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Longtime readers of this blog might remember a post that I published back in 2016 where I talked about the genesis story of Toronto-based developer David Wex and his company Urban Capital Property Group. In it, I wrote about his first project at 29 Camden Street in the Fashion District. It had a total of 55 condominium suites and an average price per square foot of ~$195. And it took somewhere around 2 years to pre-sell enough of the suites for construction financing.
The reason I bring this up today is because when I originally wrote the post, it seemed so far from reality. In 2016, I said that these same 55 suites could be sold within 2 hours at $800 psf! But now things have changed once again. The market realities that David was facing in the mid-90s with Camden Lofts feel remarkably similar to today. Selling even 55 suites might not be a sure thing. And this is the first time in over 2 decades that the market has been like this.
So for fun, let's consider what happened in the late 80s and 90s. The Toronto housing market peaked in 1989 at an average price of approximately $273,698 (according to the Toronto Regional Real Estate Board). It then went on to decline 27% over the next 7 years, finally bottoming out at approximately $198,150 in 1996. So it took around 8 years for the market to stabilize.
Of course, the market took even longer to return to its 1989 peak. The average home price crossed $275,000 in 2002, which means it took 13 years in nominal dollars. However, $275k in 1989 is the equivalent of around $610k in today's dollars. So in real dollars, it actually took until 2011 for the market to return to its prior peak, which is some 22 years later!
I'm not arguing that the exact same thing will play out with this cycle. Who knows, Toronto is a different city. But I have suggested that 2028 could be the year where we're on the other side of this downturn. The average home price peaked, most recently, in 2022 at ~$1,194,600. Since then, it has come down by around 8.5% (as a broad average). If the market does turn positive in 2028, that'll be 6 years after the peak.
Only time will tell.
Chart from the Toronto Regional Real Estate Board; cover photo by Melvin Lai on Unsplash
Longtime readers of this blog might remember a post that I published back in 2016 where I talked about the genesis story of Toronto-based developer David Wex and his company Urban Capital Property Group. In it, I wrote about his first project at 29 Camden Street in the Fashion District. It had a total of 55 condominium suites and an average price per square foot of ~$195. And it took somewhere around 2 years to pre-sell enough of the suites for construction financing.
The reason I bring this up today is because when I originally wrote the post, it seemed so far from reality. In 2016, I said that these same 55 suites could be sold within 2 hours at $800 psf! But now things have changed once again. The market realities that David was facing in the mid-90s with Camden Lofts feel remarkably similar to today. Selling even 55 suites might not be a sure thing. And this is the first time in over 2 decades that the market has been like this.
So for fun, let's consider what happened in the late 80s and 90s. The Toronto housing market peaked in 1989 at an average price of approximately $273,698 (according to the Toronto Regional Real Estate Board). It then went on to decline 27% over the next 7 years, finally bottoming out at approximately $198,150 in 1996. So it took around 8 years for the market to stabilize.
Of course, the market took even longer to return to its 1989 peak. The average home price crossed $275,000 in 2002, which means it took 13 years in nominal dollars. However, $275k in 1989 is the equivalent of around $610k in today's dollars. So in real dollars, it actually took until 2011 for the market to return to its prior peak, which is some 22 years later!
I'm not arguing that the exact same thing will play out with this cycle. Who knows, Toronto is a different city. But I have suggested that 2028 could be the year where we're on the other side of this downturn. The average home price peaked, most recently, in 2022 at ~$1,194,600. Since then, it has come down by around 8.5% (as a broad average). If the market does turn positive in 2028, that'll be 6 years after the peak.
Only time will tell.
Chart from the Toronto Regional Real Estate Board; cover photo by Melvin Lai on Unsplash
This past Monday, I got together with David Wex (of Urban Capital) and Rick Sole (my business partner) for a night of DJ'ing electronic music. We called it our inaugural developer rave session and it was a ton of fun. I (mostly) had no idea what I was doing. Rick and David were great. And together, we played to a sold out crowd that consisted of two of our wives.
David was also kind enough to host us at his bar Lisbon Hotel (it's closed on Mondays). Which is why when I posted some of the above photos on X, Affan Imran asked if we are calling ourselves the Lisbon House Mafia. I thought that was pretty good. And since I'm still in search of a proper DJ name, that's the title of today's post.
Maybe when we do this again, we'll open it up to more than 2 people. Maybe.
My friend David Wex recently opened up a new bar called Lisbon Hotel, and this evening I went to check it out with him. It's not in Lisbon. And it's not a hotel. But it is deliberately designed to feel like a hotel lobby bar, and it is a great place for drinks and snacks. I recommend both of the dishes pictured above -- especially the cucumber and dill one.
It's also housed in the River City community, which his firm Urban Capital developed. And I think that's something. Developers are often criticized when they put in boring (yet profitable) uses in the ground floors of their buildings. And this is not that (though hopefully it's still profitable). This is him and his partners wanting to do something cool and help create a "place."
Who said new ideas need old buildings? Rhetorical question. It was Jane Jacobs who said this.
For more on Lisbon Hotel, check out this profile in Toronto Life.
This past Monday, I got together with David Wex (of Urban Capital) and Rick Sole (my business partner) for a night of DJ'ing electronic music. We called it our inaugural developer rave session and it was a ton of fun. I (mostly) had no idea what I was doing. Rick and David were great. And together, we played to a sold out crowd that consisted of two of our wives.
David was also kind enough to host us at his bar Lisbon Hotel (it's closed on Mondays). Which is why when I posted some of the above photos on X, Affan Imran asked if we are calling ourselves the Lisbon House Mafia. I thought that was pretty good. And since I'm still in search of a proper DJ name, that's the title of today's post.
Maybe when we do this again, we'll open it up to more than 2 people. Maybe.
My friend David Wex recently opened up a new bar called Lisbon Hotel, and this evening I went to check it out with him. It's not in Lisbon. And it's not a hotel. But it is deliberately designed to feel like a hotel lobby bar, and it is a great place for drinks and snacks. I recommend both of the dishes pictured above -- especially the cucumber and dill one.
It's also housed in the River City community, which his firm Urban Capital developed. And I think that's something. Developers are often criticized when they put in boring (yet profitable) uses in the ground floors of their buildings. And this is not that (though hopefully it's still profitable). This is him and his partners wanting to do something cool and help create a "place."
Who said new ideas need old buildings? Rhetorical question. It was Jane Jacobs who said this.
For more on Lisbon Hotel, check out this profile in Toronto Life.
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