Burlington Economic Development Corporation (BEDC)
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Burlington Economic Development Corporation (BEDC) Mobility HUBs - Office and Retail Market Analysis Summary Report January 2019 Deloitte LLP Bay Adelaide Centre, East Tower 8 Adelaide Street West, Suite 200 Toronto, ON, Canada M5H 0A9 Ms. Anita Cassidy Dear Ms. Cassidy: Acting Executive Director Re: Burlington Retail and Office Marketplace influencing Mobility Hubs - Summary Report Burlington Economic We are pleased to submit our Summary Report to the Burlington Economic Development Corporation (BEDC) for the study of Retail and Development Corporation Office Market Trends influencing the Burlington Mobility Hubs including three GO Station Mobility Hubs and the Downtown Mobility Hub. In this 414 Locust Street, Suite 203 Burlington, Ontario, L7S 1T7 document, we have identified the following: E [email protected] • Economic and demographic trends affecting Burlington’s growth opportunity. These trends indicate that Burlington is a growing, well D 905.332.9415 ext. 7258 educated and affluent population situated within the GTHA that is poised to take advantage of the GTHA’s overall growth opportunities; • The Burlington retail market continues to serve a regional population and has more retail space per capita at approximately 55 sf/capita compared with others across the GTHA. As a result, the large format Mapleview and Burlington Malls, combined with several power centers attract regional shoppers. That said, Burlington could be considered “over-retailed” and this continues to challenge the downtown marketplace; • The Downtown Burlington mobility hub could benefit from an overall “local experience” for shopping, services, restaurants and other amenities that distinguish this unique environment from the standard shopping malls. Adding some office space targeted toward small businesses and space that supports “creative technology” requirements will help to accelerate this mobility hub; • The Appleby, Burlington and Aldershot Mobility Hubs will continue to benefit from increased passenger ridership as the GTHA expands through to Hamilton and Niagara. As a result, a greater focus toward mixed use development including office and potentially residential could accelerate overall opportunities within the mobility hubs and for Burlington. This document highlights the markets, key trends and opportunities influencing the Burlington dynamics and mobility hubs overall in greater detail. If you have any questions with respect to the information contained herein, please don’t hesitate to connect with me directly at 416- 601-4686 or [email protected]. We look forward to additional discussion around this substantive topic facing the City of Burlington. Respectfully submitted, Sheila Botting FRICS, FCMC, AACI (Hon) Senior Partner & Canadian Real Estate Leader Deloitte LLP ©2018 Deloitte LLP and affiliated entities City of Burlington Office & Retail Market Analysis 2 Table of Contents 1 Project Background 2 Mobility Hubs 3 Market Trends – Retail and Office 4 Development Considerations & Next Steps ©2018 Deloitte LLP and affiliated entities City of Burlington Office & Retail Market Analysis – Internal Use Only 3 PROJECT BACKGROUND ©2018 Deloitte LLP and affiliated entities City of Burlington Office & Retail Market Analysis – Internal Use Only 4 Project Background – Introduction The City of Burlington has entered into a post-greenfield phase, transitioning from a suburban to an urban community The City of Burlington has been one of the most rapidly growing communities within the Greater Toronto and Hamilton Area (GTHA). For most of the last two decades, the City’s strong growth and economic performance were driven by a combination of its business- friendly environment and highly competitive land supply to accommodate new investment, particularly “greenfield” lands for ground-related housing and business park types of development. As a result, the City is home to significant residential communities and a number of high-profile companies in a range of industries. This includes advanced manufacturing, food processing, metal fabrication and packing, financial services, IT, life sciences, transportation and logistics. In recent years, with very little room for traditional greenfield development, the City has entered a post-greenfield phase where the overall pace of growth has slowed and the focus of development shifted to higher density forms, primarily residential intensification and major office development. The City of Burlington is undergoing an important transition from a suburban to an urban community. As such, the City of Burlington’s official plan, which describes the City’s land-use strategy to 2031 and beyond, has introduced the concept of a Mobility Hub as a growth priority. Mobility Hubs will be planned to be complete, compact, and sustainable communities as identified through the Province of Ontario’s Growth Plan. These Mobility Hubs will also benefit from Metrolinx’s Regional Express Rail, which will feature two-way, all-day services every 15 minutes along the Lakeshore West line. ©2018 Deloitte LLP and affiliated entities City of Burlington Office & Retail Market Analysis – Internal Use Only 5 Project Background – Assignment Overview Deloitte Real Estate was engaged to provide an office and retail market study, focusing on the three GO Stations and the Downtown Mobility Hub Background Assignment Objectives The City of Burlington has three GO Station Mobility Hubs and a Downtown Mobility The focus of this report includes: Hub within its boundaries. In order to fully understand the marketplace opportunity and successfully develop neighborhoods around the three GO Station Mobility hubs • An update on current office and retail market conditions and performance, as and the Downtown Mobility Hub, it is essential to understand both supply- well as market trends that may impact future demand and supply; demand dynamics and emerging trends in the commercial real estate market, with particular focus on the office and retail asset classes. • A high-level review pertaining to office market trends driving potential growth for the Burlington economy; Deloitte Real Estate previously conducted an office market analysis for the Burlington Economic Development Corporation (BEDC) in 2016, as well a retail market review • A high-level review pertaining to experiential and placemaking elements that for downtown Burlington in 2013. As such, the City has engaged the Deloitte would elevate and complement other developments with a focus on the four Real Estate team to provide a high-level commercial real estate market mobility hubs. update focusing on office and retail market conditions, as well as emerging industry trends that will have an impact on future development. The findings Aldershot Go Mobility Hub Burlington Go Mobility Hub of this study aim to help policy makers with making more informed decisions around all Mobility Hubs. Appleby Go Mobility Hub Downtown Mobility Hub ©2018 Deloitte LLP and affiliated entities City of Burlington Office & Retail Market Analysis – Internal Use Only 6 MOBILITY HUBS ©2018 Deloitte LLP and affiliated entities City of Burlington Office & Retail Market Analysis – Internal Use Only 7 Mobility Hub Development – Introduction Mobility Hubs are part of the Greater Toronto and Hamilton Area’s (GTHA) regional transit growth priorities What is a Mobility Hub? Mobility Hubs Objectives A mobility hub consists of major transit stations and the surrounding area, and is an Multimodal transportation important node for connectivity as well as a focal A range of higher-order transportation options with seamless point for activity. transfer Mobility hubs are believed to offer great potential to transform the GTHA through the establishment of rapid transit networks and Residential and employment density related transit oriented real estate development. Critical mass of people to work, live, shop and play Regional Movement The Big Move, a bold and visionary plan that High levels of pedestrian priority outlines a common vision for transportation, was Spaces and connections designed with pedestrian priority adopted in 2008 by Metrolinx board and is Mobility currently being implemented across the Hub GTHA. The Premier of Ontario and Minister of Transportation committed $11.5 billion to Embedded technology implement the Big Move and to get started on key transit projects. Access to real time travel information One of the Big Move’s priorities is “a system of connected mobility hubs” that provides travelers with seamless access to the regional Economic vitality and competitiveness transit system, supports higher density Significant development potential and strong economic anchors development and demonstrates excellent customer service. Strong sense of place A vibrant and vital place to support the transportation experience ©2018 Deloitte LLP and affiliated entities City of Burlington Office & Retail Market Analysis – Internal Use Only 8 Mobility Hub Development – Benefits Mobility Hub development addresses various prevailing challenges that cities are facing today Challenges in Urban Environment Potential Solution – Mobility Hub Development Rapid increase in urbanization of the population has led to growth Mobility Hub development offers an alternative to end-users by creating opportunity and improvement in the urban core, but at the same time, this desirable suburban nodes that mimic urban convenience while incorporating the trend has created challenges for the overall standard of living and sustainability. suburban market’s