7 minute read
Newsworthy Industry Hot Topics
from CAM October 2021
by MediaEdge
Industry Hot Topics
On September 20, 2021, Liberal Leader Justin Trudeau was elected for a third term in an outcome that closely resembled that of the 2019 federal election. With a vow to deliver “real and important change” to Canadians, major themes on this year’s campaign trail included pandemic measures, Indigenous issues, climate change, and to a large degree, housing affordability.
Throughout recent weeks, the hotbutton topic of housing has received plenty of airtime as major party leaders actively promoted the measures they would implement to address concerns, like chronic rental undersupply.
The Liberals’ platform includes: • a 2-year ban on foreign home buying; • the construction and repair of 1.4 million home units over the next four years,
including conversions of underused commercial space into affordable rentals; • investment into Indigenous housing and senior facilities; • renovation tax credits to add affordable residential rental space to existing units; • introducing a Home Buyer’s Bill of Rights that will regulate “house-flipping” and impose surtaxes to discourage
“renovictions”, among other key measures.
According to a recent report from JLL, these proposed measures are nothing new: “They reaffirm Budget 2021’s $1.3 billion funding allocations to increase the stock of affordable units through the National Housing Co-Investment Fund and the Rental Construction Financing Initiative.”
It is also likely that several key federal support programs, including the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Rent Subsidy (CERS) may be extended beyond the October 23 expiry date to facilitate broader recovery gains.
Popularity of small rental units back on the rise
Average rents for all property types in the GTA increased nearly a full per cent in August over July, with small rental units climbing in popularity after more than a year of pandemicrelated declines. This is the fifth straight month average rents have increased, according to the latest Bullpen Research & Consulting and TorontoRentals.com rent report.
Even with the recent uptrend, the average rent is still down 4 per cent annually from $2,184 per month in August 2020, and 14 per cent from August 2019’s average rent of $2,450 per month. Despite worries about the fourth wave of COVID-19, the return to normalcy continues with colleges and universities opening up, as well as primary schools, malls, stores, gyms, and downtown office buildings.
The majority of GTA cities and neighbourhoods experienced monthly increases in average rent in August, including Whitby, 6.6 per cent; Scarborough, 3.9 per cent; Richmond Hill, 2.6 per cent; Milton, 2.3 per cent and Mississauga, 2.1 per cent. Other cities and areas with slight month-over-month increases were: North York, up 1.3 per cent; York, East York and Brampton, all up 1 per cent; Vaughan up 0.8 per cent and Toronto, up 0.7 per cent.
“After several months of large rental units leading the recovery out of the pandemic-induced rental slump, smaller units were popular in August, with average rents for one bedroom units increasing by a whopping 5 per cent monthly in the GTA,” said Ben Myers, president of Bullpen Research & Consulting. “The market bottom is now clearly in the past, with many of Toronto’s most desirable neighbourhoods seeing average rents increase by $200 to $350 per month over the last six months.”
23 of 27 condo apartment projects with high activity on TorontoRentals.com in the GTA saw an overall average increase of 11 per cent in monthly rents in July and August over January and February of this year. The project with the highest increase was Axis Condos ($1,788 per month to $2,510 per month). This 38-storey building was completed in 2019 at 411 Church Street.
The average rent for single-family homes in the GTA has increased throughout 2021 in most markets. Rents for condos have not risen as quickly as those of single-family homes. Toronto, Etobicoke, North York, and Mississauga are all trending upward in terms of average rents, while York and Scarborough are trending flat.
The average rent for purpose-built rental apartments, after declining for most of 2020, have also shown increases throughout 2021. Average rent for units in the former city of Toronto was $2,094 per month in August, up 8 per cent from the March 2021 low of $1,938 per month. The postal codes with a high average rent per square foot were clustered in the downtown Toronto area.
The average rent for studio, one-bedroom, and two-bedroom units all experienced month-overmonth increases in average rent in August. Small rental units such as studios increased 1.4 per cent monthly to $1,525 on average while one-bedroom units increased by 5.1 per cent monthly to $1,864. Meanwhile, two-bedroom units increased 1.3 per cent to $2,308 per month. A cornerstone-laying ceremony was held in late September for Kingston’s first large-scale geothermal residential building, the Geo. The result of a partnership between Podium Development Corp., Secure Capital Partners Inc., Blue Vista Capital Management LLC, and OPTrust, the Geo will add 344 units of much-needed rental supply to the city, while also being Kingston’s first Fitwel-certified building.
“As a City, we’re committed to demonstrating leadership on climate action, but we need everyone in the community involved to make an impact,” said Kingston Mayor, Bryan Paterson. “The Geo is a big step forward towards a low-carbon future for Kingston and I’m excited to see this project be completed. Podium is leading the way with this development and has set the bar for new, environmentally conscious construction in Kingston.”
To improve energy efficiency and reduce reliance on fossil fuels, the Geo will use geothermal energy to lower its greenhouse gas emissions by over 70 per cent—which will also in turn lower utility costs for future residents.
“Our team is focused on leading positive change for lower carbon buildings,” said Podium Developments’ Managing Director, Bernard Luttmer. “This is Kingston’s first large-scale geothermal residential building, but it will not be the last. Our portfolio of new multifamily projects planned in Kingston and throughout Ontario are all being designed with innovative technologies to help us reach a net-zero carbon future. We were able to celebrate this ongoing work at the Geo this week.”
At the Geo, twenty per cent of car parking will be provisioned with EV charging capabilities. Building amenities will include private outdoor terraces, a rooftop terrace, a two-storey gym with a squash court, and 344 dedicated bicycle parking spaces.
“From the earliest stages of planning, we wanted the Geo to be the first Fitwel certified building in Kingston,” said Luttmer. “Resident well-being has always been a high priority for us, but this pandemic has truly magnified the importance of health and wellness in our buildings,”
A redeveloped Brownfield infill site, the Geo is centrally located at 575 Princess Street, just a short walk to both Queen’s University and downtown Kingston. Once complete, it will rise 10-storeys and feature ground-floor retail as well as a corner parkette at Princess St. and Frontenac St.
The Cornerstone Ceremony at the Geo was followed by the Official Grand Opening of Unity Point, the Project Partnership’s first purpose-built rental community in Kingston, which is currently fully leased and occupied.
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CAPREIT acquires apartment portfolio in Kelowna
In early September, CAPREIT announced it had completed the purchase of a Kelowna, B.C., apartment portfolio consisting of four new low-rise buildings. With 193 suites alltolled, it was acquired for $63.3 million, funded from CAPREIT’s Acquisition and Operating Facility. Occupancy was 97.9 per cent at the time of closing.
Made up of three six-storey buildings and one three-storey building, the portfolio is located close to the Okanagan Highway, parks, schools, restaurants and the Westbank Shopping Centre. Each suite is described as being spacious, with air conditioning, laundry facilities, stainless steel appliances, quartz countertops and premium quality finishes throughout. Amenities include a business centre, fitness centre, community lounges and games rooms, rooftop patios, a theatre and extensive landscaping and lawns for residents’ use. In keeping with CAPREIT’s focus on reducing its environmental footprint, the buildings are currently equipped with ten EV charging stations for residents.
“The Okanagan Valley and Kelowna remain a key retirement destination, and this brandnew apartment portfolio of high quality, spacious and luxury suites, continues to be in high demand,” said Mark Kenney, President and CEO. “This acquisition also fits with a key element of our asset allocation strategy to acquire modern, recently constructed properties with low capital investment needs and the features and amenities demanded by today’s discerning market.”
