ATLANTIC BROADCAST SPRING 2018 - Altus Group
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ATLANTIC BROADCAST
SPRING 2018
ATLANTIC BROADCAST SPRING 2018 1
Atlantic Market Trends–Office
16.2% 15.4% 8.5% 21.8% 19.0% 12.3%
Halifax Moncton Fredericton Saint John St. John’s Charlottetown
Office Vacancy Rates — Q4 2017
Halifax, NS
• The vacancy rate in Greater Halifax rose to 16.2% from 13.7% reported at
Q4 2016.
• Nova Centre (300,000 SF) opened its office tower in December with BMO,
Grant Thornton and Pepper Group Ltd. being the lead tenants.
• Queen’s Marque, a mixed-use project (120,000 +/- SF office) on the Halifax
waterfront, is under construction with Stewart McKelvey announced as the
anchor tenant.
• 5151 Terminal Road (Class B),154,000 +/- SF is undergoing a major
renovation as the probable home for NSPI and related companies of Emera. The office tower at Nova Centre, Halifax, NS
• Ravine Centre I and II (125,000 +/- SF) in Clayton Park West was
purchased by True North Commercial REIT which also acquired the OFFICE SALES
HOOPP office portfolio (+/- 300,000 SF), four office buildings known
as the Blue Frog Campus on Eileen Stubbs Avenue in the City of Lakes HOOPP Office Portfolio, Dartmouth 298,000 SF $53.0 million
Business Park.
Ravine I and II, Halifax 129,000 SF $31.3 million
• 111 Ilsley Avenue, 236 Brownlow Avenue, 277 Pleasant Street and 117
Dream Office Portfolio - National 6.8 million SF $1.7 billion
Kearney Lake Road (+/- combined 200,000 SF) sold as part of a $1.7 billion
•F our HRM buildings part of the assets 200,000 SF
national transaction. sold to KingSett Capital
• Two Fredericton buildings part of the assets
• A new 76,000 SF three-storey office building is underway on Wilkinson sold to SOT NB Inc. (Slate) 130,000 SF
Avenue and will be completed by Summer 2018.
2 ATLANTIC BROADCAST SPRING 2018
Atlantic Market Trends–Office (continued)
Moncton, NB Saint John, NB
• The vacancy rate in the Greater Moncton area declined to 15.4% from the • The vacancy rate in Greater Saint John rose to 21.8% from the 18.2%
17.0% recorded at Q4 2016. recorded at Q4 2016.
• Acadian Lines Bus Terminal at 29 Victoria Street was purchased and will • A major development shaping the office market in Saint John is the
be renovated into 16,000 SF of office space. As well, the former Moncton construction of the new 11-storey, +/- 300,000 SF Irving Oil headquarters
Jail located at 225 Assumption Boulevard was recently purchased and will at 20-24 King Square South. The new Irving Oil head office is slated to be
provide 12,500 SF of future Class B office space to the downtown. finished later in 2018.
• Heritage Management is remodelling the old CBC Building located at
250 University Avenue into 50,000 SF of high-end office space which will
open in mid-2018 increasing the Class A inventory. As well, Heritage is St. John’s, NL
developing the old Moncton High School which will add 90,000 SF of high
quality office space to the market. • Downtown St. John’s posted a vacancy rate of 23.7% up from 12.8%
reported at the end of 2016. The suburban office towers reported 14.1%
• Two Class B buildings with large vacancies are Co-op Atlantic Building and vacant, up from 10.7% reported at year end 2016.
1199 St. George Boulevard. These two buildings are part of the announced
sale by Cominar REIT. When concluded, this transaction will increase the • KMK Capital Inc. has started construction on a 97,000 SF building at 20
profile of Slate Office REIT in the Moncton office market by 220,000 SF. Hebron Way. A four-storey, Class A building with a two-storey parking
garage, due to be completed in spring 2019.
• In the latter half of 2017, two office buildings under construction on Kelsey
Drive were completed. These buildings added 96,000 SF to the suburban
office inventory and opened at full occupancy.
Fredericton, NB
• The vacancy rate in the Greater Fredericton area is continuing its
downward trend falling to 8.5% from the 10.1% recorded at Q4 2016.
• Cominar REIT is one of the largest landlords in the Fredericton office
market with 350,000 +/- SF of office space. These buildings form part of
the Cominar assets that are reportedly under agreement with Slate Office
REIT, and anticipated to close before mid-year 2018.
• Two office buildings traded between Dream Office REIT and Slate Office
REIT (SOT NB Inc), 250 King Street and 460 Two Nations Crossing, totaling
130,000 SF, part of the national disposition of Dream assets.
Bristol Court Office Park, Kelsey Drive, St. John’s, NL
ATLANTIC BROADCAST SPRING 2018 3
Atlantic Market Trends–Industrial
13.2% 17.6% 15.0% 16.0% 26.2% 2.3%
Fredericton, NB
• The vacancy rate in Fredericton industrial has fallen to 15.0%, down from
24.9% at Q4 2016. Industrial gross rents have risen over the past year from
Halifax Moncton Fredericton Saint John St. John’s Charlottetown
an average of $11 psf to $11.80 psf year end 2017.
Industrial Vacancy Rates — Q4 2017
• The national trade of a number of Cominar REIT’s properties to Slate REIT
impacts this market as Cominar is one of the largest office and industrial
property owners in Fredericton.
Halifax, NS
• 40 Blizzard Street has been acquired by Canopy Rivers Corporation, one
• Robust leasing activity reduced the vacancy rate in Burnside/City of Lakes
of the largest medical marijuana producers in Canada. Plans are to expand
from 14.5% at mid-year 2017 to 11.6% at year-end.
this existing building by +/- 100,000 SF.
• Industrial tenants expanding and relocating contributed to the declining
vacancy rate including: Wartsila Canada, Sauder Industries/Metrie and
Medical Mart to name a few.
St. John’s, NL
• A number of trades occurred in late 2017 after seeing long listing periods.
• St. John’s has approximately 1.3 million SF of industrial space with a 26.2%
• New construction of “Net Zero” industrial buildings are underway by vacancy rate reported at the end of 2017. This marks an 8.6% increase
East Port Properties, known as the Wilkinson Project. The development from the 17.6% vacancy reported at the end of 2016.
will include a series of four or five multi-tenant warehouses totaling
approximately 300,000 SF. The first 60,000 SF building is scheduled for • A number of industrial buildings traded during the latter half of 2017 with
occupancy in Spring 2018. buyer motivation being for investment purposes. Buildings traded were
both single and multi-tenant between 15,000 and 20,000 SF.
• No new industrial construction was underway by year end 2017.
Moncton, NB INDUSTRIAL SALES
• The vacancy rate rose slightly to 17.6%, up from 16.5% at year end 2016.
1100 Aviation Ave, Dieppe 92,000 SF $6.82 million
The largest industrial lease transaction in Moncton this period was 55,000
SF leased at 245 English Drive. 80 Rooney Cr, Moncton 81,600 SF $5.65 million
• New warehouse construction is underway at 55 Frenette Avenue, a 40 Blizzard St, Fredericton 42,361 SF $2.525 million
100,000 SF freezer-cooler building by Sealand Freezers Limited.
4 ATLANTIC BROADCAST SPRING 2018
Atlantic Market Trends–Retail
Halifax, NS
• IKEA opened its +/- 300,000 SF facility in Dartmouth Crossing in
September. Also opening in 2017 were Lindt and Mastermind Toys.
• Cabela’s is under construction in Dartmouth Crossing (next to IKEA) and is
anticipated to open later in 2018.
• New stores at Halifax Shopping Centre include: Colori, H&M (2 level),
Olsen and Zara. Sears Canada closed its 3-level store in January 2018 and
the outlet store in the Annex closed November 2017.
Moncton, NB
• Costco is building a new 154,000 SF store at Elmwood Drive & TCH which
will open in 2018.
• Cannabis NB recently announced the location of 9 stores set to open by
September 2018. This will add to the 11 stores already slated to be open by
July 1st. Each are +/-3,000 SF retail located close to existing NB Liquor stores.
• Choice Properties REIT announced in 2018 its $6 billion acquisition of
CREIT, which includes several retail properties in Atlantic Canada totaling
1.5 million SF. RETAIL SALES
• Cabela’s recently closed its location in Moncton. Bass Pro Shop purchased Strathallen acquisition—3 plazas 337,000 SF $33.1 million
Cabela’s in a $4.5B US deal in 2016 and has a store in Moncton close to Woodlawn Plaza, Dartmouth & Smart Centres -
Truro, New Minas
the former Cabela’s.
165 Chain Lake Dr, Halifax 44,000 Sf $8.2 million
St. John’s, NL 635-639 Portland Hills, Dartmouth 25,000 SF $7.345 million
• Costco has started construction on its new building in the Shoppes at Galway.
55 Roe Ave, Gander, NL 25,000 SF $5.6 million
• Crombie REIT is underway with its major redevelopment of the Avalon Mall
on Kenmount Road.
• Kenmount Crossing is being marketed as a new retail development along
Kenmount Road.
ATLANTIC BROADCAST SPRING 2018 5
Atlantic Market Trends–Multi-Residential
• Skyline Apartment REIT made an entrance into the Atlantic Market with Overall Multi-Residential Vacancy Rates (%)
a $68M acquisition of 615 modern units in the City of Moncton. Skyline 11.4
acquired 150-260 Mapleton Road & 22-35 Fairlane Drive, Moncton, NB &
190 & 196 Carson Road, Moncton, NB.
3.2 9.0
3.8 8.5 8.5
• Starlight Investments purchased a modern 55 unit building in the active 7.9 7.9
3.4
suburban Halifax market located at 200 Broad Street with MetCap as 7.2
property manager. The reported purchase price was $13.3M. 2.6 6.2
5.8
6.0
5.4
4.7 4.6 4.7
• Killam REIT announced the Killick at Kings Wharf was under agreement for 3.8
2.3 4.4 4.2
$33M. Located on the Dartmouth waterfront with 110 units, this would be 3.2 3.4 3.2
2.6
one of the highest rates per unit seen to date in the Atlantic Market. 2.3 2.2
1.7
0.9
• Killam REIT Q4 2017 results indicated revenue growth of 2.6% in Halifax,
4.0% in New Brunswick, -1% in St. John’s & 2.9% in Charlottetown.
Halifax Moncton Fredericton Saint John Charlottetown St. John’s
Halifax benefited from strong migration and low vacancy: New Brunswick
benefited from fewer starts and an improving economy, St. John’s 2013 2014 2015 2016 2017
was impacted by a decline in rental rates and reduced activity in the Source: CMHC
offshore, Charlottetown benefited from high rates of immigration and a
comparatively large population of seniors.
• The impact of increased interest rates on prices is not yet clear, with the
most recent transactions consistent with the trend over the last 12 to18
months for new suburban product.
• Maritime MHC GP Inc. acquired three manufactured home parks from
Keystone Communities in Fredericton and Quispamsis in March 2017 for
$18M, having a total of 566 land lease sites.
• New construction is underway in Dieppe (Aris Vautour—172 units) and on
Lewisville Road, Moncton (Halls Landing—64 units).
• Mix Apartments (71 units) in downtown St. John’s opened to tenants
in February 2018. This was a renovation of the former Newfoundland
Telephone Building at 345 Duckworth Street.
345 Duckworth Street, St. John’s (2015) Redeveloped as Mix Apartments (2018)
6 ATLANTIC BROADCAST SPRING 2018
Altus Group–Property Tax
Nova Scotia 2019 New Brunswick Property Tax Appeal Deadline is
Request for Information (RFI) Process April 3, 2018
If you own income producing property in NS, you have less than 30 days to Recent legislation has been introduced regarding an assessment freeze for
submit your 2019 Financial Information Request the 2018 assessment cycle. There are a number of exceptions and some
owners may be surprised by their tax bills. Keep in mind that just because your
The Property Valuation Corporation (PVSC), the body responsible for assessing assessment may be frozen does not mean you are without recourse or that an
all property in the Province of Nova Scotia is preparing for the upcoming appeal is not warranted. 2018 notices were issued March 1st with a 30 day
2019 assessment year. As part of that process, PVSC is requesting financial appeal deadline. Time is of the essence.
information from commercial property owners and has delivered Requests for
Information (RFI) returns to the province’s commercial property owners this
week with a 30 day response period. HOW ALTUS GROUP CAN HELP
Altus Group represents some of the largest property owners in the country and
Owners of income producing property are subject to a mandatory information we have saved millions of dollars in property taxes to a varied client base. In
request annually in Nova Scotia. Here are some points to consider before NB, commercial property owners face some of the highest property tax rates
submitting financial information for the 2019 year. in Canada. Let Altus Group help you navigate safely through the property tax
appeal process and keep tax dollars in your pocket.
• We encourage you to use the approved PVSC forms appropriate to the
applicable property type – apartment, office, retail, and hotel. We have proven experience with the assessment authority, robust information
• Do not include raw data such as rent rolls, balance sheet financial data, and technology capabilities, and professionals focused on tax appeal work to
income and expense statements, as some sources of revenue may not be provide you with sound advice. We are well positioned to ensure the tax
pertinent to the realty in question. burden levied against your property is the lowest possible.
• Information must be filed as of 31 December, 2017; or the most recently
available annual statement. For more information on any commercial property tax concerns, please contact
• Audited financial statements are not necessary. our Property Tax Experts:
Mathieu Maillet, Senior Director Richard Trenchard, Senior Director
Failure to respond with the required information before the due date
mathieu.maillet@altusgroup.com richard.trenchard@altusgroup.com
will result in the loss of the right to appeal your assessment for the 2019 902.420.6636 902.421.5275
assessment year.
Rob Newman, Senior Consultant Jeff Cuzner, Senior Consultant
rob.newman@altusgroup.com jeff.cuzner@altusgroup.com
If you have any questions or concerns, please do not hesitate to contact us at 506.869.4906 902.421.5269
Altus Group, it will be our pleasure to assist.
ATLANTIC BROADCAST SPRING 2018 7Altus Group–Cost Consulting
Altus Group’s Construction Cost Guide 2018 is now available to download
Altus Group’s annual Construction Cost Guide is the Canadian real estate
industry’s leading guide to development project costing. It is trusted as a
budgeting tool by public bodies, developers, lenders, contractors, consultants
and various industry professionals.
The guide is founded on Altus Group’s proprietary database of project costs,
which includes project data from over 1,200 Canadian Cost and Project
Management engagements in 2017 alone. Drawing upon this comprehensive
catalogue, our industry leading experts have analyzed the information and
provided a succinct and user-friendly summary of the findings for each major
market across the country.
http://www.altusgroup.com/news_insights/construction-cost-guide-2018
8 ATLANTIC BROADCAST SPRING 2018The leading
source of real
estate intelligence
in Atlantic Canada
In order to serve you better, Altus Group has
five offices located across Atlantic Canada. Our
regional experts work together, as one integrated
office, to provide Atlantic Canadians with the
most diverse services and solutions for all their
commercial real estate advisory needs.
ATLANTIC CANADA OFFICES
Halifax 902 420 8880
St John’s 709 726 4059
Charlottetown 902 368 3177
Moncton 506 858 2787
Fredericton 506 450 7150
atlanticinfo@altusgroup.com | altusgroup.comYou can also read
