By Luciano D’Iorio, Managing Director, Cushman & Wakefield Québec
As we approach the provincial general election this coming October, there have been numerous announcements regarding public transit as well as road infrastructure. These announcements, some long overdue, are welcome measures as they touch on infrastructure and public transit, all of which can help development in the eastern part of the city. If development continues on the island of Montreal, the east end has the opportunity to deliver. With better access to public transit that services its work force and better ease of access and egress for trucking, development and transactions are sure to continue for years to come.
Several new private and public development projects are planned for Montreal’s east end. Over the years, this area has seen sporadic growth but also economic downturn that has forced developers and investors to reinvent their real estate.
With the current red-hot market, demand for industrial space and demand for shovel- ready land is far exceeding supply. Developers who have long been holding assets in east end are finally seeing their projects come to life.
The Société de développement Angus’s Technopôle Angus project developed over the last 15 years points to positive indicators of a bright future for other developers in the east end.
One of the first government pre-election announcements is a commitment to invest $20.5 million in infrastructure at Technopôle Angus. The master plan for the Green Neighbourhood (Ecoquartier) developed under LEED-ND V4 Platinum standards includes 895 thousand square feet of social housing, offices, retail and a primary school.
Photo Credit : Société de développement Angus
Over the next few years, Technopole Angus will see a new French language primary school that will accommodate up to 400 students as well as two educational workshops. The residential component of the project will have 395 thousand square feet of family- oriented two-to-four-bedroom housing with 80% dedicated to social and affordable housing. Presales have already have begun. There is also a plan for an office building of 485 thousand square feet and 32 000 square feet of retail. Parking on the site will be only underground, with a capacity of accommodating up to 550 vehicles. In total the project is estimated at $250 million. Certainly, if Technoparc’s past success is any indication, this project promises to be a hit.
Another announcement this spring involves the extension of Boulevard L’Assomption and Avenue Souligny. The federal government announcement represents an investment of $45.8 million meant to facilitate access to the Port of Montreal intermodal container port. This news is welcome as it will engender several potential real estate projects.
Over the last few years there have been a few major transactions that demonstrate the renewed interest in this area.
Canadian Steel Foundries
The land is roughly 2.4 million square feet and sits just west of Dickson and Notre Dame. Any extension of L’Assomption Boulevard will most likely involve parts of this land.
The new owner, Ray-Mont Logistics, is currently looking at several possibilities for this land but according to a report by Société Radio Canada, Ray-mont Logistics is currently in litigation with the city over permitted uses of the land and the current Plante administration in the borough is considering public consultations to revisit the future of this entire area.
L’Assomption between Hochelaga and Sherbrooke East
Currently there are two large tracts of land on L’Assomption that are ripe for development. Rosdev, owner of the former Metro refrigerated warehouse on L’Assomption and Hochelaga, are currently considering developing the 700 hundred thousand square feet of land with big box stores, for a total of 250 thousand square feet
Just north of this site, and in walking distance to the L’Assomption Metro on the Green Line at de Marseilles, developers are looking at adding 1000 housing units and up to 150 thousand square feet of office space.
Viau – Mondelez Factory
This 300-thousand square-foot building on 500 thousand square feet of land was until recently home to Mr. Christie’s Oreo cookie at Viau and de Marseilles streets. It is currently sitting idle and will most likely find an investor who will appreciate this building’s proximity to the Metro Green Line, and the Olympic and Saputo stadiums.
This is certainly a neighbourhood in transition as the Olympic Stadium Tower, steps from this facility, will house a thousand employees of Movement Desjardins this fall, occupying about 80% of the total available space in the tower.
Dickson – Mabe
Shapiro Group and Triad have recently purchased the former Mabe manufacturing facility of approximately 500 thosuand square feet on almost 1.3 million square feet of land located at Dickson and Notre Dame East. The facility is currently being offered for rent and boasts ceiling heights of 55 feet clear. This site will certainly find tenants in a market that Renaud Fortin, Economic Development Commissioner for Mercier Hochelaga Maisonneuve, says is “not meeting the demand. We currently have a million square feet of demand!”
The STM has recently announced that they will be building three new bus garages for their additional fleet of buses promised by the Plante administration. One of those garages will be located on the corner of Souligny and Dickson on 550 thousand square feet of land. This project will bring hundreds of workers to the neighbourhood in the next few years. Construction should be completed by 2023.
Autoroute 25/Notre Dame East
Another recent transaction is the former Energizer/Johnson & Johnson Campus on Notre Dame Street sold to Divco. The building, 500 thousand square feet on 1.3 million square feet of land already is occupied at 60%. Divco believes that they will be 100% leased soon, given the high demand in the area and the site’s proximity to Autoroute 25 and the Port of Montreal.
Autoroute 25/ Sherbrooke East
The Place Versailles shopping centre has housed Montreal’s Police department for over 15 years in its tower adjacent to Radisson Metro on the Green Line. The police have purchased their own building further east on Sherbrooke street that also houses their training facility. Their move will leave 55 thousand square feet of office space for lease at the beginning of 2019.
Although the current vacancy in the adjacent Anjou office market is at 15%, access to public transit is a plus in this market and will become more so with the construction of the Blue Line.
The Blue Line announcement this spring has developers waiting for the exact location of the five stations that will link to Montreal’s Metro system. This will certainly bring changes to the north-eastern part of the city that is currently underserved by public transit. Early preliminary drawings show the Metro being underground along Jean Talon Street East from the St Michel Metro station towards Anjou, which will be the new eastern terminus for the Blue Line.
With the closure of Sears’ 120 thousand square feet of space at Galeries d’Anjou, Cadillac Fairview is looking at all of its development possibilities including converting its store into office space. Cadillac Fairview has spent over $85 million over the last few years to refresh Galeries D’Anjou and add new stores including Winners and Saks OFF 5th. This is certainly a testament to the strong regional pull the centre has.
Late last year, Groupe Laganière, a locally-based environmental site rehabilitation company, purchased part of the former Shell refinery. Measuring almost 10 million square feet of land, Laganière’s vision, recently shared at a UDI luncheon, is one of businesses that will help bring employment back to the area. The group is currently looking at the various possibilities that they can develop on the land. We expect to hear more from this group later in the year as the City of Montreal has consultations regarding a proposed park on part of the land purchased.