Office Building Signage in the Toronto Office Market
Laymen to the office-leasing business in Toronto sometimes mistakenly assume that a sign on an office building in Toronto is that of the company who also owns the building. To the contrary, in most cases a sign on an office building in Toronto is usually reserved for the major tenants of the building, though there are exceptions. In some other jurisdictions in North America, signage is rented on office buildings separately from the lease of office space within a commercial property as though it is advertising space on a billboard. This is rare in any part of Canada.
Signage is often a major negotiation point in an offer to lease office space. Office tenants that occupy a large proportion of an office building have more clout in a negotiation for a lease on office space. Consequently, the larger the tenant in terms of the amount of square footage of office space occupied within an office building will usually obtain the most favourable provisions with respect to the amount and type of signage the tenant would be allowed to install on the property of the landlord.
Smaller tenants are also allowed signs in office buildings in Toronto, however it is less common for a tenant that is not one of the tenants paying the greatest amount of rent within the building to be granted the right to exclusive building-mounted signs or naming rights to a Toronto office building. Of course there are exceptions since rights to tenant signage is a negotiable item in an office lease and, even though a tenant may not require a great amount of office space in a Toronto building, they may be prepared to compensate a landlord for signage they would not otherwise expect to have based on their size.
Even though a tenant might not occupy a great deal of space within a building it is still customary for an office tenant in a Toronto office building to have some form of signage. They might be provided with a space or spaces on the directory boards at the entrances of the office building or in the front lobby. They might also be provided with directional signage on their floor near the elevator lobby and suite identification. This type of signage is usually defined by the landlord at “building standard” tenant signage and might be an additional charge to the tenant or included in the operating cost of the office building.
An extreme example of the importance of signage for an office tenant in Toronto happened during the height of the “Tec Bubble” at the end of the 1990s. Microforum, was essentially a tec start-up that had raised tens of millions of dollars for a dot-com incubator business. The company had not yet then hired enough employees to fill two floors of office space at 150 Ferrand Drive in Don Mills. Nevertheless, for exclusive building-top signage rights on the office building, Microforum’s executives agreed to lease five floors of office space within the building. Signage was crucial for Microforum to create the impression to customers, employees, and possibly most importantly, to their investors that the business had a dominant position in that market since it was viewed that first movers and existing mass was a competitive advantage in the dot-com business environment.
The right to signage is not all that is negotiable concerning a tenant’s sign in, on or around the office building within which they are leasing office space in the Greater Toronto Area office space market.
The type of the signage the tenant is allowed is defined in the lease agreement, and usually in the offer to lease that precedes the formal lease negotiation. For example, a sign could be on a specific area of the exterior façade of the office building, on a separate structure near the entrance of the building (called a podium), within the lobby of the building on directory board(s) and on the tenant’s floor or at the suite entrance of the tenant’s office premises.
The lease on the office
space leased by a tenant will also stipulate what are the obligations of the tenant. Some typical obligations of the office tenant with respect to their own signage are: to receive the approval of the design and size of a sign by the landlord and any governing authority (municipality or MTO), the cost of fabrication, the cost of installation, the cost of maintenance, the cost of power to the sign (if back-lit), the cost of removal of a sign from the office building and the cost of any damage to the office building caused by the installation and/or removal of the office tenant’s sign.
Some people in and around the office-leasing industry in the Toronto area believe that any signage on a structure detracts from the architectural integrity of its design. Many of the more prominent office developments in Toronto have very little in the way of building-mounted signage, quite possibly due to this reasoning. The Toronto Dominion Centre managed by Cadillac Fairview does not allow any sort of building signage on any of the office towers. Many of the other bank towers in Toronto’s Financial Core do have signs but even those are limited in size relative to the size of the office tower and are reserved only for the bank that is the lead tenant of the office building.
Building-top signs on AAA Class Office Towers in Toronto’s Financial Core are set out on the following table:
Brookfield Place – 161 Bay Street – TD Canada Trust – Oxford
Brookfield Place – 181 Bay Street – None – Brookfield
Scotia Place – 44 King Street West – Scotiabank – Dundee REIT
Royal Bank Plaza – 200 Bay Street (South Tower) – None – Oxford
Commerce Court – 199 Bay Street – CIBC – GWL Realty Advisors
First Canadian Place – 100 King Street West – BMO – Brookfield
Toronto Dominion Centre – 66 Wellington Street West – None – Cadillac Fairview
Toronto Dominion Centre – 77 King Street West – None – Cadillac Fairview
Toronto Dominion Centre – 79 King Street West – None – Cadillac Fairview
In Midtown Toronto, some of the more memorable signs on office buildings are shown on the following table:
Complex – Address – Tenant’s Sign – Landlord
Manulife Centre – 55 Bloor Street West – Manulife – Manulife
Rogers Head Office – 1 Mount Pleasant Road – Rogers – Rogers
Canada Square – 2180 Yonge Street – Canadian Tire – Northam
Yonge-Eglinton Centre – 2200 Yonge Street – RIO CAN – RIO CAN REIT
On the North Yonge Corridor, some to the more memorable signs on office buildings are shown on the following table:
Complex -Address – Tenant’s Sign – Landlord
Proctor & Gamble Building – 4711 Yonge Street – P&G – Menkes
Nestle – 25 Sheppard Avenue West – Nestle – H&R REIT
City Centre – 5140 Yonge Street – Investco – GWL Realty Advisors
Heinz Building – 90 Sheppard Avenue East – Heinz – Crown Realty Partners
Royal Bank Building – 5001 Yonge Street – RBC – Dundee
Empress Walk – 5075 Yonge Street – Scotiabank – Evton Capital Partners
Davpart Building – 4576 Yonge Street – Davpart – Davpart