... The joke is that we own all aspects of the building, are paying our debt down through profits from operations, paying suite owners a healthy profit every month, and seeing our condo fees drop. The problem is nobody understands our condo corporation. Bottom line is that there are great buying opportunities at One King that won't last forever. Where else can you buy a studio 40 floors up with magnificent views, a historic lobby, connected to the path with a return of $2k per month for less than $250k. I sense there may be a lot of envious Trump investors out there.
Here is a breakdown of my revenue and costs
Revenue - $2000 This is an average over 12 months for my suite in the hotel pool
Condo Fees - $540
Taxes - $375
Net - $1085 before mortgage payments
I will let others figure out their optimum capital structure but this gives you an idea of possible returns. I can tell you that I have $116,000 left on my mortgage at a variable rate of 2.25% (got it pre 2008). My payments are right around $1000 per month but I am paying down $800 per month in principal. Our condo fees have actually been decreasing due to profits from the food and beverage portion of our Hotel. I am happy with the return considering I get to use my investment as an "urban cottage".
I am in the commercial property development business and believe me, the returns are much better than condos in DT Toronto. However, the risks are also higher.
I probably use my suite a total of 4 weeks per year. I live int the GTA burbs but enjoy using the suite with my wife and family.
The mortgage rate I got was pre-recession. I have a number of mortgages at that rate so yes, I got lucky. The only problem is that the 5 year terms on the loans are almost up. It was a good run while it lasted though. The upside is that I should be able to renew right around 3%, and have paid a hell of a lot of principal off in the past 5 years.
I would love to see a similar breakdown of these numbers at the Trump. I just can't see how they make any money.
thats an ominous thing to hear, esp from an agent....any particular reason you feel this way?
Just saw on some channel, maybe Bloomberg, that the rate of appreciation in big Canadian cities is unsustainable. That means hot money is moving in. If banks heedlessly lend the inflated prices, then the banking system is headed for a familiar-looking collapse. The banks have to ease up and lend a reasonable amount, forcing buyers to come up with ready cash of their own. Or Canada could be Greece or Iceland.
It's called stigma civdis. It will eventually go away - mostly anyway as some will always recall this particular piece of history.
This is my favourite residential building in all of TO. I can stand for hours and stare at it or for just as long, admire from within, the marriage of vintage and new.
But should one buy in it?
Civdis has certainly made a "reasonable" cash flow argument. On the other hand, until the stigma goes away...assuming it eventually does, it has not been a good investment from the capital appreciation point of view to date.
I am not judging but asking whether one should consider "investing" in this building if one were an investor.