There’s been a lot of interest in the Toronto Don Valley Hotel and Suites and adjacent development lands since Allied Hotel Properties Inc. (AHP-X) hung a “for sale” sign on the property earlier this month.
“We see both traditional residential developers taking a look, as well as some of the more substantial hotel owners,” CBRE Hotels executive vice-president Bill Stone said of the property his company has been asked to represent. “The interest will be very strong domestically and we’re anticipating some pretty strong off-shore interest as well.”
The 5.42-acre site at 175 Wynford Dr. is presently occupied by: a six-storey, 353-room hotel; Garden Cafe and DV Bar/Bistro; a two-storey convention centre; a health club with exercise equipment, a whirlpool, saunas, steam rooms and indoor and outdoor swimming pools; and 420 parking spaces. It offers 17 meeting rooms comprising more than 16,000 square feet.
Major renovations to Toronto Don Valley Hotel and Suites that included guest room, public area, mechanical, electrical and structural upgrades were completed for approximately $8.5 million in 1999. It underwent another renovation to public areas and guest rooms in 2010 and 2011.
“It’s a very successful hotel that’s been there a long time,” CBRE Canada Land Services Group executive VP Mike Czestochowski told RENX.
Zoning for future residential development
The property received zoning approval in 2015 to permit the development of two new residential towers comprised of just over 585,000 square feet.
A site plan application was submitted last year that proposes 755 residential units in 32- and 39-storey towers along with parking, indoor and outdoor amenity spaces, and a restaurant. It maintains the guest room wings of the existing hotel, while repurposing its lobby and convention centre.
A new owner could explore potential rezoning of Toronto Don Valley Hotel and Suites for additional residential density in the future, but Czestochowski said CBRE is offering the property based on its current zoning. The hotel continues to operate normally.
“There’s now a comprehensive development plan that a company can take on,” Stone told RENX. “They (Allied) are not traditional developers.
“They will either work with developers or, in this case, would like to put it in the hands of somebody else who will capitalize on what they’ve achieved.”
Hotel site offers a prime location
Toronto Don Valley Hotel and Suites is located on the north side of Eglinton Avenue and east of the Don Valley Parkway. A transit stop is being built at the corner of Eglinton and Wynford for the new Eglinton Crosstown light rail transit route.
Czestochowski said those factors, along with the Aga Khan Museum and the mixed-use redevelopment to be undertaken at the nearby 60.5-acre Celestica campus property, add to the attractiveness of the site.
“Wynford has always been a go-to location for condos, and I think we’re seeing a resurgence.”
Allied Hotel Properties Inc.’s future plans
Allied hasn’t set a definitive schedule to complete the identification of potential buyers or to sell the property, and there’s no guarantee a transaction will take place. A sale would be subject to certain conditions, including approval from the TSX Venture Exchange and Allied’s shareholders.
“It’s their property and they will make a decision based on the offers,” said Czestochowski. “We are receiving offers until July 31, and I fully expect that Allied will have a choice of who they can sell the property to.
“Based on the activity level and the calls Bill and I are receiving, I have no doubt that we’ll have a multiple-offer situation.”
Vancouver-based Allied was formed in 1998 to amalgamate the hotel interests of parent company Allied Holdings Ltd., a real estate investment and development company that has owned and developed commercial and residential real estate since 1968.
Allied has owned, developed and managed hotels in Vancouver, Edmonton and Toronto. Toronto Don Valley Hotel and Suites is the last one remaining in its portfolio.
Stone said he didn’t know what Allied’s future intentions are, noting he’s focused on the current task at hand of trying to find a purchaser.