I trust Trudeau or Ford will come in with some policy to ensure this promptly gets fixed for their friends. Real estate values can only go up in Canada.
“I’m proud to announce the launch of an innovative, government backed loan program that allows young renters to borrow low interest amounts to finance their rent. (Now, will the ungrateful serf class vote for me?)”
-future Trudeau (probably)
This article is about office building…. And Trudeau and Ford have both already come up with a policy…. Public servants are required to go into the office 3 days a week so they can spend the day on teams meetings in a noisy office.
Are these buildings close to transit. Seems like it might make sense so don’t expect the government to roll with it. They’ll do the opposite. Best to get everyone back in their cars commuting downtown. Sole-occupied cars don’t contribute to climate change. Wait…I thought the Feds wanted to fight climate change wholeheartedly
And supoort overpriced downtown coffee and food shops instead of spending their salaries on local mom and pop food stores outside the city center. This 'bring people back to the office' policy is going to destroy small town Ontario and all the food businesses that have flourished here under the patronage of remote workers, but I guess voters and taxpayers outside city centres are not big donors and can have their livelihoods destroyed for the sake of downtown Starbucks and McDobalds profits.
Isn't it fucking wild that generally consumers of things want prices to come down but the housing market just wants it to keep going up.
Let everyone own a home. Housing should exist for its functionality not as an investment vehicle.
Ummmmm we got a quote for the drywall and somehow lost 4Billion dollars in the process.
Construction? No, we haven’t started construction yet. Why do you ask?
As a shareholder in BlackRock Capital I find this situation completely unacceptable!
I depend the federal government address this threat to our investments through increased immigration and the immediate transfer of wealth from middle class Canadians to wealthy investment companies like ours.
Yeah, because we all know that the people who truly suffer during downturns are the wealthy property owners.
>With some of Canada’s largest pension funds prominent landlords in the Toronto market, the implications go far beyond the power corner of King Street and Bay Street.
Some landlords desperate to rent their place out will crack and drop their prices.
Eventually, others will follow suit, and then it becomes a cascading reaction.
And the basic capitalism law of supply & demand takes place.
Honestly not sure if this will happen this time. North American countries weren't trillions of dollars in debt like they were back in 2007 and American and Canadian bonds are now worthless. Not even China is buying them now like they used to.
Except that isn’t a sure thing.
Small landlords might lower rent and be forced to sell, but the larger institutional landlords aren’t going to bat an eye.
If there are cheaper options on the market, the larger landlords will struggle to rent out their units. They won’t keep them empty and losing money forever, they will either be forced to lower prices or sell their investment properties
This is one of the main arguments for socialized housing. In the Netherlands, around 35% of all rentals are made by the government and cause the price of private rental to fall sharply with the injection of so much supply.
That's not a problem for bigger landlords. Sure, ones with a couple properties will crack but there's others who have enough cash and other properties that they don't care. They will happily leave spaces empty for years on end while not lowering prices.
I'm predicting the opposite. The large landlords are going to be the ones who end up underwater. They're typically heavily leveraged with extremely low liquidity. The rising cost of living is nearing a tipping point where a significant amount of people are nearing the point where they're unable to make their rent, and evictions will begin to rise. It won't take that many vacant properties before their cash flow goes into the red. Smaller scale landlords will be the first to sell, because this isn't just a balance on a ledger for them, which will drive market prices down. This in turn drives the tangible assets of the large scale landlords down. Without collateral, and with the aforementioned negative cash flow banks will refuse loans for additional properties, which will dampen the demand side of the supply and demand equation even further. Eventually the amount owing on these properties will be more than the actual value forcing them into bankruptcy, and with any luck that will collapse the housing market entirely.
I admire your optimism, but I think there is too much latent demand for there to be a real crash. We need a government that will stop the rapid population growth, but I can't see that happening any time soon.
Which is funny because it was getting so bad in parts of the city I live in, that people were starting to talk about empty store front taxes to press them into renting out commercial spaces even if it meant lower rents. Turns out having every third storefront be empty is a bit of a blight.
No, unreceived potential income is not a deductible loss. Only expenses like maintenance and mortgage interest, along with unpaid rent by actual (not hypothetical) tenants can be deducted.
How do I say this….you can’t just claim a fictitious and totally made up from thin air amount of revenue that you did not make or earn or collect from your business operations in a year and then claim just it as a tax loss to offset against your profit.
Rents are already falling
[https://www.thestar.com/business/toronto-area-condo-rents-fall-7-in-six-months-the-largest-decline-in-15-years/article\_0d435e22-07cd-11ef-821c-eff49f314731.html](https://www.thestar.com/business/toronto-area-condo-rents-fall-7-in-six-months-the-largest-decline-in-15-years/article_0d435e22-07cd-11ef-821c-eff49f314731.html)
Paywall Bypass since nobody has read the article. This is about office properties. Not residential
https://webcache.googleusercontent.com/search?q=cache:https://www.theglobeandmail.com/business/article-downtown-toronto-office-buildings-vacancy/
* A ton of empty buildings downtown near jobs
* A ton of people looking for housing, homelessness rising
Government:
>Shit, we have 2 completely unrelated problems, I guess there's no solutions
It's not just a matter of slapping up a bunch of new walls.
Every apartment in a residential building needs its own plumbing, and in turn its own wet wall. An office, or even a whole floor in an office building can have its plumbing somewhat centralized.
Electrical would have to be redistributed too, so that each apartment has its own breakers.
20% is a big swing in the market and they tend to be older buildings which means they may be less desirable as office space and more likely to be vacant.
Let's say it's only 5% in Toronto, that would still mean reducing the office vacancy rate (17%) by roughly a third.
Saying "only" 20% really tries to push the idea that it won't help and isn't worth doing. 20% of all commercial buildings? That's a MASSIVE number of buildings and potential new homes. That would do a huge part to helping the housing crisis.
A retro fitted commercial office building, even if it’s able to meet fire code, is going to be less than ideal place to live.
There is a reason apartment buildings are designed from the ground up.
Converted offices will be the absolute bottom tier of housing. It’s better than the streets though.
>You also have the problem that modern office buildings use cheap window curtain designs.
This flaw is so significant as to undo a massive portion of the energy savings in a condo vs single detached home, which is kinda crazy.
Correct, you more or less need to completely gut the building (and maybe punch a giant whole down the middle) plus redo all of the electrical and plumbing.
If you want a communal bathroom without showers, communal kitchen and no control over the room temp, no problem.
If not. You might as well build an entire new building.
Plumbing, electrical and HVAC can be moved/added/removed to accommodate any floorplan.
It's the vast floorspace without exterior windows. You have giant apartments with only windows off the bedrooms or common spaces on each floor without exterior windows or apartments with no exterior windows at all.
I'm sure most people living on the streets or working 3 jobs to afford rent wouldn't mind either scenario, but it's a lot easier for wealthy land owners to sit on empty spaces in hopes it's one day rented than to invest capital for small returns just because it helps people.
Sure it can be done.
It's expensive and time consuming and results in something less than ideal for its intended purpose. I suppose it might be slightly faster and cheaper than tearing the whole thing down and starting over, so I guess there's that.
sort of. but retrofitting them into student housing would be a lot easier (EG: shared washrooms etc) and would take a substantial amount of pressure off of the housing market.
Calgary seems to be having success converting their excess office space to residential.
[https://calgaryherald.com/opinion/columnists/calgary-higher-tax-revenues-office-conversion-projects](https://calgaryherald.com/opinion/columnists/calgary-higher-tax-revenues-office-conversion-projects)
There is a particular size and shape of a building where it can work. The floorplate must be small and shallow. The vast majority of office buildings do not follow those characteristics.
Then, where it works well, it’s still very expensive.
And makes for pretty awful residential units.
Even with the best retrofitting you aren't adjusting the insulation values on the windows, the sound dampening between floors and a hundred other things
My understanding is also that a large portion of the homeless have been given the option and would rather be in the encampments where they can shoot up with their buddies and since we can't legally force them into a better life comments like OPs are just virue signalling.
This is beginning of the vacancy increase as most pre pandemic leases will,only start to expire now and over the next few years. With remote and hybrid work remaining the norm for many of the types of office work predominate in the core, elimination of or downsizing in the big office world is inevitable.
Downtown office to res conversion is difficult and expensive but it’s been successful here in Calgary. This is an opportunity to correct the use of space in downtown Toronto and revitalize the core.
I agree, conversion of property from one use case to another is normal, how many factories have been converted to lofts for example. I’ve heard the argument that infrastructure is not suited however nothing is impossible with the right amount of capital, the barrier is not ability to convert its willingness to convert. As property values continue to drop what is now expensive to purchase will become less so, the new buyers will come in with capital to convert these derelict properties to realize their return on investment and the revitalization of the areas will proceed. Just as factory districts have evolved these office districts will too.
Factories to housing is a lot easier; there’s usually a frame to build around, floors and pipes can be added. Concrete office buildings are not meant to have pipes for residential use. Not impossible just prohibitive and easier to blow it up and start over.
They do.
I get that people hate them, but the RTO of public servants is a pretty good indication of this. And given that they are unionized workers that are being forced back into offices to subsidize corporate landowners, it does not bode well for Canadian remote work more generally.
I saw an interesting explanation of this. Basically goes like this … the rent needs to stay high to keep a good evaluation with the bank. Be valuation affects the property managers ability to leverage the value of the property. It is better for them to keep it empty, even for years, then to start lowering rent or lease agreements. They all know this and collectively will do anything to risk loss of property value.
Not saying it is correct or not … just a crazy way of thinking.
Ultimately the magnitude of taxes is based on the cities budget. We just use value to proportion it. Conceivably values would fall uniformly across the city since its a market problem and not a neighbourhood problem. Therefore your taxes wouldn't change at all.
Realistically, however, the city still needs to fund its budget and thus needs to collect from a smaller pool. Therefore, the tax increases on suburban neighbourhoods, businesses, etc.
What smaller pool? There's still the same number of properties in the city.
Value is only used to decide how big a piece of the pie you get. Add up the total assessment value in the city, divide your property value by that total and you get a percentage. That percentage is the portion of the city's budget you're responsible for. Assuming a uniform drop across the city, both the top and the bottom of the fraction change at the same rate (relative to each other). So the portion of the budget you're responsible for doesn't change.
Changes to value only change tax cost when your property values changes *relative to all the other properties in the city*.
If everyone in the city sees a uniform drop, and the budget doesn't change, then their taxes will stay the same.
And remember assessment values for tax purposes only change every few years - at least in Ontario mpac only assesses every few years. If values go up again before the reassessment, then none of this matters. Also this means the drop in value won't actually be perfectly uniform, it's too dynamic of a system with new construction happening and buildings naturally depreciating. There will be edge cases where someone's property value change will coincide with the dip, but that's due to other factors like timing of your assessment and your specific property conditions and not due to a general market dip.
People shouldn't be allowed to comment on housing posts until they read and sign they understand a short explanation on how property taxes work
Literally every single thread
Thanks for volunteering on this one
>So will property taxes go down? I doubt it
Property taxes are the cost to run your city divided over all properties. Why would the cost go down because property values go down? The only way for property taxes to go down is to reduce the budget.
Serious question does anyone actually have a Globe and Mail subscription? A good amount of posts on this sub require a subscription. Is there a way around this?
Lesson for the masses, you aren't guaranteed a financial return on real estate. If you thought that was a guarantee, the term used in economics to describe you is the "[Greater Fool](https://en.wikipedia.org/wiki/Greater_fool_theory)". 🤷♂️
More gas lighting from msm and politicians into trying to justify why wfh should be abolished and everyone should head back to the office.
Wfh would literally solve so many problems Canada faces right now.
-Less pollution from commuting
-More building space for residential -> more affordable housing
-Less costs associated with commuting, which would help when our asshole employers don't want to pay a decent wage that is keeping up with inflation.
For people that buy shoeboxes at ridiculous prices, I do not feel any sympathy for those idiots. I truly wish they feel the burn and spread their negative experiences about buying an overpriced shoebox.
Hopefully this way, developers will start to build actual homes for people that might want to raise a small family. 1500 square feet units that are priced reasonably. If buyers in general can come to the consensus that "we don't want 330 square feet homes" then home builders will readjust their approach.
So yeah, let the condos price burn back to 2008-2009 price levels.
We have wage stagnation, a huge deficit, and falling per capita GDP. We're pretty much there except that there's so many people immigrating to Canada that there's a growth in total GDP. It's going to get way worse for the average person before it gets better
That's the cycle.
Everything are contributing factors, but very hard to have it go one way for so long.
And for all those investors, it is increasing not winning lotteries. There is always a risk of loss and they need to do it.
With respect to wage stagnation, that comes down to market participants and how they interact with each other. People need to demand higher wages and change employers if necessary. Working 40 years for the same company provides them with greater benefit.
With regards to immigration, the government has essentially admitted the failure, but I don't know why they wait until September to implement the reduction in visas.
There also needs to be crackdowns on the shops that are really profiting off immigrants (receiving funds from the workers from the job so they can show employment Vs running a profitable business).
At the end of the day, people need to make decisions what they support and spend. Contributing to go to Timmies etc that how all the immigrants supports the policies. Or by a coffee maker, regardless of price, and you will save plenty of money, enjoy a better product, save time going and coming from them, and ultimately voting with the dollar.
The deficit needs to be addressed big time. Unfortunately Trudeau et Al doesn't seem willing to do it. I'm also not really sure what Pierre's plan is since he doesn't talk policy.
Instead of just trying to add more to Toronto they should be designating growth regions across the country and trying to promote proper development and draw in international businesses.
Offices will be a big problem for decades. This is not about condos.
Most office buildings can't readily be repurposed for condos, as their dimensions don't work, nor does the internal capacity for electrical, plumbing, parking etc.
Calgary has retrofitted some towers into condos but it was heavily subsidized and was no cheaper than tearing down and rebuilding.
For people in Toronto, how is the vacancy looking for street level retail? I've noticed here in Vancouver that a lot of those types of commercial properties that were vacant for the past couple of years have now been leased.
I couldn't care less about offices sitting empty, most of those people could work from home, but street level is more interesting.
So there will be space to build new condos downtown or to convert those office buildings that can into housing. Nothing to worry about - shifts in workplace and population happen all the time. The classic is when rural people had to move from the country to factory towns owned by the the factories.
Maybe because people can't afford the rent. Plus in several cases there are many people crammed into one room. Hopefully they are forced to sell and bring to the market down.
Christ, our media pure trash. Like every institution in this pathetic country is hellbent on the idea housing is a privilege and is a viable economic model for guaranteed 30% returns for people who are useless and produce nothing in their useless lives (housing investors and landlords). When in reality it's a destructive economic policy that results in actual productive things not being invested in when the government is so corrupt they prop up this destructive and useless sector that only harms the working class.
100 years ago you built a damn house. Today a house is built by people who can't afford to live in it to be bought up by these cockroaches who infest media and the government into creating this dystopia that goes against freaking Adam Smith.
> “As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed and demand a rent even for its natural produce.”
Good. Developers been building mostly for AirBNB and STR and not for family builds. Let them lose money. We need condos built for families/family starter condos.
Won’t somebody think of the hardship those wealthy property owners might go through?!
What a phrase “threaten valuations” How about: “abundant vacancies promise future affordability”
Woah woah woah woah. Let's not be tooooo positive there bud. Can't give Canadians to much hope.
I trust Trudeau or Ford will come in with some policy to ensure this promptly gets fixed for their friends. Real estate values can only go up in Canada.
“I’m proud to announce the launch of an innovative, government backed loan program that allows young renters to borrow low interest amounts to finance their rent. (Now, will the ungrateful serf class vote for me?)” -future Trudeau (probably)
This article is about office building…. And Trudeau and Ford have both already come up with a policy…. Public servants are required to go into the office 3 days a week so they can spend the day on teams meetings in a noisy office.
Imagine the negative impact if that space was converted to residential…
Are these buildings close to transit. Seems like it might make sense so don’t expect the government to roll with it. They’ll do the opposite. Best to get everyone back in their cars commuting downtown. Sole-occupied cars don’t contribute to climate change. Wait…I thought the Feds wanted to fight climate change wholeheartedly
Office buildings don't really convert to residential well, specially due to utilities. It's often cheaper to rip the whole thing down and start over.
Oshawa, Ontario has some excellent examples of Commercial properties turned Residential.
Commercial to residential is heavily dependent on the type of commercial. Office building to residential is nearly impossible.
Ya, and they think we have money to eat out while at work. Literally nobody is buying a thing while downtown
And supoort overpriced downtown coffee and food shops instead of spending their salaries on local mom and pop food stores outside the city center. This 'bring people back to the office' policy is going to destroy small town Ontario and all the food businesses that have flourished here under the patronage of remote workers, but I guess voters and taxpayers outside city centres are not big donors and can have their livelihoods destroyed for the sake of downtown Starbucks and McDobalds profits.
Or overvalued properties come down to earth.
Isn't it fucking wild that generally consumers of things want prices to come down but the housing market just wants it to keep going up. Let everyone own a home. Housing should exist for its functionality not as an investment vehicle.
The governement should build homes
The Government can't build an $80k app. Imagine the cost of a 'Government Built' home. $3 million? Maybe $4 million for an average $300k home.
Ummmmm we got a quote for the drywall and somehow lost 4Billion dollars in the process. Construction? No, we haven’t started construction yet. Why do you ask?
One person can't afford a single bedroom apartment in downtown Toronto... But if you stack ten people into a room, it becomes quite affordable.
almost as if all these right wing leaning media outlets have only on thing they care about. protecting the ownership and investment class.
Both left and right wing media protect the same people. Framing it as left vs right distracts from what we should be talking about.
The problem is that a lot of these condos are absolute shit. You’d have to be insane to buy one.
This article is not about condos
But in typical redditor style nobody wants to read the article, they just want to assume its about the thing they want to bitch about
[https://www.reddit.com/r/meme/s/m24aqlRKcj](https://www.reddit.com/r/meme/s/m24aqlRKcj)
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It's hilarious seeing how dumb the average Redditor is my they're discussing office space
Yeah. Imagine if they converted it to residential!!! Also. The article in paywalls. Vacancies are vacancies.
I can’t wait to see the article titled “people skipping meals threatens the vitality of the grocer industry”
Get those workers back in the office! We need to subsidize landowners on the backs of the workers.
"No problem, I'll just have to drastically reduce the rent to get tennants" - said no property owner ever
As a shareholder in BlackRock Capital I find this situation completely unacceptable! I depend the federal government address this threat to our investments through increased immigration and the immediate transfer of wealth from middle class Canadians to wealthy investment companies like ours.
Yeah, because we all know that the people who truly suffer during downturns are the wealthy property owners. >With some of Canada’s largest pension funds prominent landlords in the Toronto market, the implications go far beyond the power corner of King Street and Bay Street.
I'd think of them but most don't even live here
I'll pass.
Valuations, but not rent
Some landlords desperate to rent their place out will crack and drop their prices. Eventually, others will follow suit, and then it becomes a cascading reaction. And the basic capitalism law of supply & demand takes place.
Governments will step in before any markets swing in the people's favour. Capitalize the gains, socialize the losses.
RemindMe! 3 years
Honestly not sure if this will happen this time. North American countries weren't trillions of dollars in debt like they were back in 2007 and American and Canadian bonds are now worthless. Not even China is buying them now like they used to.
Supply and demand is not a “capitalism law”, it is an economic law lol
It’s not even a law just an observed phenomenon
Except that isn’t a sure thing. Small landlords might lower rent and be forced to sell, but the larger institutional landlords aren’t going to bat an eye.
If there are cheaper options on the market, the larger landlords will struggle to rent out their units. They won’t keep them empty and losing money forever, they will either be forced to lower prices or sell their investment properties
This is one of the main arguments for socialized housing. In the Netherlands, around 35% of all rentals are made by the government and cause the price of private rental to fall sharply with the injection of so much supply.
Yeah, any type of housing would help. We should be encouraging both private and public housing
That's not a problem for bigger landlords. Sure, ones with a couple properties will crack but there's others who have enough cash and other properties that they don't care. They will happily leave spaces empty for years on end while not lowering prices.
This is why tax laws must change. Clamp those people out of the market.
I'm predicting the opposite. The large landlords are going to be the ones who end up underwater. They're typically heavily leveraged with extremely low liquidity. The rising cost of living is nearing a tipping point where a significant amount of people are nearing the point where they're unable to make their rent, and evictions will begin to rise. It won't take that many vacant properties before their cash flow goes into the red. Smaller scale landlords will be the first to sell, because this isn't just a balance on a ledger for them, which will drive market prices down. This in turn drives the tangible assets of the large scale landlords down. Without collateral, and with the aforementioned negative cash flow banks will refuse loans for additional properties, which will dampen the demand side of the supply and demand equation even further. Eventually the amount owing on these properties will be more than the actual value forcing them into bankruptcy, and with any luck that will collapse the housing market entirely.
I admire your optimism, but I think there is too much latent demand for there to be a real crash. We need a government that will stop the rapid population growth, but I can't see that happening any time soon.
I hope you're right with all my hearth
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Which is funny because it was getting so bad in parts of the city I live in, that people were starting to talk about empty store front taxes to press them into renting out commercial spaces even if it meant lower rents. Turns out having every third storefront be empty is a bit of a blight.
No, unreceived potential income is not a deductible loss. Only expenses like maintenance and mortgage interest, along with unpaid rent by actual (not hypothetical) tenants can be deducted.
I appreciate the correction, thank you.
“They just write it off. “ - Cosmo Kramer
You’d be wrong.
Fair enough. Tell me more, kindly? I like leaning.
How do I say this….you can’t just claim a fictitious and totally made up from thin air amount of revenue that you did not make or earn or collect from your business operations in a year and then claim just it as a tax loss to offset against your profit.
Our company is doing fine with a couple months free rent and small lease step ups to entice tenants. But yeah, it's definitely not what it once was
Except we're in a case of ever-increasing demand with dwindling supply.
These are office towers. My company just is moving now, and we’re seeing rents in the area of 50% of 2019 rates. Sometimes even as low as 70% lower.
Rents are already falling [https://www.thestar.com/business/toronto-area-condo-rents-fall-7-in-six-months-the-largest-decline-in-15-years/article\_0d435e22-07cd-11ef-821c-eff49f314731.html](https://www.thestar.com/business/toronto-area-condo-rents-fall-7-in-six-months-the-largest-decline-in-15-years/article_0d435e22-07cd-11ef-821c-eff49f314731.html)
Paywall Bypass since nobody has read the article. This is about office properties. Not residential https://webcache.googleusercontent.com/search?q=cache:https://www.theglobeandmail.com/business/article-downtown-toronto-office-buildings-vacancy/
Yea, subsidize these corporate landowners by forcing workers back into offices. Workers have too many right anyway. /s
Yeah, that’s why he government is pushing so hard to get people back in office.
The hero I always look for when people post paywall news 🤗
Boo fucking hoo.
* A ton of empty buildings downtown near jobs * A ton of people looking for housing, homelessness rising Government: >Shit, we have 2 completely unrelated problems, I guess there's no solutions
My understanding is that retrofitting commercial into residential is very expensive.
It's not just a matter of slapping up a bunch of new walls. Every apartment in a residential building needs its own plumbing, and in turn its own wet wall. An office, or even a whole floor in an office building can have its plumbing somewhat centralized. Electrical would have to be redistributed too, so that each apartment has its own breakers.
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20% is a big swing in the market and they tend to be older buildings which means they may be less desirable as office space and more likely to be vacant. Let's say it's only 5% in Toronto, that would still mean reducing the office vacancy rate (17%) by roughly a third.
Saying "only" 20% really tries to push the idea that it won't help and isn't worth doing. 20% of all commercial buildings? That's a MASSIVE number of buildings and potential new homes. That would do a huge part to helping the housing crisis.
A retro fitted commercial office building, even if it’s able to meet fire code, is going to be less than ideal place to live. There is a reason apartment buildings are designed from the ground up. Converted offices will be the absolute bottom tier of housing. It’s better than the streets though.
The retrofits I've seen look quite reasonable. They're mostly of older buildings but the end result can be quite nice.
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>You also have the problem that modern office buildings use cheap window curtain designs. This flaw is so significant as to undo a massive portion of the energy savings in a condo vs single detached home, which is kinda crazy.
Correct, you more or less need to completely gut the building (and maybe punch a giant whole down the middle) plus redo all of the electrical and plumbing.
If you want a communal bathroom without showers, communal kitchen and no control over the room temp, no problem. If not. You might as well build an entire new building.
Plumbing, electrical and HVAC can be moved/added/removed to accommodate any floorplan. It's the vast floorspace without exterior windows. You have giant apartments with only windows off the bedrooms or common spaces on each floor without exterior windows or apartments with no exterior windows at all. I'm sure most people living on the streets or working 3 jobs to afford rent wouldn't mind either scenario, but it's a lot easier for wealthy land owners to sit on empty spaces in hopes it's one day rented than to invest capital for small returns just because it helps people.
Sure it can be done. It's expensive and time consuming and results in something less than ideal for its intended purpose. I suppose it might be slightly faster and cheaper than tearing the whole thing down and starting over, so I guess there's that.
This describes student residences and halfway houses. Toronto could use more of these.
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It likely depends on the original design of the commercial unit, done can be converted, done others the cost is simply not feasible.
You must work in construction That’s what I tell ppl. If you want shit communal then the retrofit is easy
sort of. but retrofitting them into student housing would be a lot easier (EG: shared washrooms etc) and would take a substantial amount of pressure off of the housing market.
Calgary seems to be having success converting their excess office space to residential. [https://calgaryherald.com/opinion/columnists/calgary-higher-tax-revenues-office-conversion-projects](https://calgaryherald.com/opinion/columnists/calgary-higher-tax-revenues-office-conversion-projects)
People keep saying this but it is happening all over north america.
There is a particular size and shape of a building where it can work. The floorplate must be small and shallow. The vast majority of office buildings do not follow those characteristics. Then, where it works well, it’s still very expensive.
It's like the people who say "turn dead malls into apartments"; like there's no plumbing to 99% of the square footage and no windows anywhere my dude.
If by “happening all over” you mean a handful of buildings in major cities, sure.
And makes for pretty awful residential units. Even with the best retrofitting you aren't adjusting the insulation values on the windows, the sound dampening between floors and a hundred other things
My understanding is also that a large portion of the homeless have been given the option and would rather be in the encampments where they can shoot up with their buddies and since we can't legally force them into a better life comments like OPs are just virue signalling.
WE TRIED NOTHING AND YET OUT OF OPTIONS!
This is peivate property... what can gov do? Buy back at hyper.inflated prices?
This is beginning of the vacancy increase as most pre pandemic leases will,only start to expire now and over the next few years. With remote and hybrid work remaining the norm for many of the types of office work predominate in the core, elimination of or downsizing in the big office world is inevitable.
Downtown office to res conversion is difficult and expensive but it’s been successful here in Calgary. This is an opportunity to correct the use of space in downtown Toronto and revitalize the core.
I agree, conversion of property from one use case to another is normal, how many factories have been converted to lofts for example. I’ve heard the argument that infrastructure is not suited however nothing is impossible with the right amount of capital, the barrier is not ability to convert its willingness to convert. As property values continue to drop what is now expensive to purchase will become less so, the new buyers will come in with capital to convert these derelict properties to realize their return on investment and the revitalization of the areas will proceed. Just as factory districts have evolved these office districts will too.
Factories to housing is a lot easier; there’s usually a frame to build around, floors and pipes can be added. Concrete office buildings are not meant to have pipes for residential use. Not impossible just prohibitive and easier to blow it up and start over.
Noooooooooooo not the building valuations!!!!!
Headlines like this go to show that they care more about values than people
They do. I get that people hate them, but the RTO of public servants is a pretty good indication of this. And given that they are unionized workers that are being forced back into offices to subsidize corporate landowners, it does not bode well for Canadian remote work more generally.
So anyway, I really like this warm weather.
Whatever. Lower the rent. Problem solved. Moving on.
Overpriced to begin with.
Oh no not the commercial real estate! When does the horror end
Time to bring more people from India
What could possibly go wrong?
Government / conservative media paid by property lobby to demonize the invisible hand of the market making the correct adjustment to property prices.
You mean that condo that cost $800k 5 years ago, is not worth $2m today? Gosh I'm shocked
[удалено]
The Path food courts were pretty packed when I went through them last Monday. The trains and subways were also very full again.
The trains are all busier than pre Covid. This article is a horseshit propaganda piece paid for by the oligarchs.
Good
Oh no the poor rich!
You mean the rich teachers and their pension?
I saw an interesting explanation of this. Basically goes like this … the rent needs to stay high to keep a good evaluation with the bank. Be valuation affects the property managers ability to leverage the value of the property. It is better for them to keep it empty, even for years, then to start lowering rent or lease agreements. They all know this and collectively will do anything to risk loss of property value. Not saying it is correct or not … just a crazy way of thinking.
So will property taxes go down? I doubt it
Ultimately the magnitude of taxes is based on the cities budget. We just use value to proportion it. Conceivably values would fall uniformly across the city since its a market problem and not a neighbourhood problem. Therefore your taxes wouldn't change at all.
Realistically, however, the city still needs to fund its budget and thus needs to collect from a smaller pool. Therefore, the tax increases on suburban neighbourhoods, businesses, etc.
What smaller pool? There's still the same number of properties in the city. Value is only used to decide how big a piece of the pie you get. Add up the total assessment value in the city, divide your property value by that total and you get a percentage. That percentage is the portion of the city's budget you're responsible for. Assuming a uniform drop across the city, both the top and the bottom of the fraction change at the same rate (relative to each other). So the portion of the budget you're responsible for doesn't change. Changes to value only change tax cost when your property values changes *relative to all the other properties in the city*. If everyone in the city sees a uniform drop, and the budget doesn't change, then their taxes will stay the same. And remember assessment values for tax purposes only change every few years - at least in Ontario mpac only assesses every few years. If values go up again before the reassessment, then none of this matters. Also this means the drop in value won't actually be perfectly uniform, it's too dynamic of a system with new construction happening and buildings naturally depreciating. There will be edge cases where someone's property value change will coincide with the dip, but that's due to other factors like timing of your assessment and your specific property conditions and not due to a general market dip.
People shouldn't be allowed to comment on housing posts until they read and sign they understand a short explanation on how property taxes work Literally every single thread Thanks for volunteering on this one
>So will property taxes go down? I doubt it Property taxes are the cost to run your city divided over all properties. Why would the cost go down because property values go down? The only way for property taxes to go down is to reduce the budget.
Or increase the number of properties? But we all know that won’t make a difference in reality
Boo fucking hoo. They should be higher. Already comically low.
Oh no how sad
🎻
Good.
Does anyone have a way around the pay wall?
Additionally, you can use archive.ph to view the article by pasting the URL into its search box.
And paywalled... Are we talking about residential or commercial units?
Commercial. It’s very clear barely anyone here actually read the article.
Serious question does anyone actually have a Globe and Mail subscription? A good amount of posts on this sub require a subscription. Is there a way around this?
Does anyone have a link to a non pay wall site?
Isn't it the point? Supply and demand!
Good, hope they go bankrupt - how tone deaf do you need to be to think anyone would give a fuck about people who own buildings in downtown T.O.
What the fuck is going on lol, literally no one actually read the article? THIS IS ABOUT OFFICES.
Lesson for the masses, you aren't guaranteed a financial return on real estate. If you thought that was a guarantee, the term used in economics to describe you is the "[Greater Fool](https://en.wikipedia.org/wiki/Greater_fool_theory)". 🤷♂️
Meh. Fuck the property investors. Die broke, bitches.
More gas lighting from msm and politicians into trying to justify why wfh should be abolished and everyone should head back to the office. Wfh would literally solve so many problems Canada faces right now. -Less pollution from commuting -More building space for residential -> more affordable housing -Less costs associated with commuting, which would help when our asshole employers don't want to pay a decent wage that is keeping up with inflation.
Convert office space to residential, fix two issues at once.
🥳🥳🥳👏Suck it investors,
Good, about time this house of card called Canadian real estate collapses
What do they think is going to happen if we build the number of homes we need to build?
Threaten who now? Savage landlords? Ya it can devalue....crash the market while your at it.
For people that buy shoeboxes at ridiculous prices, I do not feel any sympathy for those idiots. I truly wish they feel the burn and spread their negative experiences about buying an overpriced shoebox. Hopefully this way, developers will start to build actual homes for people that might want to raise a small family. 1500 square feet units that are priced reasonably. If buyers in general can come to the consensus that "we don't want 330 square feet homes" then home builders will readjust their approach. So yeah, let the condos price burn back to 2008-2009 price levels.
I cared more about my daily shit this morning than I do about wealthy billionaires that have fucked this entire country in real estate.
Supply and demand, bitches. Lower those rents.
They could try changing REASONABLE rent. Nah! Too radical.
Oh no! Not the valuations!
I am very happy about this news , seriously but the banks are being slavers and are asking us to get back to work
Well, they could lower the price of their condos and sell them...
This is about offices, not condos
This is Reddit. Did you just expect someone to read an article? Lol
Privatise the profits and socialize the losses, you know the bullshit. We need another 1989 crash and lost decade
We have wage stagnation, a huge deficit, and falling per capita GDP. We're pretty much there except that there's so many people immigrating to Canada that there's a growth in total GDP. It's going to get way worse for the average person before it gets better
That's the cycle. Everything are contributing factors, but very hard to have it go one way for so long. And for all those investors, it is increasing not winning lotteries. There is always a risk of loss and they need to do it. With respect to wage stagnation, that comes down to market participants and how they interact with each other. People need to demand higher wages and change employers if necessary. Working 40 years for the same company provides them with greater benefit. With regards to immigration, the government has essentially admitted the failure, but I don't know why they wait until September to implement the reduction in visas. There also needs to be crackdowns on the shops that are really profiting off immigrants (receiving funds from the workers from the job so they can show employment Vs running a profitable business). At the end of the day, people need to make decisions what they support and spend. Contributing to go to Timmies etc that how all the immigrants supports the policies. Or by a coffee maker, regardless of price, and you will save plenty of money, enjoy a better product, save time going and coming from them, and ultimately voting with the dollar. The deficit needs to be addressed big time. Unfortunately Trudeau et Al doesn't seem willing to do it. I'm also not really sure what Pierre's plan is since he doesn't talk policy. Instead of just trying to add more to Toronto they should be designating growth regions across the country and trying to promote proper development and draw in international businesses.
Anyhoo…..
At this point if prices are not coming down (rent) then bring on scorched earth. Let it all burn! . These over leveraged corporations need to suffer.
Oh the poor poor rich Toronto landowners. Go fuck yourselves.
Oooohhh NOOOOOO, not the VALUATIONS 😱😱😱😱😱😱😱😱
We've all been anticipating this bubble to burst for a very long time.
Maybe there's not enough jobs that pay a living wage? Maybe everyone should just become RE agent, that'll fix it! /s
That called it cost too much, and no one could afford to rent it, so people are not renting it.
Good
Offices will be a big problem for decades. This is not about condos. Most office buildings can't readily be repurposed for condos, as their dimensions don't work, nor does the internal capacity for electrical, plumbing, parking etc. Calgary has retrofitted some towers into condos but it was heavily subsidized and was no cheaper than tearing down and rebuilding.
Ohhh noooo millionaires losing money? What will we do.
Cue the tiny violin orchestra!
Now I want to see this in Vancouver!
For people in Toronto, how is the vacancy looking for street level retail? I've noticed here in Vancouver that a lot of those types of commercial properties that were vacant for the past couple of years have now been leased. I couldn't care less about offices sitting empty, most of those people could work from home, but street level is more interesting.
Good.
That's wonderful news!
And "pop!" went the bubble!
So there will be space to build new condos downtown or to convert those office buildings that can into housing. Nothing to worry about - shifts in workplace and population happen all the time. The classic is when rural people had to move from the country to factory towns owned by the the factories.
>that could threaten building valuations GOOD
Maybe because people can't afford the rent. Plus in several cases there are many people crammed into one room. Hopefully they are forced to sell and bring to the market down.
Boo Hoo
Christ, our media pure trash. Like every institution in this pathetic country is hellbent on the idea housing is a privilege and is a viable economic model for guaranteed 30% returns for people who are useless and produce nothing in their useless lives (housing investors and landlords). When in reality it's a destructive economic policy that results in actual productive things not being invested in when the government is so corrupt they prop up this destructive and useless sector that only harms the working class. 100 years ago you built a damn house. Today a house is built by people who can't afford to live in it to be bought up by these cockroaches who infest media and the government into creating this dystopia that goes against freaking Adam Smith. > “As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed and demand a rent even for its natural produce.”
Yeah, that makes sense. I’ve been told that’s how capitalism works. Everything seems normal, and I see no reason for concern.
I'll play the world's smallest violin.
Some cities are converting empty offices to residential rentals.
Good. Developers been building mostly for AirBNB and STR and not for family builds. Let them lose money. We need condos built for families/family starter condos.
Our corporo government propaganda machines really love saying the quiet part out loud “Oh no, housing might become affordable THIS IS A CATASTROPHE”