Target Opening in Waterloo, Cambridge, Guelph

That’s right – Target is coming to South Western Ontario in a BIG way!

There are five stores opening within a quick drive of Waterloo Region:

Conestoga Mall

Cambridge Centre

175 Stone Road West, Guelph

Gates of Fergus

Stratford Mall

Plus, 2 in London (Masonville and Westmount), several in the GTA and 2 in Hamilton.

This is great news for the local commercial real estate market, and comes on the heels of the announcement of Apple’s new store in Waterloo.

Here is the full list of Target stores announced in the first round:

The rest of the stores in Canada are as follows:

Alberta
•       Chinook Centre, Calgary
•       Forest Lawn Shopping Centre, Calgary
•       Market Mall, Calgary
•       Shoppes at Shawnessy, Calgary
•       Signal Hill Centre, Calgary
•       Sunridge Mall, Calgary
•       Bonnie Doon, Edmonton
•       Kingsway Garden Mall, Edmonton
•       Mill Woods Town Centre, Edmonton
•       Prairie Mall, Grande Prairie
•       Bower Place, Red Deer
•       St. Albert Centre, St. Albert
•         Sherwood Park Mall, Sherwood Park

British Columbia
•       Abbotsford Power Centre, Abbotsford
•       Metropolis at Metrotown, Burnaby
•       Discovery Harbour Shopping Centre, Campbell River
•       Cottonwood Mall, Chilliwack
•       Coquitlam Centre, Coquitlam
•       Driftwood Mall, Courtenay
•       Tamarack Mall, Cranbrook
•       Scottsdale Mall, Delta
•       Willowbrook Shopping Centre, Langley
•       Haney Place Mall, Maple Ridge
•       Nanaimo North Town Centre, Nanaimo
•       Pine Centre, Prince George
•       Oakridge Shopping Centre, Vancouver
•       Village Green Mall, Vernon
•       Tillicum Mall,  Victoria

Manitoba
•       Shoppers Mall, Brandon
•       Grant Park, Winnipeg
•       Kildonan Place Shopping Centre, Winnipeg
•       Polo Park Shopping Centre, Winnipeg
•       Southdale Centre, Winnipeg

New Brunswick
•       McAllister Place, Saint John

Newfoundland and Labrador
•       Corner Brook, Corner Brook
•       Cabot Square, St. John,s

Nova Scotia
•       Bedford Place, Bedford
•       Mic Mac Mall, Dartmouth

Ontario
•       Durham Centre, Ajax
•       Aurora Shopping Centre, Aurora
•       Bramalea City Centre, Brampton
•       Shoppers World Brampton, Brampton
•       Trinity Common, Brampton
•       Burlington Mall, Burlington
•       Millcroft Centre, Burlington
•       Cambridge Centre, Cambridge
•       Woodbine Centre, Etobicoke
•       Gates of Fergus, Fergus
•       175 Stone Road W., Guelph
•       Centre Mall, Hamilton
•       South Hamilton Square, Hamilton
•       Hazeldean Mall, Kanata
•       Cataraqui Town Centre, Kingston
•       Lindsay Square Mall, Lindsay
•       Masonville Place, London
•   Westmount Shopping Centre, London
•       Milton Mall Shopping Centre, Milton
•       Erin Mills Town Centre, Mississauga
•       Square One, Mississauga
•       Meadowlands Shopping Centre, Nepean
•       Upper Canada Mall, Newmarket
•       1899 Algonquin Ave., North Bay
•       Centerpoint Mall, North York
•       Orillia Square Mall, Orillia
•       Place D,Orleans, Orleans
•       Five Points Mall, Oshawa
•       Bayshore Shopping Centre, Ottawa
•       Billings Bridge Plaza, Ottawa
•       RioCan St. Laurent, Ottawa
•       Hillcrest Mall, Richmond Hill
•       Bridlewood Mall, Scarborough
•       County Fair Mall, Smiths Falls
•       Niagara Pen Centre, St. Catharines
•       Stratford Mall, Stratford
•       Sudbury Supermall, Sudbury
•       Intercity Shopping Centre, Thunder Bay
•       Cloverdale Mall, Toronto
•       Shoppers World Danforth, Toronto
•       East York Town Centre, Toronto
•       Flamborough Power Centre, Waterdown
•       Conestoga Mall, Waterloo
•       Taunton Gardens Power Centre, Whitby
•       Devonshire Mall, Windsor

Prince Edward Island
•       Charlottetown Mall, Charlottetown

Quebec
•       Galeries d,Anjou, Anjou
•       Faubourg Boisbriand, Boisbriand
•       Carrefour Angrignon, Lasalle
•       Mega Centre Notre-Dame, Laval
•       Galeries Chagnon , Levis
•       Place Longueuil, Longueuil
•       Place Alexis Nihon, Montreal
•       Place Vertu, Montreal
•       Terrarium Shopping Centre, Pointe Claire
•       Les Galeries De La Capitale, Quebec City
•       Place Fleur De Lys, Quebec City
•       Place Laurier, Quebec
•       Le Carrefour Rimouski, Rimouski
•       Promenades Saint-Bruno, Saint-Bruno-de-Montarville
•       Carrefour Saint-Georges, Saint-Georges
•       Carrefour Richelieu,  Saint- Jean sur-Richelieu
•       Carrefour du Nord, Saint Jerome
•       Carrefour de L,Estrie, Sherbrooke
•       Les Rivieres Shopping Centre, Trois Rivieres

Saskatchewan
•       Northgate Mall, Regina
•       The Centre, Saskatoon

The latest commercial real estate news is the soon-to-be  Apple Store in Conestoga Mall.

Benefit for Area Businesses

What are the implications for businesses in the area?

Yesterday we noted the positive effect that Apple in Conestoga Mall will have on adjacent businesses:

Having Apple as a destination tenant at Conestoga Mall is great news for all the other stores in the area – except maybe Future Shops’s Apple department – because people will head to the mall to check out the new toys at Apple, and they’ll inevitably browse around and grab food at adjacent businesses.

Also, it can be a negative for an authorized retailer, who now has to compete with the real deal

What does it mean for competing retailers like Carbon Computing?  When Apple has come into similar communities, it has been hard for independent authorized retailers to stay in business and maintain a valuable point of differentiation.

Benefit for Landlord

What does it mean for the owner of Conestoga Mall, Ivanhoe Cambridge?

As we reported yesterday (in Apple Store coming to Conestoga Mall in Waterloo) there was a “$75 million investment into Conestoga Mall over the past few years.”

Does having an Apple Store in Conestoga Mall increase it’s value?

If a recent sale in Montreal is any indication, the answer is YES.

Montreal’s 9,007 sq ft Apple Store at 1321 Ste. Catherine Street West recently traded at $15,750,000 (or $1748.64 a sq ft)

To give you some reference for how expensive that valuation is, the Vaurdreuil Shopping Centre near Montreal recently sold for $25,400,000, and its a 118,330 sq ft new format shopping centre with a Canadian Tire, Staples (Bureau en Gros), Golf Town and more.  This traded at $214.65 a square foot.

Bringing Apple to Conestoga Mall will increase sales of other stores in the mall, will attract even better tenants to the mall as space become available, and increases the desirability and prestige of the asset if Ivanhoe Cambridge decided to sell it.

Apple’s signanture black floor-to-celing construction hoarding recently went up at the other Fairweather space.

From Apple Store coming to Conestoga Mall in Waterloo:

We have heard rumblings for months that the next Apple retail store would be in Waterloo Region, and now between the tell tale hoarding and what workers are saying, it seems certain (but it has not been confirmed by Apple corporate or the Mall yet).

A foreman on site has confirmed that this is the location of the new Apple Store in southwestern ontario:

“Its going to be all glass across and is costing over million dollars.”

What does Apple @ Conestoga mean for Waterloo Region?

Having Apple as a destination tenant at Conestoga Mall is great news for all the other stores in the area – except maybe Future Shops’s Apple department – because people will head to the mall to check out the new toys at Apple, and they’ll inevitably browse around and grab food at adjacent businesses.

What does it mean for competing retailers like Carbon Computing?  When Apple has come into similar communities, it has been hard for independent authorized retailers to stay in business and maintain a valuable point of differentiation.

It seems like the $75 million investment into Conestoga Mall over the past few years is paying off for owner Ivanhoe Cambridge.  Even more good news for the mall will follow – I predict that Target moves into the Zellers space too (the other option being the Zellers space in Bridgeport Plaza)

From BenjaminBach.com:

[The REALEX portfolio] includes several commercial real estate properties in Kitchener Waterloo including:

Market Square – 239,689 sq ft (shown above)

Galleria – 237,146 sq ft

50 Queen – 169,616 sq ft

235 King – 100,798

22 Frederick – 95,841 sq ft

The Accelerator Centre – 92,808 sq ft in the University of Waterloo Research and Technology Park

Realex also owns commercial properties in Alberta and BC that were included in the sale. Click here for a list of Realex’s commercial real estate holdings.

The Globe & Mail notes that the “full enterprise value of Realex is pegged at $385-million, including the assumption of about $210-million in debt and some working capital.”

For more info, read the whole article at: Dundee REIT to buy Realex’s Kitchener Waterloo office & retail assets

Look Smart By Investing Where The Jobs Are

How do you buy Real Estate? Location, location, location.

Buy Property Near The Jobs!

Are you looking to invest in an area where the employment capacity is increasing? Take a look at residential investment properties near Weber Street North between Northfield and Benjamin Road.

This short stretch of road in North Waterloo adjacent to an investment property we just sold is seeing a lot of intensification through redevelopment. Let’s take a look at what’s in the pipeline:

North Waterloo Development Projects

580 Weber Street North, Former NCR Site

Purchased by GPM Investments in 2008 for ~ $20,000,000

Plans for 350,000 – 500,000 square feet of offices in 8-12 buildings

The former NCR site is huge – 37 acres with an existing building of approx 280,000 square feet as is. To give you an idea of the expansion potential, the site currently houses a couple baseball fields.

GPM (the same firm that is developing Sportsworld Crossing) has plans to add an additional 8 buildings (between 2,670 and 50,000 sq ft) to the site, to compliment the existing building. According to The Record, they’re debating whether to modify or replace the existing office building.

–

600 Weber Street North

Under redevelopment by the Marsland Corporation – 106,000 square feet

The Marsland Family owns some prominent office real estate in Kitchener Waterloo, including the Marsland Centre on Erb in Uptown Waterloo, two buildings RIM leases on Phillip, the Sybase building in the University of Waterloo Research & Technology park, and several Class A high-tech offices on Randall.

They are currently renovating their 100,000+ sq ft property at 600 Weber Street North, and have plans for a new 50,000 square foot building next door at 598 Weber Street North. This site is immediately north of the NCR site

–

Potential redevelopment site, Weber Street North

15 acres, existing building is 152,000 sq ft

This site, just south of Benjamin Road on Weber, is another potential office redevelopment. The site is currently being marketed by CB RE.

Location, Location, Location

Oh – there is also a proposed Light Rapid Transit (LRT) stop at Northfield and Parkside, one block from Northfield & Weber. And SmartCentres just poured millions into a new retail development anchored by Walmart a minute away in St Jacobs.

Your future tenants enjoy things like that.

When you are investing in a residential rental property in Waterloo, you can buy one of the shiny new condos for $$$ in uptown, or buy a comparative bargain in the Northlake neighbourhood near major tech firms, new retail development and LRT.

Your money, your call. For a list of affordable investment opportunities in the North Waterloo area, send me an email at Benjamin @ BenjaminBach.com or call me at 519-772-4376

Note: Leasing at the NCR site is handled through Colliers; 600 Weber is for lease through DTZ Barnicke.

Residential development:

Downtown Kitchener Swaps Car Lot for Highrise Towers

A builder from Guelph has bought a 2.4 acre block of downtown Kitchener – bordered by Madison, King, Cameron and Charles – for $3.6 million, or $1,500,000 per acre.

Fusion Homes bought the property and plans to put two highrise towers on site, plus townhouses and some retail.  There is also indication that the City wants to see a grocery store incorporated into a mixed use development along the King Street East mixed use corridor.

Infrastructure Development:

Waterloo Region Buys Kitchener Land to Redevelop for Transit Hub for $6 million

Big Kitchener Waterloo land assembly news made public this morning – the Region of Waterloo has bought a number of contigious buildings along Victoria Street between King & Duke to serve as a development site for a Central Transit Hub.

The Region paid about $2 million per acre to buy 16 Victoria Street North (End of the Roll), 50 & 60 Victoria Street North (Rumpel Felt factory), and 510 King Street West (small grocery store).  The parcel of land that the Beer Store sits on has not yet been acquired, but is on the Region’s wish list.

The assembled land package is right across from the Kaufman Lofts & the new Medical/Pharmacy School.

Related: GO Trains coming to Kitchener Waterloo

Commercial Office Development:

Allied REIT buys 50% stake in Kitchener’s Breithaupt Block from Perimeter Development

Exciting news for Kitchener’s Warehouse District, and Perimeter Development’s Breithaupt Block in particular.  Allied REIT has bought a 50% share of the redevelopment opportunity.

From The Record:

Major developer takes stake in Breithaupt Block project

Perimeter Development Corporation has signed a deal to sell a 50-per-cent stake in the project to Allied Properties REIT, a Toronto-based developer that specializes in adaptive re-use of urban industrial buildings. The deal, expected to close Dec. 1, is worth $4 million [ed: for a 50% share].

The Breithaupt Block consists of six former industrial buildings, containing about 176,000 square feet of space, at Breithaupt and King streets in Kitchener’s warehouse district.

Why does REIN consistently rank Kitchener Waterloo #1 ?

Here are the Top 9 Reasons You Should Invest in Kitchener Waterloo Real Estate

#1 – consistently ranked as the top spot to invest in real estate in Ontario, and #2 in Canada as per REIN

#2 Low Interest Rates – It is now more affordable to borrow money, making it a great time to buy investment real estate

#3 Great Prices

For the complete article, click here: Top 9 Reasons You Should Invest in Kitchener Waterloo Real Estate or watch this video:

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Large Apartment Building Sold in Cambridge Ontario

Last week we looked at Two Waterloo Region Apartment Buildings that Sold For $45+ million.

Here is a video with some more information on the sale:

To recap, the investment property in Cambride, Ontario was purchased at a 5.7% cap rate.

Between both apartment buildings there are 225 units, and the average rent is above $1500 per month.

High valuation, but the properties generate premium income, are prestigious assets, and are very recent (6 years and 1 year) construction.

Two Waterloo Region Apartment Buildings Sell For $45+ million…

…$46,710,000 to be exact

Killam Properties has announced the purchase of 225 recently built residential units in Cambridge, in two river front apartment buildings. This is one of the largest recent Multi-Family transactions in the Kitchener Waterloo area.

“Killam has acquired 100 and 200 Eagle Street North in Cambridge, Ontario, in the Kitchener-Waterloo Region. The luxury apartment buildings are of newer concrete construction and include spacious units ranging from 1,000 to 1,400 square feet, modern features and five appliances. The buildings’ amenities include a fitness centre, guest suite, air conditioning and underground parking.

100 Eagle Street, constructed in 2008, has 119 units with 9-foot ceilings, including 3 one-bedroom units, 59 two-bedroom units and 57 two-bedroom units with a den. The average rent is $1,523 per month. 200 Eagle Street, constructed in 2004 and located directly beside 100 Eagle Street, has 106 units, including 25 one-bedroom units and 81 two-bedroom units. The average rent is $1,351 per month.

The purchase price for the two river-front properties of $46.7 million ($207,600 per suite) was satisfied with a combination of the assumption of a 20-year mortgage for $10.1 million at 5.15%, a new mortgage for $16.0 million at 4.5%, and the balance in cash.

“We are pleased to report progress on our apartment acquisition program in Ontario” noted Philip Fraser, Killam’s President and CEO. “Closing these two Cambridge assets increases Killam’s apartment ownership in Ontario to 362 luxury apartment units. We have continued our acquisition focus on newer, high quality assets. These two assets meet this standard and are among the highest quality assets in Cambridge. The cap rate on the acquisition is approximately 5.7%, reflecting the buildings’ age, location and quality of construction.”

Both the cap rate and the price per suite are rich for the region, reflecting the quality of the asset, as well as the cheap financing that REITs and other institutional investors have access to right now. (CMHC is happy to loan on Multi Family properties, as it is a secure asset class. Rents continue to come in, in both good and bad economic times.)

We have many qualified real estate investors looking to buy apartment buildings now – if you own one, contact us to arrange for a quick sale. You’ll likely be pleased with what buyers are willing to pay for a quality building!

The Globe Advisor expands on the lack of available supply of apartment buildings in Canada:

Apartment buildings - there are about 100,000 of them across Canada, with the majority of them clustered along the Windsor-Quebec City corridor – may not return as much to their investors as shopping centres or office buildings, but they offer a lower-risk way to own income-generating properties.

They held their value through the recession for one main reason – there were no distress sales because owners could refinance their debt inexpensively through Canada Mortgage and Housing Corp. This ensured them access to credit at a time when other property owners found debt markets completely closed.

And with mortgage rates almost certain to move higher in coming months, buyers are scrambling to make purchases while rates sit near all-time lows. RealNet Canada, which tracks sales, shows first-quarter sales volumes actually decreased in most of the country at a time when other commercial sectors were showing sharp signs of recovery.

It has nothing to do with a lack of confidence in the sector, but rather illustrates how reluctant sellers are to part with their income-generating properties.

“What’s happening is people who own them are quite happy and those who want to buy really have to spend a bit more than they may like,” said RealNet president George Carras. “The most dominant owner profile in the sector is the private investors, and they tend not to want to trade.”

…

“You can get money at ridiculously low rates and the big challenge is just finding quality product,” Mr. Greer said. “There is no low-balling, and when something comes around, you see a ton of interest.”

Halifax-based Killam Properties started the year with a goal to spend up to $150-million on Ontario apartment buildings, and passed the $100-million threshold with the Cambridge deal earlier this week.

Chief executive officer Philip Fraser said it has become increasingly difficult to find relatively new buildings that met the company’s criteria, and indeed there were never any “for sale” signs planted on the front lawn in Cambridge.

If you have a building, and you have thought of selling in the next ten years, I strongly reccomend we talk today; with interest rates as low as they are (but heading up fast!) you will likely get more for it today then when rates are higher.

originally posted at: http://www.benjaminbach.com/?p=771

Multi-Family Housing in Waterloo Region

One of things I find myself talk to real estate investors about these days is the price of apartment buildings. Seems there are lots of people looking to acquire high quality investment property, but there is not a great supply of these buildings for sale.

Most owners are happy to hold their buildings now - multi family real estate is a notoriously stable investment during good times and bad (and stable investments are held in higher regard during recessionary times), but buyers are eager to deploy their capital into a stable asset.

This spread between available supply and current demand makes it a great time to sell your Kitchener Waterloo apartment building; case in point, we have seen quality properties come to market and receive multiple offers in the first few days.

Pricing an Apartment Building

If you were going to sell your property, how would you price it?

Right now, there is a large difference in ‘per suite’ asking prices for comparable buildings online, with several active listings being priced considerably higher than comparable recent sales.

Click play to watch this quick video we put together looking at the prices of apartment buildings in Kitchener Waterloo

If you have any questions about the multi-family investment market in Waterloo, or for a free list of apartment buildings for sale in the region, email me at Benjamin@BenjaminBach.com

KW Commercial is your one stop shop for commercial, investment, retail and multi family advice and brokerage in Waterloo Region.