The Effects of GTA Transit on the Suburban Market
Updated: Jul 26, 2019
Currently, the GTA benefits from two main rapid transit systems. The Go Rapid network connects the outlying GTA Suburban market with the Toronto downtown core, and the Toronto Subway System serves the suburbs and downtown market. But these systems are not enough, GTA transit must expand to benefit our market value.
Both of these systems were completed decades ago, before the GTA had grown into the expanse of suburbs we know today. The focus rested on the growing demand for office employment in the downtown core. However, as office employment has shifted from downtown to the GTA suburban markets, there is a new need for infrastructure and expansion of the existing systems. The GTA is suffering from major traffic congestion with commuters travelling throughout the suburbs, resulting in a loss of approximately $6 billion per year in productivity.
Clearly, the current GTA transit infrastructure is over capacity, with daily average commutes exceeding 65 minutes. The GTA’s highway system has little to no room to grow, making the usage and expansion of rapid transit a must-have if we want the GTA to remain one of the most competitive and powerful commercial office markets in North America.
Downtown Toronto’s transformation
When you enter Toronto’s downtown core, the development boom is undeniable, with constant condominium construction paired with steady demand and rising prices. Both young people and empty nesters are being attracted to urban living and commuting to their jobs in the suburbs is becoming a way of life.
This puts a strain on Union Station, which sees 240,000 daily commuters with GO Transit, Via Rail and the Toronto Transit Commission. With passenger traffic expected to increase by as much as 300% by 2031, the $800-million revitalization project (scheduled to be completed this year) is well-needed, as it will triple interior space, add new PATH connections and provide access to a number of downtown developments.
The impact on the GTA Suburban corporate real estate market
GTA office markets are seeing a direct correlation between rental rate and proximity to rapid transit. Spaces within 400 metres (walking distance) of rapid transit are seeing higher average rental rates, and positive absorption throughout the GTA.
First Gulf Realty
First Gulf is a landlord who understands the importance of GTA transit, specifically on the GO Train lines, as it relates to their commercial properties. Following the success of the PwC office development at 354 Davis Road, First Gulf was eager to explore possibilities for commercial development around the Oakville-Trafalgar GO Station.
Construction is now underway at 610 Chartwell Road and has already secured MMM Group as an anchor tenant. In addition to this, they have recently completed construction at 2476 Argentia Road or “FMC 3” for approximately 100,000 square feet and we have no doubt that it will be successful given its close proximity to the Meadowvale GO Train Station a mere 2 minute walk away.
HOOPP is another landlord that has highlighted GTA transit as a critical success factor for securing tenants in the future and have highlighted their proximity to the Bus Rapid Transit along Eglinton (stretching from Winston Churchill in the west to Renforth in the East) for their office and retail complex at Spectrum Square in the Airport Corporate Centre. They have already secured the Investment Planning Counsel for approx. 50,000 sf.
The promise of the LRT along Hwy 10 is also appealing to tenants who are planning for the future and office developments like the HOOPP complex at 1 and 85 Prologis Blvd. capitalizing on this trend securing tenants like Carters Osh Kosh and the Compass Group. Royal Sun Alliance is another tenant that has recently kick-started a brand new 250,000 sf building with Orlando Corp. on the Hwy 10 corridor, thinking long term about the GTA transit infrastructure.
GTA Transit Case Study: Mississauga Transportation
Mississauga has seen significant growth in around the municipality, with more jobs in the city that available workforce, resulting in people commuting in on a daily basis.
With increasing traffic volumes and congestion, Mississauga is an evolving city with evolving needs. The solution must meet high public expectations.
The City of Mississauga has implemented a strategic plan to create an infrastructure that allows people to get around without an automobile and instead rely on public transit to connect to their destinations.
Areas of focus:
The City will focus on the betterment of public transit in the following areas:
Major transit station areas
Regional Express Rail (Go Transit)
Currently, Go Transit sees peak period service from Mississauga on the Milton/Georgetown line and the 30-minute service on Lakeshore. The City hopes to expand two-way, all-day service with availability as frequent as 15-minute intervals. This ten-year infrastructure plan is expected to be approved by the end of this year.
Light Rapid Transit
With its busy midway terminal and second busiest GO Bus Terminal, The City see opportunity to advance design and funding for Light Rapid Transit improvements. This LRT plan will bring 20 kilometres of transit providing service from Port Credit to Brampton.
This project has already seen the development of a master plan, environmental assessment approval, preliminary design, funding, and technical advisements. Procurement is expected for 2016, with construction to begin in 2018 and completion and service for 2022.