BOMA CANADA REPS SEE THE GOOD, THE BAD AND THE UGLY IN CHINA NEW BY PAUL BRENT, PROPERTY BIZ CANADA AN RENX PUBLICATION - PHOTOS COURTESY OF BENJAMIN SHINEWALD
INDUSTRIAL
VAC A N C Y 2013 - Q1
A
group of eight BOMA Canada members had “a terrific, eye-opening, frankly fascinating” eight-day, three-city tour that was organized by the fledgling BOMA China organization. The delegation was promised a “comprehensive overview” of the Chinese real estate market and insider building tours in Beijing, Tianjin and Shanghai, all under the auspices of the Building Owners and Managers Association of China (BOMA China) in late March. Count the BOMA Canada president and chief executive officer, Benjamin Shinewald, as impressed. “It was the first time that we had done this type of thing and the first time that I am aware of that a commercial real estate mission has gone to China.” Shinewald said the contingent, which included members from Ontario, Alberta and British Columbia, were blown away from the beginning after being taken to Shanghai’s financial district. “We went to have lunch with Cushman Wakefield Shanghai and they hosted us on the 101st floor of the second-tallest building in the world and we had a view of a crane outside that was putting up a tower across the street that is, like 120 metres higher than the one that we were in,” he said. “Seeing the scale in Shanghai was remarkable and they have some spectacular properties in that area.” The BOMA bunch then flew to the “second-tier” city of Tianjin, China’s sixth-largest city with a population of about 13 million. “That is a place where the Chinese are building, more or less from scratch, a megalopolis,” said
EDMONTON
Industrial Building Vacancy Citywide: 3.4%
VIEW FROM THE 101ST FLOOR OF THE SHANGHAI WORLD FINANCIAL CENTRE – THE SECOND TALLEST BUILDING IN THE WORLD AT 492 METRES.
Direct Vacancy:
3.2%
Sublease Vacancy:
0.2%
Southeast Northwest Northeast Central Sherwood Park Acheson Spruce Grove Stony Plain Nisku/Leduc
2.3% 4.6% 3.1% 3.4% 1.2% 6.1% 2.7% 0.0% 4.0%
2012 Building Sales Transactions: 43 Volume: $86 million 2012 Land Sales: 21 Volume: $35 million
THE SHANGHAI WORLD FINANCIAL CENTRE AND THE (UNDER CONSTRUCTION) SHANGHAI TOWER WHICH WILL STAND 632 METRES HIGH.
Shinewald. “Hundreds upon hundreds of skyscrapers, residential and commercial, are going up.” Cranes were a common sight on the trip since approximately 37.5 per cent of www.bomaedmonton.org | BOMA Edmonton Newsletter | June 2013
1
the world’s under-construction office towers are in China, the BOMA guests were told. With more investment capital than they can easily spend, the Chinese are building infrastructure on a scale and at a pace that has never been seen before. Even the scale model of the future city was gigantic. “They had a huge hall built, just to accommodate the model. It was just unbelievable.” The next day the group took a bullet train to Beijing for industry meetings, economic analysis, tourism and building tours that included the Chinese headquarters for Bayer, the millionsquare-foot Jiaming Centre, which is managed by Canadian industry veteran Gabby Franco. The next day in the Chinese capital, the BOMA group continued its tour and learned it is not all glitter and soaring heights in the world’s second-largest economy. “We saw some more typical assets and saw very, very impressive growth but also corresponding challenges,” said the BOMA Canada CEO. “It is very clear that the Chinese properties are going to need some very serious TLC as they grow, despite the impressive veneer or facade.” The real and significant weakness shown by China’s real estate industry, and the very real opportunity for Canada’s, is that its developers are skilled at erecting commercial towers and terrible at maintaining them once they are up and running.
BOMA CANADA GROUP ON TOUR IN CHINA ORGANIZED BY BOMA CHINA.
A MODEL OF PLANS FOR TIANJIN – ALMOST EVERYTHING YOU SEE IN THE MODEL WILL BE BUILT FROM SCRATCH.
Western Canada’s leading janitorial and maintenance service provider
Everyday
We’re doing it right...
SerVantage Services Group (toll free) 1.888.985.7141 edmonton@servantage.ca MEETING WITH OFFICIALS FROM TIANJIN.
www.SerVantage.ca 2
June 2013 | BOMA Edmonton Newsletter | www.bomaedmonton.org
“One building that we saw was only six years old and I would even have a hard time comparing it with a 40-year-old building back here. The 40-year-old one (in Canada) would be in much better condition,” said Peter MacHardy, vice-president of national commercial property management with GWL Realty Advisors and BOMA Canada’s chairman.
While the Chinese are justifiably proud of the towering proof of their rapid industrialization, basic maintenance is not part of the program. “What happens is they build and after about 15 years the buildings are worn because they are not maintained. So they just knock them down and build a new one.” MacHardy sees an opportunity for North American commercial real estate companies to come to China and maintain and operate buildings, but it will not be easy. “There is quite a rigorous and robust process that you would have to go through,” said the Calgary-based MacHardy. The list of services Canadian firms could provide is long. “I would say it is almost everything. Building operators, training programs, environmental sustainability, health and safety, customer service, security, policies, procedures and guidelines.” First-world buildings in China are receiving third-world maintenance partly because building maintenance and operations staff simply do not have the experience and expertise that is common in North America. As well, the developers who construct residential towers in a “build-and-sell-it” model are the same ones who put up commercial buildings, a situation that has created a “build-it-and-forget-it” mindset, even though they may retain ownership of the building. MacHardy noted that tenants enjoy few of the amenities that are common in commercial buildings in North America. “The tenant comes in and they do their own improvements. They get a base building: they get a raised floor, ceiling tiles and air conditioning, but you do 100 per cent of your own build-out and you pay your own electricity, so you pay for what you use,” he said. “When the lease term is up and you move out, you restore it identical back to the base building.” China is also unique in that the government retains ownership of the land, meaning office towers hold 40-year leases and the issue of what happens when those leases expire remains a real question. Dominic Lau, BOMA China’s vice-chair of association services who directed much of the March tour, said there is widespread acknowledgment that the real estate industry has a long way to go when it comes to critical issues such as building maintenance. “It is a well-known fact, even the government officials admit that,” said Lau, who has spent much of his life in Canada and worked until recently in Calgary’s real estate industry. “You can’t hide it; a building that is a year or two years old [that] looks like a 10 year old building. They deteriorate very quickly.” That’s where BOMA China, established just a few years ago, comes in. That is what BOMA China’s mission is – to advocate the development of building maintenance and operations standards that are taken for granted in North America and Europe. “We have got to advocate the reasons that they need to maintain the buildings,” he said. “They don’t understand the concept of maintaining buildings. Their thinking is that once they build the building it will print cash, so leave it alone. What else do you need to do?”
Fully integrated tenant solutions
WE HAVE A STRONG NATIONAL PRESENCE TO HELP SERVE THE DIVERSE NEEDS OF OUR TENANTS
To view our portfolio of properties, visit:
www.dundeerealty.com Or contact us at: 780.423.4800 Northwest Territories British Columbia Alberta Saskatchewan Ontario Quebéc New Brunswick Prince Edward Island Nova Scotia
www.bomaedmonton.org | BOMA Edmonton Newsletter | June 2013
3
MEDEVAC BASE OPENS AT EDMONTON INTERNATIONAL AIRPORT Coordinated, timely, high-quality patient care for northern Albertans STORY BY JOANNE ANDERSON, ALBERTA HEALTH SERVICES
A
lberta Health Services’ (AHS) new medevac base offers a greater level of patient care and ensures timely, safe transport for northern patients. From March 15, all flights from northern Alberta will land at the new base, located at the Edmonton International Airport (EIA). “We don’t just transport patients, we treat them and care for them every step of the way,” says Dr. Ian Phelps, senior medical director for AHS Emergency Medical Services (EMS). “Our plan ensures patients continue to receive safe, timely and reliable medevac services, and we have taken this opportunity to enhance the care northern Albertans will receive.”
The new 3,600-square-metre hangar is designed with patient’s needs in mind and offers significant benefits that previously didn’t exist. The space will now allow patients to be transferred inside, instead of out on the tarmac. It provides a safe, well-lit area, away from cold and from slippery services. The hangar also features a six-bed patient transition area for stable patients. This area will have EMS staff on hand to provide care to patients for short periods of time. A dedicated ground ambulance fleet is based at the EIA to transport patients to and from hospitals. This means that when a non-critical patient arrives, the flight medical crew can transfer the patient to the ground ambulance crew and re-
Canada’s Top Security Company | paladindecurity.com
4
June 2013 | BOMA Edmonton Newsletter | www.bomaedmonton.org
ASPHALT SERVICE:
Roadways and Parking Lots
PHOTOS BY STEPHEN WREAKES
turn to their northern community to be available to respond to other calls. For more critical patients, the flight crew can continue treatment, but will have the assistance of an additional paramedic and a fourth EMS practitioner to drive the ambulance. Health Minister Fred Horne says he can assure Albertans that patient safety and care will not be compromised when medevac services move from the Edmonton City Centre Airport to the EIA. “This new state-of-the-art medevac base will provide the timely treatment and transport that critical and non-critical patients need. The fastest possible access to Edmonton area hospitals is assured.” About 3,000 patients are flown to Edmonton each year via fixed-wing ambulances. About 80 per cent of those patients are arriving for scheduled procedures, appointments, or for admission to a higher level of care, not for emergencies. Dr. Mark MacKenzie, medical director of air ambulance for AHS-EMS and STARS, has provided oversight on medevac services for more than 10 years. “While timeliness is a component of all transports, for the large majority of patients it is more important to provide efficient, high-quality care and safe transport, rather than embark on a race against the clock,” he says. AHS anticipates about five patients a month will require urgent access to critical care. These patients can be flown directly to a hospital from EIA by STARS helicopter, located in the same hangar building as the new medevac base. STARS will continue to land directly at hospitals when transporting a patient from a community hospital or from the scene of an emergency, such as a serious car crash. Patients receive non-stop care from
Infrared Patching Manholes and Catch Base Potholes, Crack Seals & Spray Patching Repairs health care professionals from the moment they are stabilized to leave their home community until the time they arrive at an Edmonton hospital. A transport physician oversees every critical transfer, monitoring the patient’s condition in real time and working closely with sending and receiving physicians. “If a patient’s condition changes midflight, the transport physician can order alternative arrangements, such as helicopter transfer, to be in place well before the patient arrives,” says Dr. Phelps. “Every patient has a team of medical experts around them to ensure they are receiving the appropriate level of care, at all times.” Since August 2010, 62 medevac flights, including seven critical patients, have landed at the EIA with no adverse affects to their treatment. The new travel times from EIA to major Edmonton hospitals will be about the same as travel times for patients from Calgary International Airport to the Foothills Medical Centre. “This innovative facility offers significant benefits for patients; benefits which don’t exist today. Indoor transfers, more EMS providers per patient and an increase in aircraft availability are obvious wins, but the base will also be a hub for fixed-wing, ground ambulance and STARS, providing opportunities for collaboration, which can only be good for patients,” says Dr. MacKenzie.
CONCRETE SERVICE: Curbs & Sidewalks
Concrete Removal & Replacement Trip Hazard Removal & Heave Repairs
EXCAVATION: Commercial
Underground Servicing
SNOW REMOVAL:
Parking Lots & Sidewalks De-Icing Service Sanding Services
SPRING CLEAN UP: Sweeping & Line Painting
Please feel free to call for an estimate: Kim Zurowski, Manager, Estimating & Business Development 10720-209 St NW Ph: 780.473.0384 ext. 227 kim@devlinconstruction.com www.devlinconstruction.com
www.bomaedmonton.org | BOMA Edmonton Newsletter | June 2013
5
LOOKING FOR THE LATEST CHOICES IN LIGHTING EFFICIENCY? The Solution Might Be More Familiar Than You Think DEAN MARCHUK, BRANCH MANAGER, HD SUPPLY/ LITEMOR EDMONTON PAULA D. ZIEGENBEIN, APPLICATION MARKETING MANAGER, OSRAM SYLVANIA
C
ommercial businesses are always on the lookout for ways to reduce maintenance, energy costs and consumption. Lighting is one area in which energy-saving upgrades and improvements are relatively simple to make, but sometimes determining which technology is best to use is not as obvious as one might think. LED technology is quickly becoming the darling of the lighting industry, and LEDs are widely known for their long life and energy efficiency. With the rapid evolution and growth of the solid-state lighting market, many “traditional” light sources are receiving less consideration. However, we cannot be so quick to consider these more familiar lighting technologies as relics. In the case of high-efficiency linear fluorescent systems, for example, the same – or better – longevity and efficiency that you would except from an LED source can be achieved for a lower cost. Fluorescent systems may be a tried-and-true lighting solution, but they are far from obsolete. Fluorescent technology has gone through many advances since fluorescent systems made their commercial debut in the 1940s, and improvements are continuously being made.
The first fluorescent systems introduced were T12 lamps paired with magnetic ballasts. While these were highly efficient for their time, the introduction of the T8 lamp in the 1980s by OSRAM SYLVANIA offered an even
Looking to reduce energy costs? ATCO EnergySense can help. We offer unbiased commercial energy audits, which include benchmarks comparing your energy consumption to similar facilities. Our energy management experts will develop custom solutions to help you achieve energy savings of up to 30%, contributing to a cleaner environment and improving your bottom line. Book your commercial energy audit today.
310-SAVE (7283) | atcoenergysense.com
6
June 2013 | BOMA Edmonton Newsletter | www.bomaedmonton.org
more efficient option. Electronic ballasts also improved system efficiency, as did the introduction of the T5 lamp in 1995. Fluorescent technology continued to improve and expand with the introduction of high efficiency T8 and T5 systems, and dimming features have recently been added to lamps and ballasts as well.
WHAT TODAY’S FLUORESCENT SYSTEMS OFFER Today’s high efficiency fluorescent systems offer a more than viable lighting solution for general illumination in all varieties of commercial facilities. With systems featuring up to 100+ lumens per watt efficacy, high performance, quality colour consistency, excellent colour rendering and up to 50,000 hour life ratings, fluorescent technology may be one of the best cost/value propositions in the market. Considering the average fluorescent system has been installed for over fifteen years, many existing T8 installations are reaching the end of their life cycle and are likely due for a lamp and ballast retrofit. Upgrading these systems to today’s high efficiency fluorescent systems could result in over 40 per cent energy cost savings. For medical facilities in particular, high efficiency fluorescent systems offer another notable advantage over some of the new lighting technologies available in today’s markets. High efficiency fluorescent systems offer simple and easy retrofits for existing fixtures, and rarely require the obtrusive installations often needed for an LED system upgrade. The speed and simplicity of high efficiency linear systems offers minimal disruption to offices and other working areas, saving time and expenses while reducing interference to regular operations and routines.
A CLOSER LOOK AT ENERGY SAVINGS Today’s choices for fluorescent lamps offer incredible energy savings compared to earlier systems. By simply changing a T8 lamp in an existing in-
stallation to a high efficiency, energy saving version, seven to 20 per cent of energy can be saved instantly. Combining these high performance lamps with high efficiency ballasts can deliver even more impressive results for healthcare facilities. Today’s electronic ballasts are far more energy efficient than their predecessors, and are equipped with technology to help maximize energy savings and/or lamp life. Ballasts can be selected with either instant start (IS) technology, designed to maximize energy savings and for infrequent switching, or programmed rapid start, designed to maximize the life of the system and for use on controls (i.e. occupancy sensors).
THE CEILING AHEAD Most of the lighting industry recognizes that LEDs and solid-state lighting is the future of lighting. LEDs offer a new range of possibilities to illuminate almost any type of space, and have the potential for even greater energy savings and flexibility in their controllability and sensing. However, LED technology still has a way to go in the area of general illumination, especially before it can be a truly cost-effective option. While the cost of solid-state lighting is projected to decrease substantially in the future, fluorescent systems offer many of the same benefits as LED systems, but at an affordable cost today. Fluorescent systems are one of the most viable and cost-effective solutions for general illumination currently available on the market. Fluorescent technology will continue to evolve with more energy saving options becoming available as manufacturers push the boundaries of long life. For where we are in today’s lighting market, high efficiency fluorescent lamps and ballasts are an incredibly sound investment for any facility since they offer just the right combination of cost and energy savings, maintenance cost reduction, colour characteristics and ease of replacement.
Rite-Way Fencing Inc.
8625-63rd Avenue Edmonton, Alberta T6E 0E8 edmonton@ritewayfencing.com
780.440.4300
Toll Free:1.800.425.5120 • Chain link fencing • Ornamental Iron fencing • Wood fencing • Dog runs • Electric gate systems • Rent-A-Fence • Agricultural Fencing • Guardrail • Repairs • Residential / Industrial • Free Estimates
Residential / Industrial
Repairs
Free Estimates
www.ritewayfencing.com www.bomaedmonton.org | BOMA Edmonton Newsletter | June 2013
7