Residences of Maple Leaf Square Condos (Lanterra Developments) - Real Estate -

rp07 said:
I think I already did.
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The wedge between the railway and the Gardiner Expressway is not a neighborhood in my opinion, nor will it ever be.

Mike in TO ^ This project had a very high proportion of investors due to the location – the builders have not been shy about revealing that information to a variety of publications. All other reasons aside, being practically on top of the primary transportation hub of the region is a key selling point, especially when land in the immediate vicinity is quickly disappearing.
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As far as investors buying into this GoLeafsGo! hype-machine, you hit the nail on the head- ignorant (and mostly out of town/country) investors may believe this to be a great location but I certainly don't and I suspect that neither would most Torontonians. If these investors actually believe that they can generate a positive return on $500 per sq. ft. then I've got PLENTY of things to sell them!
 
Like season ticket prices, expect a steady yearly increase in condo maintenance fees!
 
vultur said:
As far as investors buying into this GoLeafsGo! hype-machine, you hit the nail on the head- ignorant (and mostly out of town/country) investors may believe this to be a great location but I certainly don't and I suspect that neither would most Torontonians. If these investors actually believe that they can generate a positive return on $500 per sq. ft. then I've got PLENTY of things to sell them!
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But you never consider the amenities "over and above" your average condo that are included in this development. When you look at the project in its totality (Concerts, Sporting Events, Sports Bar & Shops) generating positive cash flow should not be too hard. And then consider that this area is within lands the city desperately wants to redevelop as a business and residential hub, which should create added value to the land and greater equity for the owners at MLS.
 
As far as investors buying into this GoLeafsGo! hype-machine, you hit the nail on the head- ignorant (and mostly out of town/country) investors may believe this to be a great location but I certainly don't and I suspect that neither would most Torontonians. If these investors actually believe that they can generate a positive return on $500 per sq. ft. then I've got PLENTY of things to sell them!
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Its their money so who cares. If they take a bath then that's their problem.
 
It's a great location, and the downtown space, by the waterfront, but next to Union Station and now shopping (and with Longo's downstairs), I'd prefer it to City Place (except that first phase that's between the railway and Front, which isn't isolated at all).

I bet there's a premium for the property, and I am sure the sports fan would be one of several markets MLSE is after. I know MLSE also has a reputation for squeezing fans and taxpayers but unlike the Leafs, Raptors or Toronto FC, there's plenty of competition for condos. There's no Gary Buttman to control the number of condos like they can keep a NHL team out of Hamilton.

Perhaps a bit overpriced, but not that bad an investment. If nothing else, Caveat Emptor.
 
caltrane74 said:
But you never consider the amenities "over and above" your average condo that are included in this development. When you look at the project in its totality (Concerts, Sporting Events, Sports Bar & Shops) generating positive cash flow should not be too hard. And then consider that this area is within lands the city desperately wants to redevelop as a business and residential hub, which should create added value to the land and greater equity for the owners at MLS.
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Cal, I'll try to be brief and very generous:

$500 per square foot, 1000 sq ft= $500,000

Revenue

Rent $30,000
($2500/month)

Expenses

Property Tax $5,500
Condo fees ($0.50) $6,000
Repairs $1,000
Insurance $1,000

Total $13,500

Net Income $16,500


The foregoing assumes:

  • No Vacancy

  • No Management Fees

  • No Bad Debts

Unleveraged Return: 3.3%

How the hell would anyone consider this to be a good investment? Forget about the fact that you'd never get $2500 per month in rent, you can get 4.0+% in an ING Direct savings account and pull it out on a moment's notice! A mortgage would cost 5+% before any principal reduction!

Only a complete fool would consider this to be prudent investment. Oh wait a minute I forgot- REAL ESTATE NEVER FALLS IN VALUE!
 
You forgot capital gains on the real estate. - That will more then compensate for the low "net cash" returns over the long term.

You are being a bit too generous with your assumtions for revenue, expenses and capital, as I seriously doubt a 1000 sq-ft unit in MLS is going for half a million.

btw: Property tax in Toronto is less than 1%
 
caltrane74 said:
You forgot capital gains on the real estate. - That will more then compensate for the low "net cash" returns over the long term.

You are being a bit too generous with your assumtions for revenue, expenses and capital, as I seriously doubt a 1000 sq-ft unit in MLS is going for half a million.
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I'm being generous for a reason- to give the best case scenario which we all know would never occur to show how foolhardy an investment this would really be. Property Tax is 1.1% of assessed value.

Cal, that's my point- you are assuming capital gains whereas I am suggesting that a capital gain is anything but a slum dunk. Look at all the turmoil in many American markets all predicated on the infinite rise in real estate prices.
 
Fair enough, but there hasn't been a decline in real estate prices in the Toronto area since the late 1980's through early 1990's. So your looking at 15years which have followed an upward trend.

and...

Yes the Capital Markets crisis in the United States is bad, but like I've said in previous posts, Canadian banks were never as easy with "the cash" as their US counterparts. The Canadian economy seems to be riding out the storm on the strenght of our comodities markets (oil in particular), prudent management of the public finances by the government and restrained/cautious monetary policies from the central bank.
 
As a stock market trader, I know that what goes up must (and will) come down. Place the Toronto real estate prices on a chart: the long term trend is UP. But, there will always be "corrections" that will cause the most vulnerable to lose their shirts; 10 years of bullish market in real estate is a sign the correction is due. Historically, when office towers are under construction you can sense the housing market is peaking; office builders are very conservative and imo are 5 years behind the trend. So, 2008-10 shall be very interesting to watch the condo market. I'm predicting a drop--especially in the 50 story specuvestor buildings; Freed and Street Car folks will be around serving the local market--much better buys imo.

In a correction, the guy sitting on cash shall win; the average 9-5er with a few condo investments will be hurting.

Finally, with a 3-5% return why the heck does anyone invest in real estate? I got a 30% return in 3 days on CNXT--look at the chart here:

http://stockcharts.com/h-sc/ui?s=cnxt&p=D&yr=0&mn=3&dy=0&id=p45879420300
 
Agree with everything but the Freed comments. I personally think that he is a lousy developer and a swine and that his buyers will be horribly disappointed with the finished product. Area is great though.
 
vultur, you always seem to have an answer for EVERYTHING, but for some reason you can never admit that you are wrong.

You have way too much anger built up. I think you need to get laid. Maybe that will help, doubtful, but maybe..
 
there is one man in toronto real estate that is supposedly really angry all the time etc. could vultur be him? him=brad lamb.

ya never know.

having zero interest in buying a condo (i'm a fan of chilling on the front porch and back garden--thus i'll buy a house in toronto--or hamilton if my gambling sends me to the poorhouse;) I honestly know very little about freed or anyone in the T scene; so vultur, which developers do you respect?

i've been to many sales centres but find their slick pitches annoying and their concepts ripoffs (i want a concrete shell with zippo in it.)

finally, as a real estate investor is it more the ego of the deal than the return you're seeking? I mean Options as a means of leverage are far more rewarding than owning a few dozen condos in boring old toronto--at least from my pov.
 
urbandreamer said:
there is one man in toronto real estate that is supposedly really angry all the time etc. could vultur be him? him=brad lamb.

ya never know.

having zero interest in buying a condo (i'm a fan of chilling on the front porch and back garden--thus i'll buy a house in toronto--or hamilton if my gambling sends me to the poorhouse;) I honestly know very little about freed or anyone in the T scene; so vultur, which developers do you respect?

i've been to many sales centres but find their slick pitches annoying and their concepts ripoffs (i want a concrete shell with zippo in it.)

finally, as a real estate investor is it more the ego of the deal than the return you're seeking? I mean Options as a means of leverage are far more rewarding than owning a few dozen condos in boring old toronto--at least from my pov.
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UD,

If the game is played out of pure speculation, such as the current but fleeting mantra among the Gen X/Y crowd 'I bought this POS Freed condo as AN INVESTMENT' then I too would prefer to speculate in the public markets where liquidity is not an issue.

Speaking personally, I never invest in real estate out of speculation. I invest with a plan. While there are never assurances of success, if my plan is properly executed then profit should foreseeable flow from it. I never invest in real estate using the greater fool theory that dominates the Toronto condo pre-sale market.
 
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