Succession planning moves by Greenrock Investments have resulted in two rental apartment properties and a redevelopment opportunity in prime Toronto locations being marketed for sale.
Greenrock Group of Companies and Greenrock Real Estate Advisors chief executive officer Barbara Rodgers told RENX that five families make up the third-generation family ownership group. Three of the families have decided they no longer want to be invested in real estate.
“In order to allow them to step away from the business, we’ve put these properties on the market,” Rodgers explained.
77 Davisville and Village Green Apartments
77 Davisville is a 483-unit purpose-built rental building with 302 parking spaces, a rooftop terrace and an adjoining indoor pool and sauna near the Davisville subway station in midtown Toronto.
Nineteen per cent of the units have been renovated and $11.9 million has been invested in capital improvements and suite upgrades since 2014.
In addition to the 99 per cent occupied building, there is a significant opportunity for intensification. The 1.95-acre site is sufficiently large to accommodate an additional 39-storey tower.
Village Green Apartments offers 705 rental units, 99 per cent of which are leased, as well as 600 parking spaces, on-site laundry facilities, a full-scale dog run and ample green space.
Thirty per cent of the units have been renovated and $18.3 million in capital improvements and suite upgrades have been made since 2014.
The 2.7-acre site is close to both the College and Wellesley subway stations as well as the University of Toronto and Toronto Metropolitan University campuses. Longer-term opportunities to add additional residential density also exist at the property.
Improvements made to both properties
Both properties are managed by Greenrock Property Management. Improvements have included renovated common areas, lobbies and amenity spaces, as well as new elevators, boilers and emergency generators.
The four buildings are in close proximity to grocery and liquor stores, restaurants, coffee shops and entertainment venues.
The Greater Toronto Area apartment vacancy rate was 1.9 per cent in the second quarter, with average rents increasing 12.5 per cent to $3.91 per-square-foot-per-month year-over-year. With vacancy in the low single digits and historically steady demand, rental growth is expected to continue to accelerate going forward.
Market rents are approximately 33 per cent and 43 per cent above in-place rents at 77 Davisville and Village Green Apartments, respectively, offering investors significant income growth potential.
“These are generational assets that rarely come on the market,” Rodgers explained. “They have been managed to an impeccable standard and the Green family has taken great pride in their ownership and management of these properties and has continued to invest.”
There’s been what Rodgers called a “robust” amount of interest in the properties from public, private, Canadian and international investors.
While the two properties are listed together, Greenrock will consider selling them individually. No bid deadline has been set at this point.
57-93 Balliol St. site
CBRE’s Land Services Group is also marketing a Greenrock-owned 1.07-acre property at 57-93 Balliol St. in midtown Toronto, which is currently occupied by 19 two-storey rental townhomes, as a redevelopment opportunity.
The site, located less than 200 metres from the Davisville subway station, is approved to build a 41-storey tower with 365,972 square feet of gross floor area that could accommodate 477 residential units once the townhomes are demolished.
“We're really excited about moving this forward, but it's also difficult because these buildings were within the families and they take such pride in them,” Rodgers said.
“It was a difficult decision but each family made the right decision for themselves.
"But it's very difficult to say goodbye to properties that the families and our team has invested so much into, and took such pride in managing and developing. It's a bittersweet time for all of us.”
While two families from the ownership group will continue to own and invest in other properties controlled by the business, Rodgers said they’re not looking to acquire additional assets at this point.