Q3 Update Calgary Q3 Update Calgary Downtown Office Downtown - - PowerPoint PPT Presentation

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Q3 Update Calgary Q3 Update Calgary Downtown Office Downtown - - PowerPoint PPT Presentation

Oct 25, 2023 340 likes •495 views

Q3 Update Calgary Q3 Update Calgary Downtown Office Downtown Office CBRE Limited CBRE Limited DOWNTOWN CALGARY OFFICE MARKET..THE FACTS Strong stable institutional ownership: primarily pension funds Overall Vacancy 7.0% (was

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Q3 Update Q3 Update – – Calgary Calgary Downtown Office Downtown Office CBRE Limited CBRE Limited

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CB Richard Ellis | Page 2

DOWNTOWN CALGARY OFFICE MARKET..THE FACTS Strong stable institutional ownership: primarily pension funds Overall Vacancy – 7.0% (was 11.5% Jan 2011) YTD absorption - 2.2 million SF!!!!!...that’s a record!!! Class AA Vacancy – 2.9% 5,845,000 SF built 2009-2012 : ONLY 80,000 SF vacant Who’s next?....Eighth Avenue Place?....Cadillac Fairview’s City Centre? …Palliser West?... Oxford Eau Claire?

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CB Richard Ellis | Page 3

TENANT BUILDING SF

New Deals Suncor Suncor East 120,000 SNC Lavalin 640 5th 100,000 Meyers Norris Penny LLP 640 5th 68,000 Canadian Forest Oil Ltd. 640 5th 34,000 Crew Energy Centennial 66,000 Talisman/ Sasol PennWest 63,000 Talisman First Canadian Centre 118,000 Imperial Oil BP Centre 75,000 Dover Energy Bow Valley Square 24,000 Husky Energy Western Canadian Place 37,000 IMV Projects 555 4 Avenue SW 34,000 Significant Renewals SNC Lavalin 5th & 5th 115,000 Paramount, Stikeman, Blakes, Talisman Bankers Hall 800,000 AltaGas Calgary Place II 100,000 Encana Backfill Apache TD Canada Trust 206,000 TD Bank TD Canada Trust 74,000 Schlumberger One Palliser 140,000 CNRL Bankers Hall East 180,000 Gowlings TD Canada Trust 72,000

Major Lease Transactions 2011

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CB Richard Ellis | Page 4

ENCANA OFFICE FALLOUT - Then

One Palliser Square Floors: 3 – 11 24 – 27 Area: 193,000 SF Encana Place Floors: 2 – 28 Area: 420,000 SF Bankers Hall East Floors: 10 – 19 Area: 198,000SF Bankers Hall West Floors: 7 – 9 Area: 61,000 SF TD Canada Trust Tower Floors: 8 – 40 Area: 533,000SF First Canadian Floors: 19, 20, 23 Area: 38,000 SF Dome Tower Floor: 17 Area: 14,000 SF Scotia Centre Floors: 35‐36 Area: 28,000 SF

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CB Richard Ellis | Page 5

ENCANA OFFICE FALLOUT – Now !!

One Palliser Square Floors: 3 – 11 24 – 27 Area: 193,000 SF Encana Place Floors: 2 – 28 Area: 420,000 SF Bankers Hall East Floors: 10 – 19 Area: 198,000 SF Bankers Hall West Floors: 7 – 9 Area: 61,000 SF TD Canada Trust Tower Floors: 8 – 40 Area: 533,000 SF First Canadian Floors: 19, 20, 23 Area: 38,000 SF Dome Tower Floor: 17 Area: 14,000 SF Scotia Centre Floors: 35‐36 Area: 28,000 SF

LEASED LEASED

9 % LEASED

LEASED Talisman?? ??? LEASED

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CB Richard Ellis | Page 6

Inventory vs. Vacancy Rates

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 28,000 29,000 30,000 31,000 32,000 33,000 34,000 35,000 36,000 37,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 3Q 2011 Vacancy Rates (%) Inventory (000's ) SF Years

Historical Calgary Downtown O ffice Inv entory

  • vs. Vacancy

Rates 2000 - 3Q 2011

Inventory Vacancy

2000 – 3Q 2011

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CB Richard Ellis | Page 7

Absorption

  • 1,500
  • 1,000
  • 500

500 1,000 1,500 2,000 2,500 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 YTD 2011 Abs

  • rption 000's S

F Y ears Calgary Downtow n Office Abs

  • rption 2000 - YTD 2011

2000 – YTD 2011

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CB Richard Ellis | Page 8

  • 200,000

200,000 400,000 600,000 800,000 1,000,000 Class AA Class A Class B Class C Class D Absorption (SF) Class es

YTD 2011 Downtown O ffice Abs

  • rption

Dow ntow n YTD 2011 Absorption

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CB Richard Ellis | Page 9

2012 – WHAT TO EXPECT

  • Continued Confidence, Continued

Investment

  • Demand to Remain Stable…velocity to slow

down

  • Product Offerings Deteriorate
  • Increased Focus on Renewal Leasing
  • New Developments (8th Ave West, City

Centre, Eau Claire Tower, Bow South, Centre 10)

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CB Richard Ellis | Page 10

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CB Richard Ellis | Page 11

  • 60,000 sq.ft. Oil and Gas company
  • Renewal offer for 10 years.
  • $25 psf – years 1‐5
  • $32 psf – years 6‐10
  • $90 psf tenant improvement allowance
  • Brokerage fee
  • Approx. NER of $13.71 psf

Fifth Avenue Place - Brookfield

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CB Richard Ellis | Page 12

  • 20,000 sq.ft. Law firm
  • Renewal offer for 10 years.
  • $28 psf – years 1‐5
  • $32 psf – years 6‐10
  • $60 psf tenant improvement allowance
  • Brokerage fee
  • Approx. NER of $19.84 psf

Barclay Centre

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CB Richard Ellis | Page 13

  • 150,000 sq.ft. Oil and Gas company
  • Offer for 10 years on upper floors.
  • $38 psf – years 1‐5
  • $45 psf – years 6‐10
  • $100 psf tenant improvement allowance
  • Brokerage fee
  • Approx. NER of $22.56 psf

Eighth Avenue Place - West

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CB Richard Ellis | Page 14

Brad, would you have done any of these deals as a tenant? If not, please comment.

Encana

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Q3 Update Q3 Update – – Calgary Calgary Downtown Office Downtown Office CBRE Limited CBRE Limited