In a deal announced Monday, iPort Properties (owned by the Healthcare of Ontario Pension Plan, or HOOPP), purchased 300 acres just west of the Loblaws distribution centre on Maple Grove Road. The property, currently farm fields and woodlots, stretches from Middle Block Road to Allendale Road.The Waterloo Region Economic Development Corp. put out a statement on this deal:
The parcel is the largest of three pieces of property assembled in the area over the last 12 years by Intermarket Properties, totalling 425 acres and five farms. Intermarket still owns the other two parcels and plans to develop them into employment lands.
"We're not a big group and we're focused on small and mid-sized developments," Mark Kindrachuk, president of Intermarket Properties, said in explaining why it sold the largest parcel.
"HOOPP is a big group, a big pension fund that is across the country, and they do bigger things so it just made sense."
Terms of the deal were not disclosed. HOOPP owns more than $79 billion in assets. Its real estate portfolio spans across Canada, the United States, five countries in Europe and the United Kingdom.
Intermarket is well-known in this region. It recently developed the 40-acre Waterloo Corporate Campus at Northfield Drive and Weber Street North in Waterloo, and Sportsworld Crossing in south Kitchener.
Known as IP Park, the original vision was a 425-acre master-planned business campus with more than five million square feet of commercial development, including large-scale industrial, advanced manufacturing, and office and data centre space.
Kindrachuk said Intermarket still plans to develop Phases 1 and 2 into industrial and office lands, while iPort Properties will develop Phase 3 into large-scale industrial. They'll work together to market the new properties once the buildings are ready for occupancy.
"We're collaborating, we're co-operating," he said. "We know their marketing people and we're working on a cohesive marketing program for the entire area, along with the region."
All of the transportation, planning, servicing and stormwater studies are finished, and the areas are now zoned for industrial use. The City of Cambridge will also build a new road to improve access to the IP Park.
It's expected the total development will support the creation of more than 3,000 jobs, Kindrachuk said.
In a news release, Tony LaMantia, president of the Waterloo Region Economic Development Corp., said that "Waterloo's emergence as a global technology hub has positioned us to play a leading role in advanced manufacturing and we look forward to marketing IP Park and iPort for high quality, strategic investment."
Intermarket Properties is pleased to announce that iPort Properties (“iPort”), has acquired Phase 3 of IP Park in Cambridge, Ontario to develop iPort Cambridge. iPort is owned by the Healthcare of Ontario Pension Plan (HOOPP) and is one of the largest owners of large scale industrial business parks in Canada. The sale of the 300 acres in Phase 3 will allow large scale industrial users to locate in Cambridge and benefit from the close proximity to the recently widened Highway 401 and the Waterloo International Airport.You can also read the the full Intermarket and iPort and press release below:
Intermarket Properties is pleased to announce that iPort Properties (“iPort”), has acquired Phase 3 of IP Park in Cambridge, Ontario to develop iPort Cambridge. iPort is owned by the Healthcare of Ontario Pension Plan (HOOPP) and is one of the largest owners of large scale industrial business parks in Canada. The sale of the 300 acres in Phase 3 will allow large scale industrial users to locate in Cambridge and benefit from the close proximity to the recently widened Highway 401 and the Waterloo International Airport.Even though terms of this deal were not disclosed, this is a significant deal for HOOPP's Real Estate team which tends to lead its peers when it comes to industrial real estate in Canada (see details here).
The original vision for IP Park, a 425 acre master-planned business campus, was conceived by Intermarket and provides for over 5 million square feet of commercial development including large scale industrial uses, advanced manufacturing, office and data center space. The project extends from Highway 8 to Middle Block Road and is the largest industrial development in Waterloo Region. iPort will now develop the lands south of Middle Block Road to Allendale Road; and Intermarket will continue to develop the Phase I and Phase II lands south of Allendale Road. IP Park, formerly named Creekside, also integrates over 200 acres of additional green space that provides a network of parks, woodlots and wetlands. A trail system is also proposed that will create an environment where employees can walk or bike through the entire area.
Mark Kindrachuk, President of Intermarket Properties states “IP Park and iPort Cambridge will provide much needed industrial space in Waterloo Region and there will be over 3,000 jobs created with this overall development. We have been working to ensure that the required infrastructure is available for new development in this area, and now that the construction of the roads and sanitary pumping station has started; we are seeing substantial new investment in this region”.
With the capacity to accommodate a wide range of industrial and commercial uses, IP Park was developed in collaboration with community and government stake holders and establishes Cambridge as a key driver of economic growth and competitiveness for Waterloo Region.
“HOOPP is very pleased to be acquiring the lands south of Middle Block Road to develop iPort Cambridge” said Chris Holtved, Senior Portfolio Manager HOOPP Real Estate. “HOOPP has previously developed industrial and flex office buildings in Cambridge, but this acquisition allows us to develop at a bigger scale, in keeping with our other first class business parks across Canada. It also gives us the ability to attract a wide variety of larger scale uses to the area”.
Tony LaMantia, President of the Waterloo Region Economic Development Corporation (Waterloo EDC) is excited about the opportunities for IP Park and iPort Cambridge: “Our industrial roots in Waterloo Region have laid a foundation for innovation and manufacturing excellence. We have more than a century of manufacturing experience driven by some great anchor companies and the expertise to disrupt and innovate in robotics, aerospace and automotive. Waterloo’s emergence as a global technology hub has positioned us to play a leading role in advanced manufacturing and we look forward to marketing IP Park and iPort for high quality, strategic investment.”
It's also a play on the growing importance of technology, e-commerce and autommation in the Waterloo region and overall economy.
Tony LaMantia, President of the Waterloo Region Economic Development Corporation, is right: "Waterloo’s emergence as a global technology hub has positioned us to play a leading role in advanced manufacturing and we look forward to marketing IP Park and iPort for high quality, strategic investment."
It's a bit like the movie Field of Dreams, if you build it, they will come. They being some of the top technology and traditional companies and some of the top technology talent in the world.
It's quite interesting that HOOPP is making a significant investment right in its own backyard but it makes perfect sense, after all, they know this market extremely well.
Late this afternoon, I had a chance to speak with Chris Holtved, Senior Portfolio Manager at HOOPP Real Estate. He worked on this deal and he filled me in on the background.
Holtved said HOOPP is one of the largest industrial property owners in Canada and they tend to identify markets to develop earlier than others.
What they have been doing is rebranding industrial parks they own under the iPort brand which is well recognized for its consistency and service and this latest deal in Cambridge is one of a series of successful iPort deals.
For example, in September 2018, Amazon announced it will occupy a 450,000-sq.-ft. facility at the Delta iPort in British Columbia:
The project is being developed by GWL Realty Advisors on behalf of project owner, the Healthcare of Ontario Pension Plan (HOOPP).As stated in the article, Amazon is one of the largest clients in HOOPP's global logistics portfolio and it's likely the main reason why iPort Delta and iPort Caledon took off in a major way.
Amazon has already announced, and is currently having built fulfillment centres in Ottawa and Caledon, just north of Toronto. It also announced a facility outside of Calgary late in 2017.
The new B.C. facility will create more than 700 full-time jobs, Amazon says, and join its network of existing British Columbia fulfillment centres in Delta and New Westminster.
Amazon currently employs more than 2,300 British Columbians, including about 1,500 at its tech hub in Vancouver.
“Since first opening in British Columbia in 2012, we credit our exciting growth to the incredible customers and outstanding workforce of the Lower Mainland community,” said Glenn Sommerville, director of Amazon operations in Canada, in a prepared statement.
“Our ability to create over 700 good-paying jobs with great benefits is thanks to the network of support we’ve received from the Tsawwassen First Nation Executive Council, provincial and community leaders, and strong project partners dedicated to innovation.”
“We are pleased that Amazon has chosen Delta iPort as its newest Metro Vancouver distribution facility,” said Paul Finkbeiner, president of GWL Realty Advisors. “In an industrial real estate market as constrained as Vancouver, meeting the needs of Amazon for facility size and location requires creative thinking.
“By working in partnership with the Tsawwassen First Nation, we were able to create an innovative solution for both Amazon and for our client, HOOPP.”
Delta iPort built for distribution, logistics
The agreement with Amazon is for the first phase of the 57-acre Delta iPort industrial park. When complete, the campus will offer nearly one million square feet of modern distribution space across two separate buildings. Delta iPort has been tailored to the rapidly evolving and increasingly complex logistics and e-commerce markets.
“HOOPP is pleased to welcome Amazon to Delta iPort,” said Chris Holtved, senior portfolio manager, HOOPP real estate. “Amazon is one the largest clients in HOOPP’s global logistics portfolio.
“Securing them as the anchor tenant for Delta iPort fulfills the original shared vision that HOOPP, GWL Realty Advisors and TFN create a best-in-class distribution hub that would attract leading edge global logistics clients.”
Delta iPort is located at 41B Street and Salish Sea Way, adjacent to Port of Vancouver’s Deltaport, within 30 kilometres of both downtown Vancouver and the U.S. border. It’s adjacent to several key transportation routes, including the South Fraser Perimeter Road.
The facility will open in 2019, and will be managed by GWL Realty Advisors.
It will be Amazon’s 10th fulfillment facility in Canada and join Amazon’s current fulfillment centres in Alberta, British Columbia and Ontario. The facility will be used to store and distribute items such as books, toys, small electronics and home goods.
Amazon employs more than 7,000 working at fulfillment centres, corporate offices, development centres and other facilities throughout Canada in Ontario, British Columbia, Alberta, and Quebec.
“Tsawwassen First Nation welcomes Amazon to our Lands,” said Chief Bryce Williams in the release. “This is a promising advancement that will continue to unlock the potential of TFN as a leading development partner and key economic driver in Metro Vancouver, and we thank our partners GWL Realty Advisors and HOOPP for their roles in bringing this exciting agreement to fruition.”
Other Amazon projects in Canada
Amazon’s distribution centre in Caledon will be a million-square-foot facility located near the community of Bolton. It will join Amazon’s network of existing Ontario buildings in Brampton, Mississauga and Milton in servicing the GTA and other areas. It will also handle the packing and shipping of small items.
In Ottawa, Amazon is building a million-square-foot centre in the east end of the city, in a rural area at 5371 Boundary Rd. That facility is owned and being constructed by Montreal-based Broccolini.
The two projects will bring more than 1,400 new jobs to Ontario by the end of 2019.
Amazon is near completion of its other new Canadian fulfillment centre, in the Nose Creek Business Park in Balzac, Alta., just outside Calgary. This building is more than 600,000 square feet and is expected to employ up to 1,000 people.
Construction at Nose Creek facility began in 2017 and Amazon hopes to be shipping from it by late 2018.
In fact, take the time to read this brochure on iPort Caledon to really understand the scope and scale of this industrial park and all it offers.
Chris Holtved told me there are four industrial parks in Alberta being rebranded under the iPort brand and they typically look for a minimum of 50 to 60 acres and 150,000 to 200,000 square feet when developing such projects.
But contrary to what you think, finding prime industrial logistics land isn't easy in Canada, there is a whole set of criteria for zoning and municipal services that must be met before HOOPP invests in these projects.
What Holtved told me about iPort Cambridge is designated "primarily significant employment land". It's a block away from the Toyota plant which will be manufacturing hybrid and electric cars and very close to Highway 401. Intermarket will be handling phase 1 and 2 of the project, HOOPP's iPort phase 3 which is the larger part of the deal and he said "there will be great synergies" between the two.
Holtved also told me that HOOPP has been building its logistics portfolio over the last 10 to 15 years and it's now 20% of the total Real Estate portfolio.
Since I had a real estate expert on the phone, I had to ask him his thoughts on retail real estate. He said "retail real estate isn't dead but it's all about demographics and local markets."
Today on Twitter, Bloomberg's Lisa Abramowicz posted this on how America's growth has been increasingly concentrated in large cities and by the coast:
America's growth has been increasingly concentrated in large cities and by the coasts, spurring angst about whether more rural areas will keep getting left behind. https://t.co/DviYZkTI8I— Lisa Abramowicz (@lisaabramowicz1) December 16, 2019
I replied that this is a consequence of the financialization and computerization of the US economy.
Anyway, I thank HOOPP's Chris Holtved for taking the time to give me a nice background on all these iPort deals. When it comes to top logistics properties, HOOPP is definitely a leader in Canada.
Below, Delta iPort is a market-leading, tier-1 distribution centre campus located adjacent to the Roberts Bank Superport. Delta iPort offers the largest speculative distribution centres in Metro Vancouver which can accommodate tenants from 113,000 square feet up to 1,080,000 square feet. Locate your distribution and logistics operations at Canada’s global shipping gateway.
Also, CBS Sunday Morning had a great report on drones and robots delivering your goods in the 'last mile' which you can watch here. Take the time to watch this report as it gives us a glimpse of the future.
Lastly, while most retailers are struggling, the Nordstrom family is doing just great, opening up a flagship store in New York City. Take the time to watch the secret behind their success here.