[Northern Light]

The downtown office market is undergoing a literally historic boom right now.

Doomsdayish naysaying -- especially on this project -- is borderline laughable.

The pre-leasing rate on this, last we heard, was rather low.

At the tail end of every boom, everyone things everything is justified, because of what's been happening.

They typically end up wrong.

Does that apply to this site? Probably not. CF have deep pockets.

Does that apply to this time? Maybe......there is certainly on going evidence that office space is consolidating and growing downtown.............but
there is also evidence the market is slowing a bit...........at least temporarily.

I think either POV is a matter of conjecture and POV and not laughable, so long as you can back it up.

 

[ADRM]

The pre-leasing rate on this, last we heard, was rather low.

At the tail end of every boom, everyone things everything is justified, because of what's been happening.

They typically end up wrong.

Does that apply to this site? Probably not. CF have deep pockets.

Does that apply to this time? Maybe......there is certainly on going evidence that office space is consolidating and growing downtown.............but
there is also evidence the market is slowing a bit...........at least temporarily.

I think either POV is a matter of conjecture and POV and not laughable, so long as you can back it up.

Expressing a viewpoint without offering any credible substantiation for it is essentially the definition of not backing it up.

Not every POV is worth sharing.

 

[maestro]

You're drawing conclusions. I haven't predicted anything. The market instability right now is not good, in particular, for tech which requires fundraising to reach sustainability. What we know of the project, it's highly speculative. The market could stabilize and CF may have more tenants in the wings.

Historic lows can reverse very quickly. It happened in the early nineties. It happened in the early 2000s. It happened a few short years ago in Calgary.

What more do you want?

 

[Automation Gallery]

PCL trailer and some construction white helmet guys early this morning

 

[Daniel Zafrani]

Priestly Demolition is mobilizing ... it's showtime.

 

[ericmacm]

Really happy to see that stuff is finally happening, I've been excited about this tower for a long while.

I am confident that this tower will be constructed to completion despite any potential changes in the market. Cadillac Fairview (as well as OTPP as a whole) has such a diverse investment portfolio outside of real estate that I would doubt they would need to cancel it during a market slowdown. Office buildings are fantastic as long term investments in cities like Toronto.

 

[concrete_and_light]

Walk by this every day. Excited to see it go up

 

[Automation Gallery]

Area is fenced off

 

[taal]

So while folks are trying to analysis the Toronto office market, they're not really doing so with any data points ...

Not that I disagree that it's possible we're heading toward or are at the peak of this office development cycle ... there is 0 information to suggest that atm, there's no slowdown in absortation rates, there is no signs that pre-leasing rates for new builds have dropped off ... and basing this on a turbulent stock market which often exhibits very short term movements really doesn't line up with the longer term performance metrics which drive job growth and the associated office market.

 

[Mr.Tang]

I would like to agree with you - but more there are more indicators than just stock market volatility. Recent manufacturing indices, CFO questionnaires, the flattening of the yield curve and just the sheer duration of the current cycle are making people at the very least nervous. TD economics put something out today that noted that to some extent - when enough people start talking about a slow-down - that in itself leads to a slow down. Maybe the question is how much of an economic slowdown could we endure here in Toronto and still have all these projects move forward just due to the general industry trends and demand/supply situation.

 

[TrickyRicky]

If things get ugly in real estate they get ugly in ways both obvious and unforeseen. The underlying fundamentals however of this location are sound. Adjacent Union is the place you want to be in commercial real estate if there is a place you want to be in commercial real estate in Canada.

 

[Start Fox]

I don't actually know this, but I would presume that the judgment calls about whether to build commercial real estate look far beyond the upcoming year or years. This is easily a 25 year investment (maybe more like 30-50 years before a major renovation is needed). So while there may or may not be indicators of short term volatility or recession, I don't think that's determinative of whether this building goes forward.

 

[Automation Gallery]

Gee, this building has been in the works for 8 years, and now that Cadillac Fairview is going ahead with this development people are worried it may not get off the ground?

 

[Edward Skira]

You are right. Buildings long planned most certainly get built. Why would anyone think otherwise?

I'm not saying it won't get built but don't think the worst couldn't happen because it certainly has happened before.

 

[raptor]

Geez, what's with all the debbie downers here? A major office building is starting construction, and all you are talking about is when/if it's cancelled?