Southgate council heard a highly professional pitch from a firm that specializes in selling and leasing commercial and industrial real estate.
The property of interest is the township-owned land west of Hwy. 10 which will be opened up by the extension of the Eco-Parkway.
High prices in Toronto have caused a demand especially for companies that are looking to lease properties, said Adam Scott-Sherriff of JLL.
In fact, that’s the recipe for success behind the company’s first deal in Dundalk.
The global company was looking for space for a US firm that makes backyard playground equipment to use for a warehouse. Originally, Toronto was the company’s location of choice, but finding the right location was hampered by both low vacancy rates and high rents.
JLL made a match though, after being approached by Fiuli-Jarrow Holdings Inc. to help find a tenant for the former Trim Trends at 280 Victoria St.
The company told council that it had leased the building “at the highest rental rate for a 3-year term in the Dundalk market with rental rates starting in the high $5’s per square foot.”
The land that will be opened up by the Eco-Parkway connecting to Hwy. 10 is also going to be well-suited for warehouse use, Mr. Sherriff-Scott said. He added that industrial land is in short supply in Grey County.
And the vacancy rate for commercial and industrial in the market from Oshawa to Hamilton is 1.2 percent – “effectively zero,” he said.
With a lot of businesses looking to find land outside Toronto, more municipalities are looking at engaging brokers, he said.
Coun. Barbara Dobreen asked if there could shortly be a glut in commercial space in Toronto, with many companies keeping workers at home.
Mr. Sherriff-Scott agreed that the office side is different, but that other commercial and certainly industrial businesses still had people in the workplace.
Coun. Dobreen also asked about whether residential could be included in the future use of the property.
Previous council meetings have included various suggestions for the land, from affordable housing to new township offices.
Ms Kolodziej said Dundalk already has a lot of residential growth on the books, but employment is needed for the new residents.
Mr. Scott-Sherriff and Ms Kathy Kolodziej (VP Corp. Transaction) of the Mississauga office offered some advice to council.
That included adding to the permitted uses in both the industrial and the highway commercial zoning.
Developers want to see zoning in place rather than facing delays while making planning applications for variances.
They recommend marketing the property without a price, to get the highest value, because there is such a range of price per acre.
Ms Kolodziej commented that being one hour and 20 minutes north of Toronto was “nothing” when it can take three hours to cross the city in rush hour.
The attractiveness of the land to buyers depends largely on it being serviced. While the project of the Eco-Parkway was held up during the approval stage it has cleared those hurdles.
Development Charges in Dundalk for industrial commercial in the range of $12/sq. ft. also look good compared to municipalities where they may be twice as high, representatives said.
The property will have one entrance where the Eco-Parkway intersects Hwy. 10, and that highway location is also a plus.
The marketable property has two different zoning areas, suiting different uses:
-about 32 acres of highway commercial next to Hwy. 10
- about 103 acres of industrial land adjacent to the west
The growth in residential in Dundalk will make it attractive as employers are looking for workers, the presenters said.
Mr. Sherriff-Scott stressed the opportunities in the industrial zone for buildings to be leased out as warehouses. Companies are establishing new distribution centres with more online shopping.
“Distribution is a clean use and is very much in demand,” he said.
HOW DOES IT WORK?
The company proposes that it be engaged for 18 months.
The total fee would be six percent – three to the listing team and three to the co-operating broker. If it was sold by JLL, that fee would only be five percent.
The fees are payable on closing.
All marketing costs are paid by JLL, that includes promotion to its network and target users.
The land would be surveyed and sold in parcels.
MORE ABOUT JLL
The company is traded on the New York stock exchange. It operates in more than 80 companies and has more than 90,000 employees worldwide
The JLL Toronto Industrial Team has leased and sold 450 acres in the last 24 months. In the same time, it has leased and sold 16.8 million square feet.
They sell to both end-users and those who develop the land and then lease out the space.
The local team has two leads and three “on the ground prospectors.”
Among company clients are Canada Post, Xerox, Philips, Whirlpool and Honeywell on the industrial side and in commercial, include Shoppers Drug Mart, Rexall; RBC, BMO, A&W, Subway, Peavey Mart, 7-11, Giant Tiger, FreshCo and Valu-mart.
M.T. Fernandes, Local Journalism Initiative Reporter, Dundalk Herald