The Globe and Mail - 25.11.2019

To make arrangements for a Report on Business Appointment Notice,

please [email protected] call:(416) 585-5111 • 1-800-387-9012

WeeklyAppointmentReview

The following appointments have been announced by companies and

organizations during the past week

All Globe and Mail appointment notices are archived and available

online at http://www.globeandmail.com/appointments

Mélanie Dunn

toBoardofDirectors

Cascades

Nelson Gentiletti

toBoardofDirectors

Cascades

Elif Lévesque

toBoardofDirectors

Cascades

Carrie Russell

toPresidentand

GeneralManager

Equifax Canada

MONDAY,NOVEMBER25,2019 | THEGLOBEANDMAIL O REPORTONBUSINESS| B3

Canadian developers are making record in-

vestments in new high-rise developments

while turning away from detached homes, a

shift that is not exclusive to larger markets

where affordability concerns have persisted

for years.

Over the last year, a monthly average of

$2.9-billion has been invested in new con-

struction of multiple-unit dwell-

ings, according to Statistics Can-

ada data. That is the highest in

comparable data since 2010. The

apartment segment – which in-

cludes both purpose-built rental

units and condominiums – ac-

counts for the majority of invest-

ment.

By comparison, a monthly av-

erage of $1.9-billion has been

spent on the construction of new

single-unit dwellings, which in-

clude detached homes and cot-

tages. The result is an ever-wid-

ening gap in favour of high-rise

buildings that reflects a move to-

ward comparatively cheaper liv-

ing arrangements, whether for

renting or ownership.

“It’s basically millennials, mi-

grants and baby boomers look-

ing for the last affordable piece

of housing,” said Priscilla Thiagamoorthy,

economist at Bank of Montreal, in explaining

why developers have embraced multiunit con-

struction.

Over the 12 month period ending with Sep-

tember, British Columbia saw $9.9-billion in-

vested in new multiunit construction, com-

pared with $4.4-billion for single-unit dwell-

ings, the largest gap among the provinces.

(Statscan figures for new construction invest-

ment are not adjusted for seasonality or in-

flation.) Next highest is Quebec, with a $4.4-

billion gap in favour of multiunit housing.

At the metro level, Toronto and Vancouver

have seen billions invested in high-rise living

options in recent years. This is hardly surpris-

ing given how expensive detached homes re-

main in both regions, despite a recent patch of

instability, along with a need for more apart-

ment buildings. However, it’s not just Cana-

da’s priciest markets that are building vertical-

ly.

In Halifax, $494-million has been invested

in new multiunit construction over the past

year, which is roughly double of what was in-

vested in detached homes. In 2010, single

units had an $80-million advantage.

An abrupt shift has occurred in the Niagara

region. In 2016, about $460-million was invest-

ed in building detached homes, or nearly tri-

ple the multiunit segment. Over the past 12

months, multiunit dwellings have a $50-mil-

lion advantage, with strength in both apart-

ments and row houses.

Similar reversals are found across the coun-

try, including in the metro areas

of Calgary, Winnipeg, Barrie and

Guelph in Ontario, and Abbots-

ford-Mission and Kelowna in B.C.

Statscan’s investment data do

not say whether multiunit in-

vestment is being driven by the

rental or ownership markets.

However, there are clear signs of

mounting interest in purpose-

built rental construction. For

one, there were nearly 50,000

rental-unit starts in 2018, or close

to double the previous 10-year

average, according to the Canada

Mortgage and Housing Corp.

Given low vacancies and rising

rents in many markets, rental

buildings have become an in-

creasingly popular asset class. In-

vestors spent a record $8.38-bil-

lion buying Canadian apartment

buildings in 2018, according to a

report from commercial real estate firm CBRE

Canada. Throughout the first half of 2019, an-

other $4-billion was spent.

Investment in detached homes is not en-

tirely dead, however. Total investment in sin-

gle-unit buildings – which, in addition to new

construction, includes renovations and con-

versions – was $5.4-billion in September on a

seasonally adjusted basis, or slightly higher

than for multiunit buildings. (Detached

homes attract considerably more money for

renovations.)

However, what was a $2-billion gap only

four years ago has entirely closed, as devel-

opers have shifted their spending, and the ap-

petite for multiunit housing shows little sign

of abating. “I think it will be pretty entrenched

for a while,” Ms. Thiagamoorthy said.

AccordingtoStatscandata,BritishColumbiasaw$9.9-billioninvestedinnewmultiunitconstruction

overa12monthperiod,comparedwith$4.4-billionforsingle-unitdwellings.

BAYNESTANLEY/THECANADIANPRESS

Developersarethrowing

cashatnewhigh-risesin

growingrangeofmarkets

Datasuggestthatdisparity

betweenmultiunit,single-unit

investmenthaswidened

MATTLUNDYECONOMICSREPORTER

Given low vacancies

and rising rents

in many markets,

rental buildings

have become

an increasingly

popular asset class.

Investors spent a

record $8.38-billion

buyingCanadian

apartment buildings

in 2018, according

to a report from

commercial real

estate firmCBRE

Canada.

SoftBank Group Corp.will this
week launch a previously agreed
tender offer for as much as US$3-
billion of WeWork shares, includ-
ing up to US$970-million owned
by the office-sharing company’s
co-founder, Adam Neumann, two
people familiar with the matter
said.
The tender offer to the foun-
ders, investors and employees
owning stock was expected to
launch earlier this month but was
delayed after SoftBank sought
technical revisions to the offer
documents, according to the
sources.
It will go ahead based on the
previously announced terms at
US$19.19 a WeWork share as soon
as Monday, these people said.
Last Thursday, Bloomberg re-
ported that executives at Soft-
Bank, the giant Japanese technol-
ogy investment company, had
been looking for a way to reduce
the size of the offer, including lim-
iting the amount paid to Mr. Neu-
mann. The report said that some
SoftBank executives felt the
payout to Mr. Neumann was too
generous.
The people familiar with the
matter said there was no discus-
sion between WeWork and Soft-
Bank about changing the terms of
the offer, which one of the sourc-
es said could have opened Soft-
Bank up to lawsuits from Mr. Neu-
mann and others.
Spokespeople at SoftBank and
at WeWork both declined to com-
ment.
The offer is a crucial part of
SoftBank’s US$9.5-billion rescue
of WeWork agreed to in October.
SoftBank is also providing
US$6.5-billion in debt and equity
financing to the company, which
has been suffering huge losses
and was fast running out of cash.
It paves the way for SoftBank to
control about 80 per cent of We-
Work and is part of an agreement
with Mr. Neumann that will see
him give up voting control of the
company and leave the board.
In addition to the money Mr.

Neumann will get from selling his

shares, SoftBank has given him a

US$500-million line of credit to

help repay his bank loans and a

US$185-million advisory fee as

part of the original deal.

Mr. Neumann has already

drawn about US$400-million of

the credit line, according to the

sources, and is obligated under

the terms of the agreement to use

any proceeds he receives from the

tender offer to repay SoftBank.

WeWork said on Thursday it is

laying off about 2,400 employees

globally as it seeks to drastically

cut costs and stabilize its business

after its dramatic fall from grace.

The company had 12,500 employ-

ees on June 30, and there are oth-

ers who work for affiliates.

After being valued at US$47-

billion in January and planning

an initial public offering (IPO),

WeWork quickly became a com-

pany that was facing a cash

crunch and fighting for survival. It

shelved its plans for the IPO on

Sept. 30 because investors were

wary of its growing losses, its

business model and its corporate

governance. Mr. Neumann had

resigned as chief executive the

previous week.

Marcelo Claure, the new exec-

utive chairman of WeWork’s par-

ent, The We Company, told We-

Work employees last month he

had “no idea” how many shares

Mr. Neumann was going to sell in

the tender.

Mr. Neumann has more than a

20 per cent stake in WeWork but

his real power came from super-

voting stock that gave him con-

trol. His ability to use supervoting

stock will disappear as part of the

deal with SoftBank.

The size of Mr. Neumann’s po-

tential payout at a time when the

company is firing workers led U.S.

Senator Elizabeth Warren, who is

among the contenders seeking

the Democratic presidential

nomination in 2020, to tweet on

Friday that “this is another exam-

ple of a rigged and corrupt sys-

tem.”

A spokeswoman for Mr. Neu-

mann declined to comment.

REUTERS

SoftBanktomoveahead

withupto$3-billionWeWork

stocktenderofferthisweek

GREGROUMELIOTISNEWYORK
ANIRBANSENBANGALORE

AdamNeumann,seeninNewYorklastyear,resignedasCEOofWeWork
before the company decided to cancel its initial public offering in
September.MARK LENNIHAN/ASSOCIATEDPRESS

Former Desjardins Group presi-
dent Claude Béland has died at
the age of 87, the Quebec-based
financial institution confirmed
Sunday.
Mr. Béland was elected to the
head of Desjardins in 1987 and
was twice re-elected before retir-
ing from the job in 2000.
The company says his accom-
plishments include profoundly
transforming the credit union in
his 13 years at the helm, oversee-
ing its entry into the securities
field and expanding the installa-
tion of automated tellers, in-
branch insurance sales and its Ac-
cèsD website.
In a statement, the company
described Mr. Béland as a “hu-
manist and philosopher,” whose
influence extended far beyond
the world of finance.
“Quebec is losing a great man,
who was an ardent promoter of
co-operative values,” Desjardins
Group president Guy Cormier
said in a statement.
“Although he was occasionally
critical of Desjardins, at the same
time, it was a testament to his
deep attachment to this co-oper-
ative institution, whose presiden-
cy he assumed at a pivotal mo-
ment in his history.”
Mr. Béland was born in Mon-
treal in 1932 and began his career
in law, where he specialized in co-

operative enterprises before join-

ing the financial sector.

He authored several books and

lectured at universities, and re-

mained involved in Quebec pub-

lic life until his death, serving on

committees studying electoral re-

form and financial regulation.

In recent years, he accused his

former employer of having be-

trayed its social mission and hav-

ing transformed its members into

clients. He was especially critical

of the company’s decision to

withdraw ATMs from rural areas,

and for last year’s breach of mil-

lions of members’ personal data –

including his own.

Mr. Béland was named a Grand

Officer of the Order of Quebec in

2014 for his service to the prov-

ince and his involvement in nu-

merous organizations.

A number of public figures, in-

cluding Quebec Premier François

Legault and Prime Minister Justin

Trudeau, took to social media to

express sadness at Mr. Béland’s

death.

“Claude Béland was a great

man, who helped build Quebec

into what it is today,” Mr. Trudeau

wrote on Twitter. “Our thoughts

go out to his family and loved

ones.”

Mr. Legault praised Mr. Béland

for his social involvement, which

he said helped to advance Que-

bec.

THECANADIANPRESS

FormerDesjardinsGroup

presidentBélanddiesat87

MONTREAL