Artist’s rendering of potential redevelopment at Valhalla Village in west Toronto, which is up for sale by KingSett Capital. (Courtesy JLL)

KingSett Capital is selling its 4.5-acre Valhalla Village, a site along the Highway 427 corridor in the western part of Toronto which is slated for almost a million square feet of redevelopment.

“The investment sits within KingSett’s Growth Fund, which applies active management to create value within an asset-specific thesis — in this instance through a rezoning,” JLL Capital Markets managing director Matt Picken told RENX. “With the rezoning nearing completion, it is time to monetize the investment.”

JLL has been exclusively retained by KS 300, 302 & 304 The East Mall Inc. to seek proposals to acquire Valhalla Village.

The site is currently home to three office buildings, but is slated to become a residential and commercial mixed-use development.

Valhalla Village’s location

Valhalla Village is bordered by Bloor Street West, Highway 427, Gibbs Road and The East Mall. It’s directly served by two Toronto Transit Commission bus routes and is two kilometres from the Kipling subway and GO Transit stations.

The area surrounding the property has seen substantial recent development activity, with approximately 2,400 residential units delivered in the last three years. More are on the way.

“Demand in Etobicoke is increasing for both condo and purpose-built rental, with units trading at a significant discount to core Toronto pricing, though the unit prices per square foot have increased dramatically in the past 24 months,” said Picken.

Edican Development Corporation’s Valhalla Town Square, a 6.6-acre mixed-use residential community, is beginning construction and will add to the density of the area.

The three-building, 336,832-square-foot office complex which currently comprises Valhalla Village includes on-site parking. The campus will provide holding income to potential purchasers through the remainder of the development process.

The existing leases for the buildings, which were built in the 1970s and range from six to nine storeys, allow for flexibility in terms of timing to development. While 304 The East Mall is empty, 302 The East Mall and 300 The East Mall are respectively 88 and 55 per cent occupied.

KingSett’s proposal for Valhalla Village

The entitlement process for Valhalla Village began last October. The anticipated approval of the rezoning application, which contemplates 36-, 27- and 21-storey towers and one 10-storey mid-rise building totalling approximately 986,500 square feet of gross floor area, is expected by the first quarter of next year.

“The site has received positive feedback and it allows a prospective buyer to finalize the planning process while creating a design/unit mix that works for their needs — whether it be condo, rental, seniors or a combination thereof,” said Picken.

KIngSett has proposed 867 residential units, 825 underground parking stalls, approximately 43,000 square feet of commercial and retail space to provide on-site amenities to residents, and a public park.

The Quadrangle-designed towers sit on top of a shared two- to four-storey podium and are arranged around a central courtyard fronting on to a road that connects Bloor Street and Gibbs Road.

“We expect a new purchaser to benefit from the work that has already taken place and use their own expertise to continue the development process moving forward through zoning and the sales and purchase agreement,” said Picken.

Valhalla Village is free and clear of existing financing.

Interest is high in Valhalla Village

The sales launch for Valhalla Village began in mid-July and Picken expects to call for bids before Labour Day.

“We have received tremendous feedback from the real estate community thus far, though we are still very early in the process,” he said.

“We expect continued interest from large private developers, many of which are backed by institutions. In addition, given the scale of the opportunity, we are seeing interest from some non-domestic developers.”