New condo towers are rising each day across Toronto. With every project that breaks ground, developments play a role in creating and establishing parts of the city, whether it’s through new master-plans, distinct architecture or expanding an up-and-coming neighbourhood.
Over the past few years, Toronto has become home to iconic communities that emerged as a result of new condo development, from the Distillery District to Liberty Village. Simon S. Mass and John Mehlenbacher, CEO and COO of The Condo Store (TCS), came together to talk more about the condo projects that have defined and reinvented Toronto over the years.
This Q&A marks one in a series of three interviews — Conversations with The Condo Store — between Mehlenbacher and Mass that will discuss Toronto’s new construction industry. In future conversations, the two real estate experts will talk about successful investment strategies that have worked in tough economic situations, and advice for newer pre-construction investors.
John Mehlenbacher: There is no responsibility per se for a developer to add to the local area with respect to leaving a mark whether through architecture or design. However, the majority of the developers do think this way, and are interested in making a mark and leaving a lasting impact. We like to talk to clients as human beings, not as numbers buying real estate. When any business — but specifically a developer — thinks this way, I believe it adds to their ability to create something meaningful and not just build condos.
Due to the explosive growth seen in the city of Toronto and outlying areas, it would be easy for developers to think that it doesn’t matter what this one particular building looks like, or how it meshes with the surroundings and culture of where it’s being built. But when that does happen and then growth occurs around it, you get a rich tapestry of architecture and design that pushes the next project to be better and hopefully that mentality continues until you have this dynamic city or area with creative design and function. Instead, the individual projects don’t stand alone, but rather are immersed in this great sense of community all around.
Simon S. Mass: It’s the creativity and functionality that sets projects apart and hopefully keeps developers pushing the boundaries of what is possible.
You can’t substitute location as a key factor, but once that is solved for a consumer, there are so many options for an investor or end-user in terms of entertainment, style and design. The ability to be part of a community are the important considerations for condo projects to examine.
SM: Concord CityPlace comes to mind. With its location so central and top-of-mind to not only Torontonians, but visitors to the city and those that travel into Toronto daily, everyone notices the community, and because of that, it has to be near the top of city-defining projects. Plus, just the scale of it as the biggest in Canada, it has to be mentioned.
JM: Ten years ago, you would definitely talk about the Distillery District as one of those top projects and areas. It still is a tremendous endeavour that was incredible to watch come to fruition over many years and really settle into a mature neighbourhood, not by the standards of other areas of Toronto, but in terms of its own growth and ability to create its spot at the table of great Toronto neighbourhoods. However, as time goes on, I think that Liberty Village is an incredible success story and set the bar so high for new communities and gentrification projects. What has been done in that area is wonderful to see, to watch it grow and thrive with over 20-plus towers there now and the emergence of its own micro-economy. It’s a great story.
Concord CityPlace was an amazing project that just keeps going and really does answer the question of being a city-defining project. This is not a knock, but it really is the [future] of the city with so much visibility, and was the base for what grew next and all the growth to come. I was thrilled to be a part of that project many years ago, and am proud of what it has meant for the city, its skyline and the community.
SM: Like every business, we weren’t sure how things were going to go, and we ended up seeing some developers push forward and some hang back and wait when the pandemic started.
181 East is an amazing project in an amazing location, so that helped things as we decided how to move forward, but you are right in thinking that we weren’t sure the same old process would work in the summer of 2020. So, we brought in the big guns to really allow us to have a great conversation about the project and try to allow people to talk about themselves living in the great Willowdale community, as opposed to talking about lockdowns and case counts.
Russell Peters was a dream to work with, not only from the standpoint of him being a tremendous ambassador for our city and region, but because he is a big fan of real estate. Our launch video with Russell was fun to make and was intended to get people smiling and thinking about the project and what was to come after we got past the worst of the pandemic. In fact, working with Russell on that project was so great, we have more plans for that in the near future, so stay tuned!
JM: 181 East is in a tremendous location on Sheppard Avenue East. Our clients were extremely receptive to the project and that’s how we know that we have a winner.
Our client base is made up of so many diverse-thinking people, that when the projects we talk about are big hits across the board to all different types of investors and people, then you know you have a great project. I think the mid-rise format with the views south to the downtown core are a delight, and we know the area of Willowdale is very sought-after.
SM: The GTA’s growth includes the 905, and its strength is important for overall growth and to really help push Toronto to world-class status in terms of size and desirability. The value in the suburbs is shrinking in general I’d say, but again, it’s important for the consumers and people coming to live here to have options.
I think one of the interesting things to come from the pandemic with respect to real estate was everyone talked about the exodus and that was short-lived. Really what we are seeing is the value and desire to have a great place to live. That can certainly be in the city, but it can also be in an outlying area. That is where the market has settled with respect to exodus or city living and the pull between the two. It’s not a trade-off as people made it out to be — it’s more about having a great place to live for your certain lifestyle and situation. There is a reason people love living in the city and that will continue into the future.
JM: Waterside Villas is a great example of that. It was sold out pre-pandemic, but you’ve seen the value of those homes increase tremendously. The biggest trend for the outlying areas is access to transit, and as the province and various governments make transit a bigger priority, this trend will continue for a very long time. It goes to what Simon said earlier — these are all important cogs in the growth of the GTA into its proper place as a world-class destination and metropolis.
JM: The Junction, the Stockyards District and that whole area will become the next Liberty Village and Distillery District with its own ecosystem and economy, and more importantly, its own vibe and sense of community. Expansion has already started in those areas, including the Main and Danforth location, but will just continue to grow as the people flock and the economy stabilizes itself to the community.
SM: A good portion of TCS’s history — and our client’s portfolios — is built by these types of projects and neighbourhoods. It makes sense as the people who bought in at the early stages either reaped or are still reaping the benefits of being an early adopter and getting units at the lowest possible price and watching as the area grew around their investment.
The Junction area has huge potential to become like Liberty Village, and we will continue to watch and look for projects in that area, as it is a keen area for our clients and any consumer that is in it for the long-term.
SM: Artistry is a great example of the age-old real estate mantra of location being paramount to a building’s success.
The amount of creativity going into buildings like this is amazing to witness, and the fact that all these developers are competing for uniqueness is only helping to drive the evolution of the downtown core’s living situation. I think there might have been a sense 10 to 15 years ago that the core was older and not keeping up with the trends of all the other pockets of the city, but that has changed. There has never been a better time to live in downtown Toronto, especially as we move out of the restrictions and start to gather again.
SM: I’ve said it before, but there is sentiment out there that thinks investors have only a negative impact on the market, but in reality, when the percentage is correct, investors are crucial to the market’s success. Their inventory is vital to buoy and form the rental market of our city. Pricing is market-determined. With a healthy buying community, a healthy renting community and the confluence of these two markets, this gives you a strong urban community that can flourish. When one or more of these factors are out of whack — think current supply — you get disproportioned results or impact somewhere in the market factors.
JM: At the end of the day, our city and region has incredibly low vacancy rates, and that speaks to a healthy market given the amount of supply that exists. It says things are moving as they should given the inputs. Every day, we are happy that we are helping families create wealth with great investments and also helping to shape the city by supporting various developments and gentrification projects, which helps to raise the tide that will lift all boats.