Amit & Roy were recently invited to the VIP event at the newest Condo Development in the St. Lawrence Market and King East neighbourhood – Post House Condominiums. The name and marketing of "Post House" revolves around the building's proximity to Toronto's first Post Office. The Post Office will located on the Doorstep of Post House which gives the site a very unique feel by combining the modern design of the Condominium to the Classic feel of the Post Office.
Located on George Street following the success of "The Vu" at 112 & 116 George Street, this looks like it will be a great addition to the neighbourhood. A Chic building, with 278 suites on 21 floors is located in the increasingly popular St Lawrence/King East neighbourhood that offers a number of restaurants, George Brown College, good access to the King Subway station among other amenities.
As always, when analyzing whether or not a property is worth your hard earned money, it is important to analyze the property against other New Developments and also other Resale properties.
OTHER NEW DEVELOPMENTS
The St. Lawrence Market neighbourhood has seen a number of new developments, however, there is not so many that are currently selling. We are waiting for details on "Modern" which will be located on Richmond, and other than that the major competitor in the St. Lawrence Market area is "The Berczy" (Front & Church) which is a couple of blocks from Post House.
|Post House||$525||August 2013||$39,000||20%+?5%?|
|The Berczy||$600||August 2012||$35,000||15%+5%|
Studying the Resale Market is extremely important (I would say even MORE important than studying the other New Developments) as it gives us the snapshot of a) where the market is TODAY, and b) how much appreciation the buildings have seen in order to get to where it is today. Both of these are extremely important in determining whether or not the new buildings offer good value, and if there is potential for the building to be a good investment. There is a number of examples of new developments that have been sold way over the current resale market to unknowing buyers, the result being those that needed to sell immediately for whatever reason were actually out of pocket.
In the Adelaide & Jarvis/George area we have 3 very good comparables – 112 & 116 George Street (The Vu) and 333 Adelaide East (Mozo).
|Address||Approx Price/Sq.Ft.||Approx Appreciation Rate|
|112 & 116 George ("The Vu")||$490-$510||8%-10%|
|333 Adelaide East ("Mozo")||$440-$480||7%-9% (Last 5 years)|
The current comparable buildings sell at around the $500 per square foot mark, making it a touch cheaper than the Post House numbers. However, the appreciation rates of the buildings have been pretty strong. With most investments, the magic appreciation number is 7.2% – at this figure an investment will double in 10 years. The average in the GTA is approximately 4.5%, therefore, appreciation rates of around 8% are relatively strong. However, we have seen higher appreciation rates (to the tune of 10-12%) in the Distillery District, King West & Liberty Village and Yonge & Bloor (If you are interested in learning more about appreciation rates and the "high appreciation rate areas and developements" don't hesitate to contact us).
CURRENT RENTAL MARKET
Post House Condominiums is aimed more at the end-user (will touch on this a little later….) rather than investors, however, it is still important to know what the rental market is. Any savvy purchaser will have all options open. The below rental figures are based on 112 & 116 George Street.
|1 Bedroom + Den||$1400-$1800|
Overall I believe this to be a good project in a growing area. Alterra are offering nice finishes (Quartz countertops, high-end laminate flooring, stainless steel appliances etc.). I believe it is a great option for anyone looking to live in the St. Lawrence Market area, however, I believe there are better options for investors in Toronto (DNA3 & Chaz on Charles spring to mind). I believe the price being offered by the developer to be very fair and the project will sell a good chunk of units during the VIP event.
I am very interested to see how the "Post Office" angle plays out. It is certainly unique, but interested in hearing if anyone is particularly excited by it.
A couple of additional points:
a) The developer is NOT capping levies by default. The purchaser must request this. I find this to be very unfair from the developers and I have heard home buyers who have gotten caught out with this. Always work with a professional who is protecting your interest when you purchase a new development!
b) There is NO assignments on these units meaning you will not be allowed to sell your units prior to closing. For investors this is usually a huge selling point, and something that both DNA3 & Chaz on Charles offer. Note, the Berczy development also does not allow assignments.
If you are interested in receiving further information on this development, including a detailed VIP price list and floorplans use the contact us form below.
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