Today I spent the day at the 11th Annual Land & Development Conference here in Toronto. I found it particularly good this year, but it’s now late, I’m tired, and I want to go watch game 6 of the NBA finals. So I think this is going to be a fairly short post.
Here’s a summary of some of my key takeaways from the day (a lot of it is Toronto-centric):
Increasingly, the commercial and residential sides of the real estate development business are converging. And it’s being largely driven by the focus on urban intensification and mixed-use.
This is leading to an “institutionalization” of the residential side, which has historically been the domain of smaller private/local companies and rich families.
Merger is creating complexity around asset valuations: Is it about the income (cap rates) and/or the future development potential?
Low rise house prices in Toronto continue to skyrocket. Supply is highly constrained. This has been the story for a number of years now.
High rise condo prices in Toronto continue to be more or less flat (modest increase). The industry is going to need to figure out how to work with and compliment the current surge in rental apartment development. There is an element of competition between the two asset classes.