The Luma multiresidential development at Ottawa’s Elmvale Acres shopping centre. (Courtesy RioCan)
RioCan REIT (REI-UN-T) has continued its trend of bringing in partners on major developments, selling 50 per cent interests in two of its residential-based projects to Maplelands Development Inc. (Dufferin Plaza in Toronto) and Killam Apartment REIT (Luma at Elmvale Acres in Ottawa).
The transactions total about $32.6 million, with Dufferin Plaza comprising $28.8 million of the total and Luma $3.8 million.
“These two transactions are a continuation of RioCan’s strategy to monetize the value that is inherent in our development pipeline as well as to reduce the amount of capital required to build out our urban mixed-use developments that are an important part of RioCan’s evolution,” said Edward Sonshine, chief executive officer of RioCan, in a release Tuesday.
Maplelands is a new development partner for RioCan. The company is newly established in Canada, and is a subsidiary of ASGC Construction of the United Arab Emirates.
Over the last three decades, ASGC has delivered projects in the residential, commercial, retail, industrial and hospitality sectors. Maplelands chose the Dufferin Plaza project as its first entry into the Canadian market due to “its superior quality and attractive attributes, combined with RioCan’s development expertise,” the release states.
Dufferin Plaza in Toronto
Dufferin Plaza is an open-air centre on four acres at Dufferin Street and Apex Road, near the Lawrence West subway station, Yorkdale Shopping Centre, Allen Expressway and Highway 401.
RioCan and Maplelands will redevelop a mixed-use property with approximately 608 units, or a 417,000-square-foot condominium tower and 32,000 square feet of retail space. The project has received Official Plan approval.
RioCan will be the development and retail property manager, and will develop the site in conjunction with its recently acquired 50 per cent interest at adjacent 3180 Dufferin St.
3180 Dufferin is the third project RioCan is developing in partnership with Woodbourne Capital Management. This project is a mixed-use development with up to 440,000 square feet of gross floor area intended as residential rental and ground-floor commercial.
The two projects will result in a mixed-use development of nearly one million square feet.
The Dufferin Plaza transaction closed on Aug. 10. It represents approximately $115 per square foot of future density, of which $11.3 million will be paid as pre-construction development phases are achieved over the next 18 to 24 months.
A cap rate of 2.62 per cent is based on in-place net operating income, but is more relevant to the density created by RioCan through the zoning process commenced several years ago.
This is $11.6 million above carrying value, of which approximately $10.5 million will be recognized as inventory gains in Q3 2020.
Luma at Elmvale Acres in Ottawa
Elmvale Acres Shopping Centre is an open-air, grocery-anchored property in the Elmvale Acres neighbourhood. It has immediate access to major arterial roads and transit arteries with an adjacent bus rapid transit station.
RioCan acquired the shopping centre in 2004 and in July 2017 received zoning approval for a mixed-use development.
The first phase of the project, Luma, is already under construction with initial residential occupancy targeted to commence in the third quarter of 2022.
This price was based on approximately $45 per square foot of zoned future density.
Luma, the first phase of the development, is being constructed on a 1.45-acre portion of the centre that had no existing income. It will consist of 168 rental units and approximately 9,500 square feet of at grade retail net leasable area.
RioCan is the development manager and Killam will be the property manager upon completion.
Luma is RioCan’s third partnership with Killam (KMP-UN-T), which owns, manages and develops apartments and manufactured home communities in Atlantic Canada, Ontario, Alberta and British Columbia.
The sale closed on July 30
RioCan’s existing partnerships with Killam include a mixed-use development project in East Ottawa zoned for four residential towers with up to 840 units. Frontier, the first phase, has been completed and achieved stabilization in Q1 2020.
Construction of Phase 1, Latitude, is well underway.
RioCan and Killam also have a 50/50 joint venture for the mixed-use development of Charlottetown Mall in Prince Edward Island, which has the potential for residential density.
“These partnerships, attractive deal pricing and the ongoing momentum of our residential projects during the current global pandemic, reflect the demand for well-located, high-quality residential assets and the significant value creation opportunities that RioCan’s pipeline offers,” Sonshine said in the release.
“We remain committed to our robust development strategy to drive sustainable and diversified income and to continue to expand the net asset value of our portfolio.”
RioCan Living update: Pivot and Latitude
Pivot, at Yonge and Sheppard in Toronto, and Latitude in Ottawa are both under construction on previously underutilized parcels of existing RioCan properties.
Pivot is a 36-storey, 361-unit residential rental building at one of Toronto’s busiest intersections, with access to the Yonge and Sheppard subway lines and located near Highway 401.
Initial occupancy at Pivot is on track for Q4 2020 and interest in leasing at Pivot has achieved over 800 registrants.
Latitude is a 20-storey, 209-unit residential rental building near the Blair LRT station. Adjacent to RioCan’s Silver City Gloucester open-air centre in Ottawa, Latitude is just steps away from a grocery store and other essential services.
Leasing at Latitude is targeted to commence in Q4 2021.
About RioCan
RioCan owns, manages and develops retail-focused, increasingly mixed-use properties in high-density, transit-oriented areas. The trust is focused on Canada’s six largest urban markets.
As of June 30, 2020, its portfolio was comprised of 221 properties with an aggregate net leasable area of approximately 38.6 million square feet (at RioCan’s interest) including office, residential rental and 15 development properties.
RioCan’s development pipeline as of June 30 was estimated at 42.7 million square feet, of which 14.8 million square feet is already zoned primarily for mixed-use developments.
TORONTO – The Toronto Regional Real Estate Board says home sales in October surged as buyers continued moving off the sidelines amid lower interest rates.
The board said 6,658 homes changed hands last month in the Greater Toronto Area, up 44.4 per cent compared with 4,611 in the same month last year. Sales were up 14 per cent from September on a seasonally adjusted basis.
The average selling price was up 1.1 per cent compared with a year earlier at $1,135,215. The composite benchmark price, meant to represent the typical home, was down 3.3 per cent year-over-year.
“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” said TRREB president Jennifer Pearce in a news release.
“The positive affordability picture brought about by lower borrowing costs and relatively flat home prices prompted this improvement in market activity.”
The Bank of Canada has slashed its key interest rate four times since June, including a half-percentage point cut on Oct. 23. The rate now stands at 3.75 per cent, down from the high of five per cent that deterred many would-be buyers from the housing market.
New listings last month totalled 15,328, up 4.3 per cent from a year earlier.
In the City of Toronto, there were 2,509 sales last month, a 37.6 per cent jump from October 2023. Throughout the rest of the GTA, home sales rose 48.9 per cent to 4,149.
The sales uptick is encouraging, said Cameron Forbes, general manager and broker for Re/Max Realtron Realty Inc., who added the figures for October were stronger than he anticipated.
“I thought they’d be up for sure, but not necessarily that much,” said Forbes.
“Obviously, the 50 basis points was certainly a great move in the right direction. I just thought it would take more to get things going.”
He said it shows confidence in the market is returning faster than expected, especially among existing homeowners looking for a new property.
“The average consumer who’s employed and may have been able to get some increases in their wages over the last little bit to make up some ground with inflation, I think they’re confident, so they’re looking in the market.
“The conditions are nice because you’ve got a little more time, you’ve got more choice, you’ve got fewer other buyers to compete against.”
All property types saw more sales in October compared with a year ago throughout the GTA.
Townhouses led the surge with 56.8 per cent more sales, followed by detached homes at 46.6 per cent and semi-detached homes at 44 per cent. There were 33.4 per cent more condos that changed hands year-over-year.
“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for homebuyers,” said TRREB chief market analyst Jason Mercer.
“This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”
This report by The Canadian Press was first published Nov. 6, 2024.
HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.
Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.
Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.
The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.
Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.
They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.
The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.
This report by The Canadian Press was first published Oct. 24, 2024.
Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.
Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.
Average residential home price in B.C.: $938,500
Average price in greater Vancouver (2024 year to date): $1,304,438
Average price in greater Victoria (2024 year to date): $979,103
Average price in the Okanagan (2024 year to date): $748,015
Average two-bedroom purpose-built rental in Vancouver: $2,181
Average two-bedroom purpose-built rental in Victoria: $1,839
Average two-bedroom purpose-built rental in Canada: $1,359
Rental vacancy rate in Vancouver: 0.9 per cent
How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent
This report by The Canadian Press was first published Oct. 17, 2024.
