London Inc. Weekly

Weekly Regional Business Intelligence

Written by Kieran Delamont, Associate Editor, London Inc.

Sifton project approved for office conversion funding

The city has awarded another major grant for an office-to-residential conversion project, paying Sifton nearly $3.3 million towards its conversion project at 195 Dufferin Avenue (pictured), which will convert the former office building into 94 residential units in a joint project with Homes Unlimited and the Anglican Diocese. It’s the second such grant that has been awarded in the city, with the first going to the Maas Group’s project to convert the former Rexall Building at Dundas and Richmond. (It’s also much larger; the first project received $415,000.) “We are pleased to be one of the first to receive funding under the Office to Residential CIP incentive program," said Richard Sifton, president and CEO of Sifton Properties. “This contribution from the City of London will be applied to the renovation costs to make the project successful. It will bring much-needed residential units to our core, while also reducing the amount of office space.”

The upshot: It’s nice to see additional uptake on this program, which has been slow to attract applications (which is not in itself surprising ―office-to-residential conversions are proving trickier than first thought.) There had been some concern within city hall the the homebuilding community that the grants weren’t doing enough to actually attract builders to these technical conversions, and last week the mayor had to defend the program because of slow uptake. One more major project doesn’t wipe away all those concerns, but it does indicate that developers haven’t completely passed on conversion projects. I’m incredibly pleased to see another successful applicant in this program,” Mayor Josh Morgan said in a statement. “We’re thrilled with the level of community interest and remain committed to filling vacant buildings in the downtown and supporting the construction of affordable homes for Londoners.”

Read more: City of London | London Free Press

VW: PowerCo plant remains a go despite big layoffs and plant closures in Europe

The Volkswagen-backed PowerCo battery cell gigaplant in St. Thomas remains on track to open in 2027, despite the automaker making deep cuts in Europe. On Monday, the auto giant announced it was shuttering at least three factories in Germany, cutting tens of thousands of jobs and slashing pay by 10 per cent ― a move that is almost sure to prompt intense strife with Germany’s powerful autoworker union. But in St. Thomas, things are still peachy, the company said. “We continue to aim for the first cells in 2027,” PowerCo spokesperson Jeffrey Lewis told The London Free Press. “We recently surpassed 100 employees and remain in hiring mode.” It’s not the first time questions have been raised about the future of the project, seen as a flagship part of Ontario’s EV strategy. In August, as hiccups appeared in a sluggish EV market, the company had to publicly confirm that the plant was still going ahead. For now, 2027 remains the target date in the calendar ― though as Brendan Sweeney, director of the Trillium Network for advanced manufacturing said in August, “if it got pushed back to 2028 it wouldn’t be a huge shock.”

The upshot: VW’s confirmation of the plant’s future should offer some comfort, but the fact remains that the North American EV market is in a troublesome spot. Western automakers are getting smoked on price and quality right now by Chinese automakers (a point made abundantly clear this week when Ford’s CEO revealed he drives a Chinese EV and loves it), and the response from policymakers has mainly been to slap protectionist tariffs on them, not incentivize more affordable vehicles. “If sticker prices don’t come down substantially from today’s make-and-model distorted highs in North America, only those with deep pockets will be able to afford them tomorrow,” said Scotiabank analysts Rebekah Young and John Fanjoy. “Regional automakers must see the writing on the wall and evolve their offerings across the price spectrum.” What does it all mean for the future of the St. Thomas battery plant? Well, if automakers do pivot to more affordable EVs, those vehicles will need batteries. But if the EV market continues to stumble, it’s conceivable the plant may face some hurdles.

Read more: London Free Press | Financial Times

Downtown loses another restaurant to the burb’s

Massey’s Fine Indian Cuisine is leaving downtown after two decades, citing persistent safety issues and repeated break-ins, owners said. The restaurant is headed west, out to 2130 Kains Road in RiverBend. “I think safety was the number one thing that prevented people from coming [downtown],” Anisha Massey, who runs the restaurant with her husband, Patson, told The London Free Press. “Who wants to dine in a place with bars on the windows? We didn’t feel safe ourselves, so how can we make the customer feel safe?” The new restaurant is scheduled to open at the end of November.

The upshot: Massey’s has been a long-time staple downtown (the lunch buffet was always great!), and watching social issues downtown force another business out is a tough pill to swallow, and once again highlights the glacial progress on the safety and security front. (Though, to be reasonable here, the reduction in core office workers post pandemic is almost certainly playing a part, too.) The silver lining? Massey seems excited at the prospect of reinventing the business in the west end, which is becoming an increasingly popular spot for transplanted downtown restaurants, and which now has more than enough population to sustain them. “This location will be more than just bricks and mortar,” Massey said. “People will have something new to come back to, so it’s not the same old menu sitting there. We’re going to work more on presentation this time.”

Read more: London Free Press

Cuts looming at Fanshawe as school juggles international student cap

Fanshawe College president Peter Devlin is estimating that the school will see 5,000 fewer international students next year and suggested the school may see cuts to program offerings and operating budgets as a result. “While domestic enrolment remains strong, this anticipated decline in international students will significantly impact our budget in the coming years,” Devlin said in an email to staff, obtained by CBC News London. “In the short term, the reduction in international enrolment will result in fewer program sections being offered in the upcoming semesters.” Devlin also revealed that an outside consulting firm, StrategyCorp, has been hired to independently review Fanshawe College’s operations. What potential cuts might be made is unclear at this point. “We will not be making any official statements until we have a clearer understanding of the impact,” a school spokesperson said.

The upshot: Whatever your opinion is of it, the international student strategy pursued by Ontario’s colleges and universities has now backed them into a financial corner. The Council of Ontario Universities estimates financial losses total “more than $300 million,” for 2024-25, doubling to more than $600 million in the following year. They are increasingly at odds with provincial funding partners, which are now looking to plug the gap, but which had likely grown accustomed to schools being able to achieve financial stability, in the opinion of one government report, “only because of international students.” It’s not a good situation for anybody right now, not least of which for the international students dealing with the limited allocation of spots, nor the faculty who might be on the chopping block if the school has to start cutting programs.

Read more: CBC News London | London Free Press

Two legal veterans to launch mediation business

Two longtime London lawyers are launching a new mediation business, hoping it will help ease the backlogs in the court system. Michael Lerner, partner at Lerners LLP (he is retiring from the firm on December 31), and David MacKenzie of David A. MacKenzie Law (pictured), are planning to launch Lerner MacKenzie Mediation in January. “Lawyers have been looking for alternate means to resolve disputes. Mediation is, quite frankly, the fastest and the cheapest,” Lerner told The London Free Press. “A lot of times matters are capable of being settled, but it takes the courtroom door to make people compromise,” added MacKenzie. “It really shouldn’t be that way.” According to the pair, the new company will handle a wide range of cases, with the main exception being family law issues, which they say are best left to mediators with experience in that field.

The upshot: There’s no doubt that court backlogs are a major issue for Ontario’s legal system. “The system is not working well, said mediator Avril Hasselfield, partner at Results Mediators. Earlier this year, the provincial government announced a $29 million investment to try to speed up the system, but many believe this is basically a drop in the bucket. “The failure of courts to give people who are involved in litigation a speedy trial is really egregious,” Lerner said. “If you were to come into my office today … my reasonable expectation is that you’ll see the inside of a courtroom some time in 2029.” There’s growing support for mediation as a way to ease some of this pressure. “For most cases, no matter if it is insurance, employment or securities, mediation makes perfect sense,” Hasselfield said. For Lerner, it will be a big change after nearly 50 years at Lerners LLP. “I’m looking forward to it,” he said. “It’s a new adventure.”