Building February March 2015 by Annex Business Media

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64 00

CONTENTS

what’s on BUILDING.ca

FEATURES

16 > Nerds Will Lead Us /

North America’s technology sector continues to grow and innovate, and much of that is happening in the Waterloo Region. Although Ontario’s Innovation Corridor is ripe for serious growth, will public and private developers get it right? By Rhys Phillips

EXPLORE > Westboro Station, Ottawa This wedge-shaped, multi-phase condo development is a gateway into a bustling Ottawa neighbourhood.

22 > Back to a Green Future / There’s a new kind of infrastructure in town, designed to return us to our roots. By Leslie C. Smith

EXPLORE > Luminothérapie 2014-2015 Winter is banished in Montréal’s Quartier des Spectacles by two mesmerizing outdoor art installations.

24 > Where Does $8 Billion Go? /

John Tory’s SmartTrack transit plan was a major plank in his Toronto mayoral bid. But do the numbers add up? A quantity surveyor does the math. By Terry Harron

28 > The Bright Side of the Road /

Giant lampshades create ingenious urban lighting in Québec City. By Matthew Searle

EXPLORE > Lunenberg County Lifestyle Centre Two firms create a community centre that caters to mind and body.

IN EVERY ISSUE

7 > Editor’s Notes 8 > Developments 12 > Market Watch 14 > Legal 30 > Viewpoint

ABOVE IMAGE:

Originally the Lang leather tannery circa 1850 and redeveloped in 2007 by Cadan Inc., the 340,000-sq.-ft. Tannery in downtown Kitchener, Ont. is now home to tech startups, university incubators as well as tenants such as Google and Communitech. The building was acquired by Allied Properties for $61.75 million in May, 2012. (Photo by Anthony Reinhart)

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R S

Volume 65

01 Number Editor / Peter Sobchak Art Director / Roy Gaiot Legal Editor / Jeffrey W. Lem

Contributors /

Terry Harron, Richard Joy, Rhys Phillips, Matthew Searle, Leslie C. Smith

Not to brag, but…

In a global, connected market, smart people can live anywhere. Capital will follow them and their ideas, and here in Canada this is happening nowhere more vividly than in the Region of Waterloo, right under the nose – or bubble – of Toronto. So much so, in fact, that thanks to a new Light Rail Transit system, a burgeoning and highly-educated population and the three-million-square-foot Blackberry real estate portfolio sale, the Region of Waterloo will be one of Canada’s most dynamic markets over the next several years, says Colliers International in their new Market Outlook Report. They even go so far as to call the area “Canada’s Land of Opportunity,” which normally sounds like marketing hyperbole, but as Rhys Phillips explores in this issue (Nerds Will Lead Us), the claim may actually ring true. “The Blackberry portfolio sale has been an incredible game-changer for Waterloo Region, and office users have options like never before,” said Karl Innanen, managing director, Colliers International Waterloo Region. “Blackberry’s monopoly of the buildings in North Waterloo had pushed smaller office users out of both the leasing and buying market in that area. Now that space has come to market, users who want to position themselves by the future LRT route, the universities and the Research & Technology Park have the opportunity they’ve wanted for more than a decade. There is now a huge influx of product available to tenants.” Waterloo Region is among the most competitive office markets in Canada and leasing is happening because of few choices downtown and zero free parking options for employees, which impacts most leasing decisions. As a result, traditional downtown office towers are challenged to retain current tenants and struggling to attract new ones. “Supply stimulates demand and this growth has spread to the industrial real estate sector as well, where Class ‘A’ space is in high demand and when buildings are erected, they fill quickly. Even property owners who modernize and improve ‘B’ class buildings have the opportunity to gain tenancies, while buildings with long-term vacancies continue to stay empty with better options available,” says Innanen. “Tenants want what tenants want, and they are more than willing to pay for that ‘right’ space,” said Colliers International vice president John Frezell. “There is a flight to productivity, to higher building efficiency, to employee retention and to creating culture. The culture is worth more than the lease savings they would get by going somewhere else.” “It is a development market we have always been and still are very bullish on. I often say that this is one of the best markets in North America,” says Craig Beattie, foundering partner of Perimeter Development. “Despite its size, there are not too many markets that can boast two big-sized universities as well as Conestoga College, a top brand technical college. Then you also have an insurance sector that is huge as is the university sector, and, of course, we have this growing and diversified tech scene.” New partnerships among universities, business, government and cities are playing a central role in developing intellectual assets, ideas and innovations that are improving the Region’s urban future and catalyzing new business successes. More and more it appears Canada’s Silicon Valley is a land in no need of hyperbole.

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Building magazine is published by Annex Newcom LP. 80 Valleybrook Dr. Toronto, ON M3B 2S9 Tel: (416) 510-6845 / Fax: (416) 510-5140 E-mail: info@building.ca Website: www.building.ca SUBSCRIPTION RATE: Canada: 1 year, $30.95; 2 years, $52.95; 3 years, $64.95 (plus H.S.T.) U.S.: 1 year, $38.95 US, Elsewhere: 1 year, $45.95 US. BACK ISSUES: Back copies are available for $8 for delivery in Canada, $10 US for delivery in U.S.A. and $15 US overseas. Please send prepayment to Building, 80 Valleybrook Dr. Toronto, ON M3B 2S9 or order online at www.building.ca Subscription and back issues inquiries please call 416-442-5600, ext. 3543, e-mail: circulation@building.ca or go to www.building.ca Please send changes of address to Circulation Department, Building magazine or e-mail to addresses@building.ca NEWSSTAND: Information on Building on newsstands in Canada, call 905-619-6565 Building is indexed in the Canadian Magazine Index by Micromedia ProQuest Company, Toronto (www.micromedia.com) and National Archive Publishing Company, Ann Arbor, Michigan (www.napubco.com).

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MENTS

DEVELOPNews

Tri-national agreement makes it possible for architects to work across borders

OTTAWA | Representatives from the architectural regulatory authorities of Canada, the United States, and Mexico have announced a major agreement to mutually recognize architect credentials in the three countries, making it possible for architects to work across North American borders. The Canadian Architectural Licensing Authorities (CALA) in conjunction with the National Council of Architectural Registration Boards (NCARB) in the United States and the Federacion de Colegios de Arquitectos de la Republica Mexicana (FCARM), announced the final implementation of the Tri-National Mutual Recognition Agreement for the International Practice of Architecture among the United States, Canada, and Mexico. The agreement represents over a decade of negotiations, bringing cross-border recognition of professional credentials from concept to reality in the spirit of the North American Free Trade Agreement (NAFTA). Qualified architects from each country who satisfy the requirements of the agreement will be granted a credential that will lead to a license to practice architecture in the host country. Requirements include education and work qualifications; submitting documentation to confirm the credentials; post-licensure experience and proof of “Good Standing” in the architect’s home jurisdiction; and an interview before a review panel, among other requirements (available on the Ontario Association of Architects website, www.oaa.on.ca). The path to the Tri-National Agreement has its origins in the passage of NAFTA in 1994, which spurred a discussion between leaders and regulators of the architecture profession in Canada, the United State and Mexico to consider ways to facilitate the mutual recognition of licensure credentials among all three countries. The initial agreement, signed in 2005 in all three countries, marked what many considered to be one of the first professional services recognition programs under NAFTA.

“This initiative is of major significance to the real estate industry. The adoption of a single set of international ethics standards, based on fundamental principles of integrity, will bring confidence and transparency to the entire sector. We can expect the long term result to be an improved rating for property as an investment asset class in world markets.” — Tony Grant, past World President, International Real Estate Federation (FIABCI)

Professions unite to create global ethics standards NEW YORK/PARIS | An international coalition of professional real estate organ-

izations has been launched with the aim of developing and implementing the first set of globally recognised ethics standards for property and related professional services. The International Ethics Standards Coalition (IESC) is made up of almost 30 standards bodies representing professionals working across the entire spectrum of land, property and construction related services. Member organizations of the Coalition, many of which already have their own codes of conduct focusing on qualities like trustworthiness, integrity and respect, will seek to align ethics principles through the new international standard. The ultimate goal is that all professionals, regardless of their location and the nature of their work will follow the same ethics doctrine. The IESC was first proposed during a meeting of a number of the founding organizations at the United Nations Headquarters in New York in October 2014. The ethics principles set out in the standard will be drafted and published for

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consultation by an independent group of experts, to be appointed in early 2015. It is hoped that the new standard will be ready in early 2016, following which member bodies of the Coalition will im plement it through training and guidance to their members. Currently the Royal Institution of Chartered Surveyors (RICS) is the only Canadian member, but the Coalition is encouraging other professional bodies to join the project and support the development and implementation of International Ethics Standards by contacting any of the current member organizations.

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Feds announce infrastructure funding for heritage sites OTTAWA | Prime Minister Stephen Harper announced in additional $5.8 billion

will be spent on historic sites, museums, research centres, parks and other federally-owned infrastructure across Canada. Not surprisingly, the National Trust for Canada applauded the notice, saying many of these places “are touchstones with the historic events and people who shaped our nation.” The announcement includes: $2.8 billion to support infrastructure improvements to heritage, tourism, waterway and highway assets located within national historic sites, national parks, and national marine conservation areas across Canada; approximately $400 million to maintain, upgrade and construct federally-owned buildings and other assets across Canada; and $191 million to undertake renewal and repairs of heritage and museum sites. This announcement, said the Trust in a release, indicates recognition on the part of the Federal Government that investment in heritage assets is an essential part of an overall economic plan, fundamental to creating jobs and strengthening the economy. “Canada’s towns and cities are full of examples where investment in heritage infrastructure has successfully generated economic vibrancy, as well as cultural and social benefits — all part of the recipe for resilient communities,” said Natalie Bull, the National Trust’s executive director.

Downtown Montréal office market space availability surges MONTRÉAL | In its recent Real Estate Market Study, New-

mark Knight Frank Devencore reported that vacancy rates in downtown Montréal’s Class “A” and “B” office buildings increased significantly in the latter half of 2014, from 6.8 per cent to eight per cent. Availability rates — which take into account the office space that may be occupied but is available for lease or sublet — have climbed even higher, and currently exceed 12 per cent. “A number of factors account for this increase in availability,” said Jean Laurin, president and CEO of Newmark Knight Frank Devencore. “New buildings have been, or are about to be, delivered to the market. As a result, the total available office inventory has grown by approximately 400,000 square feet. Additionally, a number of industrial properties have been redeveloped and are now offering office space, which is a trend we have been watching take shape for a few years.” Redeveloped industrial properties outside of the downtown core are attracting tenants who might otherwise have leased downtown office space. “Driving some of these tenant migrations into redeveloped space are fundamental questions of cost,” Laurin said. “Many companies are reviewing how they use space and are re-evaluating their occupancy standards. The repurposed office spaces generally offer less expensive rents, good services, and can provide more interesting work environments for employees, a key consideration when hiring and retention strategies come into play.” Laurin also noted that there is an increasing amount of sublease space coming onto the market, a trend attribut-

able to the new towers under construction as well as the recent moves that have been announced by major tenants. “Current market conditions have improved tenant leverage considerably. However, in order to take the fullest advantage of the options that exist, large tenants need to assess their occupancy needs much farther in advance than was once the case,” says Laurin. “Developing a strategic occupancy plan five years before a lease expires is not unusual; even smaller tenants should initiate the process at least three years before negotiating a new lease or renegotiating an existing one.” In Canada’s major cities over the past year the combined Class “A” and Class “B” office vacancy rate has risen from 4.9 per cent to 6.0 per cent. A primary reason for this increase is the addition of new inventory. 12 developments were added to the market inventory over the past year, representing approximately two million square feet of additional space. As space in the new developments is leased, vacancy rates in older Class “A” buildings are trending upwards. Many landlords are marketing these office spaces more aggressively, so this is where tenants have an opportunity to secure the most favourable leasing conditions.

New Projects Major renewal launched for the National Arts Centre TORONTO | The Government of Canada is committing $110.5 million in capital funding for the rejuvenation and transformation of the National Arts Centre (NAC) on Confederation Square in Ottawa, to be led by Toronto-based Diamond Schmitt Architects. Designed with a rigorous geometric order in the late 1960s, the NAC is a landmark building with a range of performance and production spaces. The transformation will include improved spaces for performance, new wings for audience and presentation events and establishes a visible presence and identity in the capital and for Canada as a whole. A marquee tower designed to extend the geometry of the original architecture into the 21st century marks a new enbuilding.ca

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DEVELOP-

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National Arts Centre

trance that will display performance imagery and live feeds from the NAC stage, as well as imagery to support national events and commemorations. In reimagining the centre with transparency, creating distant views and connection to both the landscape and urban Ottawa, the design brings NAC’s artistic energy to the forefront to be seen by the public and create a dynamic crossroads for gathering throughout the day. A transformed Fourth Stage, which serves as an incubator for new music performance, will animate the NAC’s presence along Elgin Street.

University of Windsor unveils new Creative Arts building design WINDSOR, ONT | The University of Windsor has unveiled

the design of a new building to be constructed in the city centre adjacent to the former Windsor Armouries. Located on the former Tunnel Bar-B-Q property, the new building together with the Armouries will be home to the University’s School of Creative Arts (SOCA), which itself was created through a merger of the School of Music, the School of Visual Arts and the Film Production Program. Construction of the new $12.8 million building was approved by the University’s Board of Governors as part of the University’s overall Capital Transformation Plan set in place in 2010. This Plan included a $75 million development in the city centre, creating a downtown campus for the School of Creative Arts, as well as for the School of Social Work and the Centre for Executive and Professional

Education at the former site of the Windsor Star building. Designed by CS&P Architects, the new single-story building will be 22,335 square feet with a main entrance facing the corner of Freedom Way and Park Steet East, and will house learning studios and editing suites for Media and Film Studies; workshops for metal and woodworking; digital fabrication labs and a printmaking studio. Construction on the site and the Armouries will commence in early 2015, with completion slated for August 2016. The Downtown Campus initiative will at a later date also include the transformation of the former Greyhound bus depot and nearby Chatham Street Parkette. Both of those locations were included with the Armouries, along with a $10-million contribution, in the City of Windsor’s landmark investment in the University of Windsor’s downtown campus. The Province of Ontario contributed an additional $15 million. b

School of Creative Arts

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MARKE T Spotlight: Construction

Hit by a Revolving Door Canadian construction employers predict increased business activity, although less than half will boost fulltime headcount

According to the fifth annual Hays Canada Salary Guide, most Canadian construction employers expect to grow their business in 2015 but less than half will boost permanent headcount. At the same time, construction firms struggle with uncertainty around worker availability as hiring for short-term, project-to-project contracts results in a state of employee transience. Overall, the Hays report suggests that while some construction employers increasingly rely on internal training to fill short-term talent gaps, hitting business targets in 2015 and beyond could be undermined if competitive retention strategies aren’t found. The survey, conducted in November 2014, found that 73 per cent of Canadian construction companies anticipate increasing business activity in the coming months, a jump of 18 per cent over 2014. However, permanent staff levels will likely remain static putting pressure on current employees. Many respondents also admit that hiring tends to be ad hoc and for short-term positions that don’t offer career growth or stability. As a result, employees frequently relocate to new projects rather than focus on building careers and the lack of professional development contributes to the shortage of talent experienced by almost 80 per cent of construction firms. The inability to find qualified construction help could undercut the ability to complete projects on time or commit to future ones. “Looking at the results this year, we have to ask ourselves whether construction firms’ focus on short-term hiring threatens long-term potential,” said Rowan O’Grady, president of Hays Canada. “Adding to this concern is the fact that relatively few respondents run professional development programs and admit it’s the main reason for the skills shortage in their industry,” O’Grady added. “Construction employers should be investing in skills development, recruitment and succession planning to keep pace with their current and future ambitions.”

Employers: skills shortage is our problem to fix

trol. While 64 per cent of respondents say that competitive salary packages are how their company attracts and retains top talent, promoting competitive benefits and company culture are also considered enticements for savvy candidates. 34 per cent of respondents also acknowledge that fewer people are entering the construction industry. This mirrors attitudes across all sectors as well as general opinions that employers have a responsibility to boost numbers of qualified graduates by promoting themselves and their industries at the postsecondary level. “Employers understand they have a role in facing these issues head-on and Hays recognizes that doing so falls outside their areas of expertise,” added O’Grady. “Companies need help and we can bridge this knowledge gap to support them as they invest in staff retention and recruitment plans, along with future-proofing their company.”

Positive signs on the horizon Despite unpredictable markets worldwide, responses from Canada’s construction employers show that the majority (80 per cent) of employers plan to offer some form of salary increase in 2015 and more than half (53 per cent) believe that the country’s economy will continue to strengthen throughout the next six to 12 months. This level of optimism is in lock-step with national averages, which are at their highest point in five years and signifies a 15 point jump from its lowest levels in 2011. “It appears Canadian employers are poised to capitalize on their positive outlook although I sincerely hope a focus on short-term gain doesn’t distract them from resolving the looming challenges ahead,” said O’Grady.

OVER

50 %

OF EMPLOYERS BELIEVE THEIR COMPANY’S REPUTATION AND LOW PROFILE ARE BARRIERS TO RECRUITMENT

70 %

SAY RECRUITING FOR SENIOR ROLES IS THE MOST DIFFICULT AND CAN TAKE ANYWHERE FROM TWO TO SIX MONTHS TO FILL

82%

OF EMPLOYERS SAY THEY MADE THE WRONG HIRE LIKELY DUE TO DESPERATION AND A LACK OF TIME

Employers in the construction industry admit that many of the factors that impact the talent issue are within their conFEBRUARY MARCH 2015

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The spectre of Buy American protectionism It appeared as if some of those challenges would be coming from international sources, at least according to various professional associations within the Canadian construction industry. Late in 2014, the Canadian Institute of Steel Construction (CISC), which represents the Canadian steel industry, went on record expressing grave concerns about what it sees as a growing negative impact of protectionist legislation such as Buy America/Buy American that, it said, has for years prevented Canadian firms from competing on public infrastructure projects in the U.S., and was about to extend its reach onto Canadian soil with the redevelopment project for the Prince Rupert Ferry Terminal in British Columbia. This terminal is owned by the Alaska Marine Highway System but sits on Crown lands owned by the Canadian Federal government and leased to the Prince Rupert Port Authority. It appeared the bidding/proposal documents had applied Buy American provisions which mandated that all iron and steel products used for terminal construction must be manufactured in the U.S. “This completely shuts out Canadian firms from bidding for this project on our own soil, [and] the precedence it sets for implementation of Buy American legislation on Canadian soil is an existentialist threat to the $13 billion Canadian steel industry, and the over 130,000 jobs it represents,” said CISC president Ed Whalen in a Nov. 27, 2014 press release. “This severely undermines the ability of Canadian steel firms to supply to their own domestic market, and makes a mockery of the very spirit of free trade and all our formal agreements such as NAFTA.” According to CISC, from 2002 to 2011, Canada went from net exports of just under $1.4 billion to a deficit of over $600 million for structural steel and related products because of lack of reciprocal arrangements with its trading partners, leading to a loss of over 5,000 jobs in the Canadian economy and approximately $126 million in lost government revenues. They cited Buy American legislation as a significant factor that contributed to this trade imbalance. But then, in mid-January, those opposing the implications of such a deal let out a sigh of relief. A government order under the Foreign Extraterritorial Measures Act (FEMA) was signed on January 19 by the Honourable Ed Fast, Minister of International Trade, effectively securing Canada’s right to prevent compliance with the Buy America provisions for the Prince Rupert Ferry Terminal redevelopment project. “Buy America provisions deny both countries’ companies and communities the clear benefits that arise from our integrated supply chain and our commitment to freer and more open trade. We call upon our American friends to join with us to end the harm such policies are doing within our shared North American economy,” said Minister Fast in a media release announcing the order.

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“This sends a strong message to our trading partners around the world that Canadians and the Canadian government will stand up to any threats to our sovereignty, our economy and Canadian jobs,” said Whalen. “The Canadian steel industry has been strongly advocating for free, fair and reciprocal trade and urges our trading partners to remove any protectionist barriers that negatively impact our open and competitive marketplace.” The association is also extending that call to provincial and municipal governments, urging them to level the playing field by passing reciprocal procurement legislation. b

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LEGAL Procedural Fairness Counts Steam-rolling local residents’ groups are akin to playing with fire, and every now and then, somebody gets burned. By Jeffrey W. Lem The building and development community has been a bit abuzz of late over the recent shenanigans in the Vancouver development scene. On January 27, 2015, the British Columbia Supreme Court released its decision in Community Association of New Yaletown v. Vancouver, concluding that the City of Vancouver acted unfairly in the public hearings over a controversial condominium development in the city, quashing the city’s zoning by-law as a result, and grinding the developer’s project to an instant halt. The facts in the New Yaletown case are not that complicated and can be easily paraphrased. A developer, Brenhill Developments Ltd., had entered into a deal with the city to build a brand new social housing project on the developer’s existing lot, then transfer the newly built social housing project to the city in exchange for an existing social housing project then owned by the city. After the land swap, the developer would then tear down the newly replaced social housing project, and build a bigger, better, mixed-use condominium complex on the former social housing project site. A local residents’ group, the Community Association of New Yaletown, objected to the bigger, better, mixed-use condominium complex that had been proposed by the developer for the former social housing project site (for the purposes of this article, the exact grounds for opposition are not that relevant, let’s just say all of the “usual reasons” — too tall, too big, too much traffic, etc.). So far, there really isn’t anything unique to the story. This type of land swap arA store on Westisn’t exactly de rigueur, but it is hardly novel nor an unusual way for rangement Street in Goderich, modern development to proceed, nor is the fact that a local residents’ group would Ont.’s historic downtown before the development for all the “usual reasons” (which actually is de ritry and impede tornado hit (above), gueur). So what went so terribly wrong for the city and the developer in the New the damage (right), Yaletown case? and in August 2013 (below) the town’sit boiled down to due process and procedural fairness. According In aafter nutshell, rebuilding efforts. to the court, the city, for whatever reason, failed to disclose the land swap arrangements to the public, and otherwise seemed to go out of its way to obscure the details between the city and the developer to the point where the local residents could not fairly evaluate the pros and cons of the overall development project. It’s not that the city didn’t provide adequate disclosure — on the contrary, it did — nearly 100 pages worth of disclosure, but it was how the city did it that really seemed to provoke the ire of the court. Of the 100 pages of material, many of it was overly technical and presented in a way that the relevant development information was “interlaced” throughout — in other words, the old “hide the trees in the forest” trick! The court also lambasted the city for exaggerating (well, more like estimating without any sound fiscal underpinnings) some of the proposed social benefits to be derived from the resulting new social housing project to be built by the developer. FEBRUARY MARCH 2015

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In other words, the court admonished the city to: tell the complete story in a way that made it relatively fair and understandable to the public (rather than trying to obfuscate the truth in a sea of superfluous details); stop exaggerating the social benefits of certain projects until you find some sort of evidence that such social gains can in fact be realized; and give the public a fair opportunity to be heard in the planning process and then genuinely listen to any concerns raised by the public. Duh, no kidding! This sounds like a How to Run a Public Process 101! Since the city had done virtually none of the above in this case, the zoning by-law permitting the re-development was accordingly quashed, and new public hearings were ordered to be repeated (this time done right by the book), the setback reminding this author of “snakes and ladders.” None of this should really be new to any municipality or developer heading into public hearings, and most municipal and development lawyers I know bend over backwards to try and accomplish such goals. They know that such community organizations can often fund themselves quite adequately, lawyer-up fairly well, and often carry some weight with the courts — it just makes business sense to deal with such community organizations fully and openly before dipping a backhoe into the ground. The New Yaletown case, while providing titillating reading for municipal government conspiracy fans, provides most Building readers with few, if any, real concrete takeaways when the decision is reduced to its most basic components like this. The litigation was predominantly between the residents’ group and the municipality, and the developer, not surprisingly, tried to play a relatively neutral role, arguing that even if the zoning bylaw got quashed as a result of this little spat between local residents and the city, the developer should not be forced to slow down construction since it had already sunk upwards of $7 million in hard costs into the site before

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the court made its decision. Needless to say, the court did not give the developer any such break, and the developer was ordered to stop work (by the city, ironically!) right after the decision was released. The only upside for the developer was that it had not yet started the sales process, and the $7 million already sunk to date could have been a lot more had the decision lingered or the developer rushed the process any more, but most developers will have little sympathy for continuing construction in the face of a pending zoning challenge. Ironically, the city may very well have done the right thing in terms of the zoning to be ascribed to the developer’s project. That is, the final 36-floor tower approved for the site may yet still be the right zoning for the site, and the fact alone that the new condominium project came about as a result of a now clearly obfuscated land swap should not really affect the final zoning. After all, land swap or not, the residents would still have said that the resulting condominium was too tall, too big and generated too much traffic, and so on and so on. That was pretty much the city’s argument before the court: even if the city and the developer had tricked the local residents, it would not have made a difference because nothing turned on the land swap. The building was the building. One can see why a court would not take kindly to such an argument.

Jeffrey W. Lem is Editor-in-Chief of the Real Property Reports and the Director of Titles for the Province of Ontario. The opinions expressed in this article are personal to the author and not attributable or referable to the government of the Province of Ontario.

Ultimately, the city might yet be vindicated, but the victory won’t be sweet and will, in any event, have to wait until the city and the developer have repeated the public hearings from scratch (doing it right this time). Even if the city is eventually vindicated, time is money, and neither the city nor the developer will have ultimately saved any time or money by trying to blow-by the residents’ group in the first case. The real lesson in New Yaletown is probably as trite as “conduct public hearings fairly and seriously from the get-go rather than risking a judicial do-over! Developers (and their lenders) need to factor in outstanding residents groups’ proceedings — because steamrolling them will be entirely at your own risk — every now and then, these residents’ groups do succeed and can grind projects to a halt. Just ask Vancouver. b

Environmental Abatement Council of Ontario Did you know that a designated substance assessment is required on all projects before they commence? – Do you want to make sure you understand where hazardous materials are before you start construction? When you are considering your next environmental project, call EACO for assistance in developing your standards. EACO members are: trained, insured and experienced. Whenever abatement work is required, make sure you hire an EACO member. The Environmental Abatement Council of Ontario (EACO) is a contractor based organization serving the environmental abatement industry. Our members represent our industry as a whole including contractors, consultants, engineers, suppliers, government officials and others with an interest in the environmental abatement industry.

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For more information on EACO please visit www.eacoontario.com or contact us at: Environmental Abatement Council of Ontario. 70 Leek Crescent, Richmond Hill Ontario L4B 1H1 (416) 499-4000 Ext.114 • (416) 499-8752 fax

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NERDS WILL LEAD US

Toronto-based Perimeter Development is turning what was once a rubber boot and auto parts factory known as the Breithaupt Block into commercial space targeting high-tech, research and creative sectors, such as Google, which will locate its Canadian headquarters here.

ABOVE:

A By Rhys Phillips

FEBRUARY MARCH 2015

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funny thing happened on the way to the implosion of Canada’s oil and commodities economy. Ontario, long dismissed as an aging laggard, metamorphosed into a leader, albeit a modest engine for a modest recovery. The jury is still out on whether plunging energy costs and the retreating dollar can turn around the province’s shrinking manufacturing sector, but whatever the outcome, a key misunderstanding about the strength of Ontario’s broader economy has been revealed. Not only is much of the Greater Golden Horseshoe in better shape post-recession than many thought, but a glowing beacon of strength in the region is the growing digital economy anchored at either end of an Innovation Corridor by the GTA and Waterloo Region, thanks in large part to escaping the impact of the Dot-com bust of 2000, the deep 2008 recession and the rapid shrinkage of Research In Motion (RIM). Many, such as analyst John Koetsier of VentureBeat have pronounced the corridor the second most important innovation cluster in North America, after Silicon Valley. Mark Barrenechea, president and CEO of OpenText, goes one step further placing it second in the world. But how successfully this future-oriented economy evolves will be tied to the

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Photos Knightsbridge Photos courtesy by: Jens of Langen/ Langen Studios (opposite); Shai Gil

LEFT: Completed in 2011, the Stephen Hawking Centre by Teeple Architects is a major expansion of the Perimeter Institute for Theoretical Physics in Waterloo that more than doubles the size of the existing facility.

shape and timing of both Toronto’s and Waterloo’s built environment transportation infrastructure. Fortunately, the latter has been taking bold steps to ensure this development supports the new economy. While we accept that every country wants to host the next super technology cluster that rivals the Silicon Valley model, Ontario’s venture capital in IT is “not of the same magnitude as Silicon Valley,” says David Wolfe, coordinator of the Innovation Policy Lab of the Monk School of Global Affairs, echoing a consensus opinion. Venture capital shortages notwithstanding, the Toronto/Waterloo Innovation Corridor does boast several core strengths that augur well for its future, including a large existing IT employment base; leading educational output; a remarkable economic diversity; a distinct cost advantage (in Waterloo at least); and strong, silo-busting collaboration. For these reasons, Barrenechea’s May 2014 Globe and Mail article diverges from most commentators on how Ontario can become the next tech supercluster. Simply put, he writes, “Ontario is the Silicon Valley of the North.” He and others point out that while the Valley has 380,000 tech workers, the Toronto-

Waterloo corridor already has 280,000. Equally important, Ontario’s 44 universities pump out approximately 30,000 computer science and engineering graduates compared to California’s 21,000, a number amplified by the ironic fact that the University of Waterloo (UW) is already a go-to recruitment centre for Silicon Valley. In addition to education and tech, Waterloo Region’s diversified economic base is a centre for general manufacturing, automotive production, financial services, agriculture, entertainment and creative services as well as clean technology. Plus the financial services sector has a huge appetite for digital innovation, so even within the tech industry there is considerable diversity. Moreover, commenLRT Station tators such as Wolfe and Mike Woollatt, CEO of the Canadian Venture Capital and Private Equity Association, agree there is an effective if informal “triple helix model” in place that eschews free market ideology in favour of breaking down silos between entrepreneurship, government and educational institutions. THE PHYSICAL ECONOMY OF HIGH-TECH

Although Waterloo Region is the junior partner in the corridor, its active and ongoing investment in a supportive built form and physical infrastructure is having a significant and positive impact on the high-tech economy to which it is closely tied. Quality of physical place increasingly matters, and that includes the ability to get between the different places that make up the whole. A 2013 report by Richard Florida’s Martin Prosperity Institute in Toronto, called Start-up City: The Urban Shift in Venture Capital and High Technology, found U.S. “high-tech development, start-up activity, and venture investment have recently begun to shift to urban centres and also to close-in, mixed-use, transit-oriented walkable suburbs.” Even San Francisco now receives more venture capital than the Valley. Iain Klugman, CEO of Communitech, Waterloo Region’s innovation commercialization promoter and operator of a highly successful digital media and mobile accelerator, reports that Google has been heard ruing the day it created its Mountain View suburban headquarters. This would seem to give Toronto a decided edge. Wolfe bluntly states that “the new creative class that Richard Florida has been talking about is more interested in living in Toronto than Waterloo.” But Waterloo Region is not about to fully concede Wolfe’s assessment. building.ca

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TREND

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Vacancy rate

* Buildings with less than 10,000 SF of office space and buildings owned and occupied by the government have not been included. There are 211 office buildings surveyed in the Waterloo Region

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E TH LK A DW AR BO

A MIXED BLESSING: MANUFACTURING, HIGH TECH AND URBAN DECLINE The physical evolution of the Region’s twin cities has, until recently, been checkered. In the 1970s, Kitchener and Waterloo started to face the double whammy other North American cities had experienced earlier. Their manufacturing base began a retreat, often from historic downtown factories. In 1984, Electrohome closed with a loss of 4,000 jobs, followed through the 1990s (and even into the new millennium) with a raft of other departures of major manufacturers. Coupled with this de-industrialization came a “hollowing out” of the core’s residential and retail base as it migrated to suburban housing and malls. Urban planners responded by trying to revitalize the downtowns with suburban-like malls that predictably failed miserably. “15 years ago the cores were in disrepair,” said Rick Haldenby, director of UW’s School of Architecture to Walrus magazine in 2011. “Kitchener was a basket case.” But this did not mean the regional economy was in freefall. If manufacturing was suffering (but not dead), Waterloo remained a growing centre of finance and post-secondary education. UW had emerged with one of the largest computer programs in the world and, because it also permitted students and faculty to retain rights over their work unlike most other institutions, it became a source of high tech spin-offs, a list that now includes Desire2Learn, OpenText, Sybase iAnywhere, Christie Digital, Sandvine, COM DEV, Dalsa, Agfa HealthCare and, of course, RIM. Given its university and financial services base, the smaller centre of Waterloo became most associated with the new economy. Emerging tech firms located around the university following the suburban location model then-favoured in Silicon Valley. This was consolidated in 2002 when ground was broken on the David Johnston Research and Technology Park located on the northwestern, non-urban edge of the university. But as this was taking place, the Region and particularly Kitchener began to rethink urban development, a move that coincided with the emerging shift of where techies wanted to work and live.

2014 Q4 Market Snapshot

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There is growing evidence that bold past moves, particularly over the last decade, and aggressive future plans are working to create a viable and growing tech centre of the future. While the lure of the big city is a creative economy trend, a smaller centre with a more-than-solid educational base, a physically dense and connected innovation cluster and a strong urban culture, not to mention considerably lower costs (both living and talent) and a closer connection to a rural environment has its own advantages. With almost 1,900 new start-ups in the last year (with $650 million in investment), eight of Canada’s largest technology companies ($15 billion in revenues) and numerous multinationals including Google’s Canadian headquarters, the base is solid and expanding.

201

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The Innovation Corridor Cisco OpenText IBM BlackBerry Desire2Learn Motorola Fibernetics Xylotek Solutions Esenfire ComDev

Waterloo Region

Source: Colliers International

1,066 Startups 1,000 High-tech companies

Toronto

1,666 Startups 11,500 High-tech companies

Brampton

Microsoft

Guelph

Google Square Intel Netsuite Electronic Arts ATS Automation ExactEarth

✈

122 Startups 90 High-tech companies

✈

Regional LRT Highway 401 GO Transit

16 Startups 250 High-tech companies

Notable companies Destinations

SAP Facebook Linkedin Intel Google Oracle

✈ Airport

A NEW MILLENNIUM, A NEW DIRECTION

The election of Kitchener Mayor Carl Zehr in 1997 (he stepped down last October) marked a watershed. Zehr told the Communitech News that downtown “was devoid of spirit, it was devoid of people. It was devoid of good ideas.” Over the next seven years, Zehr, his council and city CAO Jeff Fielding rethought the future. (The future strategy, goes the story, was first sketched out on a pizza box — now preserved in the city archives — during a ski trip.) After an employment land study identified the city’s best medium term development bet as the downtown’s traditional industrial lands, council decided to think big or go home, and in 2004 placed its first bold wager. That bet was a $110-million Economic Development Investment Fund (EDIF) intended for “catalyst projects” to support both the city’s economy and the re-purposing of its core. Its goals included stimulating core employment and downtown residential development while leveraging partner investments in both areas. In support, development charges were also waived for core area developments and a Downtown Strategic Plan was put in place. The current iteration of the latter, covering 2012 to 2016, divides downtown Kitchener into four development districts that include the food trendy Market District, the historic City Centre, a Civic District and the increasingly important Innovation District on old industrial lands. These districts are cleaved and linked by King Street that has been undergoing an award-winning, EDIF-supported extensive makeover as a destination “high street.” The plan envisages residential intensification within and around the Districts, in part by working to leverage development through city-owned properties. By 2004, the Region was aligning itself with the city’s objectives by introducing, in conjunction with the Regions’ three cities (Cambridge included), the Brownfield Financial Incentives program to provide financial resources for remediation of contaminated industrial lands and facilities. In addition, the Region developed hard urban boundaries to limit low-density outward sprawl while turning the developmental focus toward core area investment. The same year, Regional Council initiated an assessment for a rapid transit system linking north Waterloo through Visit building.ca the cores of the twin cities with downtown Cambridge. In to read full interviews with: 2009 the Region selected the most sophisticated option: • Craig Beattie electric Light Rail Transit (LRT). Subsequent funding from • David Wolfe the provincial and federal governments for the $818 mil• Iain Klugman lion top-line project fell well-short, leaving Waterloo Region • Mike Murray on the hook for $253 million while other larger cities like • Mike Woollatt

Hamilton, Ont. received full funding. Like Kitchener, but not without local opposition, the Region opted to think big and approved the elite system. In the ground since August 2014, the ION LRT is a P3 designed, built, financed operated and maintained by GrandLinq, which includes Plenary Group, a major P3 infrastructure player. The eventual 37 kilometer line is broken into two phases, the first being LRT from north Waterloo to south Kitchener and a Bus Rapid Transit ( BRT) extending south to Cambridge. The overwhelming consensus is LRT will (or already has, as many argue) speed the transformation of the TriCity’s cores into intertwined hubs of high-tech businesses, destination retail, dense residential development and cultural growth. “[LRT] will fundamentally shape the future of the community,” says Klugman, while from the developers’ perspective, Perimeter Development’s founding partner Craig Beattie says “it will be a real game changer for this market place. I don’t really think that people realize what it is going to do to transform the landscape here.” From a planning perspective, Mike Murray, Chief Administrative Officer of Waterloo Region says, “We see [LRT] as having two primary objectives …obviously moving people; but equally importantly — we call it shaping the community — intensification in our

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beam aesthetic creating a really cool and unique space.” So cool, in fact, that Google will make the original Breithaupt and a striking new three-storey addition its Canadian headquarters. Other highend tenants included BDO Financial Recovery Services, Workplace One, Lesley Warren Design Group, Dillon Consulting, and Associated Engineering. Further south on King Street in the core.” In anticipation, development patterns are already City Centre district, Perimeter has also been redeveloping a changing. Along the inner city transit corridors there has 1963 office tower into more funky space for high-tech crebeen approximately $1 billion of business investment be- ative firms. If there is a problem, Jim Moss (founder of startween 2011 and 2013, with 22 per cent of residential units tup Plasticity Labs) told CTV a year ago: “The tech community and 29 per cent of non-residential development constructed is growing faster than the town can accommodate,” particuwithin 800 metres of a rapid transit stop. larly the kind of creative space these firms want. In the same Council’s hefty EDIF wager also started to pay back almost month, commercial and real estate service firm Cushman & immediately. Based on earlier public/private preparatory Wakefield reported a two-tiered market has emerged with work, Toronto-based Andrin Homes was convinced in 2006 high vacancy rates in traditional buildings but a lack of availto convert the massive and historic Kaufman footwear fac- able “brick and beam” space coveted by the tech firms. Limtory (1908) in the heart of the emerging Innovation District ited space notwithstanding, downtown employment from into condos. Other nearby adaptive conversions includes the 2004 to 2012 climbed 20 per cent compared to 14 per cent for Mansion Lofts (2005), Eaton Lofts (2005) and Arrow Lofts the Region as a whole. Beattie considers the Tri-City cores to be one of the best de(2012). Two key game-changing developments in the same area, funded in part by the Fund, soon followed. The first velopment opportunities anywhere. Supported by city and the was the Health Sciences Campus (2009) anchored by the UW regional policies, the increasing number of tech firms clusSchool of Pharmacy as well as McMaster University’s Wat- tering in the core and their millennial demographics, residenerloo Regional Campus of the Michael G. DeGroote School tial developers are moving downtown. Murray reports that 10 of Medicine. While the campus across King Street from the years ago about 15 per cent of residential development hapKaufman Lofts was a striking new building, the second big pened inside the urban areas but by last year it had risen to an development was the next door conversion of The Tannery, a astonishing 55 per cent. While Perimeter has so far limited its 340,000-sq.ft. unused factory (circa 1850) into a tech-focused residential portfolio to undertaking a street-friendly, mixedcentre by Cadan Inc. In The Tannery, Communitech, founded use restoration of a full block of heritage buildings in Galt’s in 1997 by a group of local entrepreneurs to support the es- (Cambridge) historic centre and the resurrection of Kitchentablishment and growth of tech companies and now a not-for- er’s iconic Walper Hotel as a boutique inn, other developers profit public/private operation, established a 50,000-sq.-ft. are into downtown Kitchener in a big way. Andrin Homes, deHub with support from EDIF. The Hub alone houses close to veloper of the Kaufmann Lofts, has started first phase con90 start-ups as well as two university incubators, UW’s Velo- struction of its two-tower City Centre Condos. Designed by Toronto-based Quadrangle Architects, the For an expanded version of this article, with sections that highlight the political economy street-based project sits on land purof high-tech economies, and the Innovation Corridor’s entrepreneur, education and chased from the city next to City Hall. government advantage, visit building.ca Directly across from the Kaufman City and Wilfrid Laurier University’s LaunchPad. According Lofts in the heart of the Innovation District, Momentum Deto the City’s 2013 EDIF impact assessment, Communitech velopment’s 1 Victoria Street condo tower by ABA Architects, alone has attracted $333 million in equity investments while now in construction, is intended to reflect the modernism of also corralling Canadian Tire’s Digital Development Lab. the Medical Centre but with a nod to its “brick box” historic The latest major addition to the heart of the Innovation Dis- factories. “When people see the final result,” ABA’s Matt Boltrict is the adaptive reuse of the Breithaupt Block by Robertson ton told the city’s promotional web page, “the building will Simmons Architects, now well underway and has already won appear as though a series of traditional brick buildings are a Brownie Award (2014) by the Canadian Urban Institute. This floating in the air, tied seamlessly together by the glass curhistoric factory, being adapted by Perimeter Developments, is tain walls.” In the pre-build phase at 100 Victoria Street is converting the 230,000-sq.-ft. facility into what Beattie says Momentum’s two-tower condo project with street retail and will be “a best-in-class urban office space with a brick and a curving glass podium. Communitech has established a 50,000 square foot Hub in The Tannery that houses tech start-ups, Canadian Tire’s Digital Development Lab, and university incubators such as UW’s VeloCity and Wilfrid Laurier’s LaunchPad.

FEBRUARY MARCH 2015

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Photo by Meghan Kreller

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On the other side of King Street just east of the Breithaupt Block, construction is underway on Queensgate Development’s Victoria Common, a new urbanism array of brick lofts and townhouses designed by Architecture Unfolded to reflect the materials and factory aesthetic of nearby older buildings. With Ontario’s largest geothermal system and rooftop solar panels sitting on reflective membranes, the project will be an advanced green community. The project received Regional funding assistance to remediate the old tannery site.

Photo by Meghan Kreller

A CRUCIAL BUT PARTIALLY MISSING LINK The one point upon which everyone seems to agree when it comes to the future of the Region’s innovation economy is the need to establish twoway, all day GO Train service between Toronto and Kitchener. While partial service was instituted a few years ago, the perpetually-clogged Highway 401 is simply not a viable option for regular travel. The smaller tech node, its solid base and powerful cost advantages notwithstanding, needs better options for physical interaction with the large financial and innovation communities of the much bigger city and its economy. In addition, there are 30,000 tech workers in Waterloo Region, reports the study Innovative Regional Economies and Strategic Infrastructure: the Business Case for Two-Way Urban Commuter Rail on the CN North Mainline of which remarkably 34 per cent commute from Toronto/GTA. “If there is someone who insists on living in Toronto then they [must] still have the opportunity to work out of this community,” says Klugman. The Region, Murray states, is working with other municipalities including Guelph, Milton, Brampton, Halton and Peel Regions on two distinct rail corridors, one south, and one north of the 401. Ontario Premier Kathleen Wynne has committed to expanded service with the endorsement of the two opposition parties. As late as October 2014, however, the government declined to name a date for what is a relatively low cost project ($600 million) although a second daily round trip will be in place by the end of next year. At the Kitchener end, the Region is not just sitting and waiting. It has consolidated five acres in the heart of the Innovation District to create a multi-modal transportation hub linking the LRT, GO and VIA trains, and intercity bus service.

WATERLOO KEEPS UP

Much of the attention has focused on Kitchener’s emergence as both a hotbed for tech start-ups and major players like Google, Canadian Tire and OpenText. Smaller Waterloo, however, has hardly faded. Uptown Waterloo already boasts a core animated with an active public square surrounded by over 400 businesses, quality restaurants, cultural amenities, and independent retail and services. Recent major developments around this commercial core include the award-winning KPMB-designed campus for the Balsillie School of International Affairs and the Centre for International Governance Innovation (CIGI), all beautifully integrated into office space in the decommissioned Seagram Museum (Building, October/November 2010). Sitting across the street from the iconic Perimeter Institute of Theoretical Physics and Stephen Hawkins Institute addition, this corner has gained an international reputation for intellectual thought. Behind the campus, a 2001 adaptation of two Seagram storage buildings into lofts brought the first major residential intensification. This is now being dwarfed by Auburn Development’s 5.9 hectare Barrel Yards, a massive $350-million project including 1,300 residential units in condos and apartment towers, live-work units, townhouses and a seniors residence. In addition there is a hotel (now built) and retail and office space for 360 businesses, all serviced by underground parking for 2,400 cars. Located check-to-jowl with the Balsillie campus and the Perimeter Institute, it is also just a reasonable stroll across Waterloo Park to UW. This includes the new KPMB-designed Mike & Ophelia Lazaridis Quantum Nano Centre (Building, April/May 2010), one of the two most important institutes in the world for harnessing “the quantum laws of nature in order to develop powerful new technologies and drive future economies.” Only a bit further away, Wilfrid Laurier University is finishing its new $103-million Global Innovation Exchange to consolidate a synergy of business, economics and mathematics. Waterloo is also in the process of reshaping the Northdale neighbourhood sandwiched between UW and Wilfrid Laurier into a multi-residential, mixed-use community with promised high-quality, pedestrian-based urban design. Following approval in 2012, a team of IBM Smart City consultants prepared a report for the city on how to realize its vision after consulting with students, residents, developers and the universities. Once completed, surrounded by two universities and the Research Park, a new urban village will emerge that may provide the type of walkable community increasingly favoured by those techie millennials.

TRANSFORMATIVE LEADERSHIP

Today’s high-stakes, fast-evolving economies require the private sector to be innovating constantly around both finance and technology. But they also require transformative public leadership able to work collaboratively with a broad range of business sectors and educational institutions while ensuring the voting public’s long-term buy-in. Kitchener and Waterloo are doing a lot right even if aerial photos of downtown show empty parking lots waiting to be transformed into high quality urban products. Beyond the Region’s control are both the future of Canada’s limited and timid private equity market, and the actions of fast-promising but slow-implementing senior governments. We live in a world where geographic boundaries matter less and less, so attracting human and financial capital depends on having the foundations for business development, idea-making and rewarding urban life. Waterloo Region has the potential to amplify its future as a high-tech supercluster, but the key is to have the private sector, government and universities work together to catalyze economic growth and attract (and keep) all this nerdy talent. b building ca

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Back to

There’s a new kind of infrastructure in town, designed to return us to our roots

Sources: City of Montreal; Halifax Regional Municipality; Toronto Parks, Forestry & Recreation

green

By Leslie C. Smith

C AUGUST SEPTEMBER FEBRUARY MARCH 2015 2013

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ities are not natural entities. We have become so used to them, though, that we tend to forget how disruptive they can be to the natural order as well as to our own psyches. According to experts — and now city planners and developers who are following their lead — things have to change. Things are now, in fact, in the process of changing. In the near future, the urban jungle of the past will appear more jungle-like in reality, with extensive tree canopies, bioswales, green roofs and walls bringing natural health back to our cityscapes and to the people who dwell in them. Steven Peck, founder and president of Toronto-based Green Roofs for Healthy Cities and a prime proponent of

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Source: Regional Administrations, TD Economics

future

ANNUAL BENEFITS PROVIDED BY URBAN FORESTS: TORONTO $ value (millions)

$/tree

Wet-weather flow Air quality Energy savings Carbon sequestration Energy emission abatement

$53.95 $19.09 $6.42 $1.24 $0.58

$5.28 $1.87 $0.63 $0.12 $0.06

Total benefit Cost benefit ratio

$81.29 -

$7.95 $1.35 - $3.20

ANNUAL BENEFITS PROVIDED BY URBAN FORESTS: GREATER HALIFAX Benefit

$ value (millions)

$/tree

Wet-weather flow Air quality Energy savings Carbon sequestration

$2.10 $12.59 $12.40 $4.28

$0.04 $0.22 $0.21 $0.07

Total benefit Cost benefit ratio

$31.37 -

$0.54 $12.70

ANNUAL BENEFITS PROVIDED BY URBAN FORESTS: MONTREAL Benefit

$ value (millions)

$/tree

Wet-weather flow Air quality Energy savings Carbon sequestration

$15.95 $6.19 $1.72 $0.58

$2.66 $1.03 $0.29 $0.10

Total benefit Cost benefit ratio

$24.44 -

$4.07 $1.88

urban greening, says he first turned his attention to green roofs after spending more than 10 years working on environmental public policy development. “I realized green roofs would have a huge impact. We’re now working to develop green roofs around the world. Globally, the industry represents billions of square feet, makes millions of dollars, and is growing rapidly.” Peck’s company today concentrates not just on green roofs but on broader plant-centred city planning. In 2014, he produced a whitepaper, Grey to Green, which makes an excellent case for green infrastructure, postulating that it can simultaneously address two major infrastructure challenges — stormwater management and mitigation of the urban heat island effect. “Traditional urban development,” Peck writes, “changes the hydrology of the landscape, largely by disrupting the natural cycles of water. Impervious surfaces do not allow stormwater in the form of rainwater and melt water to infiltrate soils or evaporate through vegetation.” One effective countermeasure is bioswales — shallow roadside ditches planted with native vegetation. These not only inject a welcome touch of nature into the harsh urban core, they also act as no-tech water filtration plants, capturing, storing and slow-releasing stormwater. When established in sufficient quantities, they can reduce the strain on aging city pipes and prevent overflows into sewer systems, thus curtailing occasional flooding and dangerous bacterial cross-contamination. Bioswale soil and vegetation, in addition, can actually filter and metabolize a wide range of pol-

lutants, both water- and air-borne, as well as help reduce the asphalt-induced overheating of cities. Through their use, urban centres can potentially save millions in water-treatment infrastruc ture, air-conditioning energy consumption, and health-related costs. Green roofs, walls and canopies also contribute to cooling the urban heat island. “As cities continue to grow and add hard surfaces, they also get hotter,” adds Peck. “Recent atmospheric modelling projections for six major U.S. urban regions by the Environmental Protection Agency and Arizona State University indicate that urban growth under traditional development scenarios will result in 1–2°C of even higher temperatures in all regions, and more than 3°C in some.” Green infrastructure provides shade from and absorption of the sun’s rays. Air pollution and its attendant costs from coal- and gas-fired electricity generation would thereby be reduced; so too would sun-related illnesses, everything from heat-stroke and respiratory disease to skin cancer. Green roofs can even pre-cool intake air to buildings and have been proven to increase solar panel efficiency.

YOU REAP WHAT YOU SOW As with anything, there are economics related to urban greening. “You look at the costs—capital, maintenance and such— [and] they vary widely from city to city, and according to the design details. But they’re more than compensated for by the benefits. There’s probably 40 different benefits—some of which we can quantify and some of which we can’t,” says Peck. HALIFAX AND VANCOUVER HAVE HIGHEST CANOPY COVER RATES 45% 40% 35%

CANOPY COVER

Source: Regional Administrations, TD Economics

Sources: City of Montreal; Halifax Regional Municipality; Toronto Parks, Forestry & Recreation

Benefit

30% 25% 20% 15% 10% 5% HRM

Montreal

Toronto

GVRD

Vancouver

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In the former category would be job creation, both in cities and rural areas, where many landscaping materials are produced. Research by the City of Toronto indicates that, with green roofs alone, for every $170,000 to $520,000 invested, one year of employment is created for one person based on direct labour costs in design and installation. Indirect labour associated with such things as growing plants, manufacturing roof systems and blending growth media offers additional employment, often in rural economies. And if rooftops are used to produce food, even more employment can be generated. This latest global concept will be one part of a larger agenda at the Grey Rooftop gardening plots at the Daniels to Green conference on urban agriculCorporation’s ture, to be held in Toronto this June. Paintbox (right) and What is less quantifiable is the efNY2 condominiums fect on human health. Beyond reducing (opposite) in Toronto. harmful pollutants and high city-core temperatures, it is hard to put a price on simple contentment, on having a green oasis in the midst of cold concrete and steel. Certainly, our brains respond more positively to natural surroundings. Added plants and trees tend to lead to more outdoor recreation and community building, and these things in turn translate into less stress, which helps prevent a host of further health issues. They can even have by-product impact on such things as increased employee retention rates and retail sales. “The reality,” says Peck, “is that plants historically have been used as an aesthetic add-on. But all the new science that’s emerging about mental and physical benefits, the role that plants play in the environment, means vegetation should be viewed as a form of infrastructure, because it provides multiple infrastructure purposes.”

THERE’S ‘GREEN’ IN GREEN INFRASTRUCTURE Part of Peck’s corporate mission involves actively getting municipalities to consider the cost/benefit pros and cons of investing in green infrastructure. Green Roofs for Healthy Cities has held multiple research and design charrettes across North America. Most recently, it staged a series in conjunction with Ontario Parks Association and Landscape Ontario that included six cities in southern Ontario (Vaughan, Oshawa, London, Mississauga, Brampton and Toronto), and resulted in conceptual green redesigns of 11 neighbourhoods within those cities. The City of Toronto, for example, explored three sites and submitted one final report for the intersection of Carlaw and Dundas Streets. This site incorporated a proposed 100,069 square me-tres of new green infrastructure, as well as 3,500 square metres of agriculture-focused green infrastructure uses. In terms of monetary trade-off, capital investment was estimated at $18,647,957, with an annual maintenance cost of $556,355. FEBRUARY MARCH 2015

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In a projected half-century span, public return on investment was an estimated $31,920,761. Direct, indirect, and induced job-creation values for the Toronto site totalled 348.88 jobyears after year one, and 1,362.94 job-years over 50 years. Jane Welsh, Toronto’s acting project manager, Strategic Initiatives, Policy & Analysis, did not personally attend the charrette, but has plenty to say about urban leadership for green initiatives: “[Cities] are coming to terms with the importance of green, with viewing green infrastructure on the same level of importance as other infrastructure. We’re seeing the value of the triple bottom line — by investing in green, you get all these other benefits, all kinds of economic spin-offs.” Since 2010, Toronto has had a bylaw in effect that requires new developments of 2,000 square metres or more to install a green roof. Variables are built in to ensure that the larger the building, the larger the green space. Having an office on the 22nd floor of downtown Metro Hall gives Welsh a fresh perspective on the greening issue: “What’s amazing to me is when I look out on the city and I see all the green roofs that have popped up in the last five years or so. It’s exciting that it is changing its look.” The city has been exploring other ways to incorporate more green infrastructure. In particular, bioswales are being installed along certain roadways, and new policies are being drawn up to legislate adequate space and soil volume for tree planting. “The new Toronto Green Standard requires a number of performance measures for new construction, including trees, shading hardscape [pavement], retaining so much stormwater onsite, and other factors. We’ve just revised the draft policy for our official plan to include making new development attractive, functional and bio-retentive.” Part of that plan, says Welsh, could involve partial or full refund of de-

Photos courtesy of The Daniels Corporation

28 22

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velopment charges, if a qualifying developer chooses to go above and beyond the Tier I requirements.

Photos courtesy of The Daniels Corporation

UP ON THE ROOF This is welcome news to Jake Cohen, director of Project Implementation for The Daniels Corporation. “What the City of Toronto has done is an incredible job. They introduced their own specific program with a baseline of Tier I standards for all new buildings. Tier II takes it to the next level, with potential rebates and credits to developers who want to give it a shot. It provides a good incentive for us all to continue this movement,” he says. Cohen believes that urban greening “is absolutely here to

stay,” and that it involves more than just pro forma greenwashing. LEED certification was just the start of this extended trend, one that Daniels Corporation plans to continue spearheading. “We really took it to heart,” he says. “We started doing unique projects, and we’re now being imitated by other builders. For instance, we’ve been involved in urban agriculture for the last six years.” The company’s first project of this kind was in a Regent Park building, in downtown Toronto, where a green roof with raised garden beds was installed, and residents were supplied with the necessary tools and seeds. “It worked out to be a very positive experiment, and one that we’ve duplicated in every one of our buildings, where space permits,” says Cohen. “When it came time to register for LEED Gold, LEED didn’t even know how to classify it, it was so unique to the industry.” The fact that a green roof adds five to 30 per cent to a building’s property value, and that a recent cost-benefit study by the U.S. General Services Administration states the average return on such investment is a mere 5.2 years, Cohen says their amenity factor far outweighs any initial cost outlay.

“In our condos, we’ve had many people come to us and say ‘The reason we bought is because there are garden plots in your building.’ It has become an extremely popular amenity. “It fosters a lot of community spirit as well. Most of these spaces are multiuse. Where’s there’s gardening, there’s seating and barbecue areas. Growing and harvesting translates into potluck lunches. Condo life can be pretty solitary, with most of it lived behind closed doors. This gives you a little community in the sky. People get to be friends with their neighbours. It gives them a way of life they say they didn’t think they could get out of condo living, and buyers love it.” Daniels even test-marketed an urban agriculture feature in one of its Mississauga low-rises that has now been incorporated at its Toronto NY2 condo. “In our amenities spaces, we did something called the edible landscape. We told the landscape architect that all of the plant material needed to be edible — shrubs, pear trees, berry bushes and so forth. It’s a very cool thing [and] people really appreciate it. We’ve seen a harvesting team of tenant-owners develop around that.” If it seems our society is zipping along the right track and that urban greening has all the support it could possibly need, Peck offers this major caveat: “Science has been telling us for more than 30 years that [greening] has multiple infrastructure purposes. But many cities and senior levels of governments are relatively blind to that role. So too, are many building owners and developers. “We want to move away from sterile, unhealthy grey surfaces to living architecture — the integration of organic and inorganic materials. We need architects and landscape architects to converge. That’s the future, there’s no doubt about it. And we need senior government at all levels to realize that green has a role to play in our cities. There’s lots of jobs to be had here, plus all the health and social benefits. It’s a huge opportunity.” b building.ca

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By Terry Harron

John Tory’s SmartTrack transit plan was a major plank in his mayoral campaign platform. But do the numbers add up? A quantity surveyor does the math.

During Toronto’s mayoral race in the latter half of 2014, John Tory’s winning campaign centerpiece was his SmartTrack solution to transit woes in Canada’s biggest and perhaps most congested city. Mayor Tory outlined his plan as a Light Rail Transit (LRT) initiative that would comprise 22 stations from the Airport Corporate Centre in Mississauga to the west, south to Toronto’s Union Station, then all the way up to Markham in the northeast. Tory proposed the project’s total cost would be $8 billion dollars and that it would be up and running in seven years. Obviously, front and centre on many people’s minds is the question of whether that $8 billion is a realistic figure, but also what exactly the sum would be spent on. Part of a professional quantity surveyor’s job is to ask exactly those questions and crunch the numbers on construction projects, and the good news in the case of SmartTrack is that the project’s budget appears to be on track. Cost estimates are not perfect—they are estimates, after all—but quantity surveyors can make solid calculations by comparing a planned project to historic data.

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SMART TRACK LINE > COST ESTIMATE CAPITAL EXPENDITURE GUIDEWAY RETROFIT EXISTING GO LINE TRACKS $480,000,000 NEW TRACK $75,000,000 STATIONS/STOPS/INTERCHANGES NEW STATIONS $1,100,000,000 PREMIUM AT INTERCHANGE STATIONS $125,000,000

2014 DOLLARS

SUPPORT FACILITIES MAINTENANCE FACILITIES $100,000,000 YARDS & YARD TRACK $50,000,000

While the cost breakdown for SmartTrack is a very high-level one, it is based on translating the specifications put forward by Tory to those on similar projects for which there is access to rich data. In 2014, a team at RLB | CRSP was engaged by Ontario’s transportation agency, Metrolinx, after initial estimates on six major bus and rail projects were prepared by other consultants. Since the estimates all used different formats, RLB | CRSP was hired to bring them all into a consistent format, using the same assumptions for each project and bring all the costs to a common timeline. The team was able to use two of those planned projects (the Hamilton LRT and Hurontario LRT) as well as data from work on the Eglinton CrossTown Light Rail Transit (ECLRT) currently under way, to estimate costs for SmartTrack elements such as track way, stations, bridges, as well as all the soft costs that such a project entails.

SITE WORKS/SPECIAL CONDITIONS DEMOLITION/CLEARING/EARTHWORK $110,000,000 ENVIRONMENTAL MITIGATION ETC. $110,000,000 UTILITY DIVERSIONS $275,000,000 UTILITY UPGRADES $1,000,000,000 TEMPORARY FACILITIES $176,000,000 PARKING LOTS/STRUCTURES $125,000,000 OVERPASS $80,000,000 UNDERPASS $180,000,000 BRIDGE STRUCTURES $90,000,000 CULVERTS $40,000,000 SIGNAGE $22,000,000 TRAFFIC DIVERSIONS $22,000,000 TRAFFIC SIGNALLING $6,000,000 SYSTEMS OPPERATING SYSTEMS $250,000,000 ELECTRIFICATION/CATENARY LINES $265,000,000 TECHNOLOGY INTEGRATION - (IT/COMM/SIGNALS) $25,000,000 VEHICLES LIGHT RAIL VEHICLES $260,000,000

$4,966,000,000

SOFT COSTS LAND ACQUISITION $248,000,000 PRELIMINARY ENGINEERING $149,000,000 FINAL DESIGN $298,000,000 PROJECT MANAGEMENT $447,000,000 DESIGN CONTINGENCY $497,000,000 AFP RISK (ASSUMED PROCUREMENT METHOD) $149,000,000 TECHNOLOGY EVOLUTION RISK - (IT/COMM/SIGNALS) $124,000,000 LEGAL COSTS $50,000,000 LEGISLATIVE RISK $74,000,000 NON-RECOVERABLE HST $87,000,000 GENERAL CONDITIONS, OVERHEAD & PROFIT $745,000,000 ESCALATION TO MIDPOINT (7 YEARS) $163,000,000

$3,031,000,000

TOTAL COST

$7,997,000,000

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People get ready Although seven years may seem reasonable as a target completion date, large infrastructure projects often go over time and over budget. And when this happens to large regional transit system, time equals money. The SmartTrack budget is predicated on the project being delivered in seven years, but if that time period should slip, one of the most significant added costs will be simply due to inflation. We can’t know for certain what the rate of inflation will be each year—the collapse of the price of oil has recently caused the rate to be much lower than one would have guessed a year ago. However, for projects like SmartTrack that have a seven year time span, the inflation range and average rate is more predictable. So it’s fair to estimate that for each year the project goes over, the costs of whatever aspects of SmartTrack have not been yet purchased—whether capital expenditure or professional services— will go up three to four per cent according to the rate of inflation. Accordingly, if SmartTrack were to go over the seven year timeline, the City of Toronto would have to source more funding either through its own taxpayers or from one of the other levels of government. If neither of those is possible, or if a shortfall still remains, then the only other way to pay for the project will be to reduce its scope. The easiest and most efficient way to cut costs is to defer the building of a station, or cancel its construction altogether. In our estimate, we’ve placed the cost of all 22 stations at $1.1 billion, which breaks down to $50 million each. However, within the station budget there are costs that would not FEBRUARY MARCH 2015

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be recouped, which would fall at around 20 per cent. For instance, a lot of the design work such as engineering plans and architecture plans for that station would have already been done, and the City would not get that back. An example of this kind of “sunk cost” occurred when the decision was made last year to scrap a seven-stop LRT in the Scarborough district of Toronto and replace it with a three-stop subway. The amount that Metrolinx is owed for the planning work on the canceled LRT was finally negotiated with the City only at the beginning of this year. Although the number has not been made public as of print date, best estimates are that it will be between $75 million and $85 million.

Riding the rails If John Tory should succeed in getting his Light Rail Transit plan out of the station, Toronto will be in good company. Cities in Canada and around the world have embraced LRT as the mass transit mode of choice for its speed, reliability, comfort, environmentally friendly service and, of course, for its lower cost and shorter timeline. Tunneling is slow and it’s complicated to go underground. Deep excavations are expensive and, when you start digging, you have to deal with unknown ground water conditions (possible high water tables mean the requirement to build wells and a pumping system). While cities like New York City have to keep building subway tunnels because there’s no room on the street, many cities whose layout affords them the choice usually choose LRTs because they can’t afford the price of subways. Over 50 cities and regional transit authorities in the U.S. have invested in LRT systems, carrying millions of passengers daily. And in Canada, the list includes Vancouver, Edmonton, Calgary, Ottawa, and Kitchener-Waterloo (discussed earlier in this issue). SmartTrack’s LRT plan even has cost advantages over many others, such as how 90 per cent of its 53-kilometre length will be built on existing tracks currently used by the Greater Toronto Area’s regional GO Transit. In order to build new transportation projects, including LRT lines, governments often have to acquire privately-owned land from many different owners. SmartTrack’s lands, on the other hand, are all owned by Canadian National and Canadian Pacific. For projects where dozens of negotiations must take place, if a fair market value is not successful, expropriation measures may have to be employed. Legal battles could follow which can go on for years and delay a project. Another benefit to building on an established right-of-way is in the environmental assessment costs. When a new rail line is being considered, this assessment would have to look at the impact trains would have on the environment, local residents and businesses and traffic. This involves extensive and time-consuming studies and public consultations. Since SmartTrack will use an existing right-of-way, the amount of this work would be less onerous and time-consuming as the assessment team only has to consider the impact of additional trains running on the existing track. Tory’s SmartTrack is not a certainty yet, and neither is the $8 billion budget he set out. However, the City of Toronto is doing its due diligence to assess the project’s feasibility. In January, City Manager Joe Pennachetti released a report that promised a further report later this year that will include “high-level cost estimates” for SmartTrack. At that point, we’ll be able to see how close our own team’s cost Terry Harron, PQS, has been a member of the Canadian breakdown aligns with the one the City Institute of Quantity Surveyors since 2005. He is an produces. Then, if the project does get Associate at RLB CSRP and has been involved in the the green light, quantity surveyor teams construction industry for 40 years, and acted as will work with the City to help keep the Coordinating Estimator for the Toronto Yonge Spadina plan on track and on budget. b Subway expansion. building.ca

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F By Matthew Searle

Photography by: Patrick Mevel Photograhie

Giant lampshades create ingenious ur ban li Currently on Cartier Avenue in Québec City, 34 giant backlit lampshades, decorated with selected works by Alfred Pellan and Fernand Leduc from the Musée national des beauxarts du Québec, are hanging over the street. The installation is an original concept by Lightemotion, the lighting design firm that illuminates building façades and interiors in Europe, North America, Asia and Oceania. “Our major challenge was to respect the soul of Cartier Avenue, while being bold enough to create a world-class project that would help make Québec City a true international winter capital,” said François Roupinian, founder and president of Lightemotion.

Art and the cozy neighbourhood Aiming to capture the identity of Cartier Avenue, Lightemotion sought a lighting concept that could express the warmth of a neighbourhood life characterized by a strong community spirit. At the same time, the installation needed to be spectacular enough to be an event in itself. The idea of hanging FEBRUARY MARCH 2015

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lampshades was a perfect fit for those objectives. On the one hand, the shape of the lighting fixtures gives the avenue the cozy warmth of a residential interior. On the other hand, the large artworks, backlit by LED strips and mounted on circular structures eight feet across by five feet high, are an original urban medium for displaying art.

A flexible concept Lightemotion designed the positioning, shape and size of its lampshades so as to compose an environment capable of creating movement in the city, while working within Cartier Avenue’s technical and architectural constraints. The city’s major museum of fine arts, the Musée national des beaux-arts du Québec, helped turn the 34 lampshades into a temporary outdoor art gallery. The museum selected works by two Québécois painters, Alfred Pellan and Fernand Leduc, from its permanent collection and handled artistic direction for their reproduction on the giant lighting fixtures.

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ous ur ban lighting in Québec City The lighting installation aims to capture the identity of Cartier Avenue while also expressing warmth during the winter.

While the winter exhibition is designed to be temporary (it is scheduled to continue until the end of March), Lightemotion’s creation has the advantage of being flexible. The works mounted on the shades can be easily replaced to feature a different artist or theme every year. That capability suggests a vast range of possibilities for the system of displaying suspended backlit materials, whether it be art, urban-art competition entries, concert posters or images of different aspects of neighbourhood life. Moreover, the existing project includes provisions for the re-use of the lighting fixtures to create new annual shows for the next five years.

A vehicle for urban identity The project was part of a master plan proposed by Lightemotion in 2013 to the Office du Tourisme de Québec, which called for the illumination of several more major arteries. The Société de développement commercial du quartier Montcalm (the neighbourhood’s business improvement association), in collaboration with the municipality, the Office du Tourisme and the Musée des beaux-arts, commissioned Lightemotion to design the master plan’s first lighting component for Cartier Steet. More than a simple street installation, the project is a true vehicle for expressing urban identity. Emphasizing the importance of light for northern cities, the Office du Tourisme de Québec plans to use this type of installation to highlight its tourism programs and promote the city internationally as a winter capital. b building.ca

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V I E W Walk With Joy ULI Toronto’s Executive Director explores Toronto’s PATH network, and the incredible public utility the private realm can provide when land is used responsibly. By Richard Joy

Downtown Toronto’s underground PATH network is arguably the city’s greatest land use triumph, something I was reminded of during the 7 Cities Winter Spaces Walking Tour organized by the Council on Tall Buildings and Urban Habitat and the Ontario Professional Planners Institute. This remarkable 30-kilometre network of 1,200 shops linking over 50 buildings in Toronto’s financial district has no international comparison, and stands as perhaps one of the best examples of what can be achieved when the public interest and private land development intersect. The PATH owes its success to a subterranean history that reaches back almost 100 years. As early as 1917, the Timothy Eaton Company had five tunnels connecting their downtown retail agglomeration, and in 1929 CP Rail connected the Royal York Hotel to Union Station. Both of these early examples proved that the climate-controlled convenience of such pedestrian linkages is commercially lucrative. But the idea that Toronto should create a parallel pedestrian and retail universe to that which existed at ground level was not always viewed as a smart thing to do. Fear that such a public amenity would create a ghost town of the street level Bay Street corridor was a major concern of former mayor John Sewell and a few key senior planning officials in the City in the 1970s and 80s, during which the PATH witnessed its greatest expansion. Fortunately the combination of financial and zoning incentives during this era enticed the development community to boldly venture forward. And today, as anyone who has experienced the daily salmon run of the PATH’s 200,000 commuters can attest, it would be hard to imagine the chaos on Bay Street were the PATH not to exist. The financial district’s ever more vibrant bar scene defies the old adage that Bay Street rolls up its sidewalks at night. Increasingly, hipster restaurants such as the Queen WestFEBRUARY MARCH 2015

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inspired Gabardine and Drake150 (or even the once stuffy REDS) are doing brisk business to the late night and weekend crowds. And the proliferation of patios (once considered pariahs to civilized Toronto society) also defies the notion that the pedestrian ant farm below would sterilize the commercial opportunities above. Early skeptics of the PATH also feared that an underground retail environment limited to pedestrian traffic during weekday business hours was doomed to fail. Yet a recent City report allays that: at over four million square feet of retail it is already one of the largest malls in the world, with $1.5 billion in annual sales revenue that by 2031 is anticipated to account for over 5,000 jobs and close to $300 million in taxes. But the PATH does have its problems. Various attempts to improve wayfinding have largely failed, perhaps because it was never really meant to succeed as each connected property owner has a bit of a vested interest in a little pedestrian confusion. The TD Towers also once boasted the world’s only Mies van der Rohe shopping mall where architectural design trumped commercial marketing, and store signs were restricted to elegant white on black uniformity. But today this section has slid into commercial branding, and lacks its former modernist elegance. There are also frustrating broken links to the system that defy logic. Visitors to major tourist attractions such as the CN Tower and Ripley’s Aquarium have to go outside even though they are just steps to the PATH, and two of Toronto’s new fivestar hotels, Shangri-La and Trump, are Richard Joy is Executive off the grid even though they too are imDirector of ULI Toronto. mediately adjacent to the network. Previously, he served as Thankfully, Toronto’s other five-star Vice President, Policy and hotel, The Ritz, and its newest hotel, Government Relations at The Delta, are connected. the Toronto Board of The tour ended in the burgeoning Trade, and was the South Core district where the power of Director of Municipal the PATH is in full display, shifting ToAffairs and Ontario ronto’s commercial centre of gravity (Provincial Affairs) at south of the railway tracks, even sucGlobal Public Affairs. cessfully penetrating the formidable Follow him on Twitter Gardiner Expressway. It has amplified @RichardJoyTO or email the convergence of transportation, enat Richard.Joy@uli.org tertainment, office, residential and recreational land uses in this district and has unleashed the most explosive forces of urbanism this city has ever experienced. No small triumph, and one suspects its future is not fully written. b

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Present

For mor Canadia

Winnipeg Art Gallery

February 28 - May 3 2015 wag.ca | +1.204.786.6641

Arctic Adaptations: Nunavut at 15, the award-winning Canadian exhibition at the 14th International Architecture Exhibition - la Biennale di Venezia, surveys a recent architectural past, a current urbanizing present, and a projective near future of adaptive architecture in Nunavut. This unique exhibition reveals acts of architectural resistance and identifies an unrecognized modern Canadian North. Iqaluit, photograph by Mosesie Ikkidluak.

Presenting Sponsor

For more information on Arctic Adaptations and its Canadian tour please visit arcticadaptations.ca

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Presenting Partners

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With the participation of the Government of Canada

Platinum Sponsors

Avec la participation du gouvernement du Canada

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