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Oxford Pushing Ahead With New Tower

Company Picks Architect for 1.4 Million-SF Tower in South Core, But No Tenant Named
February 26, 2018
Oxford Properties said it has hired UK-based architects Rogers Strik Harbour + Partners to design its new 1.4 million-square-foot office project in Toronto's south core.

The city of Toronto on Friday received a development application for a 60-storey tower at 30 Bay St., the location known as The HUB, named for its proximity to the Harbour, Union Station and Bay St.

The subsidiary of the Ontario Municipal Employees Retirement System would not comment on whether it has a tenant lined up for the building, but a press release indicates it is moving forward.

“Oxford Properties announces to develop The HUB,” the release states, boasting the site will be "a dominant feature on Toronto’s skyline."

In May, PortsToronto announced it had sold 30 Bay and 60 Harbour Streets to Oxford and the Canada Pension Plan Investment Board in a $96 million deal. Each pension fund was to have a 50% stake.

"Oxford has been enthusiastic about this site since PortsToronto selected us as their redevelopment partner five years ago,” said Michael Turner, Oxford executive vice-president, Canada, in a statement at the time of the deal. "This is an exceptional piece of real estate, and we will continue to advance the development of the site to maximize its value and associated benefits to the community."

As part of the deal, the Toronto Harbour Commission building, which currently sits on the property and serves as the head office for PortsToronto, was to be restored and maintained in any future development of the site.

Stuart Barron, national director of research for Cushman & Wakefield, noted most towers of the size Oxford proposes would need to have 300,000 to 400,000 square feet pre-leased before construction would begin. He couldn’t comment on potential tenants.

"I will say even with that building coming, it is still a very manageable market," said Barron, noting the vacancy rate in downtown Toronto is 2.7 percent. "If you throw that building in, we have a pipeline coming in the next wave of 8.7 million square feet. This would push the vacancy rate, let’s assume it arrives in the second quarter of 2022, to about 10.4 percent. That’s still a balanced market."

Dean Newman, the principal broker at Cresa Toronto, which represents tenants, said he would be surprised to see the building constructed on speculation. "But you know, there are not many very large blocks of space available," said Newman. "Oxford is obviously bullish that there is a net inflow into the core. Technology companies are driving growth. I really think this will be a beautiful complex and a spectacular product."
Garry Marr, Toronto Market Reporter  CoStar Group   

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