Vancouver’s Aquilini Group has put its 22-storey GM Place Tower project back on the drawing board with plans to start construction this year on what could be downtown Vancouver’s first major office building in almost a decade.
David Negrin, president of Aquilini’s development and construction firm, on Wednesday, said the company has tenants lined up for the building and he is in final discussions with the city to obtain a development permit for the 230,000-square-foot tower that would rise over GM Place Stadium at Georgia Street.
Negrin said the building will have three over-height levels of retail space from Expo Boulevard to the height of the Georgia Viaduct, where the office building’s main lobby would be, then at least another 19 storeys of offices.
The company hopes to add a few storeys to the tower as it is developed. Negrin said adding some height to the building would still fit within the city’s height restrictions for view corridors.
Negrin expects the development would include new restaurants and other entertainment options as well as incorporate a few private stadium boxes that open into GM Place.
“Right now we have two large, well-known companies that are interested in taking space,” Negrin said in an interview.
Negrin declined to name the firms, but with major tenants willing to lease a significant amount of space, “we’re ready to move.”
And moving on the tower’s construction would represent a shift from Vancouver’s pre-recession office development market, which previously saw developers consider and then shelve projects on expensive downtown sites while building large amounts of new office space on cheaper suburban land along the Broadway corridor and in Burnaby.
The Bentall 5 building at Burrard and Dunsmuir, which was completed in two phases between 2002 and 2007, was the last major purpose-built office tower to be built downtown.
The Aquilini Group proposed the GM Place Tower in 2007, but shelved it in 2008, at the same time Bentall Capital was proposing to build 25-storey tower for the British Columbia Investment Management Corp. at Alberni and Thurlow.
Bentall is also seeking a development permit for its project, which is scheduled to go before the City of Vancouver’s development permit board May 17.
The recovery of downtown’s office-leasing market, however, is likely giving developers the incentive to put their projects back on the books, according to Nicholas Westlake, a senior research analyst for commercial realtor CB Richard Ellis.
“Certainly the market indicates we are going that direction in terms of needing more space,” Westlake said.
Downtown’s notoriously tight office vacancy rate eased somewhat during the recession rising to 5.8 per cent at the end of 2009, but Westlake said more tenants are back in the market looking for downtown space.
“I think there is going to be demand out there [for new space], and we’ll start to see pre-recession levels regarding vacancy come 2011.”
The Aquilini Group shelved the project in 2008 because it couldn’t find tenants willing to pay rents that would justify building it.
Negrin said potential tenants started looking at the tower differently after the city completed its official community plan for North East False Creek in 2009.
“Two years ago, we couldn’t get anybody interested in it,” Negrin said.
“It’s not triple-A [quality], it’s not going to get you $45 per square foot [in rent],” Negrin said. “But there’s definitely interest.”
However, the company has seen “unbelievable interest in the tower over the past six months.”
“I’m hoping to start construction in September and we’re working with all our sub-trades right now,” Negrin added.
And the British Columbia Pavilion Corporation (PavCo) is poised to announce another major commercial development nearby on the south west corner of BC Place Stadium.
PavCo chairman, David Podmore, in February, said the Crown corporation was in the final stages of negotiating and agreement that would see a tenant lease rights to develop 700,000 square feet of development space as a means to help finance BC Place’s $563-million roof replacement project.
Source: The Vancouver Sun