Posts Tagged ‘economics’
[URBAN NOTE] “Troubled Trump Tower in Toronto likely will go to owner of $301-million construction loan”
The Financial Post carries Alastair Sharp’s Reuters report noting that debt-laden Trump Tower here in Toronto has not received any bids, and that the bank that is its main debt holder is likely to take the building.
The court-run sale of a downtown Toronto high-rise bearing the name of U.S. President Donald Trump received no initial bids and ownership will likely fall to its main debt holder, a letter from the receiver showed.
The court process only indirectly involves Trump, whose sprawling business empire licenses its brand and manages the Toronto property on behalf of the developer, Talon International Inc. But the Trump International Hotel & Tower’s new owner will need to navigate an unresolved dispute over whether they can get out of that arrangement.
No qualified bids apart from a stalking horse offer of $298 million were received for the luxury hotel and condo property by an initial deadline, the receiver, FTI Consulting, said in a letter dated Feb. 21 and seen by Reuters on Monday.
“As a result, the Receiver has determined that the Stalking Horse Bidder is the Successful Bidder,” the letter said.
With no rival bidders emerging, the hotel’s ownership will likely fall to JCF Capital ULC, which on Sept. 29 bought the $301 million owed on the tower’s construction loan, before quickly moving to initiate the sale process.
Torontoist features John Parker’s criticism of city council for not properly budgeting expenses in the coming fiscal year.
“What’s a million?” a comment famously attributed to Canadian wartime minister C.D. Howe, is one of those lines so rich in its obvious contempt for the sensibilities of the average taxpayer that it is almost a shame that there is no record that he actually said it.
But we now know that the spirit of that remark lives on in today’s Toronto City Hall. Over the years, $1 million has increased to $2 million. And we now know that this is the premium Toronto City Council submitted for future taxpayers to pay, just so that they could bring down the curtain on a 15-hour day of kicking the same tired old issues around the floor of council on 2017 budget decision day, to the point where someone, in effect, said, “It’s late, we’re all tired, and we want to go home.”
It’s not as if the 2017 budget process hadn’t already gone through a long and detailed series of analytical steps and decision points long before midnight on February 15. There is a budget committee that meets regularly throughout the year. City staff had released their preliminary 2017 numbers before the end of 2016. Community information sessions had been held. Special budget committee meetings had taken place. Recommendations and proposals had been submitted, discussed, and voted on at the Executive Committee. The bulk of about $10.5 billion dollars of tax that supported operating spending in the original proposal had emerged from the process pretty much unscathed. Proposed spending lined up neatly with projected revenues, in accordance with the law that imposes at least that degree of fiscal discipline on every municipal government in the province of Ontario.
As the midnight hour approached, there was just one problem. After taking into account all the recommendations from staff in all departments, and after all the town halls, and after all the committee meetings, and deputations, and proposals, and votes, Toronto City Council decided that the budget they were about to adopt just didn’t provide for the City’s roads to be clean enough. Two million dollars in street sweeping, to be exact, had to be added to the plan. So it was added.
The Toronto Star‘s Ben Spurr reports on the latest in the back-and-forth between Metrolinx and Bombardier.
The TTC says it remains confident that Bombardier will stick to its latest streetcar delivery schedule, despite allegations this week of ongoing dysfunction at the Quebec-based rail manufacturer’s plants.
Court documents filed Thursday by Metrolinx, the provincially owned transit agency, accuse Bombardier of a “persistent inability to deliver on its contractual obligations” under a 2010 deal for 182 light rail vehicles (LRVs) and claim that as recently as last month there were “chronic and ongoing” problems with the company’s manufacturing processes.
The $770-million order from Metrolinx is separate from the TTC’s 2009 purchase from Bombardier of 204 low-floor streetcars, which has also been plagued by delays. But the vehicles from the two orders are similar and Bombardier is assembling the TTC cars at the same plants that have worked on the Metrolinx project.
Metrolinx filed the affidavits in response to Bombardier’s attempt to secure an injunction to prevent the agency from cancelling the contract. The documents have not been tested in court.
Bombardier denies it has bungled the Metrolinx order and in a statement released Thursday said: “we categorically disagree” with Metrolinx’s allegations. The company stated it was “fully able to deliver” the vehicles, which Metrolinx purchased to run on the Eglinton Crosstown and the Finch LRT.
Marcus Gee’s extended feature in The Globe and Mail reports on how Shelburne, a farming town far to the northwest of Toronto that I frankly had never heard about before today, is starting to be overtaken by the effects of the Toronto real estate boom. That the return trip to Toronto for commuters is on the order of five hours is apparently not an issue for buyers.
The soaring new office and condominium towers of downtown Toronto have come to stand for the dynamism of Canada’s biggest city. But if you really want to understand the staggering growth of greater Toronto, don’t look up, look out – way, way out. Look at what is happening to tiny Shelburne, fully 100 kilometres from the city centre.
For generations, this was a sleepy farming community where everybody knew everyone. Farmers would drive their cattle down the muddy main street to board trains to Toronto slaughterhouses. Motorists on the road to the ski chalets of Collingwood or the beaches of Lake Huron would pass by with hardly a second thought.
Today, little Shelburne is the second-fastest-growing town in all of Canada.
New census figures show it grew 39 per cent between 2011 and 2016, second only to Blackfalds, Alta., near Red Deer, among municipalities with a population of at least 5,000 and located outside a major metropolitan area.
People from down the road are flocking to Shelburne (its official slogan: “A people place, a change of pace”) to take advantage of the fresh air, open spaces and house prices that are still in the realm of sanity. Some commute all the way to downtown Toronto and back, an odyssey that can take five hours, round trip.
The Toronto Star‘s Tess Kalinowski reports on a study that suggests, plausibly enough, that increases in GO Transit rail service to outlying communities in the Greater Toronto Area will boost real estate prices there.
The plan to expand the GO train system to 15-minute, all-day two way service could increase some Toronto area property values up to 12 per cent.
It could also make housing up to 18 per cent more affordable in some areas of the region, according to a study of 773 communities commissioned by the Toronto Real Estate Board (TREB).
But maximizing those benefits depends on local municipalities making it attractive for commuters to get to the station, said the president of a data analytics company that studied the impact of GO’s Regional Express Rail (RER) expansion on Toronto region housing prices and affordability.
“While the GO station may be close to people it may not be accessible to them,” said Paul Smetanin, president of the Canadian Centre for Economic Analysis (CANCEA).
Areas that stand to gain the most in terms of affordability from RER are those outside the city, places such as Barrie, Guelph, Hamilton and King.