522 University | 232.92m | 62s | Industrial Alliance Insurance and Financial Services Inc | WZMH

[interchange42]

I'm surprised it's worth it to demolish a 15 story office building in what seems to be decent condition. Is it really that difficult to build the same tower a few streets over?

Yes, if you don't own a few streets over. You can only seek to maximize the density (redevelop) on property that you own.

42

 

[TRONto]

Strongly agree. I pass by this building quite often and it's definitely a negative as far as street engagement is concerned and the new building will be better (largely because of retail at grade).

My kids would disagree with me as they use the space to parkour. They will have grown out of that phase by the time this is torn down and won't care by that point

After a few more walk-bys I've changed my mind. At street level I think it's better the way it is

 

[The Preservationist]

University Ave in my opinion is our premier street downtown. I just think we can do better...

 

[MichaelZ]

Yes, if you don't own a few streets over. You can only seek to maximize the density (redevelop) on property that you own.

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I assume ownership of this office building didn't just land in their lap by happenstance. In other words, if they are not the original owners, they must have made an active decision, against the unbounded spectrum of other possibilities, to have bought this building in the first place.

A more explicit version of the question:

Assuming the developers are not the original building owners, when they were making the decision to buy this building, in whichever year, was it projected to be that much more difficult to assemble a similar sized piece of land a few streets over and get it through the city rezoning/approval process?

 

[interchange42]

I assume ownership of this office building didn't just land in their lap by happenstance. In other words, if they are not the original owners, they must have made an active decision, against the unbounded spectrum of other possibilities, to have bought this building in the first place.

A more explicit version of the question:

Assuming the developers are not the original building owners, when they were making the decision to buy this building, in whichever year, was it projected to be that much more difficult to assemble a similar sized piece of land a few streets over and get it through the city rezoning/approval process?

…a few streets over, where you'd be asking the same question because there would be some other building/buildings on that property. In the meantime, it doesn't really matter what year they bought it, any landowner can propose a redevelopment at any stage, and the City will test the application against the prevailing policies and eventually things will be settled one way or the other by Council or OLT. Landowners everywhere are looking to maximize the return on their investments, and will try to get what they can out of them. Unless there are laws declaring "though shalt not redevelop, period", there will be applications to do just that.

42

 

[MichaelZ]

…a few streets over, where you'd be asking the same question because there would be some other building/buildings on that property. In the meantime, it doesn't really matter what year they bought it, any landowner can propose a redevelopment at any stage, and the City will test the application against the prevailing policies and eventually things will be settled one way or the other by Council or OLT. Landowners everywhere are looking to maximize the return on their investments, and will try to get what they can out of them. Unless there are laws declaring "though shalt not redevelop, period", there will be applications to do just that.

42

Surely the opportunity cost of redeveloping a few townhouses, 2 storey commercial buildings, parking lots, etc., is far less than that of a 15 storey office building?

Is the paperwork so much more involved for rezoning that it dissuaded them from doing the lower cost option?

 

[Northern Light]

Surely the opportunity cost of redeveloping a few townhouses, 2 storey commercial buildings, parking lots, etc., is far less than that of a 15 storey office building?

Is the paperwork so much more involved for rezoning that it dissuaded them from doing the lower cost option?

First, can we acknowledge that you're asking for speculation. Many of us here are very knowledgeable about the development pipeline in the city but only a few can speak to discussions of motivation at the time of a property purchase some years back, and then only on a small number of parcels.

***

In a generic scenario there are lots of things that enter into buying a building, including, for instance, the steady stream of income it may provide an investor who may wish to buy and hold the asset for an extended period of time.

But certainly, the potential for redevelopment may well be a factor depending on the buyer and the purchase.

That potential is about zoning, its about precedent, its about market demand, its about ease-of-assembly, amongst many other things.

If a building is already zoned for Mixed-used/Multi-Res, then that may serve to eliminate the need for an Official Plan Amendment; if the existing building is 10 storeys, you know you can build that (in most cases);
but if the area permissions or precedents are for 35 storeys you know you can likely achieve that or at least something close.

Where a building zoned neighbourhoods or employment is much more of a pain to get rezoned, its not a sure thing by any means (higher risk) and if achieved, will almost certainly add 1 or more years to the process and many millions of dollars;
If a building is in or next to a high demand area/subway, you know you will pay more to buy, but also receive more when you sell. Even if the margin were similar on a smaller development, the (potential) absolute return is higher. (albeit higher risk)

Buying one building which provides a sufficient lot for a project is generally much quicker, and sometimes cheaper, than taking much longer to buy multiple smaller properties.

Potential opposition matters. Propose a midrise, never mind a tower on a small side street of SFH and typically expect you will go to the OLT and there may be a very prolonged cycle to getting a project done. Propose something in an office/hirise district and mostly, blowback is considerably less.

****

In addition to all of the above, you can also only buy what someone is selling (of course you can cold offer to push, but its more of an effort with a less clear outcome, particularly if you need multiple properties)

 

[MichaelZ]

First, can we acknowledge that you're asking for speculation. Many of us here are very knowledgeable about the development pipeline in the city but only a few can speak to discussions of motivation at the time of a property purchase some years back, and then only on a small number of parcels.

***

In a generic scenario there are lots of things that enter into buying a building, including, for instance, the steady stream of income it may provide an investor who may wish to buy and hold the asset for an extended period of time.

But certainly, the potential for redevelopment may well be a factor depending on the buyer and the purchase.

That potential is about zoning, its about precedent, its about market demand, its about ease-of-assembly, amongst many other things.

If a building is already zoned for Mixed-used/Multi-Res, then that may serve to eliminate the need for an Official Plan Amendment; if the existing building is 10 storeys, you know you can build that (in most cases);
but if the area permissions or precedents are for 35 storeys you know you can likely achieve that or at least something close.

Where a building zoned neighbourhoods or employment is much more of a pain to get rezoned, its not a sure thing by any means (higher risk) and if achieved, will almost certainly add 1 or more years to the process and many millions of dollars;
If a building is in or next to a high demand area/subway, you know you will pay more to buy, but also receive more when you sell. Even if the margin were similar on a smaller development, the (potential) absolute return is higher. (albeit higher risk)

Buying one building which provides a sufficient lot for a project is generally much quicker, and sometimes cheaper, than taking much longer to buy multiple smaller properties.

Potential opposition matters. Propose a midrise, never mind a tower on a small side street of SFH and typically expect you will go to the OLT and there may be a very prolonged cycle to getting a project done. Propose something in an office/hirise district and mostly, blowback is considerably less.

****

In addition to all of the above, you can also only buy what someone is selling (of course you can cold offer to push, but its more of an effort with a less clear outcome, particularly if you need multiple properties)

Thanks. I didn't even consider that anyone could effectively set up serious roadblocks for building dense a 3 minute walk from University & Dundas.

It seems strange because somewhat less tall proposals are regularly approved in the middle of suburbia that are farther away from any transit stations and opposite SFH too.

For example, extrapolating this to somewhere like North York, how did any of the towers get built at all? After all the folks living in suburbia over there would have experienced an even more dramatic change than any neighbourhood of SFH near University & Dundas could possibly experience, and would have had 10x the reason to push back.

 

[WislaHD]

I'm surprised it's worth it to demolish a 15 story office building in what seems to be decent condition. Is it really that difficult to build the same tower a few streets over?

Others already mentioned the difficulties in developing a few streets over from the planning (and er ownership) perspective. I'd add that brand new double or triple A office space can achieve higher rents and lower vacancies than the existing office building at this location could, in addition to the windfalls from plopping 47-storeys of residential development on top.

The discussion about embodied carbon in the existing building is also ignoring the potential that redevelopment with carbon efficient and cost-saving building infrastructure over a multi-decade timespan might have in long-term sustainability. I cannot comment on this building in particular, but some of these older office buildings are shockingly inefficient.

 

[70Challenger]

Get WZMH off this site immediately, and have HPA recreate what they are doing at 350 Bloor.

 

[formerTorontonian]

Get WZMH off this site immediately, and have HPA recreate what they are doing at 350 Bloor.

WZMH should not be allowed to touch any of these office tower redevelopments/recladdings....the damage they're doing to this city is inexcusable