Today we present another guest post from Dean Macaskill, Senior Vice President at Lennard Commercial Realty. Dean has worked as a commercial realtor since 1980 and has years of industry insight into the Toronto real estate market. Having been through three cycles in the business, he has seen the highs and lows. He shared some of his insider information and insights with UrbanToronto on a semi-regular basis.

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In May, I took a look at the state of the market for this current quarter with respect to high-density residential land sales and declared that the back had been broken and that investors were either taking a breather or saying no to vendor’s pricing expectations. At that time, only 19 high rise land sales were recorded. A number at the halfway point of the quarter appeared low. Forward to June 16, that number has now crept up to 40 sales. So maybe I jumped the gun when I stated that the market had cooled.

Guest Column, Dean Macaskill, Lennard Commercial RealtyToronto skyline, image by Forum contributor Razz

But let’s look at what’s happened this quarter so far. Firstly, within the 416 area code, only two transactions could be considered development parcels on their own – the sale of 5800 Yonge Street, a whopping 8.114-acre site owned by Toronto Hydro and sold to Times Group for $122,200,000. Approximately 1.25 million square feet of development is anticipated. The other would be First Gulf’s acquisition on the southeast corner of King and Spadina, a half-acre site, for just under $39 million. There have only been a couple of properties in the 905 that traded in the range of half an acre or larger so far this quarter.

What the results show is that most of the trading has been additions to an ongoing assembly or the start of an assembly. For example, MOD Developments have acquired two properties on Charles Street that combine for 0.564 acres at a combined cost at just over $75 million. 

Much of the trading has been through grunt work on the behalf of developers, such as Times Groups assembly on Soudan Avenue which, after 6 acquisitions, only has 0.172 acres of land to show for their efforts for an $11 million investment. A similar situation is happening on Gladstone Avenue by Condoman Development who has acquired two properties with an aggregate area of 0.269 acres for $7,050,000. A development application had been commenced for this site in 2016 but not yet approved. If the proposed development gets the green light, the value works out to a hefty $146 per square foot buildable, a big number for a property so far west of the core.

So yes, Chicken Little, the sky had not fallen. What is changing is the size of the deals. Over the years we’ve followed some rather large transactions occur like the LCBO property on Lake Shore East, but are those days numbered? Other than a re-trade of a development-approved large site, is the 416 coming to the point where we’re looking at the scraps that remain? Trust me, assemblies are a nightmare. I have great respect for those who have been successful in such quests. Getting multiple owners onside to sell is like watching Erich Brenn on Ed Sullivan balancing spinning plates on sticks. As he gets three balanced and spinning nicely, the fourth one starts to wobble, requiring his attention before he can add more plates to other sticks and so on. If you still don’t get what I mean, check out the video embedded below: 


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