Building April May 2011

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Volume 61 Number 2

april/may 2011

Editor

Peter Sobchak Legal Editor

Jeffrey W. Lem Contributors

Stephen Carpenter, Colin Dyer, Rhys Phillips, David G. Reiner, Doug Sanders, Robert Shouldice.

Circulation Manager

Beata Olechnowicz Tel: (416) 442-5600 ext 3543

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Liz Callaghan

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Features 10. Competing Bankruptcy Priority Claims / The Ontario Court of Appeal confirms its stand against the priority reversing power of the federal bankruptcy legislation.

By Jeffrey W. Lem and David G. Reiner

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12. Moving Ahead / Four commercial real estate trends are emerging as dominant forces in the global economic recovery of 2011. By Colin Dyer

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14. One Size Does Not Fit All / Public Private Partnership models are changing, as are the sectors that use them. Nevertheless, they have gained traction and are being adopted in more places across the country. By Doug Sanders and Robert Shouldice

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16. Surviving Global Economic Crises (and then some!) / How two Canadian architecture firms prospered through foreign projects. By Rhys Phillips

22. The Future Has Arrived / Corus Quay, the new 500,000-sq.-ft. Toronto head-

quarters of Canadian media conglomerate Corus Entertainment, is not only a highlight of the city’s ambitious waterfront redevelopment plans, it can also be accurately called one of the city’s greenest and smartest buildings. By Peter Sobchak

27. A Lotus in the ‘burbs / After two years of intensive renovation work, Scarborough Town Centre has unfurled itself like a debutante at a ball. By Peter Sobchak

Departments 4 Editor’s Notes

6 Upfront

29 Infosource

30 Viewpoint

Cover: Corus Quay, Toronto, by Quadrangle Architects Limited. Image © Richard Johnson Above images courtesy of: Westpro Constructors Group Ltd., Kingkay Studio, Richard Johnson, Lisa Murzin.

editor’s notes

Green Sells A tough economy forces companies to pay more attention to detail. Pressures to keep pace with growth, anticipate future business needs, recruit from a shrinking labour pool, and spend money wisely drive many companies to re-evaluate how they do business.

To compete, they must be careful about how they manage the assets they have – including their people, their buildings, and their financial investments. Even companies that don’t give a hoot about the environment in the abstract will find that attention to all things green is now critical for the bottom line. Green mandates for corporations promote a wide range of values, greatly enhancing each company’s ability to recruit top talent; attract customers and clients; improve public relations; reduce operational and real estate costs; and ultimately increase productivity.

Yet to meet these formidable challenges, employers and employees must do more than drive hybrid cars and replace light bulbs. Employers need to rethink their expectations about how work happens, and employees need to rethink how they live and work. While many companies acknowledge this as a corporate priority, only a small number are incorporating sustainability as a basic core of their corporate philosophies.

This is to their own loss, since companies that address sustainability issues and integrate them into their ways of doing business perform markedly better than those that don’t, according to a growing number of surveys. A 2008 study by the Economist Intelligence Unit, Doing Good: Business and the Sustainability Challenge, surveyed 1,254 senior business executives to learn how, if at all, stock performance correlated to corporate social responsibility performance. Among the many results, the survey showed that companies exhibiting the highest share-price growth from 2005-2007 were also the ones that paid more attention to sustainability issues. It seems self-evident that shareholders are more interested in companies that display a longer and more comprehensive view of their business, a view that by its nature includes social and environmental factors, and is also displayed in more areas than just a marketing brochure.

Greg Winkler puts it very well in the opening paragraph of

chapter one of his new book, Green Facilities: Industrial and Commercial LEED Certification. “Green facilities are smart facilities. They are businesses that control their costs through focused attention on reduced energy consumption, enhanced equipment efficiency, consistent maintenance, and more flexible building and human resource management. In the sense that business environmental sustainability is largely measured in resource efficiency, businesses have been practicing sustainability for a long time under the name of cost reduction. A business that did not routinely look for ways to produce their products or services less expensively was destined to be overtaken by producers who operated more efficiently and sold their wares for less. This aspect of green practices is not new, though the tools available to today’s managers for assessing and implementing cost reduction measures are vastly greater than those of even a decade ago. What is new, is the beginning of a new era of looking at a wider range of sustainability factors—including facilities, human resources, equipment, and operations—in a comprehensive manner as part of an overall sustainability program.”

Environmental strategies and actions that have long-term impact are about achieving more than high-performing, sustainable buildings: they are about changing the way people live and think about the world. A green workplace in its truest sense is one that integrates place, human behaviour, technology, building operations, design, and business goals. It requires an understanding of green principles and of how people react to change.

With Corus Quay, featured in this issue, Quadrangle Architects Limited of Toronto has created a building which brings life to a nascent neighbourhood, engaging both the public and the building’s occupants. It encourages employee wellness and enables literacy of resources, empowering staff to make decisions within a framework of knowledge. While green buildings can only partially solve today’s environmental problems, Corus Quay vividly illustrates that companies can change not only the buildings where work takes place, but also the rules about how people use buildings and even what “workplace” means. B

Peter Sobchak

Building welcomes your opinions.

E-mail your comments to editor@building.ca

Read De-Mystifying Regulation of Small Public Utilities in British Columbia / Matthew Ghikas and Chris Bystrom of Fasken Martineau discuss various models of District (or Neighbourhood) Energy Systems.

Green Facilities Are Smart Facilities / In an excerpt from his new book Green Facilities: Industrial and Commercial LEED Certification, Greg Winkler begins to examine a wide range of factors relating to building sustainability.

Explore An in-depth tour of the new Corus Quay building on the shore of Lake Ontario in Toronto, by Quadrangle Architects Limited.

Life after the back cover...

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upfront

Rebound in Canadian commercial real estate returns in 2010

TORONTO — Investment in Canadian commercial real estate bounced back last year with the strongest performance in three years, at 11.1 per cent, as measured by the rebranded REALpac / IPD Canada Annual Property Index. The annual total return — a marked turnaround from 2009’s negative return, at -0.3 per cent, and 3.7 per cent in 2008 — is underpinned by a 4.0 per cent capital growth and a 6.5 per cent income return. The REALpac / IPD Canada Annual Property Index measured C$97 billion of directly-held commercial real estate as at the end of 2010.

“A rebound in property values was entirely responsible for boosting the total return back into double-digit territory in 2010,” said Simon Fairchild, managing director of IPD North America.

“The return to capital growth last year follows two consecutive years of write-downs worth 9.3 per cent.” Stronger returns were posted in all of the four major sectors. For the second year in a row, Retails were the top performing sector with a total return of 15.6 per cent in 2010, followed by Industrials at 8.8 per cent, Offices at 8.5 per cent and Residential at 7.6 per cent.

Montréal led the six largest commercial property markets, with a total return of 14.2 per cent; Edmonton trailed in last with 6.5 per cent, the only market among the six where capital values did not show any recovery. Returns in the other four major markets were as follows: Vancouver (13.7 per cent); Toronto (10.9 per cent); Ottawa (10.6 per cent); Calgary (8.7 per cent).

Direct property investment underperformed the REIT market, which rebounded by 27.1 per cent in 2010 according to the FTSE EPRA/NAREIT Index for Canada, as well as stocks which returned 14.9 per cent according to the MSCI Canada Index, but outperformed bonds which returned 7.6 per cent, as measured by the JP Morgan 7-10 Year Government Bond Index.

On December 31, 2010, REALpac assumed the functions of the Institute of Canadian Real Estate Investment Managers (ICREIM), an organization originally formed to manage the Frank Russell Index for Canada and subsequently, the ICREIM / IPD Canada Property Index. A new REALpac / IPD Canada Property Index Committee has been formed of former ICREIM members within REALpac. In turn, REALpac and IPD signed an agreement on January 27, 2011, to work together and to rebrand the Canada Index as the REALpac / IPD Canada Property Index.

2011 remains a strong year to kick-start construction, says BTY Group

VANCOUVER — The coming year will be the right one to kick off construction, according to Vancouver’s BTY Group report on construction costs across Canada. “The message is clear — 2011 is the year to get solid value before pressure begins to push construction costs up again in 2012,” said Joe Rekab, managing partner at BTY Group, a cost management and project management consultancy. “In 2011 we expect balance. Investments in roads, bridges, and public buildings will push the market up, while residential construction will continue to stay cool and create downward pressure.”

BTY annually reviews cost drivers in the construction industry, and the factors behind the changing marketplace. The story building april/may 2011

for 2011 is a wave of major new infrastructure projects that will continue to sustain construction levels and stabilize costs. This will be boosted by the federal government extending until the fall the deadline for projects under its $40 billion federal stimulus fund. “The soft housing market in every province except B.C. and Alberta will continue to moderate cost increases through 2011,” Rekab said.

The expectation of only moderate construction wage increases is also helping make 2011 a value year, according to research by the Independent Contractors and Businesses Association of BC (ICBA), which BTY Group consults on industry analysis projects. ICBA recently surveyed its 1,100 members on wage and benefits expectations for 2011 and 2012. Forecast increases are 2.15 per cent in 2011 and 3.47 per cent in 2012.

“In the wake of the economic downturn, construction companies have had to hold the line on costs and wages to stay competitive and productive,” ICBA president Philip Hochstein said. “With moderate wage increases expected in 2011, and higher increases the year after, it’s clear that the coming year is an opportunity to get the best bang for your company’s construction buck.”

Manageable growth for B.C.’s construction industry over next nine years

VANCOUVER — With a few exceptions, B.C.’s construction industry will grow at a manageable pace for the next several years, thanks mainly to mining and utilities-related projects, and a modest housing recovery.

A new forecast scenario released by the Construction Sector Council (CSC), Construction Looking Forward: An assessment of construction labour markets for British Columbia from 2011−2019, says new mining, pipeline and port expansion projects will drive growth until 2015. The CSC is a national industry/government partnership funded by the Government of Canada’s Sector Council Program.

Those, along with the construction of several major hydroelectric projects means some trades will see double-digit employment growth between 2011 and 2015. But during the same period, as government stimulus projects wind down, trades heavily involved in road, highway and bridge work will likely see reductions in employment.

From 2016 to 2019, the industry will again face some employment losses as major projects begin to wind down and residential investment slows. But these losses will be partly offset by retirements from the aging workforce.

“Industry needs to continue to focus on attracting new workers even during periods of limited employment growth. Many of these new workers will be first time new entrants to the labour force and others from outside the industry. Training programs will likely need to expand and adapt to prepare these new workers for the job site,” says Tom Sigurdson, executive director, British Columbia and Yukon Building and Construction Trades Council.

During the 2011-2019 period, 31,000 workers will exit the workforce due to retirements, and this raises the total labour force requirement to 32,600 workers. Two thirds of these requirements will be filled by an expected 22,400 new entrants to the

upfront workforce, leaving a gap of 10,000 workers that will need to be recruited from outside the local construction market to meet labour requirements.

IBM to work with McMaster University to improve campus building’s energy efficiency

HAMILTON — IBM is collaborating with McMaster University to improve the energy uses and supplies in its buildings campus-wide. Developed as part of the IBM First of a Kind program, new technology will assess, simulate and forecast energy consumption from 60 campus buildings (such as the Burke Science Building, pictured) and a university hospital using the latest modeling techniques in physics, mathematics and statistics.

Traditional energy analytics under-utilize all the data available from building operations and energy uses, and lack comprehensive modeling capability that can help building managers/occupants understand how energy is consumed.

This new analytics capability from IBM Research will help McMaster analyze the information from a variety of activities in their buildings (heating, cooling, hot water, lighting, running equipment etc.) as well as factors contributing to the inefficiency in energy consumption.

McMaster will improve its decision making process and raises the bar for sustainable, cost-saving building management practices. Using IBM Information Management software, McMaster will be able to develop building performance models and analytics using real-time data from sensors, actuators and meters, and dynamic-pricing data to accurately assess, track, forecast, simulate and optimize energy consumption. The system will also identify under-performing buildings and the causes of energy inefficiencies.

USGBC launches new LEED scoring tool for homes

LAKE BUENA VISTA, FL — The 2011 RESNET Building Performance Conference was the venue for the U.S. Green Building Council’s launch of a new online scoring tool for green homes that offers anyone an easy way to explore the LEED for Homes green home building program. By breaking the LEED for Homes rating system into both a Quick Score path and a deeper dive Credit by Credit path, project team members can better

understand which green features they want to incorporate into a new green home.

The Quick Score path is intended for people new to green building and allows users to explore LEED and answer very general questions about green building. It provides an approximate certification level and a list of things that would be required in order to be in the ballpark for certification. Users have the option of proceeding to the Credit by Credit path in order to fine tune their score and learn detailed information about the LEED for Homes rating system requirements.

The Credit by Credit path is a walk-through of the rating system with a built-in checklist in which people can read the credit requirements and indicate their intentions for that specific credit. It calculates the points for each LEED credit category, checks to make sure that all the pre-requisites are checked off and ensures that the minimum point floors are attained.

The Scoring Tool is also useful as a project management tool for project teams working on multiple projects or looking to see how different iterations of the same project fare in the LEED for Homes rating system.

U of T Faculty of Architecture, Landscape, and Design opens Responsive Architecture lab

TORONTO —The University of Toronto, John H. Daniels Faculty of Architecture, Landscape, and Design has opened the Responsive Architecture at Daniels (RAD), a laboratory that provides resources and expertise for project-based research on embedded technology and ubiquitous computing in the built environment.

“The migration of computing from dedicated static appliances to mobile devices, objects of everyday life, and physical environments directly implicates and empowers architecture, landscape and urban design,” notes RAD co-director Carol Moukheiber.

RAD capitalizes on this opportunity, bringing emerging technology and research to bear on the built environment: responsive and interactive systems; augmented reality; embedded/situated technology; ambient intelligence; mobile computing and locative media.

The research is premised on the notion that every building or landscape component can be equipped with computational power to better handle persistent and emerging challenges in the areas of healthcare, building technology and sustainability.

Bullfrog Power launches green natural gas

TORONTO — Bullfrog Power has launched the first and only 100 per cent green natural gas product — a clean, renewable alternative to fossil fuel-based natural gas — to be widely available to homes and businesses across Canada. The product, which complements Bullfrog’s green electricity offering, enables Canadians to power appliances and heat their homes and businesses without increasing the amount of carbon dioxide in the atmosphere.

When homes and businesses sign on for Bullfrog’s green natural gas product, Bullfrog’s producers inject 100 per cent green natural gas into the pipeline system to match the amount of gas the customer consumes. Bullfrog Power’s green natural gas is produced by capturing and cleaning the building april/may 2011

upfront energy-rich gas produced through the decay of organic matter in our everyday waste stream. The gas is then injected onto the national gas pipeline system, displacing fossil fuel-based gas sources. Unlike conventional natural gas, green natural gas does not increase the amount of carbon dioxide in the atmosphere.

Initially Bullfrog Power’s green natural gas is produced in Canada at a landfill gas project in Québec. The facility meets strict environmental standards defined by ICF International.

Available in most provinces, Bullfrog’s green natural gas costs less than $1 extra a day for the average home. In February, Kraft Canada became Bullfrog Power’s pilot green natural gas customer, using the energy for baking and packaging processes in Toronto.

Metro Vancouver industrial real estate market slow to recover

VANCOUVER — In its Industrial Real Estate Market Report, Newmark Knight Frank Devencore reported that the industrial real estate market in Metro Vancouver has been somewhat slower to recover from the 2008-2009 recession than the office leasing sector. However, Newmark Knight Frank Devencore also notes that a number of signs point to an economy that is gaining strength and momentum, and expects that the market will see moderate but steady growth in the months ahead. Vacancy rates vary significantly throughout Metro Vancouver, from a high of approximately 7.5 per cent in Delta, to 5.2 per cent in Richmond, 3.5 per cent in Surrey and 3.0 per cent in Vancouver itself, so the various submarkets must be carefully researched to isolate the best leasing opportunities. ”In 2011, we anticipate a gradual increase in demand for quality industrial space, and overall vacancy rates should drop as major blocks of space have been taken up and are now in short supply,” said Jon Bishop, vice-president and general manager of Devencore Company Limited. “And because there is a minimal amount of new spec construction taking place, there will likely be upward pressure on asking rental rates in the coming months.”

Bishop also pointed out that many risk-averse institutional landlords remain willing to negotiate flexible leasing arrangements, so tenants with strong covenants may have an excellent opportunity to recast their leases. “Indeed, we have been able to secure a wide range of inducements — from office improvements and cash allowances to warehouse -component upgrades — for our clients. Similarly, users wishing to relocate also have opportunities to strike advantageous deals in competitive submarkets.

Additionally, with the flow of capital restored and excellent financing options available, we are seeing an increasing number of space users evaluating their options in the build-to-suit and acquisition markets,” Bishop said.

Nationally, the industrial real estate markets in most of the country’s major cities strengthened through 2010. Certain sectors gained ground more quickly than others; the high tech and manufacturing industries were hardest hit by the global slowdown, and have also been the slowest to bounce back. In 2011, Newmark Knight Frank Devencore expects to see continubuilding april/may 2011

ing positive space absorption and increased demand for quality industrial space throughout most of the country.

Kruger Energy and Helios Energy form solar energy joint venture

MONTRÉAL — Kruger Energy Inc. and Helios Energy Inc. have formed a joint venture, KH Solar Limited Partnership, to develop large-scale rooftop solar energy systems in North America. The partnership will focus on developing and transferring ownership of systems to Kruger Energy, who will operate the systems pursuant to long-term leases with building owners. The systems will be installed on commercial and industrial rooftops using a ballasted mounting technology that does not penetrate the building roof membrane. The partnership may also develop rooftop solar energy systems for building owners interested in system ownership.

Through this partnership, Kruger Energy enters the solar energy market with a view to owning and operating a portfolio of solar energy facilities. “KH Solar is unique in Canada’s emerging solar industry, thanks to its Canadian ownership, depth of renewable and solar energy expertise and underlying financial strength,” said Winston Bennett, vice president of Helios Energy.

SAIT offers new bachelor degree in construction project management

CALGARY — SAIT Polytechnic is launching a new degree this fall that will prepare graduates to accelerate their entry into project management within Canada’s lucrative construction industry.

The new Bachelor of Science degree in Construction Project Management (BSc-CPM) is the first of its kind in Canada. It will launch in September with a cohort of 32 students.

“Construction project managers require leadership ability, a broad range of management skills and knowledge of a number of core disciplines within the industry. Traditionally, they have been the product of considerable experience rather than a disciplined, focused training program,” says Gord Nixon, SAIT’s Vice President Academic. The four-year program is based on extensive research and consultation with industry which has heavily influenced course content. The program will apply theory, immersive learning and technological training to address the scientific management of construction projects.

“Construction project management is a high-demand field that includes the design, tender and management of facilities; the budgeting, planning and scheduling of project activities; and the safe and efficient management of employees, contractors, equipment and materials,” says Larry Rosia, Dean of SAIT’s School of Construction. “Ultimately, construction project managers are responsible for every aspect of their projects.”

Mortenson Construction opens office in Canada

TORONTO — Mortenson has expanding its presence in Canada.

The U.S. construction firm, an affiliate of M. A. Mortenson Company, opened an office in Mississauga, Ont., near where the firm is currently working on several renewable energy projects. In

upfront Canada, Mortenson has erected (including wind projects currently under construction) 328 wind turbines, generating 687.2 megawatts of natural wind power. Mortenson completed its first wind power project in Canada in 2006 when it completed the Prince 1 Wind Power Project near Sault Ste. Marie, Ont. The company’s latest wind power project is the Comber Wind Project, which will be built near Lakeshore, Ont., located south of Lake St. Clair. Mortenson will begin construction on a new 165.5-megawatt wind power facility for Canadian-based developer, Brookfield Renewable Power.

The Comber Wind Project is being built right next to the Gosfield Wind Project, which Mortenson recently completed in September. For this project, Mortenson is erecting 72 Siemens 2.3-megawatt turbines for a total projected output of 165.6 megawatts, which will provide electricity to more than 21,500 households.

Peter S. Rummell announced as new chairman of Urban Land Institute

WASHINGTON D.C. — Peter S. Rummell, principal of the Rummell Company in Jacksonville, Fla., has been selected as the incoming chairman of the Urban Land Institute (ULI), a global non-profit research and education institute dedicated to responsible land use, with nearly 30,000 members worldwide. A former chairman of the ULI Foundation, Rummell will serve on a voluntary basis for a two-year term that begins July 1, 2011 and ends June 30, 2013.

A member of ULI since 1983, Rummell, 65, began his 40-year development career working at the Sea Pines Company in Hilton Head, S.C. for industry legend Charles Fraser, who taught him the value of building in a way that enhances the surrounding environment, and of seeing potential where others cannot. He would later apply these lessons as president of the Disney Development Company and chairman of Walt Disney Imagineering, where he guided major developments including Celebration, Fla., a community widely regarded as exemplary of pedestrian-oriented design and connectivity; and as chairman and chief executive officer of The St. Joe Company, known for its nature-conscious approach to development, including several resort communities along Florida’s Gulf Coast.

Rummell believes strongly in long-term planning, and in settling only for high quality – two courses of action that will guide his leadership of ULI, particularly as the institute seeks to expand its impact and influence in the post-recession environment.

According to Rummell, one of the ULI’s great strengths is its ability to bring together land use professionals from around the world to share knowledge and local experiences, making the institute effective locally at a global level. This quality, he believes, will serve ULI well during this period of change for the industry. “This is a time when everyone is open to change, because everyone has had to change the way they do business,” Rummell said. “We’re in a flexible environment right now, so we have some space to make real, positive, substantive changes in community building. ULI has a strong brand. There is an international need for what we offer, and people are ready to listen to us.”

Jamieson Place achieves largest LEED-CS Gold certification in Alberta

CALGARY — The 38-storey Jamieson Place in Calgary has achieved LEED-CS (Core & Shell) Gold certification, becoming the largest new construction project in Alberta to be awarded certification under the LEED green building rating system. This 84,100-sq.-m. office tower with ground floor retail was designed

by Gibbs Gage Architects, and Enermodal Engineering served as the Sustainability Consultant for the project. The building is owned by bcIMC Realty Corporation and operated by Bentall Kennedy LP. At Jamieson Place, a variety of energy efficiency measures were implemented, including an air-tight envelope, energy efficient mechanical system, a waterside economizer, a highefficiency lighting plan, 25 per cent regional construction materials, and other features. Most office buildings use mechanical equipment that operates in full-on or full-off mode. However, at Jamieson Place, the mechanical system is based on modulating boilers and chillers that run at varying speeds, depending on how much hot or cool air is needed. This simple improvement saves considerable energy.

To ensure that the predicted energy savings for Jamieson Place are realized, Enermodal has been retained to collect data from energy and water meters for one year to help the owner and property manager improve the building’s energy performance. building april/may 2011

legal

By Jeffrey W. Lem and David G. Reiner

Competing Bankruptcy Priority Claims The Ontario Court of Appeal confirms its stand against the priority reversing power of the federal bankruptcy legislation.

The recent decision of the Ontario Court of Appeal in Re Indalex Limited has the insolvency and bankruptcy world atwitter. In Indalex, an insolvent company’s assets were sold in a liquidating proceeding under the federal Companies’ Creditors Arrangement Act (the “CCAA”). The company had an administered defined benefit pension plan which had substantial deficiencies at the time of the filing, although the company was up to date in making all of its legally required contributions. The Court of Appeal of Ontario, to the surprise of most pundits, found that the deemed trust applicable to the deficiencies was a priority claim over the sale proceeds even though the Court administering the CCAA proceedings had ordered superpriority to be given to the debtor-inpossession lender.

The Court of Appeal in Indalex also found a “constructive trust” applied to the insolvent company’s property (including the proceeds resulting from the sale of its business) and, therefore, such property (and the sale proceeds therefrom) had to be first applied to pay down any unfunded pension plan deficiencies regardless of whether or not a deemed trust existed, and that a voluntary assignment into bankruptcy should not be used to reverse the priority of a valid claim under provincial legislation. The Court of Appeal held, in particular, that: “it is inappropriate for a CCAA applicant with a fiduciary duty to pension plan beneficiaries to seek to avoid those obligations to the benefit of a related party by invoking bankruptcy proceedings when no other creditor seeks to do so.”

While the commercial bar tries to digest the true scope of

the Indalex case on insolvency practice, readers of Building will recognize the themes in Indalex as “old hat.” In another decision, Canadian Imperial Bank of Commerce v. Canotek Development Corp., decided some 14 years earlier, the Ontario Court of Appeal also adopted a similar dim view of bankruptcy as a means of reversing provincial priorities.

Prior to Canotek, it had been wellestablished law that a landlord exercising its right of distress has priority over secured creditors, but that such priority could be reversed if the tenant could be bankrupted before the distraint was complete. Before Canotek, the legal theory was that a landlord’s distress is a “process against the property of the bankrupt.” As such, if the landlord had not yet completed the distress (and this meant that the goods had to be sold, not just seized) before the tenant was bankrupted, the landlord would then be forever stayed by operation of the bankruptcy legislation. Once the landlord’s rights were stayed, the secured creditor (say, a bank, inventory financier or equipment finance company) would then take priority over the landlord’s unpaid rent, relegating the landlord to its “preferred claim” in the bankruptcy – greatly paraphrased, three months’ of rent arrears and three months’ of accelerated rent (the so-called “three plus three”). In effect, prior to Canotek, the timely bankruptcy of the tenant “reversed” the usual priorities otherwise applicable under provincial law.

The Ontario Court of Appeal in Canotek found that the “reversing rule” which had previously governed was “artificial,” concluding as follows: “This is a tail-chasing type of priority problem which must be resolved by looking at the relationship between the true parties to the dispute. In this case, the bank never did have a priority over the landlord once the landlord

Jeffrey W. Lem, B.Comm. (U of T), LL.B. (Osgoode), LL.M. (Osgoode), practises in the areas of commercial real estate and finance with the law firm of Davies Ward Phillips & Vineberg LLP, and has been called to the bar in Ontario, England and Wales. He is an executive member of the Real Property Section of the Ontario Bar Association and is editor-in-chief of the Real Property Reports, published

by Carswell Thomson Professional Publishing.

David G. Reiner, B.Comm. (Concordia), LL.B. (Osgoode) is an associate practising in the area of commercial real estate at Davies Ward Phillips & Vineberg LLP and is called to the Bar in Ontario.

This article provides general information only and is not intended to provide specific legal advice.

Readers should not act or rely on information in this article without seeking specific legal advice on their particular fact situations. building april/may 2011

legal

distrained against the goods. The artificiality of looking to the bankruptcy proceedings to give the bank something the law never intended it to have is obvious, and should not be countenanced by the court.” [emphasis added] The Canotek decision, in effect, reversed the reversing rule.

Since the Canotek decision, secured lenders could no longer gain priority over distraining landlords simply by bankrupting the tenant before the landlord could seize and sell the on site goods.

Now, Canotek did more than just reverse the reversing rule, and is not, in fact, really a landlord-friendly decision. While it did take away the advantage that secured lenders previously had over landlords during tenant bankruptcies, it also took away the advantage that a landlord had over the trustee in bankruptcy by finding that the landlord’s distress was a fraudulent preference. Indeed, if Canotek is seen as a battle between a secured lender and a landlord over the value of a bankrupt tenant’s assets, then Canotek sees both parties as losers, with the tenant’s trustee in bankruptcy (and the tenant’s unsecured lenders) as the only winner.

Of course, Indalex and Canotek are hardly identical.

Amongst other things, in Indalex, the insolvent company sought to voluntarily bankrupt itself in an attempt to reverse

the priority of its unfunded pension obligations, whereas in Canotek, the bankruptcy petition was filed by a competing secured creditor in an attempt to reverse the landlord’s competing distress priority. Nonetheless, the Ontario Court of Appeal’s apparent distaste for the ostensible reversing power of the federal bankruptcy legislation comes through loud and clear in both decisions.

According to Robin Schwill, an insolvency and bankruptcy expert at Davies Ward Phillips & Vineberg LLP, Indalex has fundamentally changed the corporate restructuring landscape, and may even have an impact on cross-border corporate group insolvencies, especially those involving claims for breach of fiduciary duty.

Oddly enough, Canotek remains a relatively unknown decision to this day, even amongst lawyers who regularly deal in landlords’ rights and remedies. One of the unexpected impacts of Indalex may simply be to remind such lawyers that Canotek has reversed the reversing rule in tenant bankruptcies (and has, in other ways as well, turned the priority of distress on its head).

Hopefully, we won’t see a wave of tenant bankruptcies like we did in the early and mid-nineties in order to test our understanding of the post-Canotek distress priorities. B

building april/may 2011

Moving Ahead Four commercial real estate trends are emerging as dominant forces in the global economic recovery of 2011.

By Colin Dyer Every year on the snowy slopes of Switzerland, a small ski resort plays host to 2,500 world business, government and public sector leaders. Behind the perimeters of the tight security cordons, the town of Davos is transformed into a hub of conferences, panel discussions and networking events. While the meeting, which is in its 40th year, is not intended to solve the world’s problems in an instant, it brings critical parties together to face social, economic and business issues with a view to real solutions.

This is my third year in attendance and each experience provides a fascinating insight into where we are in the economic cycle and which new issues come in and out of focus. Last year there was a feeling of relief but it was still tempered by fear. World economic growth was sluggish, keeping certain recovery on the sidelines. There were fears of a double dip recession, questions on whether China would continue to lead the recovery and much debate about fiscal regulation.

This year’s mood was more confident, albeit subdued rather than brimming. Many corporations saw a positive 2010 with new and more efficient business models contributing to their success; but it’s too early for a bullish outlook as the recession is still visible in the rear view mirror.

The importance of being BRIC The overriding theme of the meeting was ‘Shared Norms of the New Reality’. The topic centred on the rise of the BRIC countries (Brazil, Russia, India, China) and how they have emerged triumphant through the recession. There were notable delegations from China and India and much debate on how the building april/may 2011

global community will accommodate their increasing presence on the world stage. The new reality is about giving these major sophisticated nations that hold 40 per cent of the world’s population a clear voice in world economic and political affairs.

Like the overall global economic recovery, commercial real estate growth is resurging in Asia Pacific. A recent survey of 200 of our corporate clients said they believed their largest strategic opportunities lie in the East. We are seeing unprecedented growth in both sales and leasing across major Asian cities despite the risk of inflation and interest rate hikes. But for now, and what I heard at Davos, Asia is a top priority for investors. As evidenced in our global capital flows research, we found that commercial real estate investment volumes in the region grew by 25 per cent from 2009 to 2010, equating to US$83 billion. Growth in Singapore was up 219 per cent, in Australia 77 per cent and in China 41 per cent.

Real Estate: State of the Union Representing the commercial real estate industry at the world’s foremost meeting is not only important to Jones Lang LaSalle but also to the real estate industry. We have a key role to communicate to a global audience on issues ranging from real estate market conditions to real estate finance and sustainability.

I went to the meeting with four key real estate trends in mind that are not only pertinent to our industry but also vital to global economic recovery.

We know that real estate is a lagging indicator and that property market recovery encourages the globalization of capital flows and liquidity in the investment markets. We have good

news to deliver. With a fundamental performance recovery well underway in most dominant global real estate markets, we expect global direct investment into commercial real estate to surge up by 20 to 25 per cent to US$380 billion in 2011, which follows the 50 per cent growth we experienced in 2010 over 2009 levels.

Fourth quarter 2010 global investment volumes already topped the $100 billion mark for the first time since the onset of the global financial crisis in 2007, demonstrating momentum for increased investment trades in our sector. More property trades signal improved investor confidence that will encourage investors to assume greater risk to achieve their intended returns. At the same time, the lending environment is being strengthened as banks successfully and quietly refinance their loans. All in all, the return of commercial property markets bodes well for a global economic renaissance.

Secondly, we are seeing commercial property recapture its place as a preferred institutional investment category. Many institutional investors once again have faith in real estate investments and their ability to supply above-average returns. Along with the aging population in many parts of the world, governments and companies will need to generate more cash to pay beneficiaries and, in turn, are very likely to increasingly tap commercial real estate as an asset class due to its income-producing characteristics.

We expect global direct investment into commercial real estate to surge up by 20 to 25 per cent to US$380 billion in 2011, which follows the 50 per cent growth we experienced in 2010 over 2009 levels.

Also, there is an increased demand for transparency in our industry. Amid the recent global financial and market turmoil, activity in most markets focused on surviving rather than advancing. Now, investors are demanding the ability to see clear exit strategies before placing their capital into commercial real estate. One of the key reforms likely to emerge from the credit crisis is a renewed focus on demonstrating improved transparency and regulatory measures to stem a repeat incident. Many cities will work to become more transparent in recognition that it can enhance their competitive strength in attracting both business and capital.

Finally, sustainability initiatives are climbing the corporate agenda and gaining momentum. As evidenced by the surprisingly positive outcome of the UN Climate Change summit in Cancun, Mexico in December 2010, many countries and companies around the world recently have demonstrated their renewed

commitment toward addressing the role they play in the emission of greenhouse gases that accelerate climate change. At one of the Davos Forum’s sustainability sessions a senior Greenpeace representative told us that some years ago he struggled to persuade multinational business leaders to meet with him. This year he was inundated with requests. My case in point.

In Davos, I chaired the real estate group’s panel on retrofit financing. We discussed ways to finance retrofit and modernization projects in existing buildings. We looked at methods that not only elevate real estate to the best environmental standards but also to increase its value. While this is a work in progress, all the panel members agreed that energy, efficiency and sustainability are top priorities for corporations and investors alike and the recession has not diminished their interest.

Sign of the times It was a valuable meeting and important for commercial real estate to be at the table. Not only was sustainability high on the agenda but topics such as diversity, innovation and social media were a key focus. These are areas that will remain in focus as they play an important role in both our personal and working lives. On leaving the meeting it was clear to me that China and India are major players which are making their mark and will continue to have broader influence in the future. They present the commercial real estate industry with significant opportunities. For example, we are seeing space requirements for Chinese banks in Western financial centers and Western firms are expanding their footprint across Asia.

I also left feeling that large corporations across all geographies were overwhelmingly positive and were in investment mode. As with commercial real estate, Asian companies are taking the lead and the process is firmly underway. These firms are demanding all real estate assets classes and increasing their space demands.

While it’s clear that the business world is getting into strong financial shape, many governments are still remarkably unfit.

They are facing challenges such as fixing budget deficits and trade imbalances, rising interest rates and inflation. As a firm and industry we need to be mindful of this. As we look ahead to 2011 we see a clear picture of where we are heading and the challenges and possibilities we face. It will be interesting to see how our influence on sustainability will grow, how transparency in emerging markets will develop, whether true economic optimism will return and what we will be discussing at Davos next year. B Colin Dyer is president and Chief Executive Officer of Jones Lang LaSalle Incorporated, an integrated global real estate services and investment management firm. Dyer has overall responsibility for guiding Jones Lang LaSalle’s strategic direction and growth and for chairing the firm’s Global Executive Committee, the most senior internal management committee.

He is also a member of the firm’s Board of Directors. www.joneslanglasalle.com building april/may 2011

One size does not fit all Public Private Partnership models are changing, as are the sectors that use them. Nevertheless, they have gained traction and are being adopted in more places across the country.

The Canadian infrastructure world has been shaken by the impact of Public Private Partnerships. New hospitals, long term care homes, schools, arenas, energy generation, roads, bridges, water and wastewater plants, and prisons have been built using this formerly European model. Much of this infrastructure replaces older failing infrastructure, while others are new greenfield projects. The overarching theme is that many of these projects would not have been built in our traditional model.

Public Private Partnerships for projects The term PPP (or P3) may be new, but using a different set of letters it is not necessarily a new project delivery method. While many Canadian construction projects are built using a process where the owner engages designers to prepare a design and then tenders out the construction (generally called design-bid-build, or “DBB”), many other projects are built using design-build (or “DB”) where the owner hires a single entity to design and construct the project. Acronyms are rife in the construction sector, as “DBFs” (design-build-finance, where the design-builder finances the project through to completion), “DBOs” (designbuild-operate) and others have also been used. A PPP is actually a design-build-finance-operate (or maintain), or “DBFO” or “DBFM,” for you acronym junkies.

The challenge for all owners is determining the best way to successfully deliver a project. These newer methods add one other question: how do we best maintain the asset once it is constructed so that it does not become part of the next generation’s infrastructure deficit? Traditional methods rely on the owner’s consultants to verify that the owner is getting what it is building april/may 2011

By Doug Sanders and Robert Shouldice

paying for, but in a PPP (or DBFO), the company that is hired to perform all of these functions over a long term, together with the bank that has lent the money, have an equal or greater interest in making sure that the asset is properly designed, constructed, and maintained. Of course, this is of particular interest to public sector owners, where ribbon cuttings were traditionally followed by continually slashed maintenance budgets. Five year governments maintaining fifty year assets are mismatched from the start.

Are PPPs a panacea? The choice of delivery methods needs to be carefully matched to the needs of the owner and the peculiarities of the project. One size definitely does not fit all.

Government agencies Many of the larger provinces have agencies dedicated to the delivery of infrastructure, and these agencies (such as Infrastructure Ontario, Infrastructure Québec and Partnerships BC) are all now delivering projects on a broader basis than just Public Private Partnerships. This means that companies who were not interested or able to participate in PPP now have the prospect of seeing these agencies in other delivery modes.

Added to this mix is PPP Canada, which is a federal agency that is targeting PPP projects. Its mandate is to support the development of PPP projects and facilitate the development of the Canadian PPP market. To accomplish this goal, PPP Canada has a fund (the P3 Canada Fund) that is a merit-based program that can be accessed by provincial, territorial, municipal governments, First Nations and other public authorities. In addition to the fund, PPP Canada offers consultancy services to these same

McGill University Health Centre receives PPP Deal of the Year (Americas) Award Thomson Reuters awarded its 2010 PFI Award for PPP Deal of the Year (Americas) to the McGill University Health Centre (MUHC), Groupe immobilier santé McGill and Infrastructure Québec for the financing of the new MUHC Glen Campus project. The prize was awarded at the PFI Awards Dinner held on January 26 in London, U.K. The combination bank/bond financing for the new McGill University Health Centre in Montréal expanded the universe of PPP investors to fund the largest greenfield hospital project in Canada despite the challenge of a lengthy 51-month construction period.

The financial advisors for Groupe immobilier santé McGill, groups, as well as to other federal government agencies.

In addition to federal and provincial agencies, there appears to be increased interest in PPP project delivery in municipalities, both large and small. Some of the larger municipalities such as Toronto and Winnipeg have already been involved in PPP projects, while others such as Calgary and Victoria have appeared interested. Smaller municipalities have also been the source of some projects, but project size, constrained municipal resources, and lack of education have appeared to be problematic. The latter is an area of interest for PPP Canada.

Infrastructure sectors The needs of each government have driven the sectors in which PPPs have been used in Canada. In British Columbia, hospitals, highways, and energy generation have led the way. In Alberta, schools and highways have been the principal targets. In Ontario, healthcare was the clear priority, with highways now following suit. In Québec, highways and now healthcare have been the primary sectors. In the other provinces, such as New Brunswick, it is a mixture of many sectors.

There does not appear to be a clear sectoral winner for the future. It appears that healthcare (both hospitals and long term care) remains strong, as does the highway sector. There appears to be some room for growth in schools, particularly in the provinces that have not been active yet.

Energy continues to be a strong player. The ever increasing appetite of Canadians for power has led to numerous calls for new power, many of which have been done on a PPP or quasiPPP basis. Additionally, maintenance budgets for existing power generation facilities have not escaped the politician’s guillotine, resulting in a significant need for refurbishment.

While much of that refurbishment is being done on a traditional basis, there appears to be some appetite for PPPs in the refurbishment sector.

The areas that have seen some projects, but that appear to be in the “moderately strong” category are prisons, police stations, water and wastewater, and transit. Each of these sectors has prospects for growth.

The final categories are project areas that have had less press, but that could be poised for some increased activity. These sectors include recreational facilities (such as ice rinks and auditoriums),

SNC-Lavalin Capital and Investec North America Limited, chose Scotiabank, Dexia, BNP Paribas, CIBC, Crédit Agricole, RBS, and SMBC to handle the bank portion and Scotia Capital, Casgrain and Dexia to underwrite the bond issue.

The financing program received great investor demand for the bond portion. The amortizing bonds, which mature in 2044, were priced to yield 290 GBX over the benchmark. The bank loan portion of the financing was priced at 225 GBX over Libor.

The bond issue raised 764 million from more than 50 investors.

A consortium led by SNC-Lavalin with its partner Innisfree will develop the 300,000-square-metre, 500-bed facility under a DBFM contract comprising a 30 year operating period. ports, waste (including energy from waste), and miscellaneous other government facilities such as maintenance facilities. Each of these sectors has had some activity, but there appears to be a prospect for growth in each sector.

Exports of Canadian expertise When Partnerships BC and others first solicited work, the project professionals had foreign accents, mostly Australian and British, reflecting their nations’ PPP head start. The bankers came mostly from Europe and the U.S., and Canadian professionals were brought in only for our local knowledge.

But Canadian professionals learned quickly, and now others are seeking Canadian expertise. Entering this market after the Australian and British trailblazers, Canadians have learned from their mistakes and built on their successes.

Canadians have a tremendous history of success abroad, and are playing an important role in the development of PPPs on all continents (with the exception of Antarctica, although Public Penguin Partnerships cannot be far from occurring). This trend is likely to continue as PPPs have spread to developing countries around the world.

The future The only constant is change. New models will develop and current models will adapt. PPPs survived the recession, and the need for infrastructure creation and rehabilitation continues to increase. There is no perfect project delivery model, but PPPs appear to have found a home in Canada. B Doug Sanders is a partner with Borden Ladner Gervais LLP in the firm’s Vancouver office.

Also an engineer, Sanders includes Construction Law among his areas of practice. Robert Shouldice, also a BLG Vancouver partner, practices in Corporate Commercial as well as Energy Law. Doug can be reached at 604-640-4128 or dsanders@blg.com. Robert can be reached at 604-640-4145 or rshouldice@blg.com building april/may 2011

Surviving

By Rhys Phillips

Global Economic Crises (and then some!)

How two Canadian architecture firms prospered through foreign projects.

Architects, it is said, are to the economy what canaries once were to coal mines: an early warning system. When architects start falling off the perch, you know that economic trouble is not far behind. While the economic crisis of the last two and half years has swirled around the near collapse of key global financial structures, the overdevelopment of property and the infamous series of linked “bubbles” were at least key contributors to the depth and severity of the recession. And, true to form, the architecture profession took an early and, it appears, extended hit.

In the United States, reports Kermit Baker, chief economist of the American Institute of Architects, architecture firms have lost a third of their jobs since the summer of 2008.

Paul Katz, president of Kohn Pederson Fox (KPF) is quoted in a Xiamen University published article on opportunities in China that “demand just fell off a cliff when the economic crisis began. The recession is only second in magnitude to the Great Depression … and construction activity completely building april/may 2011

dried up.” Even now, early in 2011, Baker reports that U.S. architecture firms remain “reasonably pessimistic” although the Faststream Recruitment Group, U.K.-based specialists in built environment jobs, reported in February that architecture businesses are at last looking to hire again.

Architecture firms with global practices, however, have been less negatively affected. According to Ed Hammond, writing in the Financial Times last December, larger name firms such as Foster and Partners and Rogers Stirk and Harbour have been able to secure large projects overseas unlike smaller British firms (although this did not save the former from laying off over 300 employees primarily in offices serving the eastern European market). Hammond quotes Will Alsop, who has carved out overseas niches in Canada as well as China and the Middle East: “If you are really going to take any [overseas market] seriously you have to be there and absorb the culture, have to be eating and drinking the food and doing what locals do.” But, he warns, doing

Previous page and left: Stantec provided full architecture, interior design, landscape architecture, and engineering services on the transformation of Nassau’s aging Lynden Pindling International Airport. Stage 1 of the design, completed in March 2011, is a 16-gate facility that welcomes visitors and residents alike with its dramatic roof form, natural materials, and the lively colours of the islands.

Photos © Richard Johnson

so is not cheap and often there is not a local base of professionals thus necessitating the costly transfer in of a firm’s own staff.

Two Canadian firms have more than met both the culture and staff challenges, combining local recruiting, acquisitions and a sensitivity to a country’s “sense of place” to prosper through the global financial crisis. As a result, Edmonton’s Stantec and Toronto/Vancouver/Shanghai-based B+H Architects are emerging as major Canadian global practices.

Stantec — From civil engineering to integrated practice Edmonton-based Stantec Inc., which originated under the Stanley name in 1954 until it was re-branded in 1998, is emerging as a world-class Canadian engineering and architecture firm.

By the 1990s, the then-modest sized regional firm decided its focus on civil engineering limited access to clients who wanted more than basic infrastructure.

Through acquisitions, including in the United States, management began to expand into urban development, architecture and landscape design. In 1998, with the consolidation of over 20 associated firms and 2,000 employees under the new name, CEO Tony Franceshini announced, “Our vision is to grow the company into a 10,000 employee, billion dollar firm by 2008.” Both goals were achieved. A year later, Business News Americas was reporting on Stantec’s aggressive consolidation of the Caribbean region and its movement into Latin American countries including a sewage treatment plant in Columbia financed by the Canadian government.

Over the last 11 years, Stantec has evolved into a major professional consulting firm focused on both public and private projects in Canada, the United States and the Caribbean but with even broader international aspirations. Its expertise spans planning, engineering, architecture, interior design, landscape architecture, as well as project management and economics. Expertise in integrated public and private urban land development, as well as public facilities such as health care and education, is supported by the firm’s broad competencies in sustainable development.

Stanis Smith, Stantec’s Senior Vice President, Building

Group explains in a telephone interview that “the last couple of years have been good in large part because we are diversified both by sectors and by geographical regions.” The firm’s extensive experience and proficiency in public sector oriented projects, particularly hospitals, airports and higher education facilities, has helped Stantec weather the recession because demand has remained high, both domestically and internationally, as governments have spent on these sectors to stimulate flagging economies. In terms of healthcare, says Smith, the firm is very active in North America and the U.K. as well as Abu Dhabi, Qatar and Australia. Even in Dubai where the bubble did burst, Stantec continues to work in the public sector. On many domestic projects experience working in P3s has prepared the company to work with the powerful infrastructure companies emerging as key players in global public sector projects.

Already Canada’s largest architecture firm, Stantec has set its sights on becoming a leading international design practice, a goal perhaps already achieved with its selection in 2009 as one of Building Design magazine’s top firms in its annual World Architecture 100 survey. Stantec ranked overall in the top 10 in healthcare, retail, infrastructure, leisure, and criminal justice as well as top 10 for earnings in facilities management, surveying, landscape architecture, planning, and urban design.

Global Ambition and the Art of Acquisition Having weathered well the international financial crisis, Stantec continues to expand with a strategy of aggressive acquisitions.

In May 2010 during the heart of the recession, The Globe and Mail reported that the company has “made no secret of plans to expand by snapping up entire firms of engineers and architects” in pursuit of its goal of 10 per cent annual growth through acquisitions. And acquire it did, absorbing 10 firms through the year to add to over 30 prior acquisitions since 1999. With the rapidly shifting dynamics of a globalizing but also increasingly fragmented international market, this strategy has centred on two linked goals. First, it has sought to consolidate its North American and Caribbean base in areas that build on project types less devastated by the recession. This has often included publicly-funded priorities such as healthcare, schools, building new or replacing deteriorating infrastructure, transportation and, increasingly, environmental sustainability.

For example, its 2009 acquisition of San Francisco-based Anshen+Allen strengthened further its U.S. healthcare presence on the American west coast while the purchase in the same year of Philadelphia-based Granary Associates, a 100-person architecture and interiors firm focused on healthcare, expanded this market strength to the eastern seaboard. Most recently, its January 2011 purchase of Georgia-based Street Smarts added a proven and well-connected transportation operation in the building april/may 2011

Left: Microsoft Zizhu Campus is a 1.8 million square foot sustainable and very flexible office complex forming part of a bucolic, high tech park in Shanghai. The campus includes a high performance envelope, solar shading, daylight controlled lighting systems, and interior light shelves to draw daylight deep into the complex. Below: The just-completed 289,000-sq.-ft. Shanghai General Motors Administration Building is designed with highly flexible layout spaces on every floor. Services are packed densely into two central cores and longer spanning columns ensure better open space, all of which will allow for future use changes.

The You You Grand Sheraton International Plaza (page 20), finished just before the recession, was the winning entry in an international design competition. Its sleek tower contains 525 hotel rooms, offices, residences and an elegant shopping galleria that provides a signature skyline profile for Shanghai’s Pudong District, as well as new urban density.

American south that builds on the 2006 purchase of Oakland-based ACEx, a 25-person firm specializing in transit, rail and power communications, as well as control systems engineering.

Second, it has aggressively extended its project base into the Middle East as well as into the continuing hot Indian market where private sector investment remains strong. With its December 2010 purchase of Burt Hill, a 600-person integrated architecture and engineering firm located in Butler, Pennsylvania, Stantec acquired a highly regarded design firm credited with numerous prestigious U.S. healthcare, education, science and technology projects. But through the purchase, it also took over significant existing practices in both the United Arab Emirates and India (Granary Associates also added a Doha, Qatar office). With the purchase, Burt Hill’s former chief executive officer, Peter Moriarty, took on the role of heading up Stantec’s international architecture and engineering offices in the United Arab Emirates and India.

“The purchase of Burt Hill with their office in India,” says Smith “continues our process of regional diversification that has accelerated in the last two years.” Recently completed work by Burt Hill includes the Gujarat Cancer Centre, and a civic hospital/medical school in Ahmedabad, India. Within five years, he reports, Stantec expects 20 per cent of its revenues to come from international work. The acquisition of existing in-place offices with a proven record is augmented by Stantec’s own solid record of quality architectural design such as the much-admired Peterborough Regional Hospital (Building, April-May 2010), its growing reputation for sustainability-based work and its ability to provide a full range of integrated services. At the same time, Stantec avoids both project financing and construction to minimize its risk exposure, a point not gone un-praised by investment advisers commenting on the publicly traded company.

Only occasionally do they enter selected design competitions.

As the number of internaional offices has proliferated, building april/may 2011

Photo by Mr. Kingkay SHI, Kingkay Studio

Photo by Kerun Ip

Stantec has moved to ensure each expertise point of service can engage, in real-time, with the other 130 global Stantec offices. Colm Murphy, a Stantec senior principal, told Digital Construction magazine in October 2010 that Rabbit Technology is being added to all offices in order to ensure the fastest systems possible for interconnected project development. Global delivery of integrated expertise also means globally integrated offices.

How a domestic partnership secured a major overseas project Stantec has worked on over 40 international airline terminals.

In fact, one of every three passengers in North America will pass through a terminal on which they have worked. Outside North America, recent projects have included airports in Chile, two in Cyprus and, just opened, the Nassau International Airport in the Bahamas. The last project emerged from a partnership with longterm client Vancouver Airport Services, through whom Stantec submitted a report on recommended functional and aesthetic principles that won the approval of the Bahamian government.

Opening last February, the new US$245 million, 585,300sq.-ft. terminal is a vital transportation improvement for an island nation dependent on air travel. It constitutes the first phase of renewal, replacing the original airport built over 40 years ago and serves U.S. traffic with allowance for pre-custom clearance. A second phase will see a 10-year-old addition renovated while the third will involve a new domestic terminal.

The finished work, explains Smith, had to be phased as the airport was required to operate fully during construction.

The design avoids a patchwork appearance by employing a dramatic undulating roof structure that unifies its various components. This umbrella-like form represents both the waves on the omnipresent ocean as well as the drift of the island’s

signature sandy beaches. Natural materials such as local limestone were used and the new terminal’s open design plays to the natural light and the remarkably even climate of the country.

Bahamian colours formed the palette and 12 local artists were contracted to provide works that appear in the four gardens, with native plantings woven into the design and are experienced either as you move through or sit in the terminal.

B+H Architects goes global B+H Architects (formally Bergman and Hamann), like Stantec, was established in the early 1950s and also like the Edmonton firm has evolved into a recognized successful Canadian global firm. Although it lacks Stantec’s engineering base, the over

B+H takes the extra step: embracing the UN’s Global Compact and Sustainable Buildings and Climate Initiative (UNEP-SBCI) The United Nations Global Compact asks international businesses explicitly to align their operations and strategies with 10 universally accepted principles on human rights, labour, the environment and anti-corruption. After signing on in 2009, B+H completed a thorough study of the Compact’s principles and reset its organizational goals to ensure compatibility. “We reaffirmed our commitment to the Global Compact with the submission of a Communication on Progress report in 2010,” says Johanna Hoffmann, H+B’s global director of marketing.

Recently, Teresa Coady, president of B+H BuntingCoady, was invited to take part in UNEP-SBCI’s efforts to promote global sustainability and raise awareness about the importance of sustainable building on reducing greenhouse gas emissions. This, Hoffmann states, is consistent with B+H’s commitment to green architecture since the early 1990s, represented in a number of firsts, such as the first LEED-Gold certified high-rise office building in Ontario and the first LEED-certified mid-rise office building in the Philippines. “We have developed an extensive education program for our staff across Asia and also for our clients, suppliers and other stakeholders in order to help them understand and adopt our ‘green’ recommendations,” she reports.

Finally, B+H believes that “innovation is born from diversity. Diversity connects us to the community, helps us form our core company values, and ensures that the brightest minds in the world are helping us to drive the very innovation we advocate... diversity is in our blood.” The firm expects partners, staff, suppliers, vendors and outside consultants to reflect these values on diversity and inclusion. Its international recruitment strategy is focused on ensuring B+H maintains staff that “is representative of the world we live in… free of harassment and discrimination.” This includes ensuring “accommodation for individuals whose needs require extra attention whether temporary or permanent.” B+H has no problem stating, she concludes, that “the result of our efforts is an international firm with a diversity record second to none in the world.”

300-employee firm is now a fully integrated architecture, interior design, landscape architecture, urban design and master planning practice. Having established a solid international reputation for dependable construction administration on large scale, technically complex projects, along with the ability to win both design and firm competitions, B+H has been building an increasingly strong capacity for sustainable design. As a result, it now boasts a global reach with its domestic offices in Toronto, Vancouver, Calgary and Kelowna complimented by offices in Asia, (Shanghai, Ho Chi Minh City, Singapore and Delhi) and the Middle East (Sharjah, Dubai and, by mid-2012, Jeddah).

As a result, B + H have weathered the economic recession well, not only sustaining its position but also expanding its sphere of practice through significant foreign projects.

Despite the similarities between the two companies, B + H’s success has been more based on “organic growth” according to Bill Nankivell, the firm’s CEO. In a far-ranging interview, he outlined how the firm has not only succeeded overseas by careful integration into local markets but has built stability into its domestic operation by creating a fully integrated practice that focuses on three “centres of excellence” in Toronto, Vancouver and Shanghai that are capable of supporting one another through the internet on a 24/7 basis.

At the same time, B+H have been making domestic acquisitions that support its international strategy. In 2010 it purchased Bunting Coady, a Vancouver firm with a global reputation on sustainability based on a record for consistently developing buildings that consume half the energy of traditional buildings at the same construction cost (the firm designed Vancouver’s Port Authority head offices, Canada’s first LEED Gold building). It followed this up with a second Vancouver acquisition, Reno C. Negrin Architects and CHIL Design, an experienced designer of hotels and resorts in North America, Europe, and South Africa as well as in the Middle East and Asia. The expectation, states Nankivell, is to grow in Canada and abroad over the next five years to over 1,000 employers.

B+H’s international expansion strategy: China Perhaps ironically, it was an earlier economic crisis that got things going. With the domestic market reeling in 1992, the firm won a design competition for the Xiamen Gaoqi International Airport in China and quickly picked up a second commission for a major trade show centre. Nine years later, the sweeping roof curves of Xiamen gave way to a deft translation of traditional Chinese roof structures into a robust but thoroughly modern signature terminal at the Changsha Huanghua International Airport. This demonstrated the firm’s conscious efforts to create designs representing an architectural environment rooted in the traditions of the relevant vernacular. In addition to respecting a site’s sense of place, states Nankivell, the internationally recognized diversity of Canada’s professional labour force, especially in Toronto and Vancouver, acts as a decided plus abroad.

Back in the 1990s, he reports, there were many architecture firms flying in and out of China but “we quickly understood the need to establish a solid, permanent local presence in order to nurture long-term relationships.” This included both hiring building april/may 2011

Photo by Kerun Ip

local architects to harmonize Chinese clients’ aesthetic preferences with the firm’s progressive international design language as well as moving design and technical expertise permanently from Canada to Shanghai. “By hiring local professionals, we also gained invaluable insight into what was ‘constructible,’ including how to work within China’s remarkably compressed schedules and to guarantee project management and administrative processes that were workable in what was a very different culture.” B+H’s Shanghai office now has 120 professional and technical staff offering a complete range of services that has produced to date 87 projects for multinational corporations as well as local Chinese developers, institutions and governments. Deep local knowledge has also allowed B+H to excel at competitions, the source of much of its work.

With a very strong planning group in Shanghai, the firm has been able to obtain numerous commissions for large, integrated landscape and land use planning projects that frequently play a key role in Chinese developments. Success with this work has provided avenues to obtaining architecture commissions related to the implementation of the plans.

Being in place permanently also allowed the firm to adjust quickly as China’s capacity for sophisticated building changed rapidly. While curtain wall was initially imported from Korea or Japan, for example, the highest quality materials are now sourced locally while the design and technical quality of Chinese architecture graduates is very high. Both official China and private sector developers, now on their third generation of projects, are rapidly increasing their commitment to sustainable development, according to Nankivell. “Our teams of LEED-accredited professionals can develop unique solutions for each project based on our experience with both the U.S. and the Canadian versions of LEED, as well as in Asian programs like Lotus and Greenmark.” In Shanghai, a “Green

building april/may 2011

Action” committee trains staff on environmental design issues and how these must guide their day-to-day work activities.

Leveraging the China experience Having built its Shanghai operation into one of its three centres of excellence, B+H is using the office to expand aggressively into other emerging Asian markets. According to Nankivell, “the Shanghai office anchors our Asian operations, supporting regional offices in Ho Chi Minh City, Singapore and Delhi, where senior principals oversee teams of local employees and selected project partners.” Along with Toronto and Vancouver, Shanghai can deliver “large, mobile teams with extensive expertise in every aspect of planning, design and project management to every market sector” to support these smaller local offices. Rather than acquiring existing firms or relying heavily on partnerships, B +H prefers to establish its own on-site presence with locally recruited professionals. Now, he states, the Ho Chi Minh office is even able to provide technical support back to Shanghai-based projects. Recently, the Vietnam Economy News noted approvingly that “the firm is sensitive to the local people’s requirements and can be adaptable to change.”

B+H launched both its Singapore and Ho Chi Minh City offices in April and May, 2010 respectively. The former is already involved in designing the Goodland Office Headquarters [targeted for Green Mark Platinum], housing for Singapore’s Urban Redevelopment Authority, and condominiums for Kolte Patil Pte Ltd. In addition to designing a new campus for the Australia International School in the Vietnam capital, the firm began work in January on the Arcadia Health and Wellness Centre under the direction of Saskatoon native Andreai Zerebecky, who transferred from the Shanghai office.

The company also reports that it is in advanced negotiations for mixed use, healthcare, transportation, commercial and institutional projects, not only in Singapore and Vietnam but also Malaysia, Brunei, Indonesia and Timor Leste.

By 2007, B+H were already expanding into India. Again, as partner Paul Gogan told the Daily Commercial News at the time, “There are a few American, European and Japanese practices there, but they tend to be commuters. We are establishing a full-time presence and making a commitment there.” Its Delhi office soon obtained major contracts in the national capital but also in Mumbai, Haridwar, Bangalore and Ahmadabad. Projects have included health care facilities as well as master planning and large scale residential resort developments, interior design and retail. In India, private sector demand has remained strong, notwithstanding a relatively brief “cautious pause” at the height of the recession, reports Nankivell. Because Indian development tends to be familyfirm controlled, being established locally to build networks is very important to getting invited to competitions. Being able to assign a senior Indo-Canadian firm member to lead the office certainly was a plus.

Currently, the firm is realizing the striking, 1.8 millionsq.-ft. Survam Knowledge Park, a multi-tenant advanced technology campus in the high-tech Gurgaon area. With advanced sustainable design features, the project is the firm’s

first to be pre-certified LEED Platinum. Like the Celestica Shanghai Research and Development Centre, Survam represents the firm’s swift exploitation of a new development staple in emerging economies: large-scale, integrated technology and knowledge campuses.

The Middle East B+H is taking on the still lively Middle Eastern market with offices now in Sharjah and Dubai and a third planned in Jeddah, Saudi Arabia. In addition to local work, the firm is also involved with a healthcare project in Amman, Jordan and a master plan and urban redevelopment in Basra, Iraq.

According to Nankivell, the move into this new market was the offshoot of an initial contact made in Toronto that lead to a lunch date at Sultan bin Muhammad Al Qasimi’s English estate and eventually to the design of the Al Rayyan Complex.

This complex of three, 35-storey residential and office towers with a mixed use podium with the Emir of Sharjah as client is now under construction. As in India, personal connections are vital in the emirates and the local offices, this time lead by an Arab-Canadian professional, and play a key role in expanding the number of projects on the boards. While several large

projects are on hold, work is proceeding on the Sharjah Jewel, an architecturally powerful sculpted tower that will act as an iconic landmark on the Al Mamzar Lagoon separating the emirates of Sharjah and Dubai (schematic design stage) as well as on the equally impressive Özdilek Centre under construction in Istanbul.

Different but overlapping strategies builds global practices Stantec and B+H have transformed successful domestic operations into major global practices. The two firms have sometimes used different primary routes with the former using strategic acquisitions to gain access to developing markets while the latter has employed architecture competitions to gain a foothold. Both, however, have taken the risk of investing in strong, on-the-ground offices, developed comprehensive technical and cultural understanding of the host country and formed vital personal networks. Both have also used internet technology to ensure high performing, interconnected offices capable of providing in-depth services. Both have focused, at least in part, on resilient public service projects and sustainability.

Finally, both have used Canadian government services to support expansion of their global aspirations (see sidebar). B

We’re from the Government and We’re Here to Help Both Stantec and B+H credit federal and provincial governments with being important partners in expanding into the global market. According to Stanis Smith, senior vice president of Stantec’s Building Group, developing a network of contacts is very important in a new market. “We have worked and will continue to work with the Canadian government’s offices when abroad as they are very helpful for opening doors in these emerging markets.”

Foreign Affairs and International Trade Canada’s Canadian Trade Commissioner Service (CTCS) has over 150 offices with 1,000 commissioners around the world (as well as in every Canadian province) that provide export advice, guidance and assistance to break into global markets. Indeed, Rick Prentice, vice president of Stantec Consulting Limited sits on the Service’s Infrastructure Public-Private Advisory Board.

The Board advises on Canada’s Global Infrastructure Strategy that supports exporting firms involved in engineering, construction and architectural services.

CTCS’s four service areas cover preparing for world markets, evaluating market potential, finding qualified contacts and resolving problems. A key component is what they call a Virtual Trade

Commissioner (VTC), which allows a firm to create a tailored web page through which is provided ongoing access to detailed country market intelligence and firm-specific business opportunities as well as current market reports, sectorspecific news and trade events. Direct help is available from Trade Commissioners at home and in a targeted market. Examples of intelligence reports include things such as India’s intention to transform 24 locations into high-tech residential and industrial hubs. Or, detailed reports may outline how in the Middle East there is a growing interest in P3s in social infrastructure such as hospitals and schools as well as airports, particularly with green build capabilities. Through the VTC, there are tools to help establish field contacts that can assist in targeting specific projects.

B+H participates in government trade missions including an upcoming Ontariolead mission to the Middle East where Al Hinton, Area Director for the Middle East at the Ministry of Economic Development and Trade, continues to play a key role for many Canadian firms. The firm’s CEO, Bill Nankivell, credits Canadian trade commissioner staff abroad with the smooth development of its expanding offices, singling

out the recent successful efforts to establish a Ho Chi Minh City office Finally, the site facilitates management of online applications to available funding programs such as Business Development Canada’s Market Xpansion Loan. This program provides up to $100,000 to a firm to participate in “prospecting initiatives” such as funding support for overseas trade shows like the influential Cityscape in Dubai as well as for export and/or e-commerce plans and for certain types of working capital related to exporting services. The Export Development Corporation (EDC), a Crown corporation, helps companies partner with financial institutions, provides financial guarantees and risk abatement insurance and facilitates “match-making” sessions with foreign clients. According to Paolo Utano, Sector Advisor, Infrastructure and Environment, the EDC works closely with CTCS and provincial bodies, such as Ontario’s Investment and Trade Services, to bring financing -- including capital for foreign acquisitions -- and overseas networks to the table. For a full list of available federal and provincial services see the EDC’s document Government Trade Services at http://www.edc.ca/english/ publications_15055.htm building april/may 2011

Future The

Arrived Has

Corus Quay, the new 500,000-sq.-ft. Toronto headquarters of Canadian media conglomerate Corus Entertainment, is not only a highlight of the city’s ambitious waterfront redevelopment plans, it can also be accurately called one of the city’s greenest and smartest buildings.

1969 Nobel Laureate Herbert Simon once said, “Engineering, medicine, business, architecture, and painting are concerned not with the necessary but with the contingent – not with how things are but with how they might be – in short, with design. Everyone designs who devises courses of action aimed at changing existing situations into preferred ones. Design, so constructed, is the core of all professional training.” Successful designers (of everything from buildings, products, services and organizations) always admit there is no “set solution” that can be bought off the shelf. Instead, savvy designers use their principles, creativity and a willingness to learn and adapt, to guide them to new and more inspired solutions – a phenomenon known as transformative design.

Transformative design is at its best when it not only changes the way products and services are made and delivered, but also increases awareness and changes human behaviour. In many building april/may 2011

By Peter Sobchak

cases, the very act of inhabiting an inspiring structure affects the conscious or subconscious reaction of the user. Corus Quay is just such an inspired structure, the result of Quadrangle Architects Limited’s design thinking and ethic. With this project, Quadrangle turned a speculative office building into the headquarters of one of Canada’s largest media and entertainment companies, a building that will have a significant impact on the revitalization of Toronto’s waterfront as well as be a major influence on the company itself.

One of the first transformative moments came when Corus Entertainment Inc. decided to consolidate under one roof operations, staff and brand assets, spread out over 11 different locations in and around Toronto. The design for what would become Corus Quay was originally developed as a speculative office building, with standard floor heights and maximized floor

Photos © Richard Johnson

Left: A Fibreglas and Corian reception desk functions as both an orientation tool and base for many design features, such as the wave motif that extends out in the form of terrazzo flooring patterns. Above: A soaring five-storey atrium houses many of the dynamic features of the building, such as the two-sided bio-wall air filtration system and the very-functional slide that links a collaboration zone to an event space. This is also how natural light is able to penetrate into the centre of a deep floor plate.

plates, by Toronto-based Diamond and Schmitt Architects Inc. By signing on before building construction began, Corus and Quadrangle were able to make strategic design changes to the building shell, changes driven by clear yet simple mandates from Corus to “do what was right.” This meant breaking down the silos that typically permeate the broadcast and media industry and opening up the company, first to its staff in an open concept, socially-driven office environment that encourages a collaborative and innovative work atmosphere, and second to the surrounding community of the nascent East Bayfront precinct on the shores of Lake Ontario.

The latter was achieved by revealing the ground floor in various ways, including radically changing the shape of the northwest corner to provide nine radio studios with direct views from the public promenade. This notion of penetrating and connecting views into the building is achieved starting in the north lobby where visitors can look straight through to the water, and follow a Fiberglas ribbon that begins its life as a bench, designed by Eventscape, then swoops up and along the perimeter, breaks through the glass doors and splits into two pieces – one dipping up to a lounge atop a three-storey studio space, the Hub, and ending at the entrance to a corkscrew slide, while the second

ribbon pirouettes through a corridor created by the studio and wraps itself around the slide.

Another strong motif is the sense of connection with the building’s location on the shore of Lake Ontario. A wave pattern emerges, first in the Fiberglas and Corian reception desk (also by Eventscape), continued on the large column with Fiberglas cladding, and picked up by the terrazzo flooring pattern that draws the eye back to the five-storey atrium. The terrazzo pattern also introduces a “land to water” theme used throughout the building and seen through changing colour patterns, from brownish-green hues to blue as it approaches the shoreline. This is echoed in a hemlock wall made from timber dug up from Toronto Harbour, wood that was used originally for ferry docks dating back to 1910.

Humans have a strong desire to connect to nature. Biophilia, a term coined by American biologist E.O. Wilson, suggests there is an instinctive bond between human beings and other living systems. “Nature is rife with sensory richness and variety in patterns, textures, light and colours,” said Wilson in his groundbreaking book. “All organisms respond with genetically programmed reflexes to the diurnal and sensory patterns of sunlight and climate.” Quadrangle applied this knowledge to their workstation designs, keeping walls as low as possible to allow light to penetrate deep into the floor plate. In addition, building april/may 2011

Quadrangle understands that acres of neutral-coloured workstations do not support human productivity. The workspaces of Corus Quay, while stimulating, do not rely on neon colours and noise, but rather access to daylight, window views to the outdoors, materials selected with sensory experience in mind, spatial variability, change of lighting levels and use of highlights, and moderate levels of visual complexity, such as coloured blades along the top of the workstation panels that help with navigation and also represent the land-to-lake scheme.

One of Quadrangle’s many strengths when designing for a media company (skills honed through 25 years of working for such clients as CityTV, MuchMusic, the CBC and Rogers) is creating innovative ways to handle various brands and integrate them into a space. Corus brought together over 70 media, radio and television assets with very strong identities to the new project.

Instead of trying to unite them under one banner, Quadrangle chose to celebrate each one in Corus Quay through specially branded meeting areas throughout the building that showcase diversity through the use of colour, lighting, furnishings and custom-designed graphics, a solution that is one of the most dynamic features of the project.

This gesture continues the theme of community in a way that extends beyond just the Corus family to include the larger Canadian design community. These brand-specific meeting rooms showcase many arresting furnishings such as lighting fixtures designed and manufactured by Canadian design collectives including Castor, Unit Five, Barr Gilmore for MADE, and Tsunami Glassworks. Workstations were designed and manufactured by Toronto-based Teknion, custom meeting tables by Regency Interiors and Commute Home. Several pieces, including the reception desk and furnishings in the eighth floor lounge, were fabricated by Eventscape, and the breathtaking executive boardroom table was designed by local sculptor Gord Peteran.

Broadening the reach of broadcast We live in a world saturated with media, but few really know or understand the world that media lives in.

Broadcast media studios are high performance, acoustically sensitive, fabricated environments, often called “black boxes,” where natural light and sound must be carefully controlled.

The larger environment is designed to support the high tech needs of broadcast components and the huge technical plant building april/may 2011

required for the processes. However, although it produces very public content, often the actual broadcast environment is cut off from the community and not particularly transparent.

Quadrangle broke down the concept of the “black box” as a space, which isolates itself from its environment, and instead opened the doors and windows to allow some connection and transparency into the broadcast processes and to engage the community both within the organization and in the actual community, its audience.

The move to this new facility also allowed Corus to explore new dimensions in broadcasting and take a quantum leap forward to re-engineer production capabilities from the ground up. This meant building an entirely digital infrastructure, based on leading-edge integrated technologies and automated systems that transform Corus’ broadcast and content businesses.

The state-of-the-art broadcast facility is a veritable wish list of high tech content creation and management systems that include 24 broadcast feeds, with the capacity to deliver up to three times as many services; a tapeless, file-based broadcast and production model; a digital asset management system; document lifecycle management via Open Text; full Wi-Fi coverage; VoIP phones with e-mail integration and Cisco TelePresence video conferencing.

The management and television broadcast systems’ implementation project was led by Siemens IT Solutions and Services. The building’s IT is designed on a computer virtualization infrastruc-

Far left: Partition walls were kept low to improve access to natural light, and coloured blades along the top of the panels are both a wayfinding mechanism and echo the land-to-lake scheme. Left: All floors have a central meeting and eating hub such as this, each in a distinctive colour. A central access stair encourages active circulation rather than elevator riding.

ture, where employees each have a monitor on their desks, which is connected to a virtual hard drive with their identity. They can log in anywhere in the building and their hard drive and personal ‘computer’ is with them wherever they go. This virtualized computing environment has shrunk hardware requirements from 300 computers at previous locations down to 40.

Among other technological advancements in the new building are: a file-based digital broadcast and playout from an IT-centric system rather than broadcast hardware, maximizing expansion and configurability to traditional playout with VOD, SVOD, broadband and other formats; full high definition broadcast infrastructure to support current broadcast as well as VOD, SVOD and broadband; a centralized document management system that controls ingest, storage, sort, search and collaboration technology via the internet, and digital document for workflow support, sharing and storage of corporate assets.

The heart and brain of Corus Quay is master control and the technical services room, which houses more than 250 racks of equipment. These look like a deck from the USS Enterprise, but also continue the theme of openness and transparency by being exposed to anyone passing by. These rooms run 24/7, so to put their function into perspective, if they were to only work 99.9 per cent of the time that would still represent eight hours of dead air within a 12 month period. As such, multiple back-up systems are installed to prevent disruptions and make sure this never happens.

Far left: All IT, radio and TV digital processes are run through the 8,000-sq.-ft.

Technical Services Room.

The screen displays the building’s energy useage.

Left: Specially branded meeting rooms, such as this one for radio station 102.1 The Edge, capture the character of many of Corus’ brands.

Elsewhere, an 8,000 square foot central data room consumes 40 per cent less energy than the company’s previous broadcast facility, yet still manages to hoard approximately two petabytes of technological storage (2,000 terabytes, two million megabytes, or 15 trillion floppy discs that could circle the world three times), equivalent in content to the entire collection of the U.S. Library of Congress, and there is still plenty of room to expand.

A physical manifestation of green values Broadcast media environments, due to the nature of their 24/7 operations, are mechanically and electrically intensive, a condition exacerbated by the extreme process loads from the specialty equipment required to broadcast. Understanding that energy savings are equal parts design, commissioning and tenant engagement, one of Quadrangle’s sustainability solutions promotes energy literacy by making master control and the technical services room visible to everyone. Meters are used to check power consumption, equipment performance and various process loads and lighting and a monitor installed near master control, which describes the amount of energy being used, can set targets for systems through metering and benchmarking performance.

Another astonishing design feature is the building’s energy efficient lighting system. More than 4,500 lights at Corus Quay are individually controllable, typically by schedule, by occupancy sensors, or by daylight harvesting sensors. Additionally, digital control panels found throughout the building enable lights to be easily adjusted, controlled by the internet and through each desktop phone. The system, designed by Oakville, Ont.-based Fifth Light, uses dimming control on an individual fixture basis (called DALI or Digital Addressable Lighting Interface) that assigns an address to a fixture and allows two-way communications, providing light control and energy efficiency. No other facility has this level of variety in lighting types – linear, incandescent LED’s, CFL’s – controlled by one system.

The physical attributes of the building play a key role in achieving the LEED Canada-CI (Commercial Interior) Gold certification which Corus Quay is targeting. A five-storey bio-wall dominates the central atrium while green roofs reduce the heat-island effect and provide green space for employees. The exterior blue glass windows are a custom THERMO 3 curtain wall system, reflecting building april/may 2011

Left: Corus Quay successfully consolidates the company’s Toronto-based operations from 11 distinct locations and over 1,100 employees into one 500,000 square foot office building located on 2.5 acres of Toronto’s waterfront.

light and driving down heating and air conditioning costs. Water consumption has been significantly reduced by using low-flow water fixtures as well as by capturing and reusing rainwater.

Wide-ranging sustainable construction initiatives meant over 90 per cent waste diversion of building materials, and an extraordinarily high percentage of recycled content and regionally manufactured materials were used. Low-VOC emitting adhesives, sealants, paints and coatings, carpet, systems furniture and seating were utilized throughout the building.

Buildings must be more than efficient and healthy to be sustainable – they must celebrate place, community, and the user. One of Corus’ goals is “to engage” the growing waterfront community. Much of Quadrangle’s efforts have been to integrate and draw connections between employees and the neighbourhood, especially since the Corus building, with over 1,100 employees, is a community within a community. The ground floor atrium is treated as a central gathering space for the community and the social heart of Corus; radio studios are laid out at grade allowing the public to watch live broadcasts and see the faces behind their favourite voices.

This focus on connectivity and sociability has led to a triple triumph of remarkable design achievement and laudable corporate citizenship: Corus Quay is a LEED Canada-CI Gold targeted interior design within a LEED Canada-CS (Core & Shell) Gold targeted base building in a neighbourhood targeting LEED-ND (Neighbourhood Development) Gold under the USGBC Pilot Program.

The rest of the building also offers Corus the opportunity to re-think ‘business as usual.’ Quadrangle transformed the office environment from a place of isolation to a place featuring a social hierarchy of spaces based on open offices, with kitchens as anchors of social activity, boardrooms as breakout spaces, and collaboration spaces throughout. The result is an environment that is creative and even playful, as evidenced by a three-storey slide that starts at the top of the lounge and

runs into the atrium.

These days the question is whether an environment that supports the most productive work needs to look and function like the offices and factories of today. Or are they relics of the past, soon to give way to new models and paradigms altogether? Corus Quay is an example of what a workplace can be, proving that the ultimate way of applying design thinking to the workplace is to consider transformative ways to accommodate work itself -- a credit to Quadrangle, which brought design thinking, not just design to the job. As the painter Francis Bacon once said, “Things alter for the worse spontaB neously, if they be not altered for the better designedly.”

Architect: Quadrangle Architects Limited Base Building Architect: Diamond Schmitt Architects Inc. Project Management: Pivotal Projects Inc. M/E Engineers: Crossey Engineering Design Consultant – Boardroom, Terrazzo, custom furnishing: William Anderson, William Anderson Design Design Consultant – 8th floor lounge: Allen Chan, the Design Agency Structural Engineering: Morrison Hershfeld Engineering Code Consultants: Randall Brown & Associates Construction Manager: Aecon Building Acoustician: Aercoustics Specifications: Don Shortreed LEED Consultant: Halsall Engineering Landscape: Terraplan Constructors and Subcontractors: Adelt Mechanical Works Limited Ampere Limited Applied Electronics Ltd. The Brothers Markle Inc. Camino Modular Systems Inc. Castlewall Marble & Tile Choice Office Installations Inc. Fifthlight

Findlay-Jones Insul. Ltd Inflated Game Systems Northwood Carpet & Tile Ontario Staging Limited Pengelly Iron Works Ltd Select Drywall & Acoustic The Surface Group TAGG Industries Vipond Inc.

Visit www.building.ca for an in-depth photographic tour of Corus Quay. building april/may 2011

After two years of intensive renovation work, Scarborough Town Centre has unfurled itself like a debutante at a ball.

A Lotus in the ‘burbs

Top: New modular design lighting has been installed throughout the common areas, as well as new curved ceiling with recessed cove lighting and energy-saving daylight sensors to ensure the shopping centre is always bathed in soft, even light. Above: New state-of-the-art skylights feature high performance glass that reduces heat gain and glare. Next page: Renovated double-door entrances include new HVAC units and ductwork to provide both heating and cooling in vestibules.

It’s tough being Scarborough. Of the five boroughs in the Greater Toronto Area, Scarborough tends to get the least amount of respect.

Let’s face it, having the rest of the city refer to your borough with a mash-up moniker that includes the back end of the name Siberia can be a little bruising to your image and even your self-esteem.

But the winds of change are blowing in Scarborough, and based on a rising tide of developments that is representative of other suburban cities in the province (or even across the country) such as a flood of condo developments by the likes of Tridel and Monarch, Scarborough is transforming itself from a rougharound-the-edges dormitory suburb into a mature and self-aware cultural centre combining housing, employment space and civic facilities in new ways that are attracting businesses and investors.

A good barometer of a suburb’s evolution is the metamorphosis of its retail landscape. Retail, after all, tends to be quicker to respond to the needs of shifting demographics and shopping patterns. In Scarborough this maturation can be best-seen in the swan-like renaissance of a two-level super regional shopping centre known as Scarborough Town Centre, which has just finished a two-year, $62-million upgrade fuelled by its owner and management company, Oxford Properties Group.

Long-considered an active nucleus for the city’s east end, the Scarborough Town Centre’s expansion and refinement parallels that of the city around it. When it first opened its doors on May 2, 1973, Scarborough’s population was approximately 200,000.

Initially a 130-store shopping centre, over the next 25 years building april/may 2011

Photos by Lisa Murzin

By Peter Sobchak

Scarborough Town Centre would continue to grow with the city by launching two major wings. Phase 2 opened an additional 240,000 square feet of shopping space on August 8, 1979 and Phase 3 introduced 177,000 square feet of space devoted to entertainment on December 4, 1999.

In between the construction of Scarborough Town Centre’s two major phases was the completion of a new Light Rapid Transit System in 1985, which linked a significant number of TTC bus routes and the subway with GO Transit. This not only made the Centre more accessible to those living in surrounding neighbourhoods, it increased its importance as one of east-end Toronto’s busiest transportation hubs.

By the year 2000 onwards, the peripheral land around Scarborough Town Centre steadily developed to service the needs of the rapidly growing city, whose population as of 2006 had tripled to more than 602,000 (with household incomes averaging $67,228 per year), and now includes marquee restaurant, grocery and retail satellites. All told, the Centre now has 1,318,418 square feet of total gross leasable area and 5,708 parking stalls sitting on 65 acres overlooking Highway 401, where over 240 shops and services draw approximately 425,000 people per week.

Renovations to Scarborough Town Centre began in the fall of 2008 when Oxford Properties Group hired Markham, Ont.based Petroff Partnership Architects to create a more inviting, modern atmosphere. The first thing a visitor will notice – particularly one familiar with the Centre’s earlier days – is the abundance of soft natural light. New state-of-the-art skylights featuring high performance glass, coupled with glass balcony balustrades (that were once concrete) and a new curved ceiling with high-tech and more efficient common area lighting, allow deep and extensive penetration of light into what once felt like a brooding cave.

Other improvements include a new central Customer Service Centre at the busiest entrance leading to the TTC; new escalators to replace the existing stairs; a new and larger centre court elevator; renovated entrances to the building; and fancy new digital mall directories.

The Food Court Areas in particular received a considerable makeover with increased seating capacity to accommodate more than 1,000 customers; contemporary column treatments and plantings; new flooring in select areas and new waste and recycling units.

Effort was also made to improve the Centre’s environmental footprint. The irrigation systems were refurbished to save significant water consumption, and a new recycling program was launched in 2009 with all tenants’ recycling being picked up at store fronts 24/7. Power consumption is expected to go down 50 per cent when old hand dryer units are replaced by 38 new ones in the commonarea washrooms, and all seven receiving bays will receive new and more efficient lighting, using 140,000 kilowatts less per year.

These measures are prompting Oxford to go for a Go Green Plus building certification through the Building Owners and Managers Association (BOMA). B

Elsewhere in Oxford’s retail portfolio...

Scarborough Town Centre is owned by Alberta Investment Management Corporation (AIMCo) and Omers Realty and managed

by Oxford Properties Group, who took over in 2005 from 20 VIC Management Inc. and added the Centre to a retail portfolio in Toronto that includes Square One Shopping Centre, Royal Bank Plaza, Metro Centre, Richmond Adelaide Centre, and Yorkdale Shopping Centre.

The latter (also owned by AIMCo and also previously managed by 20 VIC) has announced it will undergo a $220 million expansion that will add more than 145,000 square feet and 40 new stores to the mall. “We’re expanding thanks to the strength and success of the existing shopping centre and strong tenant demand for space,” says Anthony Casalanguida, general manager, Yorkdale Shopping Centre.

In addition to adding new stores, the mall’s food court will re-locate to the vacant third floor of the former Eatons store and building april/may 2011

will offer double the number of seats and additional new restaurant options. Including a brand new patio and skylights, the new food court will also reduce waste by 85 per cent with reusable tableware.

Already certified as a Go Green Plus building through the Building Owners and Managers Association (BOMA) in 2008, the expansion will feature the same sustainable technologies that are implemented in the existing facility, including a 65,000 square foot green roof, which will extend roof lifespan and reduce atmospheric heating. This growth will make Yorkdale eligible for LEED Silver certification.

As part of its expansion, Yorkdale will be making contributions to support local neighbourhood revitalization, which will include improvements to public access at the east end of Yorkdale Shopping Centre and Yorkdale Park including an enhanced landscaping plan. In addition, Yorkdale will be contribution to the Yorkdale Community Arts Centre.

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By stephen carpenter, PEng

Three Ways LEED has Shaped the Green Building Marketplace What a difference seven years makes! Before the LEED Canada rating system launched in 2004, the green building market was but a hint of the active economy it is today.

Although Enermodal has been in the building energy efficiency business for 30 years, it wasn’t until LEED and its third-party certification that we saw a real interest from a broad range of developers looking for sustainable design. Recently, Enermodal hit a milestone with our 100th LEED certified project. This makes for a great opportunity to look back at ways LEED has helped the Canadian BD+C industry evolve.

1 - Creating a demand for sustainable buildings

Enermodal has seen a variety of “carrot” approaches to encouraging green buildings. The 1980s and 1990s, saw a variety of energy incentive-based programs from utilities and governments. For example the Commercial Building Incentive Program (CBIP) by Natural Resources Canada helped to stimulate the market for energy modelling and make buildings hit a 25 per cent energy target. However, when these financial programs ended, as CBIP did in 2005, the market dried up. Similarly, government programs targeting green buildings like C2000 were also entirely dependent on government funding.

LEED was developed by the private sector, first in the United States and then in Canada. While governments support LEED, the USGBC and CaGBC operate outside the government so are less dependent on shifting funding and partisan priorities. LEED created a marketing tool that CEOs, developers, tenants, school boards, and marketing departments could understand and ask for.

In advanced commercial markets like Toronto, where developers are looking for any way to differentiate their condo or office tower from the one across the street, LEED provides a tangible marketing – and performance – benefit.

The question around the design table used to be, “Why are we going green?” Now the question is, “Why aren’t we going for LEED?”

2 - Third-party, quantified “green building”

Before LEED, tenants and visitors in high performance buildings often asked, “How do you know this building is really green?” This was often a hard question to answer because there was no universal definition of green. Given the amount of green-washing in the marketplace today, it is natural that the public wants to have certain standards. LEED helps create “intelligent” demand for green buildings as the consumers (from developers to members of the public) know what to look for in a green building.

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Today, only a few people are green-washing or LEED “shadowing” where they say they are following the principles of LEED but not going through the rigorous certification and review process – a sure way to guarantee the building is not living up to the high standards set by LEED.

3 - New material markets

When one market expands – like green buildings – other markets naturally rise as well, such as the market for sustainable materials.

Enermodal’s first LEED Canada project was Stratus Winery in Niagara-on-the-Lake, Ont. In 2004, construction teams were not familiar with the correct ways to separate waste by material to allow for recycling, and there were not the diversity of construction waste recycling facilities there are today. As a result, the design and construction team had to work hard to get 50 per cent construction waste diversion. Today, Enermodal considers it standard practice for its Ontario projects to get at least 90 per cent waste diversion with a lot less effort expended in educating the contractor.

Another early LEED Canada project for Enermodal was E’Terra Inn in Tobermory, Ont. The owner of this primarily wood building wanted to pursue the Forest Stewardship Council (FSC) wood credit under LEED. At the time, there was almost no market for FSC wood particularly in northern locations so, despite the best efforts of the design team, the project was unable to use 50 per cent FSC-certified wood as the LEED credit demands. Today, many of Enermodal’s projects get this credit and some, like the Port Hope Community Health Centre, use 100 per cent FSC certified wood.

Similar market evolutions have occurred with recycled and salvaged materials. A number of companies specializing in sourcing salvaged construction materials have popped up in the last few years.

While some may criticize the LEED process as being too simplistic or onerous, LEED has made some fundamental, progressive changes to building marketplace over the past seven years. I look forward to seeing what our next 100 LEED certified buildings look like. B Stephen Carpenter is president of Enermodal Engineering and was Canada’s first LEED Accredited Professional as well as serving as the current chair of the Technical Advisory Group for the Canada Green Building Council. Enermodal has been Canada’s largest firm exclusively dedicated to creating energy and resource efficient buildings since 1980, certifying more LEED buildings than any other firm.

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