Anvil Centre leases up
Patience is paying off at the Anvil Centre in downtown New Westminster, which Kingswood Capital Corp. and CRS Group acquired in December 2014 for $35.5 million.
Bought from New Westminster when it lacked a single tenant, the 139,000-square-foot building is 93% leased to tenants that include Douglas College, Land Title and Survey Authority of BC, Evolution Gaming Ltd., Century Group and Aerotek. Leasing has proceeded steadily over the past 18 months, coinciding with the December 31 deadline for the final instalment on the purchase price.
The occupancies obviate the need to sell portions of the building, a scenario that was always possible but which came to the fore last year in view of strong interest in strata office sales elsewhere in the region. Ultimately, it seemed wiser to lease and have ongoing cash flow from the property.
“We just needed to be patient and everything would work out,” said Joe Segal, president of Kingswood.
“We waited it out to get the tenants we wanted,” added Suki Sekhon, president of CRS, who said the property’s central location in the region, adjacent to SkyTrain, made it an appealing location for tenants.
While most of the tenants have moved from older space within New Westminster, being close to rapid transit allowed the building to secure above-average rents that confirm the potential of on-transit office space.
Anvil Centre, while long an exception in the intermittent rapid transit indexes Jones Lang LaSalle produces, now confirms the rule of thumb that space within 500 metres of a transit station typically enjoys higher rents and lower vacancies.
Cushman & Wakefield Ltd., whose brokers Roger Leggatt and Max Zessel had the leasing mandate for the property, notes that overall office vacancies in New Westminster now sit at 11.9%. Space with direct access to rapid transit is 7.3% vacant.
Real consequences
Artificial intelligence (AI) is an idea that’s been discreetly advancing through various sectors for many years, but now – if the pundits are correct – it’s on the cusp of changing how office towers function.
Chinese e-commerce firm Alibaba – once tipped as a potential Vancouver office tenant – is developing its so-called City Brain project in Hangzhou with a view to helping cities function better. The latest reports indicate that commutes are smoother, congestion is down and police response to accidents and traffic infractions is faster.
It’s a step up from the sophisticated modelling used to manage pedestrian flows and security in downtown Vancouver during the 2010 Winter Olympic Games. It’s also a large-scale deployment of the kind of smarts allowing elevators in downtown Vancouver towers (such as The Exchange, which opened last week) to ferry visitors based on destination in the building – saving visitors’ time and building energy.
The Exchange also employs a networked lighting system that responds to natural light levels and room use for seamless, responsive integration with tenant demand. Building systems at Telus Garden share information to harmoniously reduce the building’s energy use and enhance overall performance.
With more employees than ever being expected to use mobile technology in ever-smaller workspaces, Bentall Kennedy (Canada) LP investments director Adam Mitchell sees ample scope for building systems to evolve. He doesn’t think building design is keeping pace with the shift in how tenants interact with buildings.
“It’s affecting the operation of your real estate, but not the design of your buildings,” he said of the shift in tenant behaviours.
Smart buildings tailored to handle shifting tenant loads and smooth the flow of people between floors, as well as energy use, could be just what building managers need to address the practical issues of building operation and spend more time focusing on the amenities that increasingly build tenant loyalty. •
