Thursday, December 15, 2011
Federal Leasing Activity Outside the Beltway in Northern Virginia
by Dan Gonzalez
Of all of the reshuffling of federal operations outside the Washington Beltway in Northern Virginia, the Springfield submarket has been and will continue to be a major beneficiary of the changes, due in large part to the Base Realignment and Closure Act (BRAC) and other relocations. Aligned federal and defense contractors are helping to revamp and bolster the Springfield submarket for the foreseeable future.
The National Geospatial Intelligence Agency (NGA) is moving to a new 2.4-million-square-foot operation in Springfield. A staff of about 8,500, both federal employees and contractors, will relocate there. And, the Missile Defense Agency headquarters command is relocating to Fort Belvoir, along with other army and defense programs. In anticipation of leasing demand by affiliated defense contractors, Corporate Office Properties Trust (COPT) has begun construction on 7770 Backlick Road, a 240,000-square-foot building adjacent to NGA’s new facility.
Major federal leases signed in 2011 in Northern Virginia outside the Beltway include:
• The FBI leasing 182,035 square feet at Mission Ridge in Chantilly. The Bureau is consolidating several locations and expanding its cyber-security operations; and
• The Defense Logistics Agency leasing 70,056 square feet at 8111 Gatehouse Road, Falls Church.
A major loss to the Northern Virginia outside the Beltway market was the Defense Information Agency (DIA) vacating 395,800 square feet at 5275 Leesburg Pike for a move to Fort Meade, Md.
Overall, there is still a great deal of uncertainty about leasing activity relating to federal users and government contractors for outside the Beltway facilities, which is attributed to predicted defense cutbacks and the political stalemate and gridlock in Washington.
Monday, December 5, 2011
By Mark E. Rose (Toronto)
The holiday season is upon us and both Canadian and U.S. Thanksgiving have recently passed. Time moves so quickly for all of us, but we need to take time to reflect and thank those who support us and have made Avison Young the fastest-growing real estate services firm in North America.
Of course, this starts with our clients. Our client list has grown significantly over the past three years as occupiers and investors become aware of our industry-leading client-service model. Avison Young boasts the only holistic approach to solving clients’ needs, and we surround the client's objectives with accountable individuals who face reputational as well as financial risk in the pursuit of service excellence. Our Principal-led culture ensures that the client, the execution team and the shareholders are completely aligned. We do not employ the age-old pyramid structure, where business units report up through layers of managers and are pitted against each other to deliver for shareholders who are not involved in the day-to-day business.
We would be here all day if we thanked every existing and new client earned in 2011, but we can promise that their trust is truly appreciated and will be rewarded through the custom solutions created and delivered by our Avison Young family. Our clients are our lifeline and our most important stakeholders. As recent as last week, the Healthcare of Ontario Pension Plan (HOOPP) entrusted Avison Young with the listing contract to lease HOOPP’s $300-million-plus, 33-acre development (up to 1.1 million square feet of office space and 70,000 square feet of restaurant/service amenities) in the Airport Corporate Centre in Mississauga (please see the Avison Young website for details.) The ground-breaking LEED-Gold development is one of the most prominent and important projects in the Greater Toronto Area and Avison Young is honored to be associated with HOOPP and the development team.
Thanks also go out to our minority investor – Tricor Pacific Capital, Inc. Based in Vancouver, British Columbia with an office in Lake Forest, Illinois, Tricor is a leading private equity firm which, on October 14, 2011, made a minority investment in our common stock. Tricor is the proverbial needle in the haystack as it relates to a cultural match and we look forward to working with the Tricor team to accelerate Avison Young's already aggressive strategic growth plans. Bradley Seaman and Roderick Senft join our Board of Directors to enhance our capabilities and our commitment to leadership in corporate governance.
Finally, we are thankful for every member of our Avison Young family. Not only is our company differentiated by our Principal-led culture, our industry-leading growth rates and our unique client-service model, but we work together as a team to meet all stakeholder goals, deliver results and, most importantly, have fun doing it!
Avison Young is exceeding all expectations as we execute against a clearly defined vision and plan, and we will never forget those who have taken us here and whom we count on everyday to reach our lofty goals.
We thank you all and wish each and every one of you a very happy holiday and a prosperous and healthy new year.
Thursday, December 1, 2011
Healthcare of Ontario Pension Plan (HOOPP) recently announced that they have acquired 33 acres in one of Canada’s landmark business parks, Airport Corporate Centre (ACC), in Mississauga. HOOPP plans to construct up to 1.1 million square feet (msf) of office space and more than 70,000 square feet (sf) of restaurant/service amenities. The site is south of Pearson International Airport and adjacent to the new Spectrum Station, which will form part of the Mississauga MiWay Bus Rapid Transit (BRT) line. (The BRT is a high-efficiency east-west transit corridor that is being constructed across Mississauga and is part of a 100-kilometre BRT corridor connecting municipalities from Oakville to Pickering, Ontario.)
One of the things my colleagues and I have noticed over the past couple of months is, despite the negative press and dire economic news revolving around the Eurozone and the United States, the office market in the Greater Toronto Area is starting to witness a distinct elevation in activity. While attending the Toronto Real Estate Forum yesterday I was interested to hear that a number of others have witnessed this same trend across Canada.
Some of the information I took away from the Real Estate Forum is that as we move forward into 2012 rental rate growth in the Canadian office market is expected, and that tenants throughout major markets in Canada should expect to see decreasing vacancy. With increased activity tenants may start to experience "Sticker Shock" as they are faced with higher than expected rates in an environment bombarded by negative media commentary on the global economy.
More significantly, because economics will support new development and the retrofit of existing product tenants will be given the choice between second generation office product and new energy efficient product that can elevate their brand and attract employees. One speaker at the Forum commented that he believed mixed use developments that combine residential, retail and office with easy access to transit would thrive.
Given the above, HOOPP's new development, which emphasizes the "urban" in suburban by mixing high-efficiency transit, retail and energy-efficient office development may turn out to be a "game changer" providing tenants in Mississauga with a high performance work place that is in short supply together with a suburban address that need not necessarily be surrounded by a sea of parking.