Land values continue to rise. Real estate continues to sell. Developers continue to commit millions toward new developments where the emphasis is on intensification.
That’s not the case everywhere, of course. It never is.
Still, as I watch the situation unfold across the country through these summer months, I feel compelled to counter the cynical speculation that continues to appear in the media about how the sky is falling.
Some industries are in dire straits with the formidable foe we all face and will continue to struggle against – this great challenge, and our ability to overcome it, are not in dispute.
However, it doesn’t do anyone any good to showcase the worst of the pandemic’s economic effects to the exclusion of all else.
Take transit-oriented development.
Developers continue to place their bets on a return to a world where people will still want to live, work and play in mixed-used developments where the primary means of getting around is by foot and public transit.
It harkens back to the idea expressed in an advertisement I saw from decades ago – “A job at the end of every street.”
This is evident in Montreal, Toronto and Ottawa.
Reports out of Vancouver suggest that city is taking a bit of a break, but not an alarming one.
Other major urban centres like Edmonton and Calgary, as I have said before, continue to wrestle with economic challenges that were entrenched before we knew COVID-19 from chicken soup.
But even with the other challenges faced by Alberta, transit-oriented development plans are still progressing.
People seek amenities
The Ottawa-Gatineau market is particularly telling. Sure, Ottawa exists in a bubble all its own, anchored by the federal public service as well as its tech sector.
But regardless of the city’s economic prospects, there is the issue and the fear of what threat the virus will continue to pose to health, safety and whatever passes for your definition of “normalcy.”
In recent weeks, two of my neighbours sold their homes for $200,000 and $300,000 over asking.
I don’t live in a mansion by any means, and neither do they. These are freehold single-family homes that were built decades ago as regular middle-class housing.
What advantage they do have is location – a desirable and well-established neighbourhood within short walking distance of many amenities.
I can only take from this, and from the quicker-than-expected recovery of urban residential real estate markets across the country, that many people are eager to set themselves up in locations where they don’t have to travel far to get what they need.
Developers are obviously banking on this kind of sentiment, if the recent string of transit-oriented development projects reported in Ottawa since the pandemic began are any indication. All of these are adjacent to the new or the planned stations of Ottawa’s LRT system.
Busy on Ottawa’s LRT route
Let’s look at a few examples:
* A 1.3-million-square-foot complex of apartments and extended-stay hotel suites (four towers in all) on 3.8 acres in East Ottawa about 400 metres from the Cyrville LRT Station. The developers bought the site 13 years ago and had planned to build townhomes, before deciding high-rise intensification was a better way to go with LRT development.
* The federal government is seeking a developer to design, build and manage a 1.6-million-square-foot office and mixed-use development to house up to 8,000 workers. This is also in East Ottawa, on an eight-acre site at the corner of St. Laurent Boulevard and Tremblay Road. The idea is to take advantage of LRT and create, again, a community that fits the bill for having a job at the end of every street.
* Closer to downtown, Colonnade Bridgeport and Fiera Real Estate have acquired a five-acre redevelopment site with up to 2.3 million square feet of capacity. The partners are planning a mixed-use project for the property. The so-called Dustbane site is next to the Ottawa VIA Rail train station, which also of course links to the LRT system.
* Out west of downtown, Groupe Heafey filed a development plan application with city hall recently to build two high-rise apartment buildings near the Lincoln Fields Shopping Centre. The Lincoln Fields site itself is being redeveloped and will feature a nearby station on the extended LRT line.
Other locations along Ottawa’s LRT line, like Westboro, already have shovels in the ground. Still more, such as Tunney’s Pasture, have huge potential for redevelopment.
Inside Ottawa’s Greenbelt, and with transit as the foundation, 10s of millions of square feet of redevelopment are underway, planned or expected.
This hasn’t really changed with the pandemic.
Will history repeat itself?
I wrote a little while back about the skyscraper building boom, particularly in the U.S., that followed the flu pandemic of 1918-’20.
Within a few years, people’s fear of a virus far more apocalyptic than COVID-19 had faded. What followed in many cities was a new normal of more intense urban development.
The modern urban landscape was born and the idea of packing people like sardines into mass transit to work in the sky downtown became a fixture of our culture.
Only time will tell how expectation and reality mesh this time around. Developers are obviously banking on the persistence of a world where we don’t fear density.
How we use our space may indeed change, but the key thing is that it looks pretty certain that we will continue to want and use intensified urban space.
It’s up to architects and interior designers to make some tweaks that facilitate social distancing, remote working from home and other measures intended to ensure public health and safety.
Behaviour of people may adapt to being more thoughtful when someone is ill, so they can take advantage of the newfound skill of working from home while under the weather.
Municipalities must also continue to enable making different choices on the use of existing outdoor space – such as restaurants taking over street parking spots to expand outdoor seating.
And for the success of Ottawa’s transit-oriented development, we of course need that LRT system to actually work as expected.
To discuss this or any valuation topic in the context of your property, please contact me at email@example.com. I am always interested in your feedback and suggestions for future articles.