ProjectEnd
Superstar
I am not aware of any leases being signed here. Entirely a spec build. They gambled like this before with 65 King East and Google swept in to save the day, but I really wouldn't want to be Carterra right now...
Toronto Portland Commons | 71.7m | 15s | Carttera | Sweeny &Co
- Thread starter AHK
- Start date
rdaner
Senior Member
Also of importance is who is leasing the retail space as there is a lot of it and in a very good location.
innsertnamehere
Superstar
ooof. I had heard rumours of a lead tenant for this building, but clearly that hasn't come through, at least yet..
Parkdalian
Senior Member
"The macros right now are bad" - something I heard a businessman say at another table at a restaurant recently - so I'm guessing that's not great for Carttera. But I've heard newly built office space tends to have better luck than older office space. (I probably heard that from the same businessman.)
UrbanAffair
Senior Member
That's true. There has been some higher absorption in the office market for class A and particularly new inventory. The vacancy rate is around 11% currently in the core, which is better than it was.
LoMein
New Member
Class A and new inventory will get leased. It's just a matter of what price. It's the old shit buildings that will be long-term unoccupied and ripe for redevelopment.
ProjectEnd
Superstar
Nobody is claiming it will never get leased, only that Carterra is in for some tough times in the short-medium term ahead. It's hard enough these days to get financing on office buildings with tenants, what's the plan for holding costs on 530K of new, vacant, space?
wopchop
Building Toronto
Yes, the building was entirely spec build. As a far as I am aware, they have no tenants signed yet.
ProjectEnd
Superstar
Confirmed, no leases have yet been signed here.
DarwinP
Active Member
I love how it feels like an extension of The Well. seems part of it.
Collingwoodbuildinglover
Active Member
It really does
ProjectEnd
Superstar
Northern Light
Superstar
I was by here as it was getting dark yesterday, Nov 5th, 2023:
AHK
Senior Member
A couple of photos - current overview of the building from our place, and a more detailed look at the ongoing preparations for the Wellington Street boulevard area - soil spreader actively filling in the plant beds. Some additional comments below.
Last update I heard was that there were still no leases in place. Appears to be three buildings in a similar situation - the two Hines T3 buildings (Queens Quay and Sterling) and Portland Commons. All three are great buildings, but not exactly in the most prime locations. While there have been a few large scale deals done over recent months, they have generally been in the larger downtown buildings.
I suspect that most of the current activity tends to be on the smaller scale, new startups looking for very modest amounts of space, plus the more dynamic smaller businesses, whose requirements, in proportion to their existing footprints, may be more volatile - and there is plenty of such space on the market. The new buildings would, I believe, be looking for larger initial leases to take up their space - not wanting to rent out 1,500 - 3,000 square feet and then have a user come along looking for a large contiguous space, that has already been broken up by one or more smaller tenants.
In the particular case of Portland Commons, I spoke with one of the construction coordinators on site when the site prep work was being done about three years ago, asked if it might not be more appropriate to defer the actual construction until there was more clarity about where the market would be going. HIs reply was that Carterra was acting on behalf of institutional investors, pension funds with a long term horizon, and that short term market issues were not a problem for them.
I am sure that in the longer term, this building will lease up, but in the interim, as was posted above, the ongoing carrying and operating costs will be a burden.
Last update I heard was that there were still no leases in place. Appears to be three buildings in a similar situation - the two Hines T3 buildings (Queens Quay and Sterling) and Portland Commons. All three are great buildings, but not exactly in the most prime locations. While there have been a few large scale deals done over recent months, they have generally been in the larger downtown buildings.
I suspect that most of the current activity tends to be on the smaller scale, new startups looking for very modest amounts of space, plus the more dynamic smaller businesses, whose requirements, in proportion to their existing footprints, may be more volatile - and there is plenty of such space on the market. The new buildings would, I believe, be looking for larger initial leases to take up their space - not wanting to rent out 1,500 - 3,000 square feet and then have a user come along looking for a large contiguous space, that has already been broken up by one or more smaller tenants.
In the particular case of Portland Commons, I spoke with one of the construction coordinators on site when the site prep work was being done about three years ago, asked if it might not be more appropriate to defer the actual construction until there was more clarity about where the market would be going. HIs reply was that Carterra was acting on behalf of institutional investors, pension funds with a long term horizon, and that short term market issues were not a problem for them.
I am sure that in the longer term, this building will lease up, but in the interim, as was posted above, the ongoing carrying and operating costs will be a burden.
rdaner
Senior Member
There is also the potential for retail leasing to cover a small part of the operating costs.