Passer au contenu principal Passer au pied de page

Kingsett's Jon Love Doesn't Shy Away From CRE's Biggest Challenges

KingSetts Jon Love Hero
Scott Addison with Jon Love

The Canadian commercial property market is facing political, social and economic challenges. For Jon Love, the founder and CEO of KingSett Capital, there is no use sitting around complaining about the problems without also discussing the solutions and generating action.

Scott Addison, Partner, Colliers Strategy & Consulting Group, sat down recently with Jon Love in Toronto to film an episode of Colliers Talks.

Addison and Love covered various challenges in the national market including leadership amid adversity, return to office, project gridlock and political inertia — but they also focused on some of the fixes.

Here are insights straight from Love. This interview has been edited for structure, brevity and clarity.

On why leadership during times of adversity requires a different approach

Leadership in good times is one thing. Leadership in times of adversity requires a pivot. People are anxious; most young people have never navigated a difficult economic environment. Facing adversity requires different skills, focus, communication, transparency and authenticity. During times like these, leaders must lean into setting specific goals and developing a plan of action.

Generally, people are quick to complain and slow to offer solutions. Business leaders must participate by identifying challenges, but also identifying potential solutions. In the absence of offering solutions, it's just a complaining session. It’s also incumbent upon leaders to be vocal with their employees, communities, friends, families, etcetera, because business, too often, is muted in the public domain. Business leaders sometimes don’t want to offend anybody by speaking out on an issue. On the other hand, government and labour always make their views or policies well-known. Business sometimes can do itself a disservice by being silent.

When I’m at a business lunch or something, and people are complaining about an issue, my first reaction is: “What do you think is the solution? And who have you told?”

On strong immigration driving the Canada CRE market forward

Canada has some phenomenal tailwinds going for it, the most dramatic of which is population growth, which is largely driven by new Canadians: immigration. Canada experienced a record population growth last year. More people need more of everything – more places to live, work, shop and recreate. That is a very strong demand driver in every form of real estate and a constructive backdrop. However, if you look at high-density markets, principally Toronto, Vancouver and Montreal, you've got restrictive land use guidelines, which limit supply. As anyone who's been through Business 101 knows, when demand exceeds supply, it's a constructive environment.

On why hybrid office work won’t doom the office market

It's not the return-to-office issue that gives me anxiety. It's actually the change in demand from the technology sector. Because remember, up until two years ago, technology companies were gobbling up everything. Now, technology companies are in retreat.

That said, super core, transit-oriented office locations in the high-density markets will do fine.

Return-to-office will sort itself out. Canada is trailing the rest of the world returning to office largely because we have a less competitive economy. But businesses and CEOs want their people back to the office because they want the connection, the creativity, the culture, the productivity.

It could be three days a week or four days a week. The model could evolve to a Monday to Thursday in-office environment, with Friday being work from anywhere. Whether people use office space four days out of seven, or five days out of seven, it's the same space required, so demand for office doesn't really change.

Young people are the most disadvantaged working from home because they haven't built their toolkit; they haven't got their relationships — and relationships are the currency of business. You can't build, develop and nurture those relationships online.

Here’s an example: Think of your 11 a.m. Zoom call. At 10:59 everybody piles in, you complete the meeting, and then everybody piles out. Whereas if it's in-person, you show up a few minutes early, you socialize, you build a relationship, you make a connection.

Also, If I'm going to an important meeting, I'll bring a junior person with me, and they'll learn something. That doesn’t happen if we’re all at home.

On why city planners and all levels of government could do more to ease land use restrictions and housing tax burdens

If you look at Yonge Street in Toronto, you’ll see all these small shops that are vacant. It's not because of retail reasons; it's because their property taxes have gone up three to five times over the last three years. Small businesses have lost all their ability to make a living.

There's another elephant in the room in Toronto. If you build an apartment building, a third of the cost is due to taxes. While the policy maker might say that affordable housing is important, once you get going, all of the barriers are put in front of you. Parking, for instance, is the most expensive part of an apartment building. If we have a site across from transit, we’re wondering why we would need so much parking. With affordable housing, we think a lot of our customers won't have a car. Various rules and regulations, including parking, in addition to the breathtaking tax load, are frustrating the ability to deliver affordable housing.

So, when your politician says they want affordable housing, just ask them: What are they prepared to do to reduce the tax and development burdens?

If municipal governments were to waive the tax and development charges on affordable and rental housing, you'd get a whole torrent of rental and affordable buildings. It’s pretty simple. If we want affordable housing, give rental and affordable tax exemptions. We've got half a dozen or more sites right now that could be developed as rental or affordable housing if the tax burden was stripped away.

On pushing major public works projects forward quickly and efficiently

Toronto is gridlocked. And the issues we have today: homelessness, public safety, slow public works projects and so on, are all a result of imperfect public policy decisions. The good news is, we can correct all of that with better public policy decisions. But that gives me a level of anxiety because we built a culture in Canada that's really focused on the opposition industrial complex. Any decision any politician wants to make faces a well-funded, well-energized group that opposes. In many cases, politicians will take the easier path, which is more consultation without making a decision.

We have to change the way we deliver public projects. Our public projects, of which there are many around Canada, will go to the lowest bidder, and then there's a fight.

You know, the Ontario Line subway extension in Toronto is actually a four-year project. They're budgeting 12 years to complete, because it will be built using 35-hour work weeks. If we were serious about public transit projects like that, we'd say we need it faster.

Canada’s construction industry is as good as anywhere in the world. We just need to give them permission, and say we need it delivered fast. That would require seven days a week, with two or three shifts to expedite the construction process. We need to give our contractors permission.

To listen to the entire conversation between Jon Love and Scott Addison, access this Colliers Talks episode.  

Pour plus d’informations, veuillez contacter:

Scott Addison

président des Services de courtage | Canada

Toronto West

Scott Addison est président des Services de courtage du Canada chez Colliers International, soit la plus importante société canadienne de services immobiliers commerciaux. Scott travaille dans le domaine du courtage immobilier commercial depuis plus de 30 ans et se passionne pour le leadership de l’industrie et la maximisation du potentiel pour les employés de Colliers, mais aussi pour ses clients. Depuis qu’il s’est joint à l’équipe de gestion de Colliers, Scott a créé une culture distincte de leadership, de collaboration et de service à la clientèle supérieur. 

Nommé au poste de président des services de courtage en octobre 2015, Scott a joué un rôle déterminant dans la croissance organique et stratégique du courtage au Canada. Scott supervise 28 bureaux partout au pays, et motive les équipes à accélérer la réussite et à devenir des chefs de file dans le secteur des services immobiliers au Canada. Engagé à fournir des stratégies et des solutions à valeur ajoutée, Scott se fait le champion de la robuste plate-forme CRM et des solutions de données de Colliers pour fournir aux clients des renseignements commerciaux opportuns.

Voir l'expert