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Winter weather worsens inventory supply for Toronto real estate market – The Globe and Mail

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The house at 354 Soudan Ave. was listed with an asking price of $1.549-million. Even after a heavy snowfall that closed schools and clogged streets, the house had 40 showings booked. Five offers were made and the house sold for $1.920-million.Bosley Real Estate Ltd.

Perhaps house hunters were counting on their rivals being snowed in.

The day after the January storm which dumped 36 centimetres of snow on Toronto, a horde of buyers made it through the unplowed streets to see a four-bedroom detached house in Davisville Village.

“We listed it in the blizzard,” says broker Patrick Rocca of Bosley Real Estate Ltd.. “We had 40 showings booked.”

Major arteries were still cluttered with abandoned cars and buses and the return to school was cancelled, but potential buyers made their way to the two-and-a-half storey house at 354 Soudan Ave., with an asking price of $1.549-million.

“You had to get through the snow banks, you couldn’t park on Soudan, but where there’s a will there’s a way,” Mr. Rocca says. “People figure it out.”

The following day, a bully submitted an offer and Mr. Rocca’s team notified everyone who was interested. Four more offers landed but the bully prevailed and the house sold for $1.92-million.

On the same day, Mr. Rocca listed an East York semi-detached house with an asking price of $999,000. That house sold for $1.45-million with two offers.

But while those two properties vanished quickly, some sellers did delay listing in the aftermath of the storm. Last week only 13 houses were listed in the midtown Toronto neighbourhoods of Davisville and Leaside where Mr. Rocca does much of his business.

“We’re seeing ridiculously low inventory,” he says.

Jimmy Molloy, real estate agent with Chestnut Park Real Estate Ltd., figures the dump of snow delayed many listings by a week or so.

“We did not need a blizzard on the first day of back-to-school in January, 2022,” he says. “That was not beneficial to anyone. People say ‘I’m going to wait until I see a little more sidewalk and a little less snow.’”

Stagers bringing in furniture and photographers trying to create appealing images all have more trouble manoeuvring in the snow on narrow city streets. Parents who thought their kids would be returning to the classroom suddenly found them at home for an additional two days.

“It just slows everyone down,” he says. “When the obstacles get in the way, it doesn’t lessen the demand – it just builds up pressure on the system. You still have buyers who haven’t seen a house since maybe the first week of December.”

Kevin Larose, a real estate agent with Keller Williams Real Estate Associates, says the lack of supply is tempting some buyers and agents to try and circumvent the bidding process all together.

Often houses in the Greater Toronto Area are listed with a relatively low asking price and a date for reviewing offers is set for a week or so later. So-called bullies pre-empt the process by coming in before the offer date with an eye-popping bid that expires after a short window of time.

But Mr. Larose is seeing an increase in aggressive tactics now that bully offers have become standard practice. Two of his recent listings received a large amount of attention and queries from potential buyers.

In one case Mr. Larose listed a four-bedroom, detached house at 2461 Jarvis St., in Mississisauga with an asking price of $2.198-million.

The house sold after four days for $2.77-million.

Another property he recently listed in Mississauga received 10 offers and sold after seven days. The four-bedroom detached at 1069 Greaves Ave., was listed with an asking price of $1.698-million and sold for $2.1-million.

Mr. Larose has seen an increasing tendency for buyers who are frustrated at losing out on a few deals to fire their agent and approach him on their own. In some cases they haven’t signed a contract known as a Buyer Representation Agreement or it has expired.

“They’re going directly to the listing agent because we have the inventory.”

He regularly receives calls from prospective buyers looking for an edge in a bidding war. “What’s it going to take?” is a frequent question, says Mr. Larose, who advises the caller to line up an agent. In some cases another member of his team will negotiate on behalf of a buyer.

“The listing agent’s responsibility is to the seller,” he points out. “The buyer needs to be represented.”

At the same time, the ranks of real estate agents have swelled in the Greater Toronto Area. Mr. Larose figures the reason there are so many exasperated buyers trying to go it alone is that many agents are unethical or unprepared.

With so many agents and so little inventory, many are struggling to find business. And some simply lack professionalism.

“Many don’t treat it like a business and many don’t understand their fiduciary duties,” he says.

Some will try to boost their client’s chances in a bidding competition by offering to accept a smaller commission than the standard 2.5-per-cent paid to buyers’ agents on a deal.

“They give up commission right in the middle of negotiating.”

In such cases, the listing agent is obligated to inform the seller and the other agents at the table that one agent is willing to lower their commission.

Mr. Rocca at Bosley has also noticed such practices becoming more common in the past year as the heated Canadian market set new records for sales and prices.

Commission cutting creates havoc in a bidding contest, he says, and it clouds the process for the seller.

He explicitly states in writing in his listings that he will not allow it.

“If I have five offers and one agent says ‘I’m cutting my commission’, I say no you’re not,” Mr. Rocca says. “I don’t work that way. There are no deals – you’re going to get in line with the rest of the people.”

Mr. Rocca believes that the lack of supply in the market is contributing to strategies of desperation. But he’s receiving lots of calls from homeowners seeking evaluations, so he expects listings to see a good bump in coming weeks.

Farah Omran, economist at Bank of Nova Scotia, expects new inventory to be almost immediately picked up by buyers.

While housing sales in Canada were essentially flat in December compared with November, even after adjusting for the season, she believes sales were dampened by the lack of listings.

The increased tightness in the market is pushing prices up by a larger magnitude than the increase in sales.

Bay Street is forecasting a series of interest rate hikes from the Bank of Canada this year and those expectations may have contributed to a winter market that’s more hectic than usual, she adds.

“Stay tuned for what is likely to be yet another busy spring market,” Ms. Omran says.

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Calgary retains commercial real estate team to revive new arena – CTV News Calgary

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The City of Calgary has recruited three people from the commercial real-estate sector in an effort to get a new event centre to replace the aging Scotiabank Saddledome.

CBRE executive vice-president John Fisher, director of strategic initiatives with NAIOP Calgary Guy Huntingford and Ayrshire Group executive chairman Phil Swift have been retained to engage both the city and the and Calgary Sports and Entertainment Corporation (CSEC) to reach a new deal.

At Wednesday’s meeting, the city’s planning and development manager Stuart Dalgleish told committee members the group has already begun their work.

“We are at a stage where our third party is having discussions with both the Calgary Sports and Entertainment Corporation and the City of Calgary, with a view to determining whether there is interest in discussions toward a new event centre, and a new deal towards the new event centre,” Dalgleish said.

Mayor Jyoti Gondek is optimistic the team will be able to break the impasse between the city and CSEC.

“Today’s news is good news, and we need to be patient with what comes following this,” she said.

Ward 1 Coun. Sonya Sharp, who chairs the event centre committee, says naming a third party to assist in negotiations is a big step to seeing a new arena rise from the ashes of the failed deal.

“I’m very satisfied. There’s been a lot of work been put into this to get to where we are today,” she said.  “Everybody wants an event centre built.”

However, sports economist Moshe Lander says it might not be such a great deal for most Calgary taxpayers.

“The issue about who should pay for it is something that goes on in every city, more or less, anytime there’s an arena or stadium discussion,” he said.

“In almost every single case, the public sector blinks first and ends up throwing money at a project that’s not going to recoup its costs.”

“Really, it’s just an issue at this point of how much money does the City of Calgary want to throw at this project, understanding that it’s not going to get it back? How much does it want to sell to the taxpayers that this is what you’re going to be on the hook for, even though the vast majority of residents in the city are not going to use that arena in any capacity?”

CTV reached out to CSEC on Wednesday to ask if the owners still had any interest in reviving the deal. There was no response by publishing deadline.

The original agreement was signed in December 2019. In it, the city and CSEC agreed to split the cost of the $550 million project. When the price tag jumped to over $630 million, the Flames ownership group balked and cancelled the deal. It officially expired New Year’s Eve 2021.

Earlier this month, NHL commissioner Gary Bettman met with CSEC to discuss the arena, among other topics. At the time, he told reporters he remained hopeful a deal could be struck.

“I’m always optimistic,” said Bettman. “There’s nothing going on right this second to report that would indicate there is going to be a solution immediately, but my hope is that everybody can figure this out.”

Bettman also warned without a new arena or an updated Saddledome, Calgary would miss out on significant NHL events such as All-Star games.

The Saddledome is the second-oldest NHL arena behind only New York’s Madison Square Garden.

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Commercial Real Estate Report (Canada 2022) – RE/MAX Canada – RE/MAX News

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  • Commercial real estate report_blog header
Lydia McNutt

Public Relations & Content Manager | RE/MAX Canada

Lydia McNutt is an award-winning writer, editor and public relations professional, with a focus on all things real estate. At RE/MAX Canada, Lydia translates market data and trends into educational and entertaining content for homebuyers and sellers, while furthering the RE/MAX brand reach, nationally and globally. Explore timely news articles, market trend reports and thought-leadership on blog.remax.ca. Lydia has been published nationally on topics ranging from real estate to architecture, design and decor, finance, business, technology, entertainment and lifestyle topics. Email Lydia at lmcnutt@remax.ca


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Calgary recruits commercial real estate expertise to revive new arena – Sportsnet.ca

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CALGARY — The city of Calgary has recruited citizens from the commercial real-estate sector to help get a new event centre and home for the Calgary Flames back on track.

When an agreement between the city and Calgary Sports and Entertainment Corporation, which owns the Flames, collapsed late last year, city council voted in January to get a third party involved.

John Fisher, Guy Huntingford and Phil Swift are tasked with determining whether the Flames still want to build an arena with the city, or if the city will have to look for other potential partners to build an event centre.

Fisher is executive vice-president of CBRE, Huntingford is director of strategic initiatives with NAIOP Calgary, and Swift is executive chairman of the Ayrshire Group investment firm.

“This team brings considerable expertise from the commercial real-estate industry including experience in larger development,” the city’s planning and development manager Stuart Dalgleish said Wednesday in an event centre committee meeting.

“The third party has spent considerable time understanding the items and interests behind the terminated agreement and the current landscape. These items have become clarified.

“Based on a meeting with both the city and CSEC, the next step is for the third party to make recommendations on a possible path forward.”

Dalgleish said there is no definitive commitment or timeline for a new agreement.

The city and the Flames agreed on an arena deal over two years ago with the initial estimate of $550 million split between the two.

Shovels were scheduled to hit the ground in 2022 for a 19,000-seat arena and concert venue replacing the Saddledome, which has been the home of the Flames for 39 years.

The cost estimate for the project rose to $634 million, however.

Since the two sides agreed to an amended deal last July, the city added an additional $19 million in roadwork and climate mitigation to the project, and wanted the Flames to pay for $10 million of that.

CSEC president John Bean said in December that the Flames were withdrawing from the agreement because of an accumulation of issues and increased financial risk.

“While CSEC was prepared to move forward in the face of escalating construction costs, and assume the unknown future construction cost risk, CSEC was not prepared to fund the infrastructure and climate costs that were introduced by the city following our July agreement … and are not included in the current cost estimate of $634 million,” Bean said then.

So the Flames remain in the Saddledome, which is the second-oldest NHL arena behind New York’s Madison Square Garden.

CSEC also owns the Western Hockey League’s Hitmen, Canadian Football League’s Stampeders and National Lacrosse League’s Roughnecks.

The Flames recently announced they will move their American Hockey League affiliate from Stockton, Calif., to Calgary for the 2022-23 season.

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