581 replies to this topic

[Nparker]

This property has a large sign on it … listing it for sale.

Such a prime development site. 

[zoomer]

Combined with the Golden City lot, this has great development potential. Hopefully Townline and not Starlight is interested. Worried that Starlight is collecting too many properties and may hold onto empty lots longer term.

[Mike K.]

Why would you be worried? Starlight will be building the highest volume of rental housing under one company’s control, quite likely ever, next year.

[zoomer]

Exactly because of that. They have other holdings and if they continue to add they may stagger builds over a period of a decade. If a different developer/investment firm purchased they would likely proceed more quickly.

[Mike K.]

Would they? Or maybe they’d bank it for 20 years. Or maybe they’d turn it into a parking lot. Or maybe they’d pursue a proposal that would never see the light of day.

You’re talking about a property that was supposed to have been redeveloped into an office building by 2009.

[zoomer]

Exactly. REITs, investment firms are in this for the long term. They are often based out of Ontario and could care less about empty lots in downtown Victoria. We've managed to have very few of those the past decade in downtown Victoria (Gateway Green being one of them), they can be held by local owners, but the odds of more (and larger) empty lots increases when they are not owned by dedicated development companies.

[Mike K.]

That’s complete gobbledygook.

[Kapten Kapsell]

I think the challenge that Gateway Green had was that they just couldn't compete with Jawl Office to line up tenants.  This isn't due to anything nefarious on Jawl's part:  Jawl simply has long-standing relationships with many major office tenants in town, and their buildings are well-run and highly regarded (even the retail tenant mixes on the ground levels tend to heavily favour local businesses and cafes).  I believe Jawl likely has an anchor tenant lined up for its planned office redevelopment of the Capital 6, and that building is still in its initial planning stages; Gateway Green had approvals in place years ago but failed to line up any tenants.  Tri-Eagle seems to have had more success in its suburban office buildings as these generally don't compete directly with Jawl.

 

My assumption is that this site will be redeveloped as rental apartments unless it's bought by Jawl.

[Mike K.]

Tri-Eagle also has an office building in the 900-block of Fort Street that I believe was co-developed with Jawl Residential (not affiliated with Jawl Properties)?

[Nparker]

That's a good assessment KK.

[Kapten Kapsell]

Tri-Eagle also has an office building in the 900-block of Fort Street that I believe was co-developed with Jawl Residwntial? (Not affiliated with Jawl Properties).

You're right, and I think that has been a success - in part- due to its smaller overall scale compared to the Gateway Green proposal... I would also say that 900 Fort Street is similar to their successful buildings in Saanich and elsewhere in that it offers 'boutique' space to law firms and smaller companies rather than larger 'headquarters' style spaces.

Edited by Kapten Kapsell, 24 November 2021 - 10:28 AM.

[zoomer]

That’s complete gobbledygook.

Ok, let's try this one more time in case I'm not being clear. Fine if you don't agree with the assumption, but I think it's a fair one.

Starlight has 23 billion worth of assets under management. Focusing just on Canadian residential only, they have 60 thousand units with 12,000 in development. So who is more likely to develop a theoretical Gateway Green development more quickly - Starlight or say Townline, heck even Chard?

Starlight - who are already knee deep in the Yates Street proposal and all that involves, or Townline or Chard? For Chard it would be their 2nd, maybe 3rd next project. Starlight - who knows!? It's a rounding error on their books. They are in no rush to develop - a longer hold strategy may be to their advantage. They can afford to wait until future municipal or provincial elections where they may get more favourable consideration re: density and removal or relaxation of rental controls. Waiting 2, 5 or even 10 years is no big deal to them, especially if they can realize significant increased returns over the buildings 50 to 70 year life span. As for Chard, they will do that project sooner (economic conditions permitting) because that's how they generate their income and put food on their table. Think about the former bowling alley by Mayfair, it's as if that land asset was a footnote in Loblaws' reporting. Someone in Toronto sees that, thinks big deal, taxes are minimal, we have no plans to develop yet, we got bigger fish to fry. They have no clue where that lot is, we'll be lucky if they even know where Victoria is, lol. Now imagine if Chard owned that..

Hope this helps Mike.

[Mike K.]

But your proverbial “Chard” does own this land. This developer received approvals for an office tower on that land 15-years-ago.

There is no precedent whatsoever between the size of a company owning a parcel of land, and the speed with which it redevelops its holding. Market conditions dictate more than pockets, like how we saw Concert move quickly at Capital Park, but VanCity slow Dockside to a literal stall. Both are huge corporations/institutional investors.

Your theory is pure conjecture, with no basis in reality, and it is constructed in such a way as to vilify whomever buys this land and doesn’t do with it what you want them to do, at your pace.

Now if you really have an issue with under-used lots, I’m sure the City could use some persuading to finally do something with its fields of concrete along the harbourfront.

[zoomer]

There will always be exceptions, and yes my point is conjecture for the Gateway Green site (but isn't that half the convo on VV - conjecture, oh and conspiracy theories), but conjecture based on probability and not vilification. I personally prefer to see smaller, more local developers (Vancouver, Victoria) buying land and moving forward with projects because they TEND to be more highly motivated and more responsive to local needs. The rental market is starting to be dominated by a handful of powerful REITs who have the time and money to control the market and drive up their returns (25 gross for Starlight alone!).

[Victoria Watcher]

The powerful REITs are some the very best landlords.

[Mike K.]

We’ve entered a new phase in Victoria’s rental housing crisis: vilifying the builders of new rental housing, because it’s not built by the ‘right’ kind of rental housing builder.

If only we’d have more people building rental housing who haven’t built more rental housing, we’d all be better off.

[zoomer]

No vilification - we'll take what we can get right now, but there are two sides to every coin. I stand by my original premise that local developers generally develop more quickly with less long term holding of lots, which could become an issue and pressure tactic moving forward. I don't want empty lots/ buildings as they negatively impact downtown.

Starlight's only mission is to get greater return, I assume Jawl, Chard and others have broader mission statements and can actually back that up.

I'm sure you've read about Starlight playing hardball in Winnipeg and now backing out from purchasing/redeveloping a downtown mall with a social housing component as they didn't get 50 million in grants and $240 million in loans plus tax concessions. Fair enough, it's an economic calculation on all sides. Starlight doesn't give a rats ass about your city, what it looks and how it functions. In the meantime they can outbid local developers and purchase prime lots and control those for future development on their terms. It's not evil, it's just playing the game. You're naive if you can't see that. Just like Amazon, pros and cons to the local economy, but at least everyone acknowledges that.

[Mike K.]

Chard built their first Victoria rental tower recently, and it was sold to an REIT upon completion, and the lot we're discussing has been held for 15 years by a local developer post-approvals (and bought long before that). Both of your theories are now debunked. So what now?

Like I said though, it all comes down to the market. Developers big or small are bound by market conditions, and holding smaller or local developers to some other standard ultimately vilifies them for making future decisions you don’t like because you had the wrong idea. I guess what I’m saying is, developers act to secure their future, so that they may continue building more housing for our communities.

[zoomer]

Well this has turned in to the most boring road to nowhere discussion ever, so my final words here.

Mike, giving one example (or even two) does not debunk arguments, but I’m sure you know that. For every example you provide, I can provide one to back my contention, but that doesn’t make me ‘right’. I claimed no absolute unlike you, but based on probabilities why I prefer local developers. This is why I purposely used language as “tend to” or “generally”. Of course there will be a mix of REITs, large, medium and small scale developers, but I believe we need to be wary of REIT’s having too much leverage/power. Having another perspective or being wary of the potential risks in a free market that can be manipulated (logical action of capitalism) is not vilifying. I believe it’s called critical thinking and free speech. If not, feel free to move this to the Nutbar/Conspiracy Theory Dancing Banana Thread! .

[Mike K.]

I’ve got a bandolier of examples, that’s why I’m saying passing judgement isn’t appropriate.