Thursday, December 4^th, 2008
 

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REGISTRATION & CONTINENTAL BREAKFAST



 

WELCOME

Forum Chairmen:
Stephen Taylor, President & COO, Morguard Investments Limited                        Jonathan Wener, Chairman, Canderel Group of Companies

THE POLITICAL LANDSCAPE ACROSS CANADA AND THE U.S.:  IMPLICATIONS OF THE NATIONAL ELECTION RESULTS

Keynote Speaker:
Allan Gregg, Leading Pollster, Political Analyst & Social Commentator

THE RISKS AND OPPORTUNITIES IN 2009 IN THE REAL ESTATE AND CREDIT MARKETS:  ONE STRATEGIC VIEW FROM THE “C” SUITE

Introduction:
Thomas McCarthy, Vice Chairman, DTZ Barnicke

Keynote Speaker:
Barry Sternlicht, Chairman & CEO, Starwood Capital Group LLC

Session B1:
VALUES, CAPITAL AND THE ECONOMY:  WHAT DOES THE FUTURE HOLD FOR INVESTMENT ACTIVITY IN THE CANADIAN MARKET? 

A panel of commercial brokers from across the country will provide an extensive discussion on current and emerging investment trends in major Canadian markets. The past year has seen a considerable reduction in deal flow. What have been the major reasons for the decline in transaction activity? What will be required for an increase in deal-making? To what extent are cap rates experiencing some upward pressure given the rising cost of capital and the constraints on liquidity? While Class A properties are still holding there own, is there a growing weakness among non-trophy buildings? Who are still the most active buyers? Who are the sellers? Which product types are currently most favoured by investors? Which markets are “top of mind”, and why? How do investor attitudes vary from institutional vs. private and domestic vs. offshore? What is the outlook for investment activity in 2009?

Moderator:
Paul Zemla, Chief Investment Officer, Bentall LP

Panel:
David Forbes, Executive Vice President, CB Richard Ellis Limited
Michal Kuzmicki, Managing Partner,
     Brookfield Financial Real Estate Group
Tim Margolian, Vice President, Investment Sales, DTZ Barnicke
Jim McIntosh, Senior Vice President, Industrial Investment Sales,
     Colliers International
Kevin Meikle, Senior Vice President, Capital Markets Group,
     Cushman & Wakefield LePage Inc.
Robin White, Executive Vice President, Investment Group,
     Avison Young Commercial Real Estate (Ontario) Inc.

Session B2:
OFFICE MARKETS ACROSS CANADA:  MORE SUNNY DAYS IN 2009 OR IS A PERFECT STORM LOOMING?

Even though office vacancy rates are relatively low, rents are high, and new supply is moderate in almost every major city, there is a significant lack of consensus as to which direction most office markets are headed. Where some see continued rent increases, others see significant declines. Some see declining consumer confidence and spending stalling office expansion and relocation decisions, while others see the pressure to retain and attract key and scarce office workers accelerating relocation decisions. In a tight market, does deal flow matter very much?  Where some see modest levels of new supply, others see the ‘pressure to place’ pension and other funds adding that one building too many to several markets. Some see the new generation of office buildings with their new operating economics depressing the rents on the existing inventory of office buildings, while others focus on location as being the key metric. Are image and scarcity driving the rents on the existing inventory upward? What is the key dynamic or question in each of the major cities (Montreal, Ottawa, Toronto, Calgary, Edmonton and Vancouver) that will shape the future of these distinctly different office markets?

To request a copy of the PowerPoint presentation please click here.

Moderator:
Sandy McNair, President, Altus InSite

Panel:
Pierre Bergevin, President & CEO, Cushman & Wakefield LePage Inc.
Michael Emory, President & CEO, Allied Properties REIT
Yves-André Godon, Managing Director, Canada, SITQ
Stephani Kingsmill, Senior Vice President & General Manager, Real Estate,
   Manulife Financial
 

Session B3:
CHALLENGES AND OPPORTUNITIES IN INDUSTRIAL REAL ESTATE:  FROM THE BATTERED MANUFACTURING SECTOR AND THE U.S. DOWNTURN TO THE UN-COMMODITIZATION OF PRICING

The industrial real estate sector has consistently ranked as a highly desirable product across a wide spectrum of investors. But faced with new challenges, will this strong interest remain in 2009? This panel will examine some of the major potential challenges and opportunities facing this popular asset class. The session will open with a brief update on the state of the automotive sector in Canada. How is the battered manufacturing sector impacting demand for industrial space? Is this decline cyclical or structural? How will lower commodity prices affect the marketplace in the West? With operating expenses on the rise, what impact will greater cost competitive behavior by tenants have on owners? Has the yield/quality paradigm come back into apposite alignment? Does this create value loss or new opportunities? How is the escalating price of land creating greater risk for investors? Is the economic rent of new development justifiable? Is there any opportunity for innovation to offset the land cost?

Moderator:
Chris Caswell, Vice President & Director,
     TD Securities Realty Group Inc.

Speaker:
Dennis DesRosiers, President, DesRosiers Automotive Consultants Inc.

Panel:
Phil Gillin, Senior Managing Director & Head, Canadian Real Estate
     Sun Life Financial
John Hayes, Managing Director, Blackwood Partners Inc.
Donald Mathew, Chief Investment Officer, IG Realty Investment Inc.
Matt Sargent, Vice President, Transactions, AMB Property Corporation

Session B4
WHERE ARE LAND, DEVELOPMENT & CONSTRUCTION COSTS HEADING IN 2009?

Development is continuing on a very active scale in many Canadian markets notwithstanding the relatively high cost of land, escalating cost of construction, and other potential constraints. This session will open with a brief overview of land inventories and activity in the Toronto, Calgary and Vancouver markets. Where are trading volumes and values currently and where do they appear to be heading in the next twelve months? A panel discussion will then follow examining the key trends and market dynamics. How does a new project make sense given the economic rent associated with the cost of land, development and construction? What are the unique challenges associated with mixed-use development and intensification projects? What are the strategies being used to find appropriate sites and a supply of land? What impact does the current availability of land and associated costs ultimately have on retail, industrial, and residential development? How are sources of credit viewing land acquisition, development and construction?

Moderator:
Don Fitzpatrick, Partner & National Leader, Real Estate, Deloitte & Touche LLP

Panel will include:
Mark Cote, Vice President, Development, Oxford Properties Group Inc.
Steven Hurst, Vice President, RealNet Canada Inc.
Margaret Knowles, Senior Vice President, Development,
     Morguard Investments Limited
Brad Warren, Land & Development Properties, Cushman & Wakefield LePage Inc.

Session B5
WHAT IS THE OUTLOOK FOR THE DEBT MARKET IN 2009? DOES ANYONE REALLY KNOW?

The credit crunch continued to escalate throughout the past year, having a strong impact on the pricing and the availability of debt. An undervaluation of real risk in the subprime market rippled, cascaded and ultimately adversely affected the global economy. As a result, the CMBS market vapourized, risk was re-priced by the remaining lenders, underwriting standards and LTV requirements changed, and the debt market re-segmented itself. This session will focus, specifically, on the debt market and try to determine what borrowers can expect in 2009. Who will be the major providers of debt in Canada and what will they be looking for? How will the strategies of pension funds, insurance companies and other institutions vary from those of private sources of debt capital? How are lenders likely to assess a deal and price it? What property classes are lenders avoiding, reducing exposure to, or increasing pricing for? Are smaller communities and other geographic areas a tougher sell? Will lenders be looking for more syndication? Will the CMBS market ever return? As renewals start to flood the market, what will happen? How much unsecured debt is out there?

Moderator:
Scott White, Partner, Murray & Company

Panel:
Peter Aghar, Chief Investment Officer, KingSett Capital
Dean Atkins, Vice President, Mortgage Investments,
     British Columbia Investment Management Corporation
David Dulberg, Managing Director, RBC Capital Markets Real Estate Group
Alan Winer, President, Harbour Mortgage Corporation
 

Session C1
RETAIL REAL ESTATE MARKET: THE OUTLOOK FOR VALUE, GROWTH AND CASH FLOWS

A wide ranging panel discussion on the outlook for the retail real estate market in 2009 as this sector deals with the ongoing turbulence of the economy and its impact on consumers. How are the economic conditions affecting value, growth and the sales? Are there any significant valuation gaps for retail formats between large markets vs. secondary markets? How are retailers performing in the current environment? What are the growth prospects for retail on both sides of the Canadian border? Are any retailers expanding? Who appear to be the winners among the tenants as we head into 2009? What is happening to retail development activity? Are some projects being put on hold? What lies ahead overall for the Canadian retail real estate sector in the New Year? 

Moderator:
Leonard Abramsky, Managing Partner, Brookfield Financial

Panel:
Paul Chehab, Senior Vice President & Chief Investment Officer,
     Ivanhoe Cambridge
Andrew Clydesdale, President & COO, Bentall Retail
Sylvie Lachance, Executive Vice President, First Capital Realty Inc.   
Fred Waks, Executive Vice President & COO, RioCan REIT

Session C2
ARE THE SLOWING ECONOMY, NEW CONDOMINIUMS AND CREDIT CRUNCH HAVING ANY IMPACT ON THE APARTMENT MARKET?

       
The multi-unit residential buildings across Canada continue to quietly attract investor interest as a major source of steady, predictable yields and cash flow, and are viewed as reliable and stable assets. Some pundits are predicting that multi-family properties will be in relatively good shape at the end of 2009 with many viewing the sector as the lowest risk investment vehicle compared to other asset classes. What are the reasons for this outlook? Are cap rates experiencing some upward pressure? Are major investors still looking for Class A properties?  Is there a growing weakness among investors for non-trophy buildings? How significant an issue is the strong rental pool of condominium units to the apartment market? Why are some rental buildings performing very well, while others have significantly higher vacancies in the same neighbourhood? Is CMHC mortgage insurance having a very significant effect on capital availability for the multi-family sector and related values as a result?

Moderator:
Drew Koivu, Director, Multi-Residential,
     BMO Capital Markets Real Estate Inc.

Panel:
Brenda Brockbank , Senior Relationship Manager, Multi-Unit Residential Mortgages,
     TD Canada Trust
Daniel Drimmer, President, TransGlobe Property Management Services Ltd.
Steven Gross, Vice President, Investment Management, Bentall LP
Tom Schwartz, President & CEO, CAP REIT

Session C3
REDEVELOPMENT:  INSIDER VIEWS ON WHAT TO EXPECT AND HOW TO SUCCEED IN THIS VERY ACTIVE SECTOR

Intensification activity is growing in major cities across Canada.  The session will examine some of the major trends associated with this challenging form of development.  Who are the developers/investors that are turning to redevelopment of existing buildings and why? What are the typical challenges they face?  How are municipalities reacting/assisting with the redevelopment process?  What are the most significant kinds of regulatory issues that developers/investors face throughout the process?  How feasible is it to incorporate greening elements into the redevelopment of an existing structure?  How are developers dealing with the environmental issues that greenfield development does not present?

Moderator:
Ian Gragtmans, Senior Vice President, Colliers International

Panel:
George Kirchmair, Vice President, Technical Services, Barenco Inc.: Environmental
Mark Reeve, Principal, Urban Capital Property Group:
     High Density Residential Developer
Dermot Sweeny, Principal, SSweeny Sterling Finlayson &Co. Architects Inc.:
     Architecture & Design
David Wallace, President, Ros-Bay Developments Inc.: Retail Developer

Session C4
WHAT DOES THE FUTURE HOLD FOR THE CREDIT MARKETS?  WHAT WILL PRIVATE EQUITY AND THE PUBLIC MARKETS BE DOING IN 2009?

The past eighteen months has seen a major swing from a market awash with low cost capital and high leverage strategies to a significant tightening of credit underwriting and depletion of private equity buyout opportunities.  The cost of capital, the cost of equity and the sources of capital have dramatically changed. There was always lots of capital but things have changed quickly, and now there’s not enough equity to fill the gap.  Deal flow and transaction activity significantly declined in the past year.  Does anyone really have a clear understanding and control of what is going on in the credit markets? How much capital is on the sidelines? 

What are private equity funds and investors waiting for before they deploy?  Will private equity step into the vacant opportunities created by the contracting debt markets?  If so, at what price?  What is the outlook for credit and capital availability from sources private equity of 2009?  What will it take for the public markets to provide sources of capital?  How has all of this affected the interest of the buyside and the capital markets appetite for the real estate asset class? 

What is the difference between the U.S. and Canadian experience?

Moderator:
Stephen Sender, Managing Director & Industry Head, Real Estate
     Scotia Capital Markets Inc.

Panel:
Edward Boomer, Managing Director, Canadian Operations, Kimco Realty Corporation
Nicholas Cooper, CEO, ING Real Estate Select
John Kriz, Vice President, Credit Research, Spectrum Asset Management
Dennis Mitchell, Portfolio Manager, Sentry Select Capital Corporation
Michael Smith, Senior Vice President, Real Estate & Hospitality Analyst,
     Equity Research, National Bank Financial

Session C5
THE CRITICAL IMPORTANCE OF ASSET MANAGEMENT STRATEGIES: 
CREATING AND FINDING VALUE IN TODAY’S CHALLENGING MARKET CONDITIONS

Notwithstanding the sluggishness of the economy and its impact on real estate asset classes, there are individuals and organizations who are creating value in this market across Canada.  Some of their success is attributable to acquiring out-of-favour sites and properties, and capitalizing on these unique market opportunities.  Investors working with asset managers who are active in this area have the ability to see something that no one else sees. For others, it involves creating and employing asset management strategies that offer a structured approach in handling properties and that take into consideration all the factors that accompany real estate investment – a systematic process of maintaining and upgrading real estate assets in the most cost effective manner possible that works well for the property owners. The panel will discuss some of the keys to developing and executing successful asset management strategies that can lead to enhanced values. 

What are the significant elements of successful strategies, e.g.  understanding the mandate from the investor, thorough research and underwriting, risk analysis, clear definition of exit strategy and liquidity, compliance with fund criteria and risk/reward profile, independent investment review, strong strategic communication with property management and leasing teams.

Moderator:
Stuart Lazier, Partner, KingSett Capital

Panel:
William Evans, Partner, Evton Capital Partners LP
Greg Spafford, Senior Vice President, LaSalle Investment Management
Michael Pittana, Managing Partner, Crown Realty Partners Inc.
Brady Welch, Partner & Managing Director, Slate Properties Inc.
 

CLOSING DISCUSSION: FINAL COMMENTS ON THE RISKS, TRENDS, CHALLENGES, AND OPPORTUNITIES FOR 2009  

Given the broad range of issues that were raised during the Real Estate Forum over the previous two days, a panel of well-respected senior real estate executives will provide the last word. They will offer their insights and perspectives individually, and as a collective, on what they believe are the most critical issues and market trends that the industry must deal with in 2009, and what courses of action they would suggest accordingly. The panel represents a divergence of interests and viewpoints from within Canada and from the outside looking in.

Forum Co-Chairmen:
Stephen Taylor, President & COO, Morguard Investments Limited                        Jonathan Wener, Chairman, Canderel Group of Companies

Panel
Paul Campbell, President & CEO, SITQ
Michael Cooper, Vice Chairman & CEO, Dundee REIT
Marc Davidson, Managing Director & Portfolio Manager, AEW Partners Funds
Dori Segal, President & CEO, First Capital Realty Inc.
 

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