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I don't really foresee the volume of foreign capital required coming in to Mtl. and thus upsetting its affordability. There are too many vacant locations as is, and not enough population and economic growth to massively reverse the situation. The one-in-six rule: can Montreal fight gentrification by banning restaurants? | Cities | The Guardian The one-in-six rule: can Montreal fight gentrification by banning restaurants? A controversial law limiting new restaurant openings in Montreal’s Saint-Henri area has pitted business owners against those who believe they are fighting for the very survival of Canada’s ‘culture capital’. Who is right? In downtown Montreal, traditionally low rental rates are coming under severe pressure amid a deluge of new restaurants and cafes. Matthew Hays in Montreal Wednesday 16 November 2016 12.30 GMT Last modified on Wednesday 16 November 2016 12.31 GMT In Montreal’s Saint-Henri neighbourhood, the hallmarks of gentrification shout loud and clear. Beautiful old brick buildings have been refurbished as funky shops, niche food markets and hipster cafes. Most notably, there are plenty of high-end restaurants. More than plenty, say some local residents – many of whom can’t afford to eat in any of them. Earlier this month, the city council agreed enough was enough: the councillors of Montreal’s Southwest borough voted unanimously to restrict the opening of new restaurants. The bylaw roughly follows the “one-in-six” rule, with new eateries forbidden from opening up within 25 metres of an existing one. “Our idea was very simple,” says Craig Sauvé, a city councillor with the Projet Montreal party. “Residents need to be able to have access to a range of goods and services within walking distance of their homes. Lots of restaurants are fine and dandy, but we also needs grocery stores, bakeries and retail spaces.” It’s not as though Saint-Henri is saturated with business: a number of commercial and retail properties remain empty. In that environment, some residents have questioned whether it’s right to limit any business. Others felt that something had to be done. Tensions boiled over in May this year, when several restaurants were vandalised by a group of people wearing masks. At the grocery store Parreira Traiteur, which is attached to the restaurant 3734, vandals stole food, announcing they were taking from the rich and giving to the poor. “I was really quite shocked,” says co-owner Maxime Tremblay. “I’m very aware of what’s going on in Saint-Henri: it’s getting hip, and the rents are going up. I understand that it’s problematic. They were under the impression that my store targets people from outside the area, which isn’t really the case. I’ve been very careful to work with local producers and artisans. Why would you attack a locally owned business? Why not a franchise or chain?” Not everyone is sure the change in regulation will work. “The bylaw seems very abstract to me,” says Peter Morden, professor of applied human sciences at Concordia University who has written extensively on gentrification. “I wonder about the logic of singling out restaurants. I think the most important thing for that neighbourhood would be bylaws that protect low-income and social housing.” Alongside restaurants, chic coffee shops have become emblematic of Montreal’s pace of change. As the debate rages, Montrealers are looking anxiously at what has happened to Canada’s two other major metropolises, Toronto and Vancouver. Both cities have experienced huge spikes in real-estate prices and rents, to the point where even upper-middle-class earners now feel shut out of the market. Much of Vancouver’s problem has been attributed to foreign property ownership and speculative buying, something the British Columbia government is now attempting to address. This has led to concern that many of the foreign buyers – mainly Chinese investors – could shift their focus to Montreal. For now, the city’s real estate is markedly cheaper than that of Vancouver or Toronto: the average residential property value is $364,699, compared with Toronto’s $755,755 and Vancouver’s $864,566, according to the Canadian Real Estate Association. And rent is cheaper, too: the average for a two-bedroom apartment in central Montreal is $760, compared with Toronto’s $1,288 and Vancouver’s $1,368. Montrealers have little desire for their city to emulate Vancouver’s glass-and-steel skyline. The reasons for this are debatable – the never-entirely-dormant threat of Quebec separatism, the city’s high number of rental units and older buildings, its strict rent-control laws and a small-court system seen to generally favour the rights of tenants. But regardless of why it’s so affordable, many Montrealers want it to stay that way. There is widespread hostility towards the seemingly endless array of glass-and-steel condos that have come to dominate the Vancouver and Toronto skylines. If Montreal does look a bit grittier than other Canadian cities, it owns a unique cultural cachet. The inexpensive cost of living makes it much more inviting to artists, which in turn makes the city a better place to live for everyone; its vibrant musical scene is the envy of the country, and its film, dance and theatre scenes bolster the city’s status as a tourist attraction. In this context, Montreal’s restaurant bylaw is designed to protect the city’s greatest asset: its cheap rents. “I would argue this is a moderate bylaw,” says Sauvé. “We’re just saying one out of every six businesses can be a restaurant. There’s still room for restaurant development.” He says the restaurant restriction is only part of Projet Montreal’s plans, which also include increased funding for social housing. “Right now, the city sets aside a million dollars a year to buy land for social housing. Projet Montreal is proposing we spend $100m a year. The Quebec government hasn’t helped with its austerity cuts: in the last two budgets, they have cut funding for social housing in half. There are 25,000 people on a waiting list.” Perhaps surprisingly, the provincial restaurant lobby group, the Association des Restaurateurs du Quebec, doesn’t have an issue with the bylaw. “We understand the impact gentrification can have,” says spokesperson Dominique Tremblay. “We understand the need for a diversity of businesses. Frankly, if there are too many restaurants on one street, it’ll be that much harder for them to stay open. There won’t be enough customers to go around.” Even despite having been robbed, Tremblay says he recognises the anxiety that swirls around the subject of gentrification. “People feel a neighbourhood loses its soul,” he says. “I get that. I’d rather we find a dialogue, not a fight.”

Opinion: The pros and cons of life in Montreal A newcomer finds that compared with Toronto, this city has lower rents, but higher taxes; better cycling lanes, but worse roads By Chris Riddell, Special to The Gazette September 2, 2014 4:42 PM MONTREAL — To an outsider, Montreal might seem like the perfect place to live. It has the lowest rents of all the major cities in Canada, it’s the nation’s epicentre of art and culture, and there are more restaurants and cafés than you can visit in a year. When I moved here from Toronto last year, it was mostly for the lower cost of living, but also for the enriching experience of a new culture so different from my own. In Montreal, I could theoretically have a better quality of life than I did in Hogtown, where the rents are some of the highest in the country. But is living in Montreal really all it’s cracked up to be? I hit the streets, speaking to everyday citizens about why they moved to Montreal, and tried to nail down some of the advantages and disadvantages of living here. What I found was interesting. Jesse Legallais, a 31-year-old musician, moved to Montreal from Toronto 10 years ago and hasn’t looked back. Sitting on a bench outside Café Social on a sunny Friday afternoon, he says: “It’s a bit of a slower pace than some of the other major cities and there is a diverse community here. There are a lot of talented people, so you’re kind of kept on your toes, but you don’t have to constantly scrape for work as hard as, say, New York or Toronto or L.A.” Montreal turned out to be the perfect place to nurture his craft as a musician. The cheaper cost of living was one of the main factors drawing him here, along with the bilingual nature of the city. Some people come to Montreal and find it’s a great place to open a business. Take Andre Levert, for example. Originally from St. Catharines, Ont., he moved to Montreal in 2000. Today, he and his wife own a head shop on Prince Arthur St. E. called Psychonaut. “I found that because commercial space and the cost of living is cheaper in Montreal, for starting a business it was less risk in the beginning,” he says. “I went and checked the rent for stores like mine in Ottawa, and it was way more expensive.” Levert stresses that it really is the people that make the city such a great place to live. Many other aspects of Montreal are lacking: language laws and infrastructure are problems that need to be addressed, and the city has its work cut out for it in those areas. It certainly isn’t all sunshine and roses in Montreal. While there are some great advantages to living here, there are also a number of drawbacks. Here is what I’ve noticed. Pro: Cheap rent. I can definitely say that I am not the only person who moved to Montreal from Toronto at least partly for the cheaper rents. According to Numbeo.com, the average rent in Montreal for a one-bedroom apartment in the city centre is $877. In Toronto, a one-bedroom apartment in the city centre goes for an average of $1,463. If you came to Montreal more than 10 years ago, you would have paid even less. “After the referendum they were just giving them away here,” says Legallais. “Especially up in this neighbourhood (Mile End) before it became so trendy. You’d get 6½s, first month free, for $400 or $500.” Con: Taxes are higher. Although the cost of living might be lower here, you are also paying some of the highest taxes in the country. In Quebec we pay 16 per cent provincial income tax on amounts up to $41,095. Add that into the federal rate for the same bracket (15 per cent), and you’re losing almost a third of your paycheque in taxes. Sales tax is also high. Here you pay five per cent goods and services tax and also 9.975 per cent provincial sales tax. This, along with the high income tax rate, could be enough to offset any savings you might enjoy from the cheap rents. Pro: Dépanneurs. Since I’m from a province where the sale and distribution of alcohol is extremely regulated, I think the ability to buy beer at my local corner store is amazing. No matter where you are in Montreal, you’re never too far from an ice cold case of Boréale. Some dépanneurs take it a notch higher by adding extras like sushi bars, craft beer rooms and sandwich shops. Con: The SAQ. I have often said that Montreal is a kind of purgatory for scotch or bourbon drinkers. Finding a bottle of Wild Turkey involved looking up online which SAQ store to go to, and then travelling across town to buy it before the store closed at 6 p.m. Ally Baker, an arts student at Concordia, agrees. She hails from Edmonton and has been living in Montreal for 2½ years. “Coming from a province where it’s not government regulated, I find the selection is a lot less, you’re paying a lot more for whatever you’re getting, and you have to travel a lot more to get to different stores. The hours aren’t that great as well,” she says. Pro: Great parks and cycling lanes. In 2013, Copenhagenize rated Montreal the best city in North America for cycling, and it’s no wonder why. The bike-lane network is excellent, and I have been taking a great deal of time this summer to make effective use of it. The separated lanes especially are fun and make you feel safe. Coming from Toronto, a city with a terrible bike network, this is a very attractive feature for an avid cyclist. The parks in this city are second to none. There are tons of green space to spend time in when the weather is nice, and many of the large parks have facilities for just about every sport you can think of. You are also allowed to drink in public (as long as you have some food), so picnicking is always a popular summer activity. There is certainly no shortage of things to keep you busy in Montreal once the weather warms up. But of course that means ... Con: Cold and snowy winters. Montreal is notorious for long, cold, snowy winters. This past winter was especially brutal, and many Montrealers would agree with me. During these cold months, the city is comparatively dead. This doesn’t mean there is nothing to do, however. There are still events like Igloofest, for example, if you know where to look. But if you expect to survive the season, you will need to adapt. “I’m coming from Michigan, so it wasn’t so much of a shock for me,” says Rochie Cohen, a mother of four in the Côte-des-Neiges area. She has been living in Montreal for 12 years. “We just have to leave the house a half an hour earlier. There is a lot of bundling up: coats, scarves, gloves and boots. It takes a lot longer.” Pro: A world-class cultural scene and laid-back attitude. Montreal is a magnet for young artists looking for a place to develop their craft and connect with like-minded people. Numerous artists, writers and musicians of renown were born here. Not only that, the citizenry is much more laid-back than elsewhere in Canada. “My brother asked me, ‘What can you do in Montreal that you can’t do in Ottawa?’ and I told him basically nothing, but everything you do in Montreal is more entertaining,” says Levert. He adds: “You go to a grocery store and shoot a few jokes with the people in line. It’s a joie de vivre that you don’t get anywhere else.” Con: Language barriers. Language issues have been in the spotlight for a long time in Montreal. It’s virtually impossible to get a decent job if you aren’t bilingual, and it can also be isolating for some people. This is true for anglophones who don’t speak French, but it also goes the other way. Aurore Trusewicz is a freelance translator from Belgium. She came to Montreal to attend McGill University in 2007, and French is her first language. “Even though I was attending an English university, I was just listening to English all the time and not really speaking it,” she says. “I was concerned about that because I knew that in Montreal a lot of people speak English, and I was intimidated about how I would speak with (the customers at work).” Although it was intimidating at first, she stuck with it and polished her English skills with diligent practice. The same can be said for learning French. It can be scary to practise speaking it when you aren’t good at it yet. But if you show a genuine effort, you’ll find there are many people out there willing to help. Pro: Affordable public transit. When I moved here, I looked forward to using Montreal’s affordable and extensive transit system. The cost of a monthly pass is much lower than in Toronto, and the métro covers more of the city, so it’s easy to get around. The stations are also designed with better esthetics than the system of my hometown. “The public transportation system is quite nice compared to other places,” says Trusewicz. “Last year I had the chance to go to Miami, and really, you can’t do anything without a car over there. It’s nice to have a métro and buses, even in the middle of the night, to go wherever you want to go.” Con: Traffic and infrastructure problems. This city is disintegrating around us. After riding my bike around these streets, it’s plain to see that some of the roads are in a pitiful condition. After driving here, it’s also plain to see that the design of some of the highways and intersections is very confusing to someone who hasn’t been living here all his life. Combine this with the heavy amounts of roadwork and construction going on, and you’ve got some very bad traffic problems. The roads and sewers have been neglected for years, and now the city has a tremendous amount of work to do with upgrading its ailing infrastructure. City hall is also hard pressed to find the financing to pay for it. It seems this is one problem that Montrealers are going to have to suffer through for years to come. - - - For and against relocating to Montreal The good: Universities have the lowest tuition rates in the country, making Montreal a popular city for students. Residents enjoy the cheapest electricity in Canada, thanks to Hydro-Québec. Daycare is affordable, due to the reduced-contribution spaces for children 5 or younger; parents pay $7 per day. Operational costs for running a business are the lowest in North America, according to a 2013 KPMG survey. Approximately 2,000 hectares of public parks are spread across 17 large parks and 1,160 small neighbourhood parks. The bad: Many people leave Quebec each year for better job prospects in the rest of Canada (28,439 people left from January to September in 2013). Political corruption and allegations of ties to the Mob have besmirched the city’s image. Montreal has some of the worst traffic congestion in the country. It seems essential to be bilingual in order to build a life here; that can be hard for newcomers. Part of the city’s water system is well over 100 years old and prone to leaks. Boil-water advisories have been issued in the past. Chris Riddell is a freelance journalist and copywriter who lives in Côte-des-Neiges.

Bay Street still has Canada’s most expensive office space http://renx.ca/bay-street-still-canadas-expensive-office-space/ Bay Street in Toronto has the most expensive office space in Canada, and no other city comes close to matching the $68.52 per square foot average rent that’s being asked for in the heart of the country’s financial district. JLL Canada recently released its “Most Expensive Streets for Office Space” report, which ranks Canadian cities by their highest asking rents. It shows many companies are still willing to pay a premium for the most expensive spaces, and competition is growing to get into prominent financial, retail and government hubs. “The most significant trend that we are seeing across major markets is that there are a large number of new developments underway,” said JLL Canada president Brett Miller. “Although we have only seen minor changes to the top market rents thus far in 2014, we anticipate that as the new inventory comes to market, overall rents will decrease in the older class-A stock whilst headline rents in new developments may raise the top line rents.” Here are the most expensive streets in nine major Canadian cities 1. Bay Street, Toronto, $68.52 per square foot Bay Street held strong in first place for the fourth year running. It features the headquarters of major Canadian banks and is home to many investment banks, accounting and law firms. Brookfield Place, at 161 Bay St., continues to command the highest office rents of any building in Canada at $76.54 per square foot. The average market rent in Toronto is $34.82 per square foot. (Bay St. looking north from Front St. shown in the image,) 2. 8th Avenue SW, Calgary, $59.06 per square foot 8th Avenue SW again has the highest average gross office rents in Calgary. Large vacancies and availabilities along this corridor typically account for significant activity and command market-leading rates. Large oil and gas companies have historically clustered around the central business district in this area. The top rent on the street is $64.40 per square foot and the average market rent in Calgary is $46 per square foot. 3. Burrard Street, Vancouver, $58.87 per square foot Burrard Street has dropped to third place despite a slight increase in average asking rent from $58.47 in 2013. Approximately 18.3 per cent of downtown class-A office supply is located on Burrard Street between West Georgia Street and Canada Place. The vacancy rate in these six buildings sits at 1.6 per cent, which justifies this location commanding some of the highest rental rates in the city despite the impending influx of new supply that’s putting downward pressure on rents throughout the central business district. The top rent on the street is $66.06 per square foot and the average market rent in Vancouver is $38.81 per square foot. 4. Albert Street, Ottawa, $52.10 per square foot Albert Street remained in fourth position with average rents decreasing slightly from $53.40 per square foot. Albert Street is mainly home to government-related office towers, including numerous foreign embassies, and a few of the largest Canadian business law firms. There seems to be a wait-and-see approach in anticipation of the 2015 federal election regarding the government’s intentions to lease or return more space to the market. The top rent on the street is $53.54 per square foot and the average market rent in Ottawa is $30.90 per square foot. 5. 101st Street NW, Edmonton, $46.71 per square foot The average asking rent dropped from $48.19 per square foot, but 101st Street NW is expected to remain the most expensive in Edmonton with the recent commitment to build the arena district, a large-scale, mixed-use project incorporating the city’s new National Hockey League arena. This is expected to revitalize some of the most important corners on the street. The top rent on the street is $54.15 per square foot and the average market rent in Edmonton is $28.30 per square foot. 6. René-Lévesque W, Montreal, $44.28 per square foot The average gross rent on the street hasn’t changed significantly year over year, but the total value of tenant inducement packages has nearly doubled. The most expensive building on the street (1250 René-Lévesque W) rents for $52.76 per square foot but has seen some downward pressure of two to four dollars on its net rent due to 170,000 square feet of vacant space left behind by Heenan Blaikie. The average market rent in Montreal is $30.38 per square foot. 7. Upper Water Street, Halifax, $36.42 per square foot Upper Water Street has maintained seventh place despite its average asking rent dropping from $36.65 per square foot last year. New construction coming on stream is expected to put downward pressure on rents in existing office buildings. The top rent on the street is $36.62 per square foot and the average market rent in Halifax is $27.44 per square foot. 8. Portage Avenue, Winnipeg, $35.67 per square foot Portage Avenue held strong in eighth place, with its average rent increasing from $35.17 per square foot. The class-A market remains tight and is expected to remain so through 2015. The top rent on the street is $37.32 per square foot and the average market rent in Winnipeg is $23.62 per square foot. 9. Laurier Boulevard, Québec City, $27.50 per square foot Laurier Boulevard held its ninth-place position despite the average rent dropping from $28.14 per square foot. There’s been no notable increase in the average gross rent and the vacancy rate on the street remains low at 5.2 per cent compared to the rest of the market’s 7.8 per cent. The top rent on the street is $28.98 per square foot and the average market rent in Québec City is $21.89 per square foot. JLL manages more than 50 million square feet of facilities across Canada and offers tenant and landlord representation, project and development services, investment sales, advisory and appraisal services, debt capital markets and integrated facilities management services to owners and tenants.

http://www.bloomberg.com/news/2013-07-31/downtown-nyc-landlords-remake-offices-in-shift-from-banks.htmlDowntown NYC Landlords Remake Offices in Shift From Banks By David M. Levitt - July 31, 2013 David Cheikin is betting that skateboard millionaires will be happy where the Thundering Herd once roamed. As vice president of leasing for Brookfield Office Properties Inc. (BPO), Cheikin is leading the push to remake lower Manhattan’s former World Financial Center into a destination for technology and media companies. Once home to the Merrill Lynch & Co., the brokerage firm known for its bull logo, the Hudson riverfront complex is now Brookfield Place New York, and much more than the name is changing. Brookfield is stripping away brass and marble trims and adding bicycle parking, free Wi-Fi in public spaces and electric-car charging stations. At Merrill’s former headquarters, clear glass is replacing the imposing, dark-tinted facade built as a barrier to the public, Cheikin said. “We’re just trying to work out ways to make it more in line with how people want to work today,” he said. Downtown landlords with millions of square feet of empty space are transforming offices that were designed for the global financial elite to better appeal to New York’s technology and media firms. They’re pitching their properties as an alternative to the converted factories of midtown south, where a frenzy of demand has pushed up rents and driven vacancies to the lowest in the U.S. The image makeover is only part of the challenge as the area faces a glut of space from skyscrapers that are nearing completion at the World Trade Center site. Empty Space Consolidating financial companies have left landlords with at least 6.3 million square feet (585,000 square meters) of space to fill, almost 7 percent of the lower Manhattan office market, according to data from brokerage Newmark Grubb Knight Frank. Another 2.4 million square feet remains unrented at two new trade center towers scheduled for completion by mid-2014. At Brookfield Place, vacancies loom on about a third of its 8 million square feet. Across the street at 1 World Trade Center, the Durst Organization is preparing a marketing campaign to convince creative firms that they’ll feel at home in the Western Hemisphere’s tallest building. Almost half of the tower, scheduled to open next year, is available for lease. Durst, equity partner with the Port Authority of New York and New Jersey on the 1,776-foot (541-meter) skyscraper, is targeting companies that are in “phase-two growth, after the incubation startup stages,” said Tara Stacom, the Cushman & Wakefield Inc. vice chairman who is working with the developers on the leasing effort. New Construction “There’s something that the new construction can accommodate for all these tech users that the old construction can’t, and that is growth,” Stacom said. “A lot of these tenants are one size today, and they’re 200 times that size in less than a decade, and in some cases less than half a decade. We’re only now going out to speak to this audience.” Tenants could agree to take a small space at first, then expand into larger offices in the tower, Stacom said. As rents soar in the older buildings of midtown south, available government incentives and the efficiencies of new real estate would make the trade center more cost-effective, even at an asking rent of $75 a square foot, among the highest for downtown, she said. The tower’s open, column-free space offers more flexibility and the developers are even ready to duplicate a look that’s become popular with technology firms, leaving the ductwork exposed, Stacom said. Space ‘Mismatch’ About 1.4 million square feet are unspoken for in the skyscraper, which is slated to open to tenants next year and will have Conde Nast Publications Inc. as its anchor tenant. Another 1 million square feet are available at Silverstein Properties Inc.’s 4 World Trade Center, to open before year-end. There’s “a mismatch between the unprecedented amount of class A space currently available and the preferences of the tech sector for loft space in a neighborhood with a non-corporate vibe,” according to tenant brokerage Studley Inc. “Tech and creative-sector companies in Manhattan are indisputably growing by leaps and bounds,” Steven Coutts, senior vice president for national research at New York-based Studley, said in a July 24 report. “Nevertheless, this sector still lacks the heft to fill the void” left by contracting banks and other traditional office users, such as accounting and insurance companies. Lowest Rents Downtown Manhattan has the lowest rents and the highest office availability of the borough’s three major submarkets. The availability rate -- empty space and offices due to become vacant within 12 months -- was almost 16 percent at the end of June, up from 10.8 percent a year earlier, data from CBRE Group Inc. show. Asking rents jumped 20 percent to an average of $47.13 a square foot, a reflection of landlords’ expectations for the high-end space added to the market in the past year, according to Los Angeles-based CBRE. Rents in midtown south -- including such neighborhoods as Chelsea, the Flatiron District and Soho -- averaged $63.44 a square foot and the availability rate was 10 percent. Brookfield has about 2.7 million square feet of former Merrill offices to fill at its namesake complex. Bank of America Corp. (BAC), which took over the space when it bought Merrill in 2009, is keeping about 775,000 square feet and will stop paying rent on the rest in September when its leases expire. At Merrill’s former headquarters at 250 Vesey St., the vacant restaurant that once housed the Hudson River Club, where brokers dined on grouse and pheasant, has been removed. It’s now an open area where anyone can gaze at the Statue of Liberty in the distance. The change is part of a $250 million makeover of the World Financial Center’s retail space that will include an upscale food market and eateries that overlook the marina. Transit Hub Another selling point, according to Cheikin, will be the completion in the next two years of a $3.94 billion transit hub designed by the Spanish architect Santiago Calatrava. Brookfield is close to completing a 55-foot glass entryway supported by a pair of cyclone-shaped steel columns that will link Brookfield Place with the transportation center. Across town on the East River waterfront, SL Green Realty Corp. (SLG) is marketing about 900,000 square feet at 180 Maiden Lane, a black-glass tower south of the Brooklyn Bridge. Most of that is space that American International Group Inc. (AIG), once the world’s largest insurer, will vacate next year. SL Green, Manhattan’s biggest office landlord, is spending $40 million on renovations that include making over the interior plaza, as well as AIG’s cafeteria, auditorium and health club to transform them into “communal-type amenities,” said Steve Durels, director of leasing. Soul Cycle “I want the cafeteria to look like it’s a Starbucks, and I want the fitness center to look like it’s a Soul Cycle,” Durels said. “And I want the auditorium to look like the presentation space you’d find in a W Hotel.” Most importantly, he said, the ground-floor atrium will work like an indoor park, with seating areas where people can get a coffee and work on their laptops. Half of the floor will be covered in artificial turf, where tenants could arrange a volleyball, badminton or bocce game. So far, downtown landlords’ efforts to land creative firms have borne little fruit. Some of the industry’s biggest names -- Yahoo! Inc., EBay Inc., LinkedIn Corp., Microsoft Corp. and Facebook Inc. -- have opted to go elsewhere. Yahoo took four floors in the century-old former New York Times headquarters in Midtown, while LinkedIn went to the 82-year-old Empire State Building. EBay chose a onetime department store on Sixth Avenue in Chelsea that dates back to the 1890s, when the corridor was known as Ladies’ Mile. ‘Iconic’ Firms Facebook went to the East Village, taking about 100,000 square feet in 770 Broadway, which was designed in 1905 by Daniel Burnham, the architect who conceived the Flatiron Building. The social-media company joins tenants including AOL Inc. and the Huffington Post in the 15-story property. “Those firms are all iconic,” said Miles Rose, founder of SiliconAlley.com, a Web-based community for New York’s emerging technology industry. “The big, plain boxes don’t work for either their corporate culture or their workers. Older, iconic buildings have character and they have presence.” Of the 50 largest Manhattan leases made by technology, media, information and fashion tenants in the past two years, only 10 were in buildings completed later than 1970, according to Compstak Inc., a New York-based provider of leasing data. When 10gen Inc., maker of MongoDB data-management software, sought to expand out of its Soho offices last year, “downtown wasn’t exactly right for us,” said Eliot Horowitz, co-founder and chief technology officer. “We wanted some place that was pretty wide-open and feeling kind of lofty. We sort of wanted a Soho feel, but with a lot more flexibility and a lot more space than you can actually get in Soho.” Older Buildings 10Gen wound up taking about 32,000 square feet at the Times Building, he said. This month, it expanded its commitment to almost 50,000 square feet. Some creative companies that have gone downtown have favored the market’s older buildings. When HarperCollins Publishers Ltd. agreed to leave its longtime Midtown headquarters, it took 180,000 square feet at 195 Broadway, a colonnaded tower built in 1916 that was originally the American Telephone & Telegraph Co. building. WeWork, a company founded three years ago to provide shared office space to startups, took 120,500 square feet at 222 Broadway, a 27-story property completed in 1961 that once housed Merrill offices. Brooklyn Projects Brooklyn, across the East River from lower Manhattan, may emerge as competition for technology and media tenants. Developers have plans for about 630,000 square feet of offices at the former Domino Sugar plant on the Williamsburg neighborhood’s waterfront. In an industrial district near the Brooklyn Bridge, 1.2 million square feet of buildings long-owned by the Jehovah’s Witnesses are under contract to be sold to a partnership that may make much of the space into offices. New York’s Economic Development Corp. projects that fast-growing technology companies will need an additional 20 million square feet of space over the next 12 years, and they’ll be seeking rents of less than $40 a square foot. Melissa Coley, a Brookfield spokeswoman, declined to say what rents it’s seeking at Brookfield Place. The landlord last week said it had rented about 191,000 square feet combined to Bank of Nova Scotia, Oppenheimer Funds Inc. and fitness-club chain Equinox Holdings Inc. Earlier this year, it landed GFK SE, a German retail-research firm, for 75,000 square feet at 200 Liberty St., formerly 1 World Financial Center. GFK is moving from an older building in Chelsea. Trade Center The World Trade Center site is poised to get its second large media tenant. GroupM, an advertising planning and placement firm owned by WPP Inc., is working on terms to lease 515,000 square feet at 3 World Trade Center, according to two people with knowledge of the talks. The skyscraper, slated for completion in 2016, is being developed by Larry Silverstein, who considered capping the tower at seven stories if he couldn’t land an anchor tenant. If he goes ahead with building it to the full 80-story height, he’ll have another 2 million square feet to fill. The 70,000-square-foot spaces planned for 3 World Trade Center, called “trading floors” on the developer’s website, can be designed for “any industry,” according to Jeremy Moss, Silverstein’s director of leasing. GroupM is planning to use some of the five base floors, according to the people. Greg Taubin, a broker at Studley who represented 10gen, said certain technology tenants will be tempted by landlords’ efforts, while others “won’t go below 14th Street, period.” “It’s very tenant-specific,” he said. “But as midtown south continues to be tight for these types of tenants, certain buildings downtown will be the beneficiaries of this.” To contact the reporter on this story: David M. Levitt in New York at dlevitt@bloomberg.net To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net ®2013 BLOOMBERG L.P. ALL RIGHTS RESERVED.

(Courtesy of The Globe and Mail) I am quite surprised Montreal and Honolulu were so close together. Plus Oahu quite expensive, but I guess compared to other islands its cheaper. Honolulu has way more high end boutiques. Even Ala Moana shopping mall full of high end stores. The most predominate tourist in these high end boutiques are Japanese or were. Seeing I haven't been to Honolulu in quite a while. Last time I was there. There was more and more Russians. Could have changed, more Chinese could have been coming also. Plus I am also surprised Montreal and Toronto were tied. I would have thought Toronto would have been a few hundred bucks more expensive.

Trouble on The Main The former home of American Apparel on St. Laurent Blvd. now carries a For Rent sign. “I won’t deny that the construction on the street did affect traffic,” says Dan Abenhaim, the chain’s Canadian regional director. Other shop owners say the recession and high rents have hurt business on along the strip. Photograph by: John Mahoney, The Gazette By Irwin Block, The GazetteApril 24, 2009 The former home of American Apparel on St. Laurent Blvd. now carries a For Rent sign. “I won’t deny that the construction on the street did affect traffic,” says Dan Abenhaim, the chain’s Canadian regional director. Other shop owners say the recession and high rents have hurt business on along the strip. It’s known to generations as The Main and it’s as Montreal as smoked meat and the Habs. St. Laurent Blvd. is us, and in tribute to its Portuguese component, city officials on Friday inaugurated a dozen marble-topped benches between Bagg and Marie Anne Sts. But things are not going that well for some merchants, especially on the trendiest part of the street between Sherbrooke St. and Pine Ave. It’s still home to such fancy eateries as Buona Notte and Primadonna, but in the past months several major tenants have closed. They include an American Apparel store and a Mac Cosmetics outlet; the space formerly occupied by Sofia Grill at the northwest corner of Prince Arthur St. and St. Laurent is for rent, as are several other shops farther north. Dan Abenhaim, American Apparel’s Canadian regional director, said that after five years the firm decided not to renew the lease. “I won’t deny that the construction on the street did affect traffic and we decided we want to open in another location.” He also said that over five years “the street has changed and the traffic is more north of Pine Ave.” However, clothing shops are also hurting north of Pine, where Adam & Lilith has closed one of two adjoining shops on St. Laurent. According to assistant manager Carmel Pacaud, people are still attracted to the street but they are not buying as they used to. Other shop owners blame almost two years of disruptive road repairs that ended last year, as well as the recession and high rents. “The city has murdered the street,” said one real estate agent, who spoke on the condition his name not be used. People who were put off by the construction are not coming back and there is a moratorium on new restaurants and bars between Sherbrooke and Mount Royal Ave., he added. Rent at the former Mac Cosmetics store is about $7,500 a month for 1,600 square feet. Rents tend to decrease north of Pine. “It’s a little distressing, slower than usual” remarked Marnie Blanshay, who owns Lola & Emily ladies wear just south of the abandoned American Apparel. Many who were discouraged from shopping there by the ripping up and repaving of the strip have not returned, she observed. And because few retail clothing shops remain, hers is more of a “destination store” with fewer shoppers coming by to go from store to store checking out and comparing. “It reminds me of Crescent St. in the 1990s,” she said, adding that “the landlords believe it’s better than it is and need to reduce rents.” When rents go down, the creative people will return to reinject the street’s normal vitality, she said. “St. Laurent Blvd. is not a street where chains succeed.” Apart from Jean Coutu and Pharmaprix, American Apparel was the only chain outlet on the street, noted André Beauséjour, executive director of the Société de développment du Boulevard St. Laurent. He said the vacancy rate between Sherbrooke and Mount Royal is a “normal” two per cent. A stroll up the boulevard yesterday indicated that many stores that have become institutions – Bar Bifteck, Salaison Slovenia, Schreter’s, Coco Rico, Moishe’s, Segal’s grocery, Berson Monuments – are still going concerns. And there was the proverbial lunchtime lineup inside Schwartz’s. But if you have a concept, there is lots of space for rent, including the former Laurentian Bank at St. Laurent and Pine. – all 5,400 square feet. iblock@thegazette.canwest.com © Copyright © The Montreal Gazette

``What happens in the next leg down? We obviously have a huge crisis in financial institutions, but the crisis in the economy is just beginning to be felt,'' Bonderman told a private equity conference in Hong Kong today. ``The global recession is likely to be a deep one and a prolonged one, not a V-shape, not a U-shape, more an L-shape one.'' The credit contagion that began with a surge in subprime mortgage delinquencies is driving the U.S., European and Japanese economies toward recession, and prompted China to unveil a $586 billion stimulus package. The International Monetary Fund last week predicted economic contractions next year in the U.S., Japan and the euro region, the first simultaneous recession since the end of World War II. David Rubenstein, the 59-year-old co-founder of Washington- based Carlyle Group, echoed Bonderman's pessimism. Rubenstein said at the Hong Kong conference that the recession will last for at least a year, and that U.S. unemployment may rise as high as 10 percent. U.S. housing prices may have ``a significant way'' to fall because they're still high by historical standards and sliding rents are reducing the allure of home ownership, said Bonderman, whose firm's funds oversee more than $50 billion. Prices `Way High' TPG's fourth buyout fund, launched in 2003, has delivered average annual returns of 31 percent, according to the California Public Employees' Retirement System, an investor in a number of TPG's funds. Home prices in 20 U.S. metropolitan areas slid 17 percent in August as foreclosures rose, according to the S&P/Case-Shiller price index. ``Housing prices are still way high by historical standards,'' Bonderman said.

Market’s Troubles Echo in a Building’s Vacant Floors Article Tools Sponsored By By CHARLES V. BAGLI Published: November 9, 2008 The elevators work fine, the views are great, the offices have been refurbished and no one is complaining about rats. In so many ways, the green-tinted, 41-story office tower overlooking Bryant Park seems a desirable address. So why are tenants who rushed to rent space a year ago in the building, at 1095 Avenue of the Americas, rushing to break their leases now? The answer says much about the increasingly precarious state of Midtown Manhattan’s real estate market at a time when once-mighty financial companies like Lehman Brothers are disappearing and the slowing economy is driving the vacancy rate up and commercial rents down. Though the building, once owned by Verizon, just went through a two-year, $250 million makeover, several financial firms that signed leases in 2006 and 2007 say they no longer can afford the rents or the cost of outfitting new spaces. Others are laying off workers or reorganizing their offices and no longer need as much room. The first sign of trouble came over the summer when iStar Financial, a real estate finance company, decided not to move into the 100,000 square feet of space that it had rented on the 36th, 37th and 38th floors. Several weeks later, Metropolitan Life Insurance, whose name is now in block letters over the tower’s front doors, quietly began shopping for tenants to sublease 100,000 square feet of its space in the building, a quarter of what it signed up for in 2006. And last month, Centerline Capital Group, a suddenly struggling commercial property finance and investment company, confirmed that it would not be moving into its 100,000 square feet of space on the third, fourth and fifth floors. The company is negotiating with the landlord, the Blackstone Group, to buy out its lease or to sublet the space, said real estate executives who have been briefed on the talks. The companies signed leases for as much as $132 a square foot, when the market was near its peak. Despite the building’s new glass skin, refurbished space and prime location at the corner of 42nd Street, many brokers say they would be lucky to get $95 a square foot today. The difference would translate into millions of dollars a year. Neither iStar nor MetLife have found any takers. For landlords and brokers, the building has become a closely watched barometer of the commercial real estate market in Midtown, where the mercury is clearly falling. Although the rents being asked have hardly moved, brokers say that landlords are providing a menu of concessions that are substantially reducing the effective price. “It’s definitely a microcosm of the last few years in the New York real estate market,” said Peter Riguardi, president of Jones Lang LaSalle, a real estate brokerage and advising company. The problems at 1095 Avenue of the Americas are not hurting Blackstone so far. The combined unused space of Centerline, MetLife and iStar accounts for roughly one-third of the 1.06 million square feet owned by Blackstone in the building, and the three companies are obligated to pay full rent even if they are unable to sublease the space. Brokers say that Blackstone would require the companies to pay dearly to break their leases. But trouble could emerge if any of the companies tumble into bankruptcy court and stopped paying rent. Other tenants seem to be staying put. Dechert L.L.P., a law firm and the first tenant to sign a lease in 2006, is moving onto floors 25 through 31, and Bank of Scotland is occupying its two floors, 34 and 35. MetLife is moving into its space at the top of the tower, even as it tries to sublease its space in the middle. And Robert Alexander, chairman of the New York office of CB Richard Ellis, the real estate brokerage for the tower, said he had pending deals for two other vacant floors, 32 and 33. “We’re signing smaller deals at premium rents, and we look forward to finishing our leasing program,” he said. Brokers familiar with the space offered by iStar, MetLife and Centerline say competition for tenants in Midtown is growing in part because there is ample renovated space available in other buildings. As a result, many companies are demanding rent concessions from landlords or are refusing to take on the cost of adding walls, carpeting and bathrooms to newly renovated space. “What’s missing right now is the demand for raw space,” said one broker, who requested anonymity because he was active at the former Verizon building and he did not want to alienate the landlords or other brokers. The building was constructed in 1974 with vertical white marble slabs and few windows to house switches and other equipment for New York Telephone, which became Verizon. In 2005, as rents and sales prices for commercial buildings were skyrocketing, the company put the tower on the market, with the exception of 234,000 square feet on Floors 6 through 12. Equity Office Properties, one of the largest commercial real estate owners in the country, won a hotly contested auction with a bid of $506 million, more than Verizon had anticipated. At the time, many analysts suggested that Equity Office had overpaid, especially after the new owner started a $250 million renovation that included replacing the marble exterior with a glass skin. Equity Office, however, was betting that the tower would lure prime tenants and generate rents as high as $90 a square foot. And it was right: Rents escalated even higher as the vacancy rate in Midtown plunged and investors clamored to buy properties. Blackstone bought Equity Office for $39 billion in early 2007, at what turned out to be the height of the market. It sold most of Equity’s New York buildings but held on to 1095 Avenue of the Americas. The firm signed leases last year with Bank of Scotland and Centerline for as much as $150 a square foot, brokers active at the tower said. MetLife’s average effective rent, for floors in the middle and at the top, is about $100 a square foot, or $40 million a year, according to real estate executives familiar with the deal. The insurance giant had moved most of its New York employees to Long Island City in 2002, where rents were as low as $30 a square foot. But in 2006, MetLife reversed course, signing a lease to move about 1,300 employees from Queens into the former Verizon building. But this year, the company reassessed how many employees were actually in the office at any one time and determined that it needed only 9 of the 12 floors it had leased in the tower. So early next year, MetLife plans to formally market three of its floors, said John Calagna, a spokesman for MetLife. Mr. Calagna said that the same number of people who moved into 1095 Avenue of the Americas two years ago, about 1,300, are now “moving to less space.”

New York Times, October 1, 2008 Failed Deals Replace Boom in New York Real Estate By CHARLES V. BAGLI After seven years of nonstop construction, skyrocketing rents and sales prices, and a seemingly endless appetite for luxury housing that transformed gritty and glamorous neighborhoods alike, the credit crisis and the turmoil on Wall Street are bringing New York’s real estate boom to an end. Developers are complaining that lenders are now refusing to finance projects that were all but certain months or even weeks ago. Landlords bewail their inability to refinance skyscrapers with blue-chip tenants. And corporations are afraid to relocate within Manhattan for fear of making the wrong move if rents fall or a flagging economy forces layoffs. “Lenders are now taking a very hard look at each particular project to assess its viability in the context of a softening of demand,” said Scott A. Singer, executive vice president of Singer & Bassuk, a real estate finance and brokerage firm. “There’s no question that there’ll be a significant slowdown in new construction starts, immediately.” Examples of aborted deals and troubled developments abound. Last Friday, HSBC, the big Hong Kong-based bank, quietly tore up an agreement to move its American headquarters to 7 World Trade Center after bids for its existing home at 452 Fifth Avenue, between 39th and 40th Streets, came in 30 percent lower than the $600 million it wanted for the property. A 40-story office tower under construction by SJP Properties at 42nd Street and Eighth Avenue for the past 18 months still does not have a tenant. And the law firm of Orrick, Herrington & Sutcliffe last week suddenly pulled out of what had been an all-but-certain lease of 300,000 square feet of space at Citigroup Center, deciding instead to extend its lease at 666 Fifth Avenue for five years, in part because they hope rents will fall. “Everything’s frozen in place,” said Steven Spinola, president of the Real Estate Board of New York, the industry’s lobbying association, shortly after the stock market closed on Monday. Barry M. Gosin, chief executive of Newmark Knight Frank, a national real estate firm based in New York, said: “Today, the entire financial system needs a lubricant. It’s kind of like driving your car after running out of oil and the engine seizes up. If there’s no liquidity and no financing, everything seizes up.” It is hard to say exactly what the long-term impact will be, but real estate experts, economists and city and state officials say it is likely there will be far fewer new construction projects in the future, as well as tens of thousands of layoffs on Wall Street, fewer construction jobs and a huge loss of tax revenue for both the state and the city. Few trends have defined the city more than the development boom, from the omnipresent tower cranes to the explosion of high-priced condominiums in neighborhoods outside Manhattan, from Bedford-Stuyvesant and Fort Greene to Williamsburg and Long Island City. Some developers who are currently erecting condominiums are trying to convert to rentals, while others are looking to sell the projects. After imposing double-digit rent increases in recent years, landlords say rents are falling somewhat, which could hurt highly leveraged projects, but also slow gentrification in what real estate brokers like to call “emerging neighborhoods” like Harlem, the Lower East Side and Fort Greene. At the same time, some of Mayor Michael R. Bloomberg’s most ambitious large-scale projects — the West Side railyards, Pennsylvania Station, ground zero, Coney Island and Willets Point — are going to take longer than expected to start and to complete, real estate experts say. “Most transactions in commercial real estate are on hold,” said Mary Ann Tighe, regional chief executive for CB Richard Ellis, the real estate brokerage firm, “because nobody can be sure what the economy will look like, not only in the near term, but in the long term.” Although the real estate market in New York is in better shape than in most other major cities, a recent report by Newmark Knight Frank shows that there are “clear signs of weakness,” with the overall vacancy rate at 9 percent, up from 8.2 percent a year ago. Rents are also falling when landlord concessions are taken into account. The real estate boom has been fueled by a robust economy, a steady demand for housing and an abundance of foreign and domestic investors willing to spend tens of billions of dollars on New York real estate. It helped that lenders were only too happy to finance as much as 90 percent of the cost on the assumption that the mortgages could be resold to investors as securities. But that ended with the subprime mortgage crisis, which has since spilled over to all the credit markets, which have come to a standstill. As a result, real estate executives estimate that the value of commercial buildings has fallen by at least 20 percent, though the decline is hard to gauge when there is little mortgage money available to buy the buildings and therefore few sales. Long after the crisis began in 2007, many investors and real estate executives expected a “correction” to the rapid escalation in property values. But after Lehman Brothers, the venerable firm that had provided billions of dollars of loans for New York real estate deals, collapsed two weeks ago, it was clear that something more profound was afoot. And there was an immediate reaction in the real estate world: Tishman Speyer Properties, which controls Rockefeller Center, the Chrysler Building and scores of other properties, abruptly pulled out of a deal to buy the former Mobil Building, a 1.6 million-square-foot tower on 42nd Street, near Grand Central Terminal, for $400 million, two executives involved in the transaction said. Commercial properties are not the only ones facing problems. On Friday, Standard & Poor’s dropped its rating on the bonds used in Tishman’s $5.4 billion purchase of the Stuyvesant Town and Peter Cooper Village apartment complexes in 2006, the biggest real estate deal in modern history. Standard & Poor’s said it cut the rating, in part, because of an estimated 10 percent decline in the properties’ value and the rapid depletion of reserve funds. The rating reduction shows the growing nervousness of lenders and investors about such deals, which have often involved aggressive — critics say unrealistic — projections of future income. “Any continued impediment to the credit markets is awful for the national economy, but it’s more awful for New York,” said Richard Lefrak, patriarch of a fourth-generation real estate family that owns office buildings and apartment houses in New York and New Jersey. “This is the company town for money,” he said. “If there’s no liquidity in the system, it exacerbates the problems. It’s going to have a serious effect on the local economy and real estate values.”

Condos, costs squeeze Vancouver office space DAVID EBNER From Monday's Globe and Mail June 29, 2008 at 10:33 PM EDT VANCOUVER — The numbers, at first glance, couldn't look better for a commercial real estate developer. On the small peninsula that constitutes downtown Vancouver, there's barely any available office space. The 2.6-per-cent vacancy rate ranks as the lowest of any city core in North America. And rents are soaring, with the cost of prime office space jumping 25 per cent in just one year to more than $34 per square foot. Yet hardly any new commercial space is being built. Just 130,000 square feet is under construction in downtown Vancouver, which would add less than 1 per cent to what exists. It's a fraction of what's happening elsewhere: Calgary's downtown is expanding by 5.6 million square feet, or 17 per cent, and Toronto is growing by 3.8 million square feet, or 5 per cent. Construction costs have risen far faster than rents, driven by a Western Canadian construction boom that has made labour scarce and expensive, and the climbing cost of materials such as steel. Vancouver developers say they just can't make the numbers add up for new projects. In Calgary, for example, the energy boom allows developers to charge $45 a square foot, a third more than they can get in the Vancouver market. “It takes a lot of nerve to build today,” said Don Vassos, a senior vice-president at real estate services firm CB Richard Ellis Ltd. who opened the company's Vancouver office 24 years ago. Since then, the downtown has gone through a transformation that helped produce the current shortage of commercial space. It's a trend the city now hopes to reverse. In the 1980s and 1990s, planners and politicians set about creating the Vancouver that currently exists, one consistently on best-places-to-live lists. Under the rubric of “living first,” the city heavily promoted residential development downtown, pushing the population on the peninsula to 90,000, more than double the 40,000 or so in the mid-1980s. But the dozens of residential condominiums have begun to squeeze the commercial core. Four years ago, alarm bells started going off for planners when Duke Energy sold the landmark Westcoast Transmission building for a condo conversion. That provoked the city to impose a temporary halt on such changes in the central business district. With developers predicting that Vancouver will run out of space to build new commercial buildings in the next 20 years, city council is poised to encourage construction of more office space. In July, it will consider a series of proposals from planners that include an expanded central business district, tighter rules on condo conversions and proposals to allow taller towers with more density. Until things change, however, businesses will continue to feel the squeeze. Part of the problem, developers say, is that condos are far more profitable than commercial space because residential buyers are willing to pay large premiums for benefits such as views of the ocean and mountains. And unlike Calgary and Toronto, where large corporations drive demand for many storeys of commercial space, the typical Vancouver tenant is more likely to be a law firm or upstart technology company requiring far less space. Developers have to sign on many more tenants to make a project work instead of landing one big name. Some Vancouver developers say the city has to take measures to encourage new commercial buildings that go beyond the proposals city planners have put together. “They need to address costs,” said Tony Astles, executive vice-president for B.C. at Bentall Real Estate. “And they need to address the length of time it takes to go through the whole process, from zoning to approvals. “It's a clogged-up system. Right now, it's very difficult to rationalize a high-rise office tower in downtown Vancouver. The costs of construction have risen so fast that rents – even though they're at their all-time high – haven't kept up.” http://www.reportonbusiness.com/servlet/story/RTGAM.20080629.wrdowntown30/BNStory/Business/home