On Monday, October 24, 2016, a group of real estate professionals and enthusiasts gathered at Karma Condos, a collaborative effort by Lifetime Developments and CentreCourt Developments in downtown Toronto. ULI Toronto membership was offered an exclusive tour of the property led by CentreCourt President Shamez Virani. Karma Condos, which has now begun occupancy, is located just a block north of College on the west side of Yonge St. on Grenville St. The vibrant area offers great subway access and is close to the Ryerson and University of Toronto campuses.

CentreCourt Developments is focused exclusively on the development of high-rise assets. Its chosen sites are typically bound from Spadina to Jarvis, south of Bloor. They are a small team, focused on 1 asset class (condos) and have 6 projects to date at various stages of development. CentreCourt founder Andrew Hoffman, formerly a COO at Menkes, has over 25 years of real estate development experience and has participated in many prominent projects in the downtown core.

Virani offered ULI members a view into not just the building, but also the development process that CentreCourt and its partner Lifetime Developments went through to bring the building to completion. Virani walked through the development process, site logistics and market dynamics that led to the creation of Karma Condos.

Process
Centre Court approached site-owner Lifetime in 2009 and offered to help develop the site. The two parties were able to agree to terms and drew up a partnership agreement. All major decisions were to be shared, with CentreCourt assuming responsibility for most of the day-to-day management of the project. Virani outlined an approvals process not unlike most in Toronto that started with a desire to build a 54-storey tower that was reduced to 50 storeys, following consultations with the City and meetings with the OMB. He indicated that the City’s views on density and parking requirements have evolved over time and, as Toronto continues on its trajectory toward becoming a global city, this evolution will likely continue.

Logistics
Beyond being a construction site in a major urban centre, the Karma Condos site had the added challenge of accommodating a heritage house. After much discussion, the heritage property on the northwest portion of the development site was to be moved to the northeast point of the property. Virani described a method in which the contractors were able to move the building only 10 inches per day across the site. There was also great uncertainty as to the structural integrity of the wall of the existing building. During the tour, members were given access to the now transported building that Virani hopes will ultimately be leased to a signature tenant.

Market Dynamics
Virani relayed that agents were very excited to participate in the project, a signal of great pent up demand. He admitted that the condo market is, in part, driven by investors, but that this is a function of the market reality. The target demographic for condos (typically young professionals) cannot wait years after buying to assume occupancy. Virani noted that the pre-sale requirements for units sold prior to construction ensures there will be a significant investor component to condo sales. Typical units in the building were going for $400,000 for a unit size around 500 square feet with parking not included.

The tour provided a very comprehensive view of the development process from conception to occupancy. Virani shared that the building was designed from the inside out with less initial focus on the façade and more on the interior look and utility of the occupant spaces. He revealed many lessons learned from the utility and function of common elements, such as the ideal mix and use of gym versus party space. He also described a partnership CentreCourt entered into with the City to develop the streetscape on the City’s behalf. CentreCourt offered the use of its existing contractors to perform upgrades to the streetscape rather than having the city perform the work. Virani’s guided tour was an informative and interesting window into the development process and how another building was added to Toronto’s growing skyline.