You know you’ve hit the big time in high-rise condominiums when Donald Trump comes to town. And the Donald is in Toronto.
Trump has jumped into the condo building frenzy in Canada’s largest city. He plans to build the tallest residential tower in the country, in the heart of Toronto’s financial district.
My recent trip to Toronto was like a flash-forward for what could be in Orange County.
High-rise towers, just like those going up or planned in Irvine and Anaheim, span Toronto’s skyline, from the city’s once-industrial Harbourfront to trendy Yorkville uptown.
I told folks I encountered that towers are starting to take root where I live,you know, “The O.C.”,including by Canadian developer Bosa Development Corp.
But the newness of condo towers has worn off in Toronto. Sure, the market still is hot. But, just like here, many openly speculate about a bubble.
Investors are buying about a third of the condos in Toronto. This year, market watchers expect about 12,000 units to come on the market, up from about 10,000 last year.
Next year, another 17,000 new condos could go up for sale.
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Condos going up in downtown Toronto: some 12,000 units expected to hit the market this year |
The towers are lures for retirees and refugees from housing prices that have grown out of reach in the suburbs.
One retired aerospace engineer I talked with gleamed about his downtown condo, bought after he and his wife sold a more traditional home that had grown too big for the empty nesters.
But after a heady run-up, condo prices are stabilizing.
An average condo sells for about $260 per square foot, up only a hair from a year ago. Overall, prices are comparable, if not a little cheaper, than here: They start at about $150,000 for small units and go up to the $1 million range.
A recent report from Toronto-Dominion Bank predicts a subtle decline in condo prices this year and next, after eight years of nearly 10% annual growth or so.
The condo boom has transformed Toronto. The towers aren’t out of place in the city, which is like a more livable version of New York or Chicago. But they’ve made over formerly industrial areas along Lake Ontario and invaded the city’s financial district.
The condo boom is such that even the Royal Ontario Museum, a natural history museum, is getting in on the action. The ROM, as the museum is known, has submitted plans for a 44-story condo and office tower on land it owns near the University of Toronto.
And condo marketing is in overdrive. All around Toronto are ads for condo towers beckoning would-be buyers to stop by the project’s “presentation centre.” Real estate brokers have their own little marketing war going with ads on bus stops, the subway and recycling bins. (“This lamb sells condos” reads one from broker Brad Lamb, featuring his head on a lamb’s body.)
Naturally, I felt a bit at home amid all of Toronto’s condo talk.
At last count, developers are planning nearly a dozen condo towers in the John Wayne Airport area of Irvine. Lennar Corp. plans nearly 3,000 condos and apartments around Angel Stadium of Anaheim. Other towers are in the works for Costa Mesa and Santa Ana.
Even before the first towers here are done,Bosa’s twin 18-story high rises,some are wondering if demand will be there for all of the planned condos.
Bosa and Phoenix-based Opus West Corp., which is developing condos in Irvine, have presold most of their units. But it’s an open question whether all the planned projects will fare as well. Some may not even come to fruition.
