Commercial Real Estate Roundup- #11

Lots of interesting commercial real estate news this week.  The weather has cooled off but CRE news is heating up!

The downtown Toronto office leasing market is cooling as the supply of new Class “A” office towers come to market.  Many corporations are relocating their offices to newer, more environmentally friendly buildings with more efficient systems (LEED certified).  The vacancy rate continues to climb which hit 14.2% last quarter.  Many of the older office towers will require significant amounts of capital to bring them up to the calibre required for these landlord’s to fill the current vacancies.
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Yorkdale Shopping Centre in Toronto continues to make news as the best mall in Canada which rivals many popular malls in the US.
Yorkdale announced this week that it will continue its expansion projects by renovating 120,000 square feet of space on the west side of the mall where Sears used to reside.  It was announced that Restoration Hardware will open a flagship 69,000 square foot (4 level) store along with other soon to be announced retailers.
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When working with my clients, my main goal is to represent them to the best of my ability and to make the process as smooth and painless as possible.  There are many commercial real estate terms that are included in leases, which the average person not working in the industry many not know or understand.  Today, I am focusing on a key term in CRE leasing which is Tenant Improvement Allowance.  A landlord will offer a prospective tenant financial incentives (depending on term and rental rates) to attract a new tenant to its building.  These funds are typically used by the tenant to help offset the cost of renovations, permits and moving costs.
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Enjoy your weekend and look forward to your comments!