Industry Heavyweights Join Forces

In a way, they are like the Avengers, according to one industry source. Allied Properties REIT is Thor. RioCan REIT is Ironman.

“Tell Ed I want to be Ironman,” Allied CEO Michael Emory told us, referencing his RioCan counterpart, Ed Sonshine. Michael spoke with us after the launch this week of The Well, a 7.5-acre integrated mixed-use neighbourhood in Downtown West, on the soon-to-be-former Globe and Mail building site. It's the fourth JV between the two titans. Diamond Corp is the third part of The Well troika. (Would that make them Nightcrawler? Nerds, help us out.)

JVs of this scale are a growing trend, Michael says: “The biggest opportunities tend to be enormous inner city opportunities that require different areas of expertise.” RioCan owns and manages Canada's largest portfolio of shopping centres. Allied is one of the country's leading owners, managers and developers of urban office environments. Diamond develops award-winning residential and mixed-use projects.

Just last week, there was word of another RioCan-Allied JV, a mixed-use project at Palmerston and College. Michael says the companies share the same philosophy when it comes to industry trends—especially an understanding about how urban cities are intensifying. RioCan is responding to tenants that want to locate downtown in major urban centres and serve the burgeoning populations. Allied has evolved as an office owner, developer, and operator around downtown cores.

Along with this shared view is “risk diversification,” Michael adds. “Neither RioCan nor Allied needs the other for capital.” However there is a limit as to how much development a real estate trust like RioCan and Allied can engage in. They can take on more projects by working together, spreading that development risk over a number of projects. Both companies do business in a similar fashion, and can make fast decisions when opportunities come up. (This whole article makes us want to call up our high school BFF and try to patch things up.)

Then there's the social side--senior level people on both sides work well together. Michael has known Ed for years. “Ed said to me when he first proposed (the development that has turned into The Well), ‘If it works, we will do a lot of stuff together. And if it doesn't, we won't.' That's really how it is.” With the Palmerston-College project, when the broker approached Allied, they said they wouldn't do it without RioCan. And RioCan told the broker they wouldn't do it without Allied. If one had to bet, there will be many more JVs over the course of time, Michael adds.

Trump Makes TripAdvisor List

The Trump International Hotel and Tower Toronto is No. 10 on TripAdvisor's 2014 Travellers' Choice list of the top 25 hotels in the world. Vancouver's Rosewood Hotel Georgia was the other Canadian offering that made the list, at No. 16. (The Grand Hotel Kronenhof in Pontresina, Switzerland, was No. 1, in case you were dying to know.) The list was based on the latest TripAdvisor survey.

Bay Street Still No. 1

Bay Street—at $73.54/SF—is No. 1 on the list of most expensive streets in Canada when it comes to office rents in 2013, according to the third annual Jones Lang LaSalle report. (Meaning it's also No. 1 for worst places to realize you forgot your wallet.) Vancouver's Burrard Street came in second at $65.91/SF. Third was 2nd Street SW in Calgary, at $59.72. JLL president Brett Miller says as the market continues to strengthen, companies are willing to pay higher rental rates to be in prestigious locations. The most expensive streets fall into financial, retail, or government hubs that are highly prominent. Bay Street was No. 1 in 2012 as well.

Target Roll Out Rolls On

The Stockyards in Toronto will be getting a Target this spring. That makes nine new Targets in 2014, adding to the 124 already operating in all 10 provinces. The majority of the new stores will be in Ontario, with single store additions in Quebec, Manitoba, Alberta, and B.C. Erin Mills Town Centre in Mississauga and Sheridan Centre in Mississauga are the other new GTA-area locations. Snapped are Target folks at this past summer's Honda Indy race.