"Location, location, location!" isn’t a mere throwaway adage, it’s the strategy underpinning Metropia’s decision to launch a 50-storey condo project in Midtown Toronto amid strong economic headwinds.
“We believe if you have the right location, and right product for that location, and price your units at a level attainable for consumers, you can have success,” Samuel Frum, VP of investments at Metropia, told RENX about the decision to launch sales for The Hill this month.
The high-rise at 1420 Yonge St., just south of St. Clair Avenue, features 580 units in addition to eight rental suites, all of which Metropia said will have luxury finishes at sub-luxury price points.
With swift subway access at nearby St. Clair Station, a crosstown streetcar a couple of minutes north and the Eglinton Crosstown LRT just a bit further north, Frum said location is The Hill’s selling point.
“We thought it was the perfect location for young professionals and students, or for anyone who loves the charm of these local neighbourhoods but wants to be connected to everything city living has to offer,” Frum said. “This location allows you to participate in so many amazing amenities that Toronto has.”
The Hill located in a Toronto 'A' location
Frum added the location of The Hill, where construction will break ground next summer, is the reason Metropia acquired the project in 2021.
Yonge and St. Clair is one of the most densely populated areas in the entire Golden Greater Horseshoe — Slate Asset Management has helped transform the intersection, too — which Frum said is, “certainly a focus of ours when we make any investment."
“It’s an ‘A’ location in one of the most sought-after communities in Toronto,” Frum continued. “It’s a theme for Metropia; we like to be in prime locations.”
However, decelerating economic activity has had a cooling effect on the city’s housing market.
In such an environment, prime location could help lure reticent homebuyers out of the woodwork, but Frum conceded that alone isn’t enough.
Such thinking was instructive in how Metropia designed The Hill’s suite layouts, which Frum said optimize functional efficiency while restraining their price per square foot.
A 50-storey tower is an ambitious undertaking in the current economic climate, but The Hill’s floor plans are designed to augment the monetization of the building’s total square footage.
In doing so, The Hill has more units to sell and at lower price points.
To that end, in addition to regular one- and two-bedroom suites, The Hill will have junior ones and twos, which would be in the mid-300- and mid-500-square-foot ranges, respectively.
That doesn’t necessarily mean small units are cheaper to construct.
“Having smaller units in a building increases the construction costs of a project overall and it increases the complexity of designing a building by having more units in it, but we’re very comfortable with it and budgeted appropriately,” Frum said.
“The government charges tax to developers on a per-unit basis and it’s a substantial amount, which could be $40,000-60,000 per unit,” Frum added.
Given that high-rise condos attract plenty of renters, investors might be paying particular attention to The Hill, especially because junior one-bedroom units sell for $549,000, significantly below the $679,000 sticker price of a one-bedroom unit.
A junior two-bedroom unit sells for $799,000.
“It is certainly a reality that living with a roommate is something a lot of people are doing in the city these days, so we tried to build our units so that, if we think it’s possible there will be two people living there, we try to accommodate two bathrooms, which you’ll see in our junior two-beds,” Frum said.
The market had spoken
Metropia is fresh off a very successful launch of the three-tower Union City in downtown Markham. Metropia launched sales on the first tower on March 29 and sold all units released to the public in three days.
The second tower had sold out by April and sales for the third tower launched on June 8.
Union City is strategically located on Enterprise Boulevard just across the street from a York University campus slated to open in 2024. That has made the project attractive to investors and parents alike, in addition to end users.
Touting Union City’s location and consumer-friendly price points, Frum says the same playbook was used at The Hill.
“That is what we did at Union City and we took a similar approach here, with what we think is the demand of the market,” he said. “We hope to capture a similar level of success.”