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The Well Partners Ink Key Energy Deal

RioCan and Allied Properties Sign Deal With Enwave For Energy Storage Facility That Could Feed 20 Million SF and Reshape Toronto's Downtown
February 8, 2018
RioCan, Canada’s largest real estate investment trust, and Allied Properties are teaming up with Brookfield Asset Management wholly-owned subsidiary Enwave Energy Corp. on a new energy storage facility that could reshape Toronto's downtown core.

The trio said they are extending Enwave's deep water cooling and water distribution network by building a new energy storage facility to be housed at The Well, a development the two REITs are partnering on in the downtown west end.

The development, which broke ground in 2017, is slated to house 1.1 million square feet of office space, 500,000 square feet of retail and food service space, and 1,800 residential units.

"For us, it opens up the west side of Spadina and the whole area," said Carlyle Coutinho, president of Enwave, which is now in 11 markets across North America. "When you have a large anchor tenant like The Well and a large development, it allows us to facilitate infrastructure expansion."

The deal calls for a thermal energy storage facility, consisting of two 6-million-litre tanks, to be housed underneath The Well. The tanks will store temperature-controlled water fed by Enwave's existing deep lake water cooling system and a newly developed high-efficiency hot water network.

Enwave says the facility will expand the existing system's capacity to serve an additional 20 million square feet of commercial, retail and residential space.

The three parties would not divulge the nature of the relationship, more than a year in the making, other than it gives Enwave access to the site, but Coutinho says the batteries go down below the parking level and don’t take up a significant amount of space. "In downtown Toronto, space is expensive, and there is a lot of people chasing it. The city is going vertical," he added.

Enwave would have been able to reach The Well with its current footprint and access in the core, but the deal allows for extra redundancy and reliability but also a point from which to grow, north, west and south.

Andrew Duncan, senior vice president of developments at RioCan, noted Enwave is already in most of the large office buildings downtown.

"This is beneficial for the partners, Enwave and our future tenants from both a financial and community standpoint," said Duncan, adding it helps makes The Well more of "flagship" development.

"This will be the first large thermal battery Enwave is doing in Toronto outside of (its own facilities)," said Duncan. "Obviously, they don't own the land but we’ve come to an agreement on them putting the tanks here and accessing the rest of King (Street) West and the community."

Toronto-based Allied, with its heavy focus and property holdings in the King West and Spadina area, would seem to be a big winner if it helps makes that part of the core even more popular.

"This is a continuation of our ongoing community-building in King West," said Michael Emory, Allied's chief executive, in a statement. "The Well will now actively support two elements of a modern and progressive city: resilience and the need to decarbonize municipal energy supplies. As a mix of different occupancy types exerting their energy demands at different times of day, The Well is ideally suited to a system like Enwave. Also, in facilitating Enwave's expansion, The Well will enable the greater King West community to tap into a low-carbon cooling and heating source."
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