are down and write-downs have occurred and is impacting the tax base.