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Traditionally, investors and developers alike have always been focused on Western Toronto due to its denser population, more office space, and more retail locations. However, many developers see great potential in the eastern side of downtown, which has been undergoing development plans for a while.
Eastern Toronto is receiving rising investments from the government, more public transit, more office buildings – all of which increase employment and gentrification of the area. These changing tides have inspired the purchase of a 2.14-acre site located on Queen Street East, Richmond Street East, Ontario Street and Brigden Place.
Filling the Market Gap With Purpose-Built Rental
Many developers and investors agree that the current disruptions caused by the pandemic are just temporary setbacks. Although school and business closures in the downtown area, lack of immigration, and a lower influx of students have significantly impacted Eastern Toronto, Canadian developers have adopted a long-term view and are excited about the upcoming city development projects.
Data shows that there is a large market gap in many bigger cities across Canada for purpose-built rentals, and the active developers are planning to fill the gap. At the moment, renters do not have many choices when searching for apartments. They either have to opt for half-a-century-old apartment building or rent smaller units in condo properties. Renter choices are limited, and developers who know this will develop the multifamily units needed to fill the gap.
The Face of Downtown Toronto Changing
Recently there was a sale of a $129 million property to Tricon Residential. The two Hariri Pontarini Architects-designed buildings are 24 and 33 story's tall, respectively. The building currently include 850 one-, two-, and three-bedroom units; however, the mixed-use commercial redevelopment will include more two- and three-bedroom units than normal. There will be amenities like a gym, yoga studio, parcel rooms, an outdoor pool, and wrap-around retail elements to help attract renters.
While the two imposing buildings will certainly reimagine the face of Eastern Toronto downtown, the developer still plans to retain some of the area’s history. Two brick-and-beam office buildings will be rebuilt as well, while keeping the facades intact.
The offices will be equipped with new air filters, better ventilation, and touchless systems to ensure the utmost safety and alleviate COVID-19 concerns.
The construction of the project will begin by early 2022, with the first occupancy expected in 2025.
There is great activity happening in Toronto, Canada with many projects set to meet the large market gap for purpose-built rentals. The face of Eastern Toronto downtown is set to change and commercial real estate investors are expressing a strong interest in investing in large-scale projects like the ones mentioned.
With big redevelopment plans and a brighter post-pandemic future, investing in Canadian CRE can be an excellent way of diversifying portfolios and maximizing profits.