Bay Park Centre, Now CIBC Square, Breaks Ground
CIBC Square, a large-scale downtown office and retail tower development, will define our skyline for generations, according to Toronto Mayor John Tory.
“It’s going to create jobs. It’s going to create buildings of excellence. It’s going to create a modern connected headquarters for CIBC,” Tory said at the recent groundbreaking for CIBC Square on Bay Street.
CIBC Square, formerly known as Bay Park Centre, was rechristened in recognition of anchor tenant CIBC, Canada’s fifth-largest bank, which will eventually move its main offices and 15,000 of its employees to the square. As part of the lease, CIBC secured exclusive naming rights for the centre.
CIBC Square was developed by Ivanhoé Cambridge and Hines and designed by WilkinsonEyre Architects of London. It will have two towers with 49 and 50 storeys and 2.9M SF. CIBC will lease up to 1.75M SF in the two towers.
Adjacent to Toronto's Union Station, the development will include a new bus terminal, which will provide direct links to the TTC subway, GO train, Via Rail, the underground PATH system and Union Pearson Express.
“When I think of the commuters who use the GO bus system, I know that this is extremely exciting for them,” Ontario Minister of Transportation Steven Del Duca said. “CIBC Square is a visionary example of what government can achieve in partnership with the private sector.”
Cushman and Wakefield’s Lee Billinkoff, who served as lead broker for Ivanhoé Cambridge and Hines in bringing CIBC on board, said access to all forms of public transit was a no-brainer for the bank.
“From a location standpoint, it’s really ideal. Its connectivity as well. They can pull people from literally anywhere in the area,” he said.
Billinkoff said the towers will feature a new international standard of office space and include amenities such as first-class fitness and bicycle-parking facilities with showers exclusive to tenants.
“Where else do you get a one-acre park connected to your building?” he said. “They [CIBC] were very clear all along they wanted this to be a client- and employee-centered experience.”
The unique elevated park is being touted as the signature amenity of CIBC Square. It will connect the two towers, spanning the railway lines at the fourth-floor level and bringing much-needed public green space to an area seriously lacking in it.
“It is going to be the shining example of transit-oriented development where we make it not only possible, but we make it desirable for people to use public transit,” Mayor Tory said.
There is concern about the effect the new development will have on vacancy rates downtown. For example, who will fill the CIBC buildings being vacated for the new development?
Juana Sue-A-Quan, Cushman and Wakefield research marketing director, said vacancy rates will likely rise initially but that the overall effect will be relief.
“It’s not the end of the world. It’s expected that all the new space will be needed in the future,” she said.
In a recent research blog, Sue-A-Quan pointed out despite the addition of 10.6M SF since 2009, the downtown’s office vacancy rate sits at a 16-year low of 3.3%, while the fringe market surrounding the core sits at a record low of 2.3%. When the dust from the new CIBC Square starts to settle at the end of 2020, she anticipates the vacancy rate rising to 7.2%.
“Which, in a market this size, is certainly not a bad number,” she said.
It is expected the tech industry, which drove 22% of downtown’s growth in recent months, will play a role in eventually balancing the playing field for both landlords and tenants.
“Companies want to be downtown. They want to be at the centre of things,” Sue-A-Quan said.
The first CIBC Square building at 81 Bay St. is scheduled to be completed in 2020. The second structure at 141 Bay St. and the elevated park will be completed in 2023.