227 King St S (Sun Life Building)

[Brenden]

Sun Life to sell historic Waterloo HQ to B.C. firm
Sun Life Financial is selling its historic Waterloo headquarters at 227 King St S. to Concert Real Estate Corporation, based in British Columbia.

Sun Life will sign a 20-year lease and continue renting the space from Concert Real Estate Corporation and the company will have the option to extend the lease.

Sun Life would not disclose how much the building is being purchased for, as the deal has not officially closed as of Thursday.

Susan Jantzi, director of corporate affairs and sustainability for Sun Life Financial, said the building's 2,600 employees will not be affected by the sale.

"In the current Canadian real estate market, it's more financially attractive for Sun Life to lease the building and redeploy the capital elsewhere," she said.

"[Concert Real Estate Corporation] is a significant investor in Canadian real estate and they're a Canadian company owned by Canadian pension funds and we do already have a relationship with them through some other investments, so they were a great fit," Jantzi said.

"We actually retain the full control over the facilities and are responsible for maintaining and improving the building."

The original section of the building is more than 100 years old and was designed by Canadian architect Frank Darling. It was later enlarged in 1921. The Ontario Heritage Trust commemorated the Sun Life Financial building with a provincial plaque in 2012 for its historical significance.

"Kitchener-Waterloo is a fantastic home to our Canadian headquarters and we have no plans to change that," said Jantzi.

"It's a vibrant market. Growth projections are fantastic. It's an attractive centre for our employees, and it's a great part of our heritage."

[rickhd]

It is a building with multiple additions added since the building of the original building.   Expensive building to maintain.   I can see why Sun Life would want to sell it and lease it back.   It will be a huge savings for Sun Life.     Also provides capital for Sun Life to invest in their core business.   

The big advantage for the new owner is the value of the parking lots.   A huge development possibility.  

[Spokes]

Does the new owner have a history of developing, or are they more in the business of holding properties and being a landlord

[Viewfromthe42]

It seems like a value to us, the parking lots as potential development, but having amassed them for their employees, it seems unlikely to impossible that the retention of these lots was not a key part of the leaseback for this deal.

Perhaps there could be development that kept parking for SL, ala 144/155 for Vincenzo's. I'd also say, for such a far away owner, I would want to see a lot of local research before they plan to put something into motion. Before the pencil sketches, not after the plans have been released.

[Markster]

Concert Real Estate Corporation is a developer, albeit still fairly new to it. 

Their highest profile project at the moment is 88 Scott St in Toronto.



I'm certain that Sun Life has guarantees on the amount of parking they have, however I sincerely doubt that they have guarantees that the parking they must be surface parking.

[Spokes]

I hope we start to see more buildings with shared parking in them. Maybe even with public parking in them.

That being said, with the price of underground parking, it'll be a tough sell job

[nms]

Is this SunLife's way of easing into moving their Canadian headquarters out of Waterloo? When they bought Clarica (née Mutual Life), SunLife committee to keeping their Canadian operations in Waterloo. It would be sad to see another internationally known icon disappear from the region. First the manufacturing, then the business sector?

Remember too, that as far as I know, the parking lots between the main building and John St. sit on top of their computer centre and/or archive or some other similar structure.

[Markster]

That being said, with the price of underground parking, it'll be a tough sell job

The price was clearly not an issue for 155 Caroline.  Just as happened there, any development would be obligated to replace the existing parking, in addition to whatever parking the development itself requires.

[Spokes]

That being said, with the price of underground parking, it'll be a tough sell job

The price was clearly not an issue for 155 Caroline.  Just as happened there, any development would be obligated to replace the existing parking, in addition to whatever parking the development itself requires.

Is the parking at 155 Uptown not above ground in the podium?

[Markster]

Is the parking at 155 Uptown not above ground in the podium?

It is.
Redevelopment would require structured parking. It is a choice for the developer whether it would be under or overground. There is a minor price difference, but I'm not sure what your exact concern is.

[Spokes]

Is the parking at 155 Uptown not above ground in the podium?

It is.
Redevelopment would require structured parking. It is a choice for the developer whether it would be under or overground. There is a minor price difference, but I'm not sure what your exact concern is.

I don't have the exact numbers but I remember seeing somewhere that it's more than a minor price difference.  It's quite significant.

If I'm wrong, then my argument goes out the window.  But if I'm right then it just shows that price DOES play a role as to if a development will have 1, 2, 5+ levels of underground parking. 

[Markster]

I still don't understand the disagreement.

I'm saying that
a) Redevelopment of the parking lot will require building structured parking to replace the existing surface parking, in addition to new parking for the development
b) The market already shows that this is something people are willing to pay for, as seen in 155 Caroline, which replaces parking for Bauer.

Since I already did a bit of googling, see page 6 of this report, for relative costs of parking construction, but it was not my intent to get into a disagreement over where one draws the line of "expensive" parking.

[rickhd]

Is this SunLife's way of easing into moving their Canadian headquarters out of Waterloo?  When they bought Clarica (née Mutual Life), SunLife committee to keeping their Canadian operations in Waterloo.  It would be sad to see another internationally known icon disappear from the region.  First the manufacturing, then the business sector?

Remember too, that as far as I know, the parking lots between the main building and John St. sit on top of their computer centre and/or archive or some other similar structure.

That's correct under the John St. Lot is a underground structure.  

There is also a parking lot on John St beside the Iron Horse Trail.   Also another parking area at the corner of King and John St.     The parking garage on John and Caroline is also part of the property.   

To make things more complicated for any future development is the fact that the land and buildings are in both cities.   The boundary lines cross through the area.   
  

[Spokes]

I still don't understand the disagreement.

I'm saying that
a) Redevelopment of the parking lot will require building structured parking to replace the existing surface parking, in addition to new parking for the development
b) The market already shows that this is something people are willing to pay for, as seen in 155 Caroline, which replaces parking for Bauer.

Since I already did a bit of googling, see page 6 of this report, for relative costs of parking construction, but it was not my intent to get into a disagreement over where one draws the line of "expensive" parking.

Yes, I agree with you.

I think our lines got crossed.  I originally mentioned including public parking in it as well but said there likely wouldn't be the public will to do it given the price.

You're right if it's simply a developer providing parking for sunlife, they'd eat the cost.

[nms]

There is also a parking lot on John St beside the Iron Horse Trail.   Also another parking area at the corner of King and John St.     The parking garage on John and Caroline is also part of the property.   

To make things more complicated for any future development is the fact that the land and buildings are in both cities.   The boundary lines cross through the area.   
  

I think that SunLife also currently leases both the old Granite Club parking lot and the old Uniroyal/Dominion Tire parking lot on Park St next to the train tracks (I think Grand River Hospital may share the space too).  It will be interesting to see how SunLife parking demand shifts as the transit alternatives improve nearby.