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First major tenant opens at Calgary's huge Taza project | RENX – Real Estate News EXchange



IMAGE: Costco, the first major anchor of the Taza development on the outskirts of Calgary, officially opened on Friday. (Courtesy Taza Development Corp.)

Costco, the first major anchor of the Taza development on the outskirts of Calgary, officially opened on Friday. (Courtesy Taza Development Corp.)

The opening of a 150,000-square-foot Costco store and warehouse at the massive mixed-use Taza development on the Tsuut’ina Nation is the validation of years of preparation and planning.

The Costco store is the first anchor tenant in The Shops at Buffalo Run retail centre on the outskirts of Calgary, as well as being Costco’s first warehouse located on a First Nation development in North America.

“The official opening of Southwest Calgary Costco validates that Taza is open for business,” said William Briscoe, the CEO of Taza Development Corp. “Because of the collective efforts between Taza Development Corp. and Costco, we have been able to secure a leading anchor tenant to provide various employment opportunities, even as we navigate through these current economic times.”

Taza comprises three distinct Villages – Taza Exchange, Taza Park, and Taza Crossing. It is planned to accommodate about 25 million square feet of commercial, retail, entertainment, residential, light industrial and other uses during a four-decade build-out.

Costco, The Shops at Buffalo Run

The Southwest Calgary Costco is located in The Shops at Buffalo Run at Taza Exchange, which is planned to be a vibrant regional retail, office and tourism district, with other stores and restaurants part of the project.

The Costco is located at 12905 Buffalo Run Blvd., at the corner of the Southwest Calgary Ring Road and 130th Avenue SW. The official launch of the location is taking place Friday morning at the site.

“It does kick off our overall development as being our first anchor tenant for not only Taza itself, but also The Shops at Buffalo Run which is a 260,000-square-foot retail centre that we will be completing in the fall of 2022,” said Bryce Starlight, the vice-president of business development and investor relations for Taza.

“It also provides some amazing opportunities for Nation members to be employed here and offers almost 100 positions for Tsuut’ina and First Nation employees of a 300-employee warehouse.”

The Shops at Buffalo Run is located just north of the Costco parking lot. It is planned as a regional and community shopping centre with several large format retailers but also focusing on restaurants.

Negotiations with prospective retailers

IMAGE: An overview of the 1,200-acre Taza development on the outskirts of Calgary. The three distinct sectors of the 25-million-square-foot project are outlined. (Courtesy Taza Development Corp.)

An overview of the 1,200-acre Taza development on the outskirts of Calgary. The three distinct sectors of the 25-million-square-foot project are outlined. (Courtesy Taza Development Corp.)

Taza is currently negotiating with grocers, financial institutions and professional office tenants. Starlight anticipates more than 40 tenants will be in the area.

“Right now we have many conditional deals. We’re actually hoping to make some pretty big announcements in the next couple of months here,” he said. “Our leasing has been fairly strong for the last two years, actually. The Costco will definitely open up some additional opportunities.”

Starlight said Taza is in negotiations on about 80 per cent of the total square footage.

“Because it is a 40-year build-out, we’re also looking at not just retail but at some light industrial that would be used for, say, health care, innovation, technology,” he said. “We’ve got residential components identified for other areas within the development.

“It’s going to be a pretty wide range of retail right from your smaller 1,200-square-foot CRUs to your large retail formats. We’re actually in negotiations with a number of tenants at this point on other locations.”

He said the developer has focused on areas close to the Ring Road to house future retail on the massive, 1,200-acre site. The overall development is a joint venture between Tsuut’ina and real estate company Canderel.

It is one of the largest First Nation development sites in North America.

“Our location and the approval process has been extremely attractive to tenants within the Calgary region,” said Starlight.

“I think everyone’s taking a hit in this climate; however the deals we were negotiating pre-COVID have been the same ones that we’re negotiating today.”

An overview of Taza

The overall plans for the Taza development will include:

* Taza Park – 2.5 million square feet of commercial, 2.3 million square feet of retail and over 4,000 multifamily units;

* Taza Crossing – two million square feet of commercial, 750,000 square feet of retail and 2,500 multifamily units; and

* Taza Exchange – 1.5 million square feet of commercial and 1.2 million square feet of retail.

Speaking about the opening of Costco, Briscoe said: “What is very significant is this is really the transition from years and years of planning and preparation to really being open for business and the start of many, many years of economic development right at Tsuut’ina in southern Alberta – a major project.

“What is most significant is that this is the first of many and it solidifies the project. It demonstrates that all the hard work and years – and many, many decades prior to the partnership even – all coming into fruition and becoming real.

“It’s moving. I’ve been in the business for a long time and I would say that this is by far the greatest achievement I’ve been a part of. . . . It takes the dream into reality.

“It also is evidence that we have a development approval system that works, that is efficient. We have design guidelines that work. We’ve successfully integrated a cultural awareness that takes the community development to another level.

“This project, because of its scale, across the country we’re demonstrating true economic reconciliation and what can happen if you dream big and put a lot of hard work into it. They don’t have to stay dreams.”

Briscoe said the first phase of Taza’s residential component is likely to be about two years out.

“There’s still a lot of work we have to do. We’re going through different design factors. We have market studies that we’re still working through. Obviously everything is driven by the market. Those details will come out later,” Briscoe said.

“Right now we’re really just focused on introducing the world to Taza Exchange and The Shops at Buffalo Run.”

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Here's Who's Giving What to Trump and Biden in Commercial Real Estate – Commercial Observer



When Donald Trump announced he was running for president in 2015, Elie Hirschfeld switched parties.

The Manhattan developer known for building the Crowne Plaza Hotel and residential towers Grand Sutton and Park Avenue Court had given sporadically to candidates in both parties in the past, including New Jersey Sen. Cory Booker and members of the Bush clan, and considered himself a Democrat. 

But Hirschfeld has known Trump personally for decades. When Hirschfeld had an opportunity to develop the site that would become Riverside South on Manhattan’s Far West Side, he brought Trump into the deal. And he once rented office space in one of Trump Tower’s lower floors in the early 1980s.

“We became one of his first tenants in his office portion,” Hirschfeld told CO. “He built offices because he didn’t want to be alone. The apartments sold well, but the offices were slow.” 

Trump behaved more like a real estate mogul than a political power broker back then, writing checks for politicians in both parties who could loosen regulations and advance zoning applications. He has sprinkled approximately $1.5 million in contributions to national candidates and party committees since 1979, according to federal election records. Many were Democratic officeholders in New York and New Jersey. 

“I’ve given to everybody because that was my job,” Trump explained while campaigning in Iowa in 2016. “I’ve got to give to them because when I want something, I get it. When I call, they kiss my ass.”

But Trump’s own thirst for the White House grew after Barack Obama’s victory in 2008, and an array of political consultants he met with, including David Bossie, head of the conservative advocacy group Citizens United, suggested Trump shower Republican officeholders with his cash to boost his profile. 

Trump began tilting the majority of his spending toward Republicans in 2010, before he cut off Democrats entirely in 2011. By the following year, he had become a reliable Republican contributor, giving $325,000 to national candidates and party committees. 

Trump always expected something in return. He had targeted his spending to lay the groundwork for a future presidential run. Yet when Republican leaders solicited him in late 2012, after Mitt Romney’s loss, Trump chastised them over Romney’s campaign strategies and refusal to deploy him as a surrogate in the final weeks of the race.

Trump’s experiences demanding favors and dispensing advice led him to eschew sizable contributions when he launched his bid in June 2015, claiming other candidates were “puppets” of their benefactors. Yet his allies quickly registered a super PAC named “Make America Great Again.” And Trump publicly revised his views, telling CBS’ John Dickerson in August 2015, “I would even take big contributors, as long as they don’t expect anything.” 

One of his first significant donations was from the family of a New York-area developer. Seryl Kushner, executive administrator and spouse of the founder of Kushner Companies, who also happened to be the mother of Trump’s son-in-law, gave $100,000 to Trump’s Make America Great Again PAC in July 2015. (Disclosure: Seryl Kushner is also the mother-in-law of Observer Media chairman, Joseph Meyer.)

Elie Hirschfeld wrote a $2,700 check in February 2016, but the campaign’s fundraising arm was so disorganized he had to call Trump’s secretary Rhona Graff for instructions about how to send Trump the money.

“I did it because he was a friend,” said Hirschfeld, who is not currently working with the Trump Organization. “I didn’t think he had a chance to win at the time. The sense I had was it was a promotional effort, but it took awhile for me to realize it was his intent to win. When Donald puts his mind toward something, he usually gets it done.”

The Latest Round

Trump has hauled in a massive sum for his re-election this cycle, including from New York’s real estate community, after Hillary Clinton outraised him nearly 2 to 1 in 2016.

Eager to avoid being an underdog as a sitting president, Trump filed for re-election hours after his inauguration. And, after campaigning as a political outsider against the Republican Party establishment in 2016, his campaign merged with the Republican National Committee to form a joint fundraising committee. The move allows Trump to share office space and staff with the party, coordinate events, and control which candidates receive money from the party.

That early planning was critical, and the Trump campaign collected $572 million through the first half of 2020, 32 percent higher than the $433 million it brought in four years ago, according to a Center for Responsive Politics analysis of federal campaign records.

Commercial real estate poured $15.9 million into Trump’s campaign coffers so far this cycle, the second-most of any business sector. That mark so far is 42 percent higher than the $11.2 million Trump coaxed from developers in 2016. Only finance has given more, though neither has had anything on what the Center for Responsive Politics describes as “retirees,” who have raised $89 million, and Republican officials, who have brought in $65 million.

But Trump once again trails a formidable Democrat despite having an early fundraising advantage. After prevailing in a 29-candidate field, former Vice President Joe Biden has led Trump in polls with a boost of support from suburban whites, the elderly and college-educated voters. Biden’s fundraising exploded once the primary finished, with the candidate raking in $702 million so far.

It hasn’t been difficult for Biden to raise money from developers either this year. In fact, he’s brought in $17 million from the real estate industry nationally — roughly $1 million more than Trump.

This Biden motherlode includes treasure from some of the biggest names in or connected to New York real estate. Four M InvestmentsDennis Mehiel forked over $202,815 to pro-Biden groups (with his firm kicking in $5,000 more), followed by executives at BCG Partners, who distributed $100,000 to pro-Biden groups and $85,310 directly to the candidate, and at the Blackstone Group, who gave $100,000 to pro-Biden committees, according to the Center for Responsive Politics. Other top real estate-related donors this election cycle include executives and principals at Fisher Brothers ($50,000 to outside groups and $6,705 to Biden), Cushman & Wakefield ($20,763 to Biden), Royal Realty, which is part of the Durst Organization ($20,000 to outside pro-Biden groups), and GFP Real Estate ($16,800 to Biden), whose chairman, Jeff Gural, co-hosted a $2,800-ticket party for Biden with Newmark Knight Frank CEO Barry Gosin in January. 

Biden might not enjoy the same ties with real estate developers and investors as Hillary Clinton, a former senator from New York and currently a Westchester County resident. But Gural is a longtime Biden friend who held fundraisers for his Delaware Senate campaigns. The people in Gural’s social circle are mostly Biden supporters too.

“It’s hard to be friendly with Trump supporters to tell you the truth,” Gural told CO. “Biden’s a decent guy, and maybe that’s what the country needs right now.”

Property owners, investors and brokers are exactly the kind of professionals with whom Trump should be succeeding, though. The industry remains predominantly white and male and the president’s base in 2016 largely consisted of white males over the age of 50, according to a Pew Research Center analysis. Trump also received more support than Clinton from whites who earned more than $50,000, a Data for Progress analysis showed.

There is enthusiasm for Trump in the industry — stemming in large part from his tax policy, his approach to Israel and the stock markets’ performance during his presidency — and that energy has translated into larger donations from it than in 2016. Trump’s top real estate donors so far this year have been Greystone & Co. managing director Abraham Spria, who donated $100,000 to a pro-Trump group and $5,600 to the Trump campaign, and Landmark Abstract Agency president Jacob Rekant, who gave $37,000 to a pro-Trump group. Other top donors include individuals at Compass and Walker & Dunlop, who each gave about $25,000 to pro-Trump groups, while executives at Meridian Properties ($19,966), the Witkoff Group ($17,200), Hirschfeld Properties ($16,800), and the Lefrak Organization ($16,200) all gave directly to the Trump campaign. Four years ago, H.J. Kalikow & Co. president Peter Kalikow was the only developer who gave Trump more than $10,000.

“Trump brings out both extremes, but he has a lot who support him in the middle,” Hirschfeld, who serves as finance chair of the state Republican Party, said. “On financial issues, people in the real estate world believe Donald Trump is doing better than would be the case if we had a progressive-leaning president.”

But the president’s immigration policies, refusal to fund New York infrastructure projects, the cap he supported on state and local tax deductions, and abject mismanagement of the pandemic galvanized others to thwart him.

“I’ve never seen a level of disgust and anger on Donald Trump’s weakness on so many issues,” Jennifer Bayer Michaels, a longtime fundraiser for Sen. Charles Schumer and Gov. Andrew Cuomo who leads the New York office of the pro-Biden super PAC Unite the Country, told CO. “People are frankly disgusted. I’ve had a lot to work with. New Yorkers in particular are distrustful of Donald Trump. They don’t like what they see.”

President Donald Trump with Elie Hirschfeld, president of Hirschfeld Properties. The two have been friends for decades, and did business in New York City . Courtesy of Eli Hirschfeld

Why They Give 

Real estate leaders from both parties see a connection between Trump’s surprise win in 2016 and the leftward reaction in New York politics that followed. Dozens of progressives won seats in the City Council and state Legislature beginning in 2017. Democrats, in fact, took complete control of the state government for the first time since 2010. Lawmakers then passed tenant-friendly rent regulations, while developers seethed, and are pushing for higher taxes on the wealthy to close city and state budget deficits.

“The best thing that could happen to the real estate industry in New York is for Trump to lose,” one real estate executive who is backing Biden but preferred to stay anonymous told CO. “Other than a tax cut that has benefited some real estate owners personally, the last three and a half years have been a disaster politically for real estate and in a lot of people’s minds the first step to recovery is Trump getting out.”

Trump’s policies and personality have cleaved the real estate industry in unexpected ways too. One Trump fundraiser has found a bevy of support from individual property owners who own a handful of buildings and from smaller family-owned real estate firms in the New York area. Those at larger real estate investment trusts, however, favor Biden but have been open to a Trump-friendly pitch, the fundraiser said.

“I am more willing to cold call somebody in real estate who has given money to both sides but to less progressive-type Democrats like Gov. Cuomo,” the Trump fundraiser said. “I’d be more willing to call them than an attorney. The real estate industry’s been demonized a bit in New York, and I think is open to at least listening, especially over the last few years.”

But a Biden supporter noted that it may all come down to a donor’s ideology, culture, and whether they live in New York City or the suburbs.

“The higher-level guys who in a good year make $1.5 million and live in Greenwich, that’s the Trump folks,” the Biden supporter said. “It’s not really cool to be a Republican in the city. How do you be a Trump Republican and not like gay people and be bigoted in New York City? That’s not the way we operate here. Do you think they’re going to let you on the board of the Museum of Natural History if you don’t believe in science or the board of MoMA if you want to deport people?”

Some real estate firms have deep divisions within their own ranks, with senior executives raising gobs of cash for both parties while managing to keep politics out of their Slack channels. Executives at Blackstone, for instance, a major player in real estate financing and investing,  have raised $100,000 for Biden, while its CEO, Steve Schwarzman, has doled out $27.3 million to Republican candidates and PACs over the past two years, records show. 

And Stephen Ross, chairman and CEO of the Related Cos., one of New York’s busiest developers and owners, hosted a swanky Hamptons fete for Trump last summer while its employees largely gave to Democratic congressional candidates. Ross in a later New York Times interview expressed regret for hosting the Trump event, but he wouldn’t tell the paper for whom he planned to vote.

With fewer than six weeks to go before the end of the race, the money will continue to flow and donors will vie for the ear of their candidate much like Trump did in 2012. Elie Hirschfeld hopes Trump provides aid for the Metropolitan Transportation Authority and other public facilities in New York and tax relief by reinstating the SALT deduction. Jeff Gural wants Biden to continue condemning violence and outside agitators causing confrontations at protests. 

“I think deep down people would like to see the country united,” Gural said. “I don’t think they’re happy the country is so divided. I can’t wait for the election to see what people really think behind closed doors.”

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This Week’s Top Stories: Canadian Real Estate Prices Forecasted To Fall, As Households Make Fewer Payments – Better Dwelling



Time for your cheat sheet on this week’s most important stories. 

Canadian Real Estate 

Moody’s Doubles Down On Forecast Of Canadian Real Estate Prices Falling Soon

One of the world’s largest credit rating agencies confirmed an early forecast of falling home prices in Canada. Moody’s had expected government measures would delay any impact to home prices. The firm believes this is still true, and even elaborated on which markets will be hit. They expect enthusiasm over stimulus measures will begin to wear thin. At this point, the reality of a damaged labour market, and how meaningful improvements have been will start to hit sellers. This is expected to be stronger in some markets, like Toronto, than other markets – like Vancouver. 

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Canadian Condo Prices Peaked In April, Only Three Major Markets Now At Peak

Despite booming Canadian real estate sales, condo apartment prices have now fallen from their peak price. The aggregate benchmark reached $478,700 in August, up 6.45% from last year. This number is down 0.15% from the all time record reached in April. As you might expect, not everywhere is falling. Three markets have printed new all-time highs as of August. The rest however, have fallen – and some markets haven’t seen an all-time high in over half a decade.

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CMHC: Nearly Half Of Canadian Real Estate Markets Have “Moderate” Vulnerability

Canada’s national housing agency, and state-owned insurer, sees a lot of risk in real estate markets. Seven markets are now flagged as having “moderate” levels of vulnerability, up from five in the spring. Toronto and Vancouver remain in the moderate category, while Montreal continues to be considered low risk. The organization did say things appear better than the reality, due to disposable income temporarily being inflated by government support. Once disposable income falls back to non-supported levels, overvaluation metrics should rise once again.

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Canada’s Largest Real Estate Markets See Permanent Resident Declines Accelerate

Canada’s biggest real estate markets are seeing one of their fundamental drivers continue to deteriorate – immigration. Toronto only saw 4,450 permanent residents arrive in July, down 64.0% from last year. Vancouver  saw 1,300 people, down 71.1% from last year. Montreal fell to 2,110, down 47.2% from last year. Toronto and Vancouver have seen the declines become larger from the month before. Montreal bucked the trend by seeing a smaller decline, but has also seen a much longer trend that goes back before the pandemic.

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Canadian Mortgage Debt Is Soaring, But Payments Fall Over $4 Billion

Canadian mortgage debt is swelling, but households are making a lot fewer payments. The amount paid towards mortgages hit $90.27 billion in Q2 2020, down 3.32% lower than last year. Almost all of this is due to paying off less interest. Breaking the numbers down, we see payments towards principal are on the decline, while payments towards interest are actually rising. 

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Office real estate market will get back to pre-Covid level, in 2025: Cushman & Wakefield – CNBC



The coronavirus remote work experiment will become a permanent trend, but at some point, employees will return to the office in numbers that match the past. When? It could take five years, according to a new forecast from Cushman & Wakefield.

Global office vacancies will not return to their pre-Covid peak levels until 2025 and, in all, a net 215 million square feet of office vacancy will have been lost due to the pandemic, according to the outlook from one of the largest real estate services firms in the world. Between Q2 2020, when Covid-19 hit the U.S., and Q3 2021, the net negative office square feet damage will reach 95 million square feet, roughly 10 million square feet more than the financial crisis trough.  

The situation will be the worst in the West. During the financial crisis, Canada, Europe and the U.S. recorded a combined loss of 120.5 million of square feet occupancy from peak-to-trough. Including Q2 2020, that will reach over 200 million square feet of “negative absorption” peak-to-trough in the Covid recession, according to Cushman & Wakefield’s analysis.

Work from home is ‘very real’

“We know this work from home trend is very real,” Kevin Thorpe, the firm’s chief economist, recently told CNBC.

For the study, Cushman & Wakefield surveyed some of largest companies around the world about the future of the office, and attempted to measure both the cyclical impacts of the Covid recession and structural impacts assuming a higher increase in work from home. 

Thorpe said two key findings emerged. First, office leasing fundamentals will be significantly impacted and vacancies reach an all-time high. But the second find is more encouraging: the office real estate market will fully recover, according to Cushman & Wakefield, largely due to employment growth and the ongoing shift in the U.S. economy’s concentration in certain types of professional jobs. 

Vacancies caused by Covid-19 will result in over 200 million of net negative square footage in the office real estate market, but the growth of professional services sector jobs will help lead to a recovery over five years, says Cushman & Wakefield.
Thomas Barwick | Getty Images

In all, the real estate firm estimates that 82% of the damage will be related to cyclical factors: permanent office job losses and the rise of coworking, while 18% is related to structural factors: primarily assumptions about permanent remote workers and hybrid workers — those who work remotely some of the time.

Work from home will double, and hybrid workers will increase. The study estimates that the share of people working permanently from home in the U.S. and Europe will increase from roughly 5-6% pre-Covid-19 to between 10% and 11% post-Covid, while the share of hybrid — also referred to as agile workers — will increase from between 32% to 36% to just under half of all workers.

Levi Strauss & Co. CFO Harmit Singh recently told a CNBC @Work virtual event that it pulled the plug on any new commercial real estate during the crisis. “The myth that work from home is not productive has been busted,” the Levi Strauss CFO said. “I believe we will settle into a culture where working from anywhere will be the new norm, with work from home or office or a hybrid arrangement.”

Google recently announced it will try a hybrid model of work as most of its employees do not want to be in the office every day.

Many younger workers are taking advantage of the Covid remote working shift to travel, embracing a “digital nomadic” lifestyle, a shift which could become permanent for a new generation of labor.

Over time, as economy shifts to a knowledge-based, professional services economy, it will offset the flexible workforce trend, Cushman & Wakefield’s study concludes. “But in the near-term, there will be significant challenges for the office sector,” Thorpe said. 

Many workers still do not feel safe enough to return to office. One study found that only 14% of workers said that they trust their CEOs and senior managers to safely lead them back to work. 

Global office vacancy will rise from 10.9% pre-Covid crisis to 15.6% by Q2 2022, the study forecasts.

Some of the largest companies in the world have been expanding office space in major cities, such as New York, during the crisis.

Facebook, which has been acquiring New York real estate for years, agreed last month to a major lease at the old James A. Farley post office building in Manhattan. Amazon has also purchased the Lord & Taylor building on 5th Avenue, and that is even though Facebook CEO Mark Zuckerberg has said as much as half of the company’s workers may be remote in the future. In March, just as the Covid crisis hit the U.S., Amazon paid over $1 billion to acquire tha Lord & Taylor building in New York, which includes over 600,000 square feet of space.

A new analysis from Cushman & Wakefield estimates that work from home will double across the globe in the next five years with the largest share in the West.
Cushman & Wakefield Research “Global Office Impact Study and Recovery Timing”

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