Quote:
Originally Posted by Roger Strong
Just on a Portage Ave. alone, just within a few blocks of TNS, just in the last few years....
- The Alt Hotel and Glass House condos replaced a bunch of office and retail space.
- The Boyd Building tower is being emptied out, and may be turned into apartments or condos.
- The Avenue on Portage turned six stories of office space across a couple buildings into condos.
- The office tower at 238 Portage was turned into condos.
- The Sterling Building office tower (283 Portage) was turned into rental apartments.
I'm probably missing a few.
That's a whole lot of office space disappeared. There is no vacuum. Just the normal turn-over of a normal city.
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Doesn't matter. Some of those buildings were not full, others were completed before TNS was even announced. Avenue, before TNS. Centrepoint replaced dogshit, and before TNS. 238 is tiny and was not relevant office space.
A lot of office buildings get converted BECAUSE they are empty or experiencing some degree of vacancy. If they aren't, they're charging too little, because office space generally commands more revenue than apartments. So you're getting rid of poor performers but not exactly displacing many quality tenants into other buildings downtown. If it's a cheap tenant and moves to the suburbs, that doesn't help this argument.
Downtown occupancy rate is still around 8% and only gets reported as "above average" because cities like Calgary get destroyed by resource sways. 8% is "not bad for Winnipeg" territory, not "let's build a superplex" territory.
These conversions are good moves. But the reason they happen is because the office market is weaker, otherwise they'd stay office buildings. They need to adapt to, literally, the market... and they're leaving the office market. So while it reduces, marginally, occupancy, it's a false indicator of strength.
That and TNS is far from occupied.