LCD vs Plasma and HDTV Mega Guide

Plasmas still offer the best value in the 50+ sizes and the best contrast and color reproduction.  Click here to learn why you should buy a Plasma when size matters.

Here’s the mega guide for new HDTV’s.

“Grossing Up” Operating Expenses a reasonable concept that gets lost in translation

In the operating expense provisions of an office lease you may come across wording that allows the landlord to “gross up operating costs which vary with the use and occupancy of the rentable premises in the Centre as if the property were 97% occupied and operational.”

These costs are generally cleaning, waste removal, utilities and management fees if based on a % of operating costs. Leases allow these costs to be grossed up to a range of 95% to 100% occupancy.

On the surface, allowing the landlord to charge for more expense than they incur seems absurd. However, the concept is fair to the landlord – yes, you read that right – and fair to the tenant.

An extreme example to illustrate the point:
Assume there are two tenants in a 100,000 sq. ft. office building, Tenant A and Tenant B, who occupy 50% of the space each. The cleaning costs are $1 per sq. ft. per anum, or $100,000. Cleaning contracts allow vacancy credits to be given to the landlord if tenant(s) vacate the premises.

Now let’s say Tenant B vacates the premises for a full year, reducing cleaning costs to $50,000. Without a gross up, Tenant A would now pay 50% of $50,000, equaling $25,000, even though they are responsible for 100% of the cost. The landlord would be out of pocket $25,000. Grossing up the cleaning expense to 100% allows the landlord to recover all of its costs.

Lost in translational
Where this concept often breaks down is in the calculations used by landlord administrative staff. We have seen situations where incorrect calculations have resulted in tenants paying more on those variable expense items than if the Centre were 100% occupied.

For example, occupancy has no bearing on labour or utilities for the lobby, elevators, outside areas, or other common areas. Even vacant leaseable premises require a minimum of heat in the winter.

A Colliers audit on a 7,000 s.f. office space in Ottawa netted a $32,000 recovery for our client. The landlord had applied gross up calculations to the utilities on vacant space. However, they had continued to cool, heat and light the vacant premises as though they were fully occupied in order to make the marketing and showing of the space more appealing.

Finally, vacant space rarely remains so for a full year and appropriate calculations are required to ensure the gross up is applied only to the time the space was vacant.

REMEDY

Have the ‘right to audit’ written into the lease agreement in order to ensure that the grossing up is done correctly. Clear, concise lease language such as the following is also essential:
“The landlord is entitled to gross up those items of operating costs which vary with the use and occupancy of the rentable premises in the Centre as if the Centre were (% rate to be negotiated) occupied and operational. For greater certainty the variable costs are cleaning and utilities. In no event shall the tenant’s proportionate share of the variable expenses be greater that would be payable if the property had been fully rented.”

c/o Frank Iannarilli – Colliers International

Playing with Google Maps

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Here are my current commercial real estate listings across the GTA.
Now I just have to figure out how to upload my videos.

Commercial Real Estate News Toronto – January 2009

Toronto’s Mayor Miller puts faith in new agencies – With unusually hard times expected in 2009, Mayor David Miller is hoping two agencies created last year will help Canada’s largest city weather a grim economic downturn. The new municipal corporations – Build Toronto and Invest Toronto – could make a significant difference, provided they live up to their potential. Build Toronto is essentially a real estate enterprise aimed at wringing value from the city’s massive, but underutilized, land holdings.
Toronto Star, Jan 05, 2009

Help office towers go green – A big push for energy conservation in Canada’s current and future office towers and other commercial buildings has been recommended. National experts called for energy efficiency standards, financial incentives and public scrutiny to curb fuel use and carbon emissions in the more than 440,000 commercial buildings in Canada. Round table chair Robert Page blamed “inertia” in industry, focus on upfront capital costs rather than energy savings.
Canada.com, Jan 13, 2009

Toronto council executive backs subway extension – A multibillion-dollar plan to extend another of Toronto’s subway lines north into York Region was approved by Mayor David Miller and his executive committee yesterday, but with all the enthusiasm of a bus driver headed out for a midnight shift. The mayor did say that he supports the 6.8-kilometre, six-station extension of the Yonge line as important for “city-building” in the Toronto region.
Globe and Mail, Jan 06, 2009

Proposal for prime Toronto site spurs controversy – As Toronto looks at selling some of its real estate portfolio, one of the hottest pieces sits at the heart of the city － Yonge and Eglinton. At the southwest corner is the old abandoned TTC bus terminal, which could easily be turned into an office and residential tower. Local councillors don’t want to see a repeat of the bitter 2002 battle over the two Minto condominiums nearby. Councillor Michael Walker is vowing to kick up a big fight if there is any attempt to build soaring towers.
Toronto Star, Jan 08, 2009

The commercial property downturn, then and now – Anyone who remembers the commercial property market in the early 1990s likely does so whispering a fervent prayer that this recession does not come anywhere near the meltdown that struck all forms of real estate then. Now, as landlords and developers brace for another rough ride in the looming recession, the early nineties crash serves as a reference point on how bad – or not – things may become this time.
Globe and Mail, Jan 20, 2009

Commercial office market set to weather downturn – Bucking the bad news trend, Canada’s commercial office market recorded strong numbers the past few years and remains well positioned for the next 12 to 18 months as the country heads into a recession, according to industry executives. A new report from Colliers International cautions there may be two exceptions – Calgary and Toronto. Jamie Ziegel, senior managing director of capital markets for Cushman & Wakefield LePage Ltd. in Toronto, said this recession will be different from the last one.
Business Edge, Jan 23, 2009

It’s back to the future for Brookfield – Bruce Flatt has demonstrated an uncanny knack for knowing which way the wind will blow. For the past few years the landscape in which the CEO of Brookfield Asset Management Inc. operates has been too smooth and too crowded for the sort of sophisticated, countercyclical tactics at which the company excels: Restructuring troubled or bargain assets. Now Mr. Flatt senses it’s a perfect time for Brookfield to put its corporate strategy and war chest of nearly $4-billion (U.S.) to work.
Globe and Mail, Jan 26, 2009

Toronto seeks federal funds to revitalize Union Station – Amid signs of life for its long-awaited facelift, Union Station is seen as a strong contender for infrastructure dollars expected to flow from tomorrow’s federal budget. Mayor David Miller describes the station’s renewal, planned over the next seven years, as one “that makes perfect sense to expedite.” The mayor has asked Mr. Flaherty to put $75-million toward the estimated $615-million renewal, which already assumes funding from the city, the province and an as-yet-unnamed private investor.
Globe and Mail, Jan 26, 2009

Editorial: Toronto Mayor should slash development fees – Over the last several weeks, Toronto Mayor David Miller has kept a very high profile as he advocates for infrastructure funding in the upcoming federal budget. The mayor is being appropriately proactive by seeking external funding solutions to the financial challenges facing his city. In the midst of all this positive focus on job creation and economic development, there’s something that doesn’t quite add up, and that’s the threat of much higher development charges in Toronto.
Toronto Star, Jan 26, 2009

Toronto may fast track new north-south subway relief line – In a surprise move, Toronto council voted to study the possibility of fast-tracking the construction of a new downtown relief subway line — perhaps even putting it ahead of extending the Yonge line north into York region. Toronto has long had reservations about pushing the already crowded Yonge subway into Richmond Hill and had already attached a slew of conditions to the city’s support of the project, which would have doubled the price from $2.5-billion to about $5-billion.
National Post, Jan 29, 2009 Toronto Star, Jan 29, 2009

Home Theater and Boardroom Setup Spectacular

I’ve been keeping TV and entertainment system links for about a month now.  This is my selection for some of the coolest up and coming technology for your home entertainment system or your boardroom?  This is a series of 4 posts including guides, accessories and speakers.

Thinnest LCD yet

Does thinness matter?

Here’s one of the best deals I’ve seen on a DLP.

I’m not sure how this one would work.  21:9 ratio.

393 King Street West – For Sale

Here’s a commercial real estate investment opportunity through one of my co-workers.  Feel free to call me for additional information.

Please note the attached office space is not listed with OfficeSearchToronto.com but call us first at 416-992-9869 or E-mail Me for floor plans and additional information. If you want to sort out only the available office space listings on this blog, click the link “Available Office Space Toronto” in the Catories section on the bottom right.

Toronto Financial Core Commercial Real Estate

I ran this survey for a large AAA client looking for temporary or project space approximately 8,000 to 12,000 sf in Downtown Toronto with furniture.  They also asked to be on the PATH and for a term less than 2 years.  Here were the best options including the floor plans.

130 Adelaide St W – 9,670 sf – $44.41 psf – $35,800 per month – December 30, 2011

250 Yonge St – 13,593 sf – $36.00 psf – $40,800 per month – December 30, 2011

1 Yonge St – 8,500 sf – $34.50 psf – $24,500 per month – January 31, 2012

141 Adelaide St W – 11,219 sf – $33.00 psf – $30,850 – September 29, 2009

100 Wellington St W – 7,270 sf – $50.00 (estimate) psf – $30,200 – October 30, 2012

120 Adelaide St W – 7,000 sf – $33.51 psf – $20,000 – December 31, 2011

26 Wellington St E – 11,345 sf – $35.69 psf – $33,750 – February 26, 2014 (long term)

If this space is too big and you’re looking for a smaller “deal” in the core here are some option.

Link 1 Link 2

Please note the attached office space is not listed with OfficeSearchToronto.com but call us first at 416-992-9869 or E-mail Me for floor plans and additional information. If you want to sort out only the available office space listings on this blog, click the link “Available Office Space Toronto” in the Categories section on the bottom right.

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Blackberry Apps for a CEO

Here are some of the best Blackberry apps out there right now.

Link

Downtown East Commercial Real Estate

Commercial Real Estate – Downtown East Toronto.

OfficeSearchToronto.com tracks available office space across the GTA. Want a survey or availability report somewhere else in Toronto? Are these space too big? Call us at 416-992-9869 or E-mail Me!.
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One Desk – 571 King St West – Shared space Toronto

If you’re looking for a single desk / shared space in the Downtown West this is available for $375 per month.  Call for pictures and details – 416-992-9869 or email chris@officesearchtoronto.com

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