Tricon Residential plans to build two rental apartment towers on a Richmond Street East site in Toronto which it has acquired from ONE Properties. (Courtesy Tricon Residential)

Tricon Residential has purchased a 2.14-acre portion of a downtown Toronto site from ONE Properties for $129 million, where it plans to build two apartment towers as part of mixed-use development.

“What we really like about the site is that it’s one of the last few large development parcels close to the downtown core,” Tricon Residential (TCN-T) managing director of investments Andrew Joyner told RENX.

ONE Properties declined RENX’s interview request, but Joyner said CBRE had been marketing the property — which has addresses on Queen Street East, Richmond Street East, Ontario Street and Brigden Place — since 2019. ONE Properties has retained a portion of the site where it plans to build a 25-storey condominium.

The eastern part of downtown is becoming a growth area, with investment from three levels of government, new office buildings, increased employment, gentrification and more public transit on the way. All of those factors appealed to Toronto-headquartered Tricon Residential.

“More and more creative tech, advertising, media and information-type tenants are looking east and we’re really excited about the long-term prospects of the area,” said Joyner.

Tricon Residential’s plans for the site

Tricon Residential intends to build two Hariri Pontarini Architects-designed, purpose-built rental apartment buildings of 24 and 33 storeys with approximately 850 combined one-, two- and three-bedroom units. Joyner said the plan is for more two- and three-bedroom units than are normally found in a condo building.

Amenities will include a large gym, a yoga studio, an outdoor pool with west-facing skyline views and parcel rooms with oversized and refrigerated lockers.

Joyner said there will be approximately 80,000 square feet of office space as part of the redevelopment: “There are two heritage brick-and-beam office buildings that will have retained facades and be rebuilt. We think this is going to be extremely attractive office space.”

While keeping the heritage elements along Richmond and Ontario Streets, Joyner stressed the offices would incorporate the latest technology to alleviate concerns about COVID-19 — including new air filtration, ventilation and touchless systems.

Retail elements at grade will wrap around the site and be included in the laneways which run through it.

Joyner said an on-site park of approximately three-quarters of an acre will include landscaping, trees, benches, tables and gathering areas where the local community can congregate.

There will be two levels of underground parking to accommodate motor vehicles and bicycles of residents and office users. The Queen Street streetcar passes the site and a future stop on the Ontario Line subway is planned nearby.

Joyner anticipates construction will start late this year or early in 2022 and with first occupancy in early 2025.

Faith in downtown Toronto

“We’re very bullish on the city long-term,” said Joyner.

“Notwithstanding some of the current short-term disequilibrium with a lot of the demand-side factors like immigration and universities, schools and employers downtown being shut down, we’re taking a long-term view and are very excited about the long tailwind support for this opportunity.”

Joyner sees a gap in the market for purpose-built rentals that meet the needs of many of today’s renters. Currently, people often have to choose from an apartment building constructed 50 years ago or more, or rent a unit in a condo property.

Tricon Residential had success and earned acclaim from The Selby, a 50-storey, 441-unit luxury apartment at 592 Sherbourne St. that was delivered in 2018. It’s been building on the momentum from that project ever since.

“I think we’re the most active developer of purpose-built rental in the downtown core,” said Joyner. “We’ve got 11 projects with about 5,200 units on the go and we continue to plant a flag in each sub-market of Toronto that can support a new purpose-built rental building.”

Tricon Residential’s other Toronto activity

Andrew Joyner, managing director of investments at Tricon Residential. (Courtesy Tricon Residential)

The Taylor — a 36-storey, 286-unit apartment with retail and commercial space at 57 Spadina Ave., just south of King Street West — should be completed in early 2022.

Tricon Residential has approximately 12 acres in the West Don Lands where it will develop approximately 2,500 rental units, with about 30 per cent categorized as affordable. The first buildings are expected to be delivered in 2023.

The Ivy — a 34-storey, 232-unit apartment located at 9 Gloucester St., near Yonge and Bloor Streets — should also be delivered in 2023. It’s being developed in partnership with Angel Developments.

The James is a 21-storey, 141-unit apartment at 10 Price St. in the upscale Rosedale neighbourhood that’s expected to be delivered in 2025.

Tricon Residential and TAS have partnered on 7 Labatt, a 38-storey project near Queen and River Streets that will have purpose-built rental and condo units along with a commercial element. It has an estimated 2025 delivery date.

Tricon Residential was founded in 1988 and started trading on the Toronto Stock Exchange in 2010.

It owns and operates a portfolio of more than 31,000 single-family rental homes and multifamily rental apartments in the United States and Canada, with a primary focus on the U.S. Sun Belt.

It has approximately $9 billion of total assets under management and a market cap of approximately $2.83 billion.