Gairloch Developments just unveiled its fourth condominium project in Leaside, a Toronto neighbourhood the company's founder and president told RENX is the city’s next real estate hotspot.

The lynchpin is the coming Leaside LRT Station, part of an under-construction light rail transit corridor that connects to the city’s subway system.

“The new LRT opens up a new realm for us with a mass transit option 300 yards to our north,” Bill Gairdner said of the station’s proximity to Gairloch’s new project, 1802 Bayview.

“It’s so encouraging for equity partners and condo investors, and everyone else involved in a project, when you have all three levels of government investing in rapid transit all outside your front door.

“Leaside is awesome with its nice tree-lined streets, nice schools, easy access to the Don Valley Expressway to get you downtown or to Midtown and the LRT has added a whole other dimension.

"It’s not up and running yet, but when it is the option to live in Leaside without owning a car will be a game-changer.”

Still undecided if project will be rentals or condos

Gairloch hasn’t yet decided if the planned 46-storey, 419-unit tower at Bayview and Roehampton Avenues will remain a condo as originally envisioned or if it will become a rental building.

The building, designed by architects-Alliance, will offer a range of suite options ranging up to four bedrooms to attract families. Its podium is wrapped in alternating glass ribbons and recessed terra cotta panels.

1802 Bayview also marks the third partnership between Gairloch and Harlo Capital, a Toronto-based private equity firm that identifies and invests in real estate developments Canada-wide. The other two, Leaside Common and 29-39 Pleasant Blvd., aren’t far from this latest venture

The partnership can be traced back to Freed Developments, where Gairdner and Andrew Lepper, Freed's then-CFO, worked alongside each other. Lepper now serves as the CFO at Harlo.

Even with lenders and investors tightening their purse strings amid persistent headwinds, Gairdner said capital hasn’t been especially difficult to syndicate “as long as it’s a good site with a strong business plan and there’s a robust track record.”

The Gairloch-Harlo duo has yielded two successes and they’re betting on a third.

“We kept bumping into each other,” Gairdner recalled of the partnership’s genesis.

“Harlo are specialists in fundraising on the capital side, so it’s great to have them have our back. They bring a wealth of experience and back office, and they’re a great team, so it’s always great to have more smart people with eyes on each individual project.”

Leaside is an emergent neighbourhood

Leaside is an affluent area code, its makeup composed primarily of single-family homes, but the recent run of new condo development has introduced entry-level housing and made one of Toronto’s most established neighbourhoods accessible.

According to Henry Byres, coordinator of the Bayview Leaside BIA, the array of housing options has already diversified the neighbourhood demographically.

The 33-year Leaside resident recalled his daughter being one of the few children in their neighbourhood in the 1990s, a stark contrast to the droves of young families who now window shop on Bayview Avenue on any given day.

“The average age in the area has gone down quite a bit and we see a lot of families with kids, a lot of young children,” Byres said, adding that Bayview Avenue was sleepy 20 years ago.

“In terms of the street’s overall vitality, it’s increased and improved,” he said. “It’s a street where you can get everything you need for daily life.”

Today, Bayview Avenue is lined with boutique retail stores, restaurants serving a range of international foods, cafes and other “very unique, very one-off” and independently owned, stores.

The neighbourhood isn’t a nightlife destination, Byres, added, a seeming reflection of Leaside’s residential character.

“We’ve been able to maintain this independent streak we have here, but the fact that we’re not part of a larger commercial strip gives people in the area more ownership,” Byres said.

“I think, more than anything else, that’s what keeps people coming back.”

Investors set sights on Leaside

That investors who typically favour downtown and midtown condos have begun scooping up units in Leaside is a telltale sign it’s an emergent submarket.

Gairdner took notice in the fall of 2021 when Gairloch launched Leaside Common, a nine-storey, 198-unit mid-rise just south of 1802 Bayview, and investors and brokers became regular fixtures at its sales centre.

“It helped us sell about $160 million worth of condos in 60 days,” Gairdner said.

“The investor community realized it wasn’t a downtown condo or that it wasn’t Yonge and Eglinton, but there was a unique angle to get a better return and better value from a more end user-friendly investment.

"That was a bit of an eye-opener for the city and savvy, early condo investors showed up in droves for that particular launch.”