QUEEN STREET WEST 327 333 - TORONTO URBAN RETAIL OFFERING - Robins Appleby LLP
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CBRE Limited 1|
327 – 333
QUEEN
STREET WEST
TORONTO URBAN RETAIL OFFERING
|2 327 – 333 Queen Street West Toronto
TABLE OF
CONTENTS
CBRE Limited 3|
01 The Offering
02 Property Overview
03 Market Overview
04 Tenancy Summary
05 Financial Overview
06 The City of Toronto
07 Offering Process
|4 327 – 333 Queen Street West Toronto
THE
OFFERING
CBRE Limited 5|
CBRE Limited (“CBRE”) is pleased to offer for sale a signature retail
opportunity, situated in the heart of Queen West - Canada’s most
exciting and dynamic fashion retail strip. This offering, which is
located at 327-333 Queen Street West, Toronto (the “Property” or
the “Site”) presents a ~15,700 sq. ft., newly completed (2013),
The Property boasts approximately 56 feet of prime frontage that is
strategically positioned on the south side of Queen Street West, east
of Spadina Avenue at the southern terminus of Beverly Street.
Size In-Place Rent WALT Expiry
American Eagle 5,266 $93.64 8.0 Jan-25
Yyoga 10,495 $31.00 6.8 Oct-23
TOTAL 15,761 $51.93 7.2 -
|6 327 – 333 Queen Street West Toronto
2%
RETAIL
VACANCY
$110-$140
ASKING RETAIL
RENTS
POPULATION
~305,000
3KM RADIUS
53
ACTIVE DTW
CONDO
PROJECTS
CBRE Limited 7|
INVESTMENT HIGHLIGHTS
IDEALLY SITUATED IN THE HEART OF QUEEN WEST – TORONTO’S MOST
EXCITING RETAIL NEIGHBOURHOOD
Queen West represents the heart of urban lifestyle within Toronto, offering a diverse mix of
! "
retailers call Queen West home, including brands such as Zara and H&M, not to mention
FULLY LEASED WITH RENTAL RATE UPSIDE POTENTIAL
#
$$ % ' *
space along Queen West, contract rents for the Property are currently considered to be below-
market.
NEWLY CONSTRUCTED WITH BEST-IN-CLASS FINISHES
# +/48 ' "
Queen Street.
PREMIUM STREETFRONT PRESENCE AND ACCESSIBILITY
The Property’s premier location along Queen Street, surrounded by Toronto transit infrastructure
9 :
- an invaluable asset for retail tenants.
99 100
Walk Score Transit Score
|8 327 – 333 Queen Street West Toronto
UNION STATION GO TRAN
SIT LINE
ST. ANDREW STATION
KING ST
REET W
EST
AY
UE BW
AVEN TY SU ADELAID
TY SI E STREE
RSI VER T WEST
IVE NI
UN GE-U
N
YO
ET
OSGOODE STATION TRE 327-333 QUEEN STREET WEST
A NS
C
DUN
5 MIN
WALK ET
(400 M RE
) TO OS T
G OODE
STATIO H NS RICCHMON
D STREE
N JO T WEST
ET
E
STR
»
ER
QUEEN
EET
STREET
PET
TR
WEST
S
LYR
VE
BE
327-333 Queen Street West: At the heart of
one of the highest concentrations of tourist
and pedestrians in Toronto
CBRE Limited 9|
GARDINER
EXPRESSW
AY
LOCATION OVERVIEW
FRONT STR
EET WEST
327-333 Queen Street West occupies a premier street-front location
along Queen Street in the heart of Toronto’s Entertainment District.
# "
E
VENU
"
INA A
# #
SPAD
situated in a unique area of Downtown Toronto between Spadina
and University Avenues, where premiums are achieved for condo,
; 
| 10 327 – 333 Queen Street West Toronto
PROPERTY
OVERVIEWCBRE Limited 11 |
| 12 327 – 333 Queen Street West Toronto
PROPERTY PROFILE
327-333 Queen Street West is a unique newly PROPERTY DETAILS
built building, completed in 2013. The property
Address 327-333 Queen Street West
comprises 15,761 sq. ft. of rentable area and
showcases 56 feet of frontage along the trendy Size (sq. ft.) 15,761
Queen Street West. The building features a Acres 0.36
combination of brick veneer masonry and stone Occupancy 100%
tiles that seamlessly integrate the newly constructed Storeys 3
property with the surrounding historic area. The Class A
Property consists of three levels, at grade retail
Year Built 2013
space is entirely occupied by American Eagle
' Typical Floor Plate (sq. ft.) 5,200
by YYoga – the largest corporately owned yoga WAVG Inplace Rent American Eagle: $93.64
company in Canada. YYoga: $31.00
Term 7.2 years
Additional Rent CAM $2.21
Realty Taxes $20.23
Projected NOI $814,826
Financing Free and Clear
5 YEAR NOI
Year 1 Year 1 Year 2 Year 3 Year 4 Year 5
PSF Dec-2017 Dec-2018 Dec-2019 Dec-2020 Dec-2021
INCOME PROJECTION
Base Rental Revenue $52.40 $825,839 $844,371 $880,170 $890,596 $901,233
Absorption & Turnover Vacancy $0.00 $0 $0 $0 $0 $0
Scheduled Base Rental Revenue $52.40 $825,839 $844,371 $880,170 $890,596 $901,233
Operating Recovery $2.39 $37,745 $38,907 $40,108 $41,346 $42,629
Admin Fee Recovery $3.23 $50,980 $52,638 $54,378 $56,158 $58,011
Realty Tax Recovery $20.02 $315,602 $323,493 $331,580 $339,870 $348,367
Total Reimbursement Revenue $25.65 $404,327 $415,038 $426,066 $437,374 $449,007
Potential Gross Revenue $78.05 $1,230,166 $1,259,409 $1,306,236 $1,327,970 $1,350,240
General Vacancy -$1.56 ($24,603) ($25,188) ($26,125) ($26,559) ($27,005)
Effective Gross Revenue $76.49 $1,205,563 $1,234,221 $1,280,111 $1,301,411 $1,323,235
EXPENSE PROJECTION
Operating Cost $2.47 $38,967 $39,942 $40,936 $41,963 $43,010
Realty Tax $20.02 $315,603 $323,492 $331,581 $339,869 $348,366
Non-Recoverable $0.00 $0 $0 $0 $0 $0
Management Fee $2.29 $36,167 $37,027 $38,403 $39,042 $39,698
Total Operating Costs $24.79 $390,737 $400,461 $410,920 $420,874 $431,074
Net Operating Income $51.70 $814,826 $833,760 $869,191 $880,537 $892,161CBRE Limited 13 |
| 14 327 – 333 Queen Street West Toronto
FLOOR PLANS
MAIN FLOOR
HVAC PIPES
UP DN
FHC
20'-0" 16'-1" 25'-7" 20'-0" 20'-2"
ELEV
CLEAR HEIGHT
CLEAR HEIGHT= 13' -11"
=38'- 1"
GARBAGE
ROOM
FHC
54'-11"
DN
UP
5'-5"
x
15'-7"
SECOND FLOOR
HVAC PIPES
DN
UP
FHC
WINDOW DIMENSIONS
54'-7"
ELEV
OPEN TO BELOW AND LOCATIONS ARE
CLEAR HEIGHT= 14' -5" APPROXIMATE
31'-10"
FHC
HVAC PIPES
UP
DN
76'-1"CBRE Limited 15 |
SECOND FLOOR
FHC
DN
HVAC PIPES
54'-6"
ELEV
RESTRICTED
CLEAR HEIGHT= 10' -9"
HEADROOM
10'-6"
HVAC PIPES
FHC
53'-1"
LADDER
DN
TO ROOF
BASEMENT
19'-3" 65'-10"
UP
27'-5"
FHC
SPRINKLER
ROOM
ELEVATOR
CLEAR HEIGHT= 7'-1"
ELEV
6'-9" MACHINE
ROOM
x
22'-5" NO ACCESS
PROVIDED
FHC
ELECTRICAL
ROOM
23'-11"
UP
13'-4"| 16 327 – 333 Queen Street West Toronto
GARDINER EXPRESSWAY
FRONT STREET WEST
GO TRANSIT LINE
UNION STATION
KING STREET WEST
ST. ANDREW STATION
ADELAIDE STREET WEST
TREET
VEN AY
TY A BW
JOHN S
UE
RSI ITY SU
REET
UN IVERS
N ST
UN
IVE
GE-
CA
RICHMOND STREET
YON
DUN
OSGOODE STATION 5 MIN WALKK (4
((400
400 M
M)) TTOO OSGOO
OSGOODDEE STATIO
STAT
TAATTIOON
QUEEN STREET WE
BBEVERLY STREET
327-333 QUEEN STREET WESTCBRE Limited 17 |
PUBLIC TRANSIT
ACCESS
The Property features exceptional public transit access serviced by a
510 S
number of existing routes. Situated on top of the 501 Queen Streetcar
TREE
route – Toronto’s longest surface route – the Property provides excellent
TCAR
access to the Financial Core as well as direct connections with the Yonge-
University subway line at both Osgoode Station and Queens Station. The
SPAD
501 streetcar route is the third busiest in the city with over 43,000 daily
INA A
504 STREETCAR
riders.
VENU
E
The 510 Spadina streetcar, the cities second busiest route with 44,000
daily riders, is located only a short walk west of the Property. The 510
Spadina streetcar route, with its dedicated right-of-way access provides
north-south service along the Spadina Avenue offering direct connections
PETER STREET
with the King Street West, Dundas West and College Street streetcars, as
well as the Bloor Street subway line at Spadina Station.
T WEST
# " % G #
Express Airport transit network.
# J
EST 501 STREETCAR
expanding the existing bicycle infrastructure. The Property is conveniently
J "
Westbound and Eastbound access available via Richmond and Adelaide
Streets, respectively. The property is also in extremely close proximity
to several of Toronto’s Bike Share locations, providing unparalleled
transportation access to the Property.| 18 327 – 333 Queen Street West Toronto
DEMOGRAPHIC 2016 DEMOGRAPHIC SNAPSHOT - DOWNTOWN WEST
%
PROFILE TOTAL POPULATION
2011 estimated 54,131 19.60%
2016 estimated 64,717 13.80%
" 2021 Projected 73,620
through urbanization and immigration. It is
V % Pop. Change (2011-2016) 19.60%
populous city in North America supporting a % Pop. Change (2016-2021) 13.80%
total population of 6.1M as of 2015. Downtown 2016 Total Population by Age 64,717
West is the most popular residential area in
downtown Toronto, experiencing staggering
population growth of 19.6% from 2011-2016, AGE GROUP
and projected to increase 13.8% from 2016- 0 to 4 years 2,613 4.00%
2021. In addition to an exceptional growth
5 to 19 years 4,489 6.90%
] : "
income characteristics with an average annual 20 to 24 years 3,791 5.90%
household income of $100,975 as of 2016, 25 to 34 years 20,558 31.80%
projected to increase by 17.7% by 2021.
35 to 44 years 14,832 22.90%
Downtown West is a highly sought-after 45 to 54 years 7,377 11.40%
location for young professionals, situated in 55 to 64 years 5,187 8.00%
close proximity to the downtown core and well-
serviced by the existing TTC network. Overall, 65 to 74 years 3,063 4.70%
55% of the population is between the ages 75 years & over 2,807 4.00%
of 20-44 and with a mix of residential and Median Age 35.5
employment uses in the Downtown West.
2016 Total Census Families 12,148
Average Persons Per Family 2.7
Total Couples 10,012 82.40%
Without children at home 5,647 46.50%
With children at home 4,366 35.90%
Lone-parent families 2,135 17.60%
Children Per Census Family 0.8
2016 Households 35,623
Persons per household 1.77
Average household income $100,975CBRE Limited 19 |
| 20 327 – 333 Queen Street West Toronto
CBRE Limited 21 |
RETAIL LEASING MARKET OVERVIEW
The Property features the potential to utilize already established The success of Downtown West restaurants and the cachet of
retail space along Queen Street, which continues to be ideally being associated with Toronto’s trendiest neighbourhood has
suited to restaurant, fashion, service or convenience based caught the attention of several prominent restaurant chains.
retail. In addition, international fashion retailers are taking notice,
"
The Property is located amidst Toronto’s most dynamic retail Condominium development provides further opportunities
leasing environment offering the city’s most diverse assortment for new market entrants accommodating a wide range of
of tenants and retail concepts. Known for the city’s largest ' ` {
concentration of restaurants, bars and night clubs, Queen in the area has also created strong demand for new grocery
: ' stores with residents demanding unique urban concepts and
back of one of the largest development periods in Canadian healthy organic options. All told, the future of Downtown West
_ is bright experiencing dramatic rental growth driven by an
residential condominium development has led to increased insatiable demand for retail space in Toronto’s most unique
demand for a variety of retail formats and is creating a highly neighbourhood.
competitive leasing environment. National tenants continue to
< '
' "
buildings.| 22 327 – 333 Queen Street West Toronto
UPCOMING
DEVELOPMENTS ON
QUEEN STREET WEST
A majority of Queen West retail ownership are private family
holdings. Assembly of larger development sites has traditionally
been a challenge.
| ' ; {
and Spadina Avenue that will greatly enhance the pedestrian
"
Allied Properties QRC Project at the southwest cor-
ner of Queen Street West and Peter Street. Devel-
opment will deliver approximately 14,000 sq. ft. of
retail in Phase One at grade as part of a mixed
'
"
use. Phase One retail lays out in two sections, one
at the corner of Queen Street West and Peter Street,
and one at the rear of the site at Richmond Street
West.
A future Phase Two is planned which will provide a
+ /// * '
The parking lot at 302-304 Queen Street West at
Soho has been leased to Mountain Equipment Co-
}/ /// *
that will include underground parking. Construction
is anticipated to begin in Q2 2017.
336 Queen Street West, formerly Le Chateau, has
been purchased by a local investment group who
plan to construct a 40,000 sq. ft. building featur-
'
one below for approximately 36,000 sq. ft. in total.
CBRE Limited 23 |
| 24 327 – 333 Queen Street West Toronto
RETAIL STREETSCAPE
TD Bank McDonald’s
SPADINA AVENUE SPADINA AVENUE
Basil Box CIBC
Ardene
Off the Wall Shoes A&W
J.Lindeberge Horseshoe Tavern
Due West
H&M Mac Cosmetics #368
Naot Footwear
Borderline Guess
Clic Klak Nobis
EB Games Shoes.com #358
Available Sublease
NY body Piercing Burger Shoppe
Star Fashion Jealousy Beauty & Life
Sushi Xtra Spoof #350
Te Koop Fraiche
Steve’s Music Store Geologic
Keihl’s Lululemon (Original Store)
Club Monaco Redevelopment Site Formerly Le Chateau
Euroshoes 40,000 sq. ft. #336 (Pearl Group)
Saje The Rivoli Bar/Restaurant
Devine Beauty Boutique G-Star Raw
The Body Shop Brandy Melville #326
Dr. Martens Tatyana
QUEEN STREET WEST
Adida Originals Pet Supply #322
BULWER STREET
Baily Nelson Gorin Bros.
Subway Starbucks
#383 Vacant New Lululemon
Allied Redevelopment Site (wider sidewalk) Cube
Mixed Use 14,000 sq. ft.
PETER STREET Lush
Peter Pan
Kazuo Mountain Equipment Co-op
Vacant Site #367-369 Future Flagship Opening 2017
Will Build to Suit Build to Suit Single User
3,000 sq. ft. 3 levels 40,000 sq. ft. Plus Underground Parking
365 Queen Street West Vacant SOHO STREET
12,000 sq. ft. 3 levels Black Bull
Mac Cosmetics M for Mendocino
Telus Spec’s & Spec’s
Timbuk2 Calforex
Titika Fido
Your Good Health Eko Jewelry
Little Burgundy Vacant 800 sq. ft.
Aldo MYNC
Active
A Surplus Aritzia Clothing
327-333 QUEEN STREET WEST Zara Icebreaker #278
Arcteryx David’s Tea
Foot Locker
Beverly Hotel #272-274 4,500 sq. ft. at grade (Rexall Pending)
Yyoga
Am
American Eagle BEVERLY STREET
Sushi Time Shoppers Drug Mart
Groovy Clothing Underground Public Parking
So Hip It Hurts
Brimz Black Market
Drama Queen
Clearly Contacts Vacant 4,000 sq. ft. #256 (Blaze Pizza Pending)
Change
Rudsak Collections Ho Su Japanese Restaurant
Houka Holika
Scarpino Shoes Gardenview Grocery
Kallone Intimi JOHN STREETCBRE Limited 25 |
| 26 327 – 333 Queen Street West Toronto
MARKET
OVERVIEWCBRE Limited 27 |
DOWNTOWN
WEST OVERVIEW
Downtown West is the heart of urban lifestyle in Toronto
! "
luxury condominiums, world-class restaurants, nightlife
and entertainment. The neighbourhood has undergone
a dramatic transition from a textile and furniture
manufacturing district fraught with derelict industrial
buildings to the country’s preeminent destination for
nightlife and entertainment. Queen West continues to
emerge as Canada’s most diverse urban environment
' '
unique condominium projects.
Downtown West has seen unprecedented development in
recent years, driven by young professionals demanding to
'
<
condominium projects in support of the staggering
population growth and demand for dwellings close to
the downtown core. Downtown West offers a truly unique
lifestyle to residents, exemplifying the urbanization trend
providing residents the potential to live, work and play all
within walking distance of home. Residential development
has led to exceptional demand for retail and employment
uses in Downtown West garnering global recognition as
a coveted location for start-up companies, new market
the world.| 28 327 – 333 Queen Street West Toronto
TORONTO WEST DEVELOPMENTS
There are currently 53 active projects in the Downtown West area, in the immediate vicinity of the Property, which are about
89% pre-sold. The projects feature an average weighted price of about $674 per sq. ft. for remaining units. Absorption
varies widely, as it is based on the size and location of the projects. All of the active projects are still under construction,
scheduled for completion before the end of 2019. There are an additional 40 development applications in the area. The 40
speculative projects comprise an additional 21,674 units. With minimal standing inventory, the pipeline remains stable for new
developments, with the potential for new projects to come online with occupancy in 2019 and beyond. The following table
details active condominium projects in the West-Toronto area.
1
4
2
A
3
21 327-333 QUEEN STREET WEST
22
C
5
24 8 7
2
23 9
10
B
25 D 11 6
G 155 H 12 133 E K
F L
166 I
M 14
J 1
17
18 19
20CBRE Limited 29 |
' ' ' {
ACTIVE PROJECTS
Site Name Developer Occupancy Total Rem. % $ Per 70%
Date Units Inv. Sold sq. ft. Absorption
1 Residences of 488 University Avenue Amexon November-17 453 1 100% $1,145 2 Months
2 Residences at RCMI on University Tribute Communities February-14 318 0 100% $753 2 Months
3 Form Tridel September-19 189 8 96% $726 2 Months
4 Dragon Condos Ideal Developments October-16 95 7 93% $695 5 Months
5 Smart House Urban Capital Property Group and Malibu Investments May-17 241 9 96% $794 11 Months
6 Shangri-La Westbank Projects Corp. and Peterson Investment Group October-12 393 3 99% $2,620 48 Months
7 Picasso on Richmond Mattamy Homes and Goldman Group June-16 409 4 99% $656 3 Months
8 330 Richmond Greenpark Homes June-18 310 23 93% $750 7 Months
9 Studio on Richmond - Building B Aspen Ridge Homes July-15 333 7 98% 735 6 Months
10 Studio2 on Richmond Aspen Ridge Homes March-16 405 59 85% 668 7 Months
11 Bond Condominiums Lifetime Developments February-17 386 18 95% 840 1 Month
12 Pinnacle on Adelaide Pinnacle International September-14 587 4 99% 795 38 Months
13 PJ Pinnacle International June-19 368 207 44% 660 10 Months (44%)
14 Theatre Park Lamb Development Corp. and Harhay Construction January-15 233 15 94% 985 9 Months
15 87 Peter Menkes December-17 630 3 100% 897 25 Months
16 King Charlotte Lamb Development Corp. and Niche Development December-15 232 5 98% 668 36 Months
17 King Blue by Greenland - North Tower Greenland Group Co. June-18 387 28 93% 738 15 Months
18 King Blue by Greenland - South Tower Greenland Group Co. June-18 521 7 99% 675 15 Months
19 Mercer Graywood Developments Ltd. And Beaverhall Homes January-15 390 19 95% 702 12 Months
20 Bisha Lifetime Developments April-17 334 8 98% 807 12 Months
21 SQ Tridel May-17 241 6 98% 633 8 Months
22 SQ2 Tridel October-18 169 50 70% 591 14 Months
23 Fabrik Menkes June-16 171 4 98% 720 35 Months
24 James Lamb Development Corp. November-18 135 43 68% 696 10 Months (68%)
25 Brant Park Lamb Development Corp. January-16 243 31 87% 710 31 Months
APPLICATIONS
Municipal Address Height (Storeys) Floor Space Index Total Units
A 234 Simcoe Street 17, 24, and 54 12.7 1129
B 40-58 Widmer Street 40 17.9 426
C 170 Spadina Avenue 19 10.9 210
D 102 Peter Street 40 and 48 - 899
E 263 Adelaide Street West 42 20 328
F 283 Adelaide Street West 48 - 372
G 46 Charlotte Street 46 - 248
H 30 Widmer Street 51 29 461
I 8 Widmer Street 56 19.1 583
J 401, 407-409 & 415 King Street West 56 - 615
K 217 Adelaide Street West 56 28.3 410
L 100 Simcoe Street 59 - 524
M 260-270 and 274-322 King Street West 82 and 92 18.1 1949| 30 327 – 333 Queen Street West Toronto
CURRENT LAND USE
CONTEXT
9{ # '
years, drastically changing the streetscape and character of the neighbourhood.
Queen Street West features a broad land use context which includes street-front
restaurants, theatres and open spaces. The neighbourhood continues to see
' '
of height and density. There are several sites in the immediate vicinity that are
poised for redevelopment for high density residential as well as several recently
completed projects. Notable projects in the area include TIFF Bell Lightbox, M5V
Condos and King-Blue Condos. An eclectic mix of old and new, the Queen-
Spadina East Precinct features a range of brand new commercial and residential
developments, timeless sandstone-clad street-front retail, historic theatres
and open spaces which integrate seamlessly to create an area which is both
the character of the area will continue to change as this historic neighbourhood
continues to intensify.
327-333 QUEEN STREET WEST
JOHN
STREE
TCBRE Limited 31 |
PE T
ER S
TRE
ET
EET WEST
ON D STR
RICHM
ET WEST
QUEEN STRE
BEVE
RLY
STRE
ET| 32 327 – 333 Queen Street West Toronto
TENANCY
SUMMARYCBRE Limited 33 |
AMERICAN EAGLE
OUTFITTERS
G { !
accessory retailer, with over 1,000 stores in the United States,
Canada, Mexico, China, Hong Kong, and the United Kingdom,
and shipping services to an additional 81 countries worldwide.
'
offer high-quality, trendy clothing and accessories at affordable
prices. The company has a market capitalization of 3.37B and
has become a household name to members of the millennial
generation, currently trades publicly under the New York Stock
Exchange at approximately eighteen dollars per share.
YYOGA
YYoga is a community of yoga studio and lifestyle centres dedicated
to promoting holistic health and wellness. Based out of Vancouver,
YYoga is the largest corporately owned yoga company in Canada –
YYoga operates 13 studios offering more than 900 classes per week
in locations including Vancouver, Whistler, and Toronto. In addition
as an infrared sauna and mat and towel services meaning that
$$ !
Tenant Type & Term Size Rate Changes Changes Notes
Suite Number (sq. ft.) per sq. ft. On To
American Eagle Apr-2014 to 5,266 $93.64 May-2017 $95.51
Retail, Suite: 100 Jan-2025 May-2018 $97.42
May-2019 $99.37
May-2020 $101.36
May-2021 $103.39
May-2022 $105.46
Pure Freedom Yoga Centres Oct-2013 to 10,495 $31.00
Retail, Suite: 100A/200 Oct-2023
Total Occupied 15,761 100.0%
Total Vacancy 0 0.0%
Total 15,761| 34 327 – 333 Queen Street West Toronto
FINANCIAL
OVERVIEWCBRE Limited 35 |
% = #{ V$
FINANCIAL A prevailing market rate of 3.0% of effective gross
MODEL revenue has been applied as a management fee. This
expense is offset by a contractual administration fee
ASSUMPTIONS which generally states that the Landlord is entitled to
the collection of an admin fee equal to the amount
paid to the Landlord’s agent in respect of the
management or 15.0% of the operating expenses
#;V _ #_] (excluding realty taxes).
44 MLA ASSUMPTIONS
; 4 +/4 ]
31, 2027. All budget information is based upon American Yyoga
Eagle
the Vendor’s 2016 calendar year budget (ending
] 84? Analysis Start Date January 1, 2017
at the beginning of each calendar year. Market Rent $110.00 $38.00
Term 10 years 10 years
%: | { Tenant Inducement
The annual growth rate used for all revenue and New $35.00 $25.00
expense items is 2.5%. This assumption remains Renewal $0.00 $0.00
constant throughout the duration of the projection Leasing Commissions
term.
New 6.0% Yr 1/3.0% 6.0% Yr 1/3.0%
Thereafter Thereafter
% VV$ :V
Renewal 3.0% Yr 1/ 1.5% 3.0% Yr 1/ 1.5%
A vacancy allowance has been provided in the cash Thereafter Thereafter
' Renewal Probability 75.00% 75.00%
or bad debt allowances. This allowance is equivalent Downtime 6 Months 6 Months
to 4.0% of the potential gross revenue but is reduced
2.50%
' '
General Vacancy 4.00% of PGR
expiries and leasing requirements.
Management Fee 3.00% of EGR
Structural Reserve 1% of EGR| 36 327 – 333 Queen Street West Toronto
11 YEAR CASH FLOW
Year 1 Year 1 Year 2 Year 3 Year 4
PSF Dec-2017 Dec-2018 Dec-2019 Dec-2020
INCOME PROJECTION
Base Rental Revenue $52.40 $825,839 $844,371 $880,170 $890,596
Absorption & Turnover Vacancy $0.00 $0 $0 $0 $0
Scheduled Base Rental Revenue $52.40 $825,839 $844,371 $880,170 $890,596
Operating Recovery $2.39 $37,745 $38,907 $40,108 $41,346
Admin Fee Recovery $3.23 $50,980 $52,638 $54,378 $56,158
Realty Tax Recovery $20.02 $315,602 $323,493 $331,580 $339,870
Total Reimbursement Revenue $25.65 $404,327 $415,038 $426,066 $437,374
Potential Gross Revenue $78.05 $1,230,166 $1,259,409 $1,306,236 $1,327,970
General Vacancy -$1.56 ($24,603) ($25,188) ($26,125) ($26,559)
Effective Gross Revenue $76.49 $1,205,563 $1,234,221 $1,280,111 $1,301,411
EXPENSE PROJECTION
Operating Cost $2.47 $38,967 $39,942 $40,936 $41,963
Realty Tax $20.02 $315,603 $323,492 $331,581 $339,869
Non-Recoverable $0.00 $0 $0 $0 $0
Management Fee $2.29 $36,167 $37,027 $38,403 $39,042
Total Operating Costs $24.79 $390,737 $400,461 $410,920 $420,874
Net Operating Income $51.70 $814,826 $833,760 $869,191 $880,537
CAPITAL COSTS
Leasing Commissions $0.00 $0 $0 $0 $0
Tenant Inducements $0.00 $0 $0 $0 $0
Total Capital Costs $0.00 $0 $0 $0 $0
Cash Flow Before Debt Service $51.70 $814,826 $833,760 $869,191 $880,537CBRE Limited 37 |
Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11
Dec-2021 Dec-2022 Dec-2023 Dec-2024 Dec-2025 Dec-2026 Dec-2027
$901,233 $912,081 $932,114 $961,811 $1,101,119 $1,115,823 $1,133,834
$0 $0 $0 $0 ($117,629) $0 $0
$901,233 $912,081 $932,114 $961,811 $983,490 $1,115,823 $1,133,834
$42,629 $43,940 $45,126 $46,318 $44,895 $48,665 $49,880
$58,011 $59,907 $61,564 $63,222 $61,207 $66,421 $68,081
$348,367 $357,076 $366,004 $375,152 $363,163 $394,144 $404,000
$449,007 $460,923 $472,694 $484,692 $469,265 $509,230 $521,961
$1,350,240 $1,373,004 $1,404,808 $1,446,503 $1,452,755 $1,625,053 $1,655,795
($27,005) ($27,460) ($28,096) ($28,931) $0 ($32,501) ($33,117)
$1,323,235 $1,345,544 $1,376,712 $1,417,572 $1,452,755 $1,592,552 $1,622,678
$43,010 $44,088 $45,189 $46,319 $47,477 $48,660 $49,880
$348,366 $357,076 $366,003 $375,153 $384,531 $394,145 $403,998
$0 $0 $0 $0 $0 $0 $0
$39,698 $40,366 $41,302 $42,527 $43,582 $47,777 $48,680
$431,074 $441,530 $452,494 $463,999 $475,590 $490,582 $502,558
$892,161 $904,014 $924,218 $953,573 $977,165 $1,101,970 $1,120,120
$0 $0 $0 $0 $161,490 $0 $0
$0 $0 $0 $0 $53,436 $0 $0
$0 $0 $0 $0 $214,926 $0 $0
$892,161 $904,014 $924,218 $953,573 $762,239 $1,101,970 $1,120,120| 38 327 – 333 Queen Street West Toronto
THE CITY OF
TORONTOCBRE Limited 39 |
TORONTO – A BEACON
OF STRENGTH IN A
WORLD OF UNCERTAINTY
Toronto is the largest city in Canada and the provincial capital of Ontario
with Toronto metropolitan area supporting a total population of 6.1 million
as of 2015. It is the 4th most populous city in North America and one of the
most multicultural cities in the world. At a time of recent uncertainty impacting
major global economic centres, Toronto is the epicenter of one of the strongest
V | 40 327 – 333 Queen Street West Toronto
THE FINANCIAL SECTOR – A GLOBAL PLAYER IN INTERNATIONAL BUSINESS
Canadian branches/subsidiaries. Canadian banks
ranking 3rd in the 2016 PwC Cities of Opportunities have been recognized among the safest banks in the
Study, #1 most tax competitive major city by KPMG, world; a stability that fueled the growth of Toronto’s
10th of 84 cities in the 2016 Global Financial Centres ! *' +
Index (GFCI); 3rd most business friendly city in the crisis of 2008. Toronto is also home to the majority
Americas (FDi American Cities of the Future 2015- of Canadian pension funds including the 4 largest
! pension plans in the country with combined assets
sector in North America employing approximately : *
251,000 workers. As a hub for international business, sector is the backbone of the economic system in
the City has one of the highest concentrations of Canada and provides investment and funding for a
! " ' variety of businesses and new ventures.
is the headquarters of 5 of the largest banks in the
country and the majority of foreign banks withCBRE Limited 41 |
» Toronto has the third largest financial
services sector in North America
EMPLOYMENT – THE FOUNDATION UPON WHICH A GREAT CITY IS BUILT
Toronto accounts for approximately one-sixth of the for downtown locations, workers demand to be in a
national workforce. The City is headquarters to more central location in order to enjoy shorter commute
national and international companies than any other + ? + : +X+
Canadian city, including six of Canada’s leading level of amenities. This resurgence of growth in the
+ ? ! * Downtown Core has also brought with it a number
? ! * @? of businesses looking to capture the increased level
*X * @ ! of retail expenditures spawned by recent population
+ ? growth. Specialty stores and big box companies alike
home to nine of Fortune Magazine’s Top 500 Global are searching for new urban concepts to get closer
Companies. These companies include Royal Bank to the growing population base and capture a larger
of Canada, George Weston, Manulife Financial, share of expenditures. Convenience has become a
Bank of Nova Scotia, ONEX, Toronto-Dominion major driver of retail success and many businesses
Bank and Sun Life Financial. In recent years, more have started to capitalize on changing trends. Overall,
businesses are choosing to locate in the Downtown unemployment has decreased slightly in 2015-2016
Core rather than suburban locations. This trend from 7.5% to 7.2%. Moreover it is expected to steadily
has been driven largely by population growth and decline through 2020 where unemployment is forecast
: * X @ ' @ '' at 6.1% (Source: Conference Board of Canada). These
area. In order to attract talented workers, companies metrics show support for a strengthening economy and
now have to choose locations that appeal to the a strong employment market in the City of Toronto.
targeted employees. Despite higher real estate costs| 42 327 – 333 Queen Street West Toronto
TOURISM – A WORLDWIDE DESTINATION
In a recent press release, Tourism Toronto announced that the City reached
new records in 2015, welcoming the highest number of overnight visitors and
leading the county in hotel occupancy and hotel room nights sold. Additionally,
for the fourth year in a row Toronto saw an increase in overnight visitors from the
U.S. The City is the most-visited destination in Canada by fellow Canadians with
10.5 million overnight visits (and a further 25.5 million same day visits) in 2014.
These visits generated spending of $2.44 billion in the City. In 2014, Tourism
Toronto and its partners also booked 665 future meetings and conventions that
will bring 463,400 attendees to Toronto and generate 640,345 future hotel
room nights. Of these meetings booked, 16 are considered “major meetings”
with more than 2,000 attendees at multiple hotels. With these events injecting
over $550 million into the local economy, the tourism and hospitality industries
continue to thrive employing approximately 300,000 people in the Toronto
Region. These meetings will be based at the Metro Toronto Convention Centre,
which has more than two million square feet of exhibit, theatre and meeting
_==? '
' ' 8// /
Toronto’s vast network of theatres, including Roy Thompson Hall and the TIFF
Bell Lightbox. Toronto is also recognized as Canada’s sports capital with major
> ; ? ? CBRE Limited 43 |
]# _]{ = | %{ ]# { _ V]_
HISTORY
Toronto has experienced strong investment activity with building permits averaging between $10 and $15
billion per year between 2010 and 2015, which can be largely attributed to strong residential construction.
More than 63% of the $15.3 billion in building permits issued for the Toronto Region in 2015 were for
residential projects.
There were 122 high rise buildings under construction in the city of Toronto as of December 2014 (Emporis),
making Toronto second to only New York in number of high rise buildings under construction. This momentum
has continued through 2016 with 66 high-rise residential buildings under construction and another 45 projects
; +/4 > ?
Some of the larger planned development projects that will positively impact the Toronto market include: A
waterfront revitalization strategy to improve Toronto’s international image as part of investment in excess of $1
Billion in several clusters along the City’s waterfront.
# % 4}
the construction of six new indoor venues. Toronto attracted 250,000 visitors from 42 participating countries
% _ ?
create additional commercial & retail space. The Project will be completed in phases, running from 2015
through to 2017.
DOWNTOWN TORONTO RESIDENTIAL MARKET
The Downtown Toronto residential market has been incredibly strong in recent years with an abundance of
condominium development on the back of historical high unit pricing. Increased demand for condominium
" ] V < "
< '
commercial areas which are prime targets for condo developers to acquire in pursuit of affordable land close
to the Downtown Core. Development has been concentrated along major transit corridors including Yonge
Street, Bay Street, Bloor Street, Church Street, and King Street due to proximity to the Downtown Core and
] ] V
developers have had fewer options leading to higher land values. Strong population growth has resulted in
healthy absorption rates for new supply and the condominium market continues to thrive, despite an increased
level of supply and rising interest rates.| 44 327 – 333 Queen Street West Toronto
OFFERING
PROCESSCBRE Limited 45 |
MEMORANDUM CONFIDENTIALITY
CONTENTS Upon receipt of this CIM, prospective purchasers will have
" > V
V _ >V_? Agreement”) under which they have agreed to hold and
prepared by the Advisor and is being delivered to prospective V_
purchasers to assist them in deciding whether they wish to Prospective purchasers will not, directly or indirectly, disclose
acquire the Property. or communicate or permit anyone else to disclose or
communicate this CIM or any of its contents or any part thereof
This CIM does not purport to be all-inclusive or to contain all
the information that a prospective purchaser may require in
deciding whether or not to purchase the Property. This CIM is V
for information and discussion purposes only and does not provided and approved by the Vendor. Prospective purchasers
constitute an offer to sell or the solicitation of any offer to buy will not use or permit this CIM to be used in any manner
the Property. The CIM provides information relating to certain detrimental to the interests of the Vendor, the Advisor or their
'
Property. purchase of the Property. The recipient of this CIM agrees to
provide the Advisor with a list of those persons to whom this
The information in this CIM has been obtained from various CIM or any information contained herein is provided.
sources considered reliable. Neither the Vendor nor the
Advisor make any representations, declarations or warranties, The terms and conditions in this section with respect to
express or implied, as to the accuracy or completeness of the
information or statements contained herein or otherwise and “Memorandum Contents” relate to all Sections of the CIM as
such information or statements should not be relied upon if stated independently therein.
by prospective purchasers without independent investigation
' ' " The CIM shall not be copied, reproduced or distributed, in
any and all liability for any errors or omissions in the CIM or whole or in part, to other parties at any time without the prior
any other written or oral communication transmitted or made written consent of the Vendor. It is made available to prospective
available to prospective purchasers. purchasers for information purposes only and upon the express
understanding that such prospective purchasers will use it only
If any information relating to the Property, in addition to for the purposes set forth herein and upon and subject to
the information provided in this CIM, is provided at any V G *
time, orally or otherwise, by the Vendor or the Advisor, recipient will promptly return all material received from the
such information is provided as a convenience only without Vendor and the Advisor (including the CIM) without retaining
representation or warranty as to its accuracy or completeness any copies thereof. In furnishing the CIM, the Vendor and the
and such information should not be relied upon by prospective Advisor undertake no obligation to provide the recipient with
' ' access to additional information.
The division of the CIM into sections, paragraphs, sub-
paragraphs and the insertion or use of titles and headings
are for convenience of reference only and shall not affect the
construction or interpretation of this CIM.| 46 327 – 333 Queen Street West Toronto
OFFERING SUBMISSION
PROCESS GUIDELINE
Recipients of this CIM acknowledge that they are the Vendor Proposals for the Property will be evaluated primarily on
has adopted a negotiated sale process. Based on information the consideration offered, the method of payment of the
contained in this CIM and other information that may be consideration, the prospective purchaser’s ability to complete
made available upon request, interested parties are invited the transaction, and the proposed date and conditions of
to submit a proposal that addresses the requirements outlined closing.
{ %
A proposal should outline the terms for the purchase of the
CBRE is asking that bids for the Property be submitted by 4:00 Property and should include, at a minimum, the following
pm, Thursday, October 13th, 2016. information and items:
Submissions should be directed electronically to: • #
V CBRE Limited 47 |
SALE ADVISORS
CONDITIONS The Advisor is acting solely as agent for the Vendor and not as
agent for the purchaser. All inquiries regarding the Property or
The proposal should be in the Purchaser’s Agreement of any information contained in this CIM should be directed to
# { # " CBRE Limited, Brokerage, as Advisor for the Vendor:
to be purchased on an “as is, where is” basis and there is no
warranty, express or implied, as to title, description, condition,
` * CBRE Limited, Brokerage
quality thereof and without limiting the foregoing, any and all \'' ]*
conditions or warranties expressed or implied will not apply 145 King Street West
and are to be waived by the purchaser. Suite 1100
| 4;
Any information related to the Property which has been or will
be obtained from the Vendor or the Advisor or any other person,
by a prospective purchaser, has been prepared and provided
solely for the convenience of the prospective purchaser and Peter D. Senst*
will not be warranted to be accurate or complete and will not President Canadian Capital Markets
form part of the terms of an agreement of purchase and sale. 416 815 2355
peter.senst@cbre.com
V %
Senior Vice President
416 815 2398
casey.gallagher@cbre.com
Stuart A. Smith*
Vice President
416 815 2392
stuart.smith@cbre.com
*Sales Representative 145 King Street West, Suite 1100 | Toronto, Ontario | M5H 1J8
Peter D. Senst* Casey T. Gallagher* Stuart A. Smith*
President Canadian Capital Markets Senior Vice President Vice President
416 815 2355 416 815 2398 416 815 2392
peter.senst@cbre.com casey.gallagher@cbre.com stuart.smith@cbre.com
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