Beyond Proformas is proud to have achieved verifiable social impact as a Certified B Corp and also be recognized internationally for its inclusive business practices. As a valued partner of the Future Real Estate Developers community, we wanted you to be the first to know of our upcoming name change and spin off, as we approach our two year anniversary.
Green Roofs Grow Over Toronto
By Contributing Writer Brian J. Barth
Thanks to a 2010 bylaw, the city’s rooftops are now the lushest in Canada
According to a 2005 report, 21 percent of Toronto’s land area consists of rooftops, a figure which is similar in any other dense metropolitan area. For the most part, rooftops throughout human history have served a single purpose: to protect the structure from the elements. But as urban land grows increasingly invaluable, and the negative impacts of the built environment on both people and the planet are more widely understood, planners, designers, homeowners, developers, and city builders of all stripes are looking to get more value from this underutilized space covering a fifth of the urban environment.
Roofing materials are traditionally dark in color, which absorbs sunlight throughout the day and radiates it at night, leading to the “heat island” effect—where urban areas are several degrees warmer than surrounding rural areas. This causes cooling systems to work harder, thus consuming more electricity, which not only contributes extra greenhouse gases to the atmosphere, but inflates the hydro bill.
Another problem: rooftops, by definition, are impermeable. This is necessary for keeping the elements out, but it means that rainfall, rather than soaking gently into the ground, rushes off in stormwater drains, causing massive erosion in urban waterways and increasing the likelihood of flooding during high rainfall events. Roof water runoff can also pick up contaminants (sometimes from the roof, but mostly in situations where it runs across paved surfaces on its way to a storm drain), further degrading urban stream quality.
All of which has led to the growth of green, or “living,” roofs in recent years as a remedy for the problems associated with conventional roofing materials. The idea is to cover the roof structure with a waterproof membrane (basically a pond liner), add a shallow layer of growing medium, and plant the space with tough, resilient species that can hold up to the hot, windy conditions found on most rooftops.
These aerial gardens become oases for birds and native insects, helping to offset the biodiversity lost to urban development. The soil and plants shield the structure from the sun and act as a layer of insulation, cutting down on hydro costs in both summer and winter, and reducing the urban temperatures by roughly 2 degrees Celsius. When torrential rains come, the garden acts as a sponge, soaking up the water much like the natural environment does and preventing excessive runoff.
Green Roofs in Toronto
In 2010, Toronto became the first city in North America to pass a green roof bylaw, a move emulated by San Francisco in 2016. Many municipalities around the world have developed incentive programs for green roofs, as well. Within five years of passing the bylaw, more than 300 new green roofs with a total area greater than 250,000 square metres have been built, placing the city second in North America for green roof coverage.
Washington, D.C., first on the list, has nearly three times the green roof space of Toronto, largely as a result of a rebate on stormwater fees, which ranges from $7 to $15 per square foot of green roof, among other incentives. City leaders have set a goal of installing green roofs on 20 percent of D.C. buildings by 2020.
The Toronto bylaw requires green roofs on new construction (whether residential, commercial, or industrial) above 2000 square metres in gross floor area, though any residential building less than six stories in height is exempt. The green roof requirement starts at 20 percent of the “available roof space”—defined as the total roof area minus areas covered by renewable energy installations, as well as a small exemption for outdoor amenity space—on smaller buildings and goes up to 60 percent on structures with a gross floor area of 20,000 square metres or greater. Reductions to the required green roof size are granted on a case-by-case basis, with a $200 per square meter cash-in-lieu payment.
Owners of buildings that are exempt from Toronto’s green roof bylaw—existing structures and new construction under 2000 square metres in gross floor area—are eligible for incentives to add a green roof in the form of a grant calculated at $100 per square metre.
Green roofs are typically hidden from view at street level, but Toronto’s skyline has grown quite lush from a bird’s eye view. The city maintains a list of some of the more notable green roofs in the city, including publicly accessible locations like the 4,000 square metre installation on the podium roof at city hall.
Green roofs are great for the birds and bees, but civic leaders in Toronto and elsewhere have financial rewards in mind, as well. Toronto’s 2005 report found that if 75 percent of rooftops that were suitable for a green roof were converted, an area equivalent to roughly 5000 hectares, a staggering number of economic benefits would accrue:
· Erosion control savings worth $25 million
· Pollution control cost avoidance worth $14 million
· Three additional "beach open" days per year worth $750,000
· Total infrastructure savings worth up to $79 million
· Total energy savings of $181 million per year
Green Roof Design Options
Green roofs fall into two broad categories: intensive and extensive.
Extensive installations are typically larger and cheaper per square metre. The growing medium is shallow (5 to 10 centimetres) and supports a limited palette of plants, typically small succulents and hardy grasses that can survive with little soil or irrigation. Extensive green roofs are often light enough to install on top of conventional roof assemblies.
Intensive roofs are characterized by a deeper growing medium (anywhere from 10 to 100 centimetres) and often require structural upgrades to support the additional weight. They are more common where the roof is accessible and intended as a beautiful outdoor amenity. Intensive roofs can support landscaping similar to ground level plantings, including small trees for shade, shrubbery for wind protection and privacy, and flower beds for seasonal interest; and they are often enhanced with benches, pergolas, outdoor kitchens and other features. Rooftop food gardens, such as the one atop Toronto’s 401 Richmond St. building, are an increasingly popular variation on green roof theme.
Many people dream of revitalizing a community with a new state of the art real estate development. They picture themselves building the perfect solution to the Cities' problems. Creating the right balance of design, quality, and utility. The hard truth is most of us just are not ready to lead a real estate development ... yet.
I recently attended a master class in film-making held by acclaimed directors, and producers Sudz Sutherland & Jennifer Holness, founders of Hungry Eyes Entertainment. They said most aspiring filmmakers fail to launch because they focus on big feature film-making. They dream of having their art on the big screen, viewed by millions of adoring fans.
But have they honed their screenwriting craft? Dealt with logistics? Built a loyal following? Tried different filming techniques? The best route to taking on a big feature film, is to first practice your art with short films. The short film process allows you space to build your team, explore various techniques, and learn by trail and error.
Dreaming of building the perfect development in your first project can expose you to years of investment in time and millions of dollars being put at risk (investors plus your personal stake). Just like a short film project, in real estate development, you can seek to hone your skills by first building a smaller project. Learning which bankers, brokers, architects, and other professionals you can work with best. Eventually earning credibility with the local community.
Back when Bill Gates used to be involved in hiring software programmers at Microsoft, he’d give applicants a programming task involving troubleshooting. The purpose was not to test high technical proficiency or programming brilliance, but to test to see who would persevere through hours of tedious troubleshooting. Bill hired only those that finished what they began.
In looking for strong real estate development professionals, we like to see people that have chosen a tough extracurricular activity or pursued a challenging certification and stuck with it for many years. If you scored in the top percentile of a GMAT test and won a bronze medal at an elite soccer tournament; those outcomes alone are not great predictors that you are brilliant and will be a strong team player for a firm. However, if those outcomes were the result of you retaking the GMAT four times over two years and training three off-seasons at soccer camps, that tenacity is a far better predictor that you will be a very valuable addition to a development team.
In the long run, perseverance, combined with passion will take you to new heights in real estate development. Behind the pretty artist renderings of grandiose developments, there is the stark reality of constant adversity faced to bring them to life. Real estate is a cyclical industry where supply cannot change quickly. When market demand turns, there are no quick exits for property development. Development also includes a lot of incredibly tedious tasks, from reading through hundreds of pages of lease documents to deciphering incomprehensible zoning regulations. It tests the tenacity of many high performing professionals to see their years of careful proforma modelling and creating gantt schedule charts being decimated by an unforeseen materials shortage or flood.
Despite the thousands of books and talk shows that may lead you to think passion is the only thing you need, a much better predictor of success in this field is perseverance combined with passion. I highly recommend you read Angela Duckworth’s book “Grit, The power of passion and perseverance”, to learn about her landmark scientific research confirming the importance of perseverance in achieving long term success in a variety of fields. Learning to grind and strive for change will easily surpass passion alone.
He’s professional and prepared. Sitting with his leatherbound notebook and sharp suit, he tells me he has researched on-line and on the Toronto Stock Exchange (TSX), all the major real estate developers in Canada to find out who was hiring. I knew right away, he had only seen the tip of the iceberg of opportunities. Unfortunately, he like many other young professionals have missed over 90% of the real estate employers in just the Toronto development community. I knew this because, there are over 800 developers in the Toronto area alone. I will show you how this young professional’s job searches missed so many companies. Then I will point out some tips on how you can best connect with these firms for job opportunities.
The challenge in finding info on real estate development firms, is that many of them are not well known. Although they create millions of jobs and invest billions into projects across Canada; commercial developers generally market to large companies not to the general public. The public only sees the iceberg tip of real estate employers. While just below the surface there are over 1800 real estate firm offices in Canada.
Scanning publicly traded real estate companies does not give a complete picture of the number of real estate development firms in Canada either. Most developers don’t often seek stock exchange listings, because they need more patient capital sources. Before, you run to google, you will find that many commercial developers’ websites are focused on projects and provide only sales personnel contacts.
I recently sat down with J Anderson Winton, a highly respected former executive recruiter, specializing in the real estate industry. He has placed ‘C’ level real estate executives across Canada and the U.S. over several decades and has a firm grasp on the depth and breadth of developers across the country. He has stepped back from the recruiting business, but to help others make contacts in the industry, he has created a directory of real estate executives (www.realestateexecutives.ca). His directory database is updated regularly with over 5,900 contacts; Presidents, Vice Presidents, Partners, and other executives developing and managing Office, Industrial, and Shopping Centre portfolios across Canada.
Now that you have a source, what should you do with that information? There are many paths to job search success, but I will tell you what you don’t do. Don’t jump to cold call companies you have not researched. Don’t send out a generic resume to a 100 companies, hoping they guess what position you are interested in. Those are job search strategies that generally fast track your resume to the delete file.
Many firms’ development portfolios are organized around asset classes and/or geography. Start by deciding where your skills and interests can contribute the most to a prospective employer. For example if you went to University on the East coast but are settling in Toronto to start your career, look for firms based in Toronto, with East coast projects. Do your research and prepare to impress them with your curiosity and knowledge of their development goals.
Real estate development firms are not easily found on the internet or the TSX stock exchange listing. This breed of entrepreneurs can be found in thousands of companies across Canada. If you wish to see the complete iceberg, start with broadest list you can find and select target firms that have a good fit for your experience.
Calgary’s East Village development is progressing in the face of the challenged Alberta economy. A former industrial and derelict area has been the focus of an ambitious commercial development. After perusing through the condo sales centre to see what pricing and quality was like in the area (prices = $500 - $550 psf and quality = moderate), I stopped by Charbar for lunch. You walk into the historic Simmons Bedding Company space, which has been beautifully restored to house an alluring trinity of food concepts.
Once I entered the historic building, I was first hit with comforting aroma of Phil and Sebastian coffee roasters. Their expert Baristas working away across from a vintage coffee roaster. Up next, I smell the fresh baked artisan bread from Sidewalk Citizen Bakery. But, the main event is Charbar, with their Argentinian style, melt in your mouth meats roasted over a special grill. The lucky new condo dwellers of East Village will sleep well steps from some of Calgary’s freshest food.
There was a smart guy I met through a professional real estate association. Let’s call him Dan. Dan is a very likeable young professional who travels, teaches, and is a real estate tax expert. He has such a strong grasp of the municipal tax code that he helps his employer deal with complicated tax issues for large real estate assets. He asked me one day for advice on figuring out why he was not getting ahead in his career. There are a number factors to consider, but I told him it is good to keep in mind that even great virtues, when taken to extremes can hold back your career progress. Here are three characteristics of a great employee like Dan, that when taken to extreme, can hurt their chances of promotion.
You are the irreplaceable expert.
You know your area of expertise better than anyone in your department. You have published articles, taken professional courses, and worked extensively in your field. How can this be a bad thing? If you think about it, being irreplaceable is by definition a good reason to keep you in the same role. If your boss cannot live without you and there is no one else in your organization that could succeed you in your role, you have become your own road block to getting ahead. So start planning for your succession. Is there someone internally you can develop? Is your company willing to start an internship program? It is risky, planning to put yourself out of a job, so you have to be strategic. However, there is more risk waiting around hoping someone hands you a promotion and figures out your succession plan for you.
You are very detail oriented
This is somewhat related to the expertise quality. You know the inner details of one narrow area of your organization. Mastery of those details makes you a great employee. However, if you want to be a leader, don’t you have to understand the big picture? How well do you know the business model of your organization? How does it grow its client base? How does it mitigate risk? Look for ways your area of expertise can contribute to the big picture of the organization. Are there ways you can get on a cross functional committee made up of finance, legal, or project management? From this platform you can start to gain credibility in tackling business problems broader than just your area of expertise.
You get along with everybody
The other myth is that being Mr. or Mrs. Congeniality is the only ticket to a promotion. The employee who never has a bad thing to say about anyone or any project. This is an admirable quality, but if you take it to the extreme end of the spectrum, then no one needs your point of view. Why would senior leaders in your organization come to you for insight or feedback, if all they are going to get sunshine and rainbow responses. Give great, constructive feedback when asked. Point out how one real estate acquisition may be higher priority than another based on your experience. You may not have the full picture of all the considerations being weighed, but at least your leaders know they can depend on you for an insightful perspective. They will respect the fact that you are willing to hunt down a solution, which may not make you the most friends, but will benefit the overall company.
…And the new employee of the year award goes to the Dan! The irreplaceable, smartest, and most liked employee in the firm. I would genuinely encourage Dan to show his appreciation and grab that award. It’s a good thing. Just as long as he had a plan to make sure the award is not an anchor.