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March 13, 2014
Yet Another Icon For Sale
Legendary rock club El Mocambo is the latest in the slew of popular asset sales, following Honest Ed's (which was even selling its famous storefront signs this past weekend) and Sam The Record Man. (It's getting harder to defend against people who say rock & roll is dead.)
Royal LePage Commercial broker Neil Warshafsky, who's handling the transaction, says reaction to the sale so far has been mixed. (We imagine much of it has come from the over-40 crowd.) The asking price is just under $4M,and the new owner will have a tough act to follow: The Rolling Stones played a gig there in 1977, and Elvis Costello, The Guess Who, U2, Blondie, and an early version of the Tragically Hip have all passed through.
Neil hopes the El Mocambo stays "as is," and that will be his preference as interested parties come forward. "Unfortunately," he says, "times change." Funny suggestions have come in: “The ElMoCondo” and “The ElMotel,” to name a few. There's been a fair bit of interest in the club, but Neil doesn't have a timeline for the sale just yet.
Some had hoped the city would make it a heritage space. Going forward, Neil says the ground floor could become a workout facility, or perhaps a restaurant or retail. Additional density is permitted under the zoning of the property, which could also make the building more appropriate for student residences. (Which in many ways are music clubs, just without the liquor license.)
Chartwell Sells 14 Residences
The buyer is a mystery, but Chartwell Retirement Residences has unloaded a non-core portfolio of 14 retirement residences across Ontario for $65.9M. Prez Brent Binions says the sale follows its strategy of divesting assets like these. The portfolio includes Toronto's Millwood Retirement Residence and Teddington Park Retirement Residence, as well as Willoughby Manor Retirement Residence in Niagara Falls, above.
New Suburban Home For Aviva
Aviva Canada is relocating to a new head office in Markham (it's now on Eglinton Avenue), one of the centerpieces of a new, high-density commercial, retail, and residential development in the neighborhood's core. The building is atypical compared to other suburban office parks (not the usual low-rise building surrounded by parking). Come 2017, Aviva will occupy most of the new 350k SF 12-storey office building. (Eventually in downtown Markham, there will be 3.4M SF of office space over 243 acres--a former cornfield.) The developer, Christopher Bratty, president at The Remington group, says Aviva joins Worley Parsons and Motorola in opting for LEED certified space in Markham. (If you're going to live in a cornfield, ya might as well be green. Anything else would upset some of the ears still living there.)
Tempered Optimism
Count Avison Young CEO Mark Rose among those who feel more confident than in 2013. Mark says that despite the "mountain" of debt and equity that is available, "interest rates have only one way to go—up." A REALpac/FPL Canadian Real Estate Sentiment Survey for Q1' 14 has been released, measuring senior executives' confidence in the Canadian commercial real estate: overall real estate conditions, access to capital markets, and asset pricing.
Mark sent us this pic from MIPIM in Cannes, France this week; he's here with AY president of US operations Earl Webb and European investment manager Udo Stoeckl. Overall, a rise in interest rates will cause some anxious moments, "but a correction is ultimately very healthy... there should always be a certain amount of anxiety when operating in the real estate marketplace." (Up or down market, always invest in heartburn relief.) Canada is stable, but hovering at "frothy pricing levels." He says that fundamentals also support an "upward bias" as GDP growth, employment growth, and consumer sentiment remains positive.
New Bisnow Education Video!
By popular demand, we've just released a second video we did with Peter Linneman, widely considered the top professor of commercial real estate in the US. This new video is called "Real Estate Finance," i.e., on how you get money to do deals. Although an advanced topic, it's purposely very simple to understand. It's 77 minutes, broken into 5-minute increments, so you can watch or listen as you are waiting in line, or at the gym, or lying in bed. (To each his own.) Click here for the new video and here for the old video.
Overheard someone in the elevator this morning say a co-worker was two hours on the road and still nowhere near the office. Whom do you think among all the candidates for mayor will do the best job leading us out of this transportation mess? Email mark.keast@bisnow.com.
