The two companies acquired the property for $120 million from two numbered companies in December 2021, after already submitting an official plan amendment and zoning bylaw amendment application for a high-density mixed-use development.
The site is currently under-utilized with a 95,200-square-foot commercial plaza and surface parking. The plaza is 90 per cent occupied by national and local tenants, including retail and office users, and generates annual net rental income of $1.91 million.
CBRE has been retained by the vendor to seek proposals for the disposition of the property.
“We've reached pricing for condos such that, on transit lines and future transit lines, it justifies construction,” CBRE vice-chairman Mike Czestochowski told RENX.
What was planned for the site
Mizrahi and Constantine were proposing a four-tower, multi-phased condominium development comprising 2,196 residential units (including 440 live/work spaces for residential or business use) and 34,243 square feet of retail space.
The four towers rising from two six-storey podiums range from 34 to 55 storeys with all elements comprising a gross floor area of 1.87 million square feet.
“Many of our big private institutional developers for condos like multi-phased projects,” Czestochowski said. “They like the fact that they can be there for a long period of time.
“With the marketing and everything, it’s a lot of money to get up and going. And if you can defer it over four towers, it helps the economics of it.”
The proposal included five levels of underground parking with 1,098 resident spaces and 220 visitor spaces, as well as more than 1.72 acres of parks and open spaces.
Zoning and site plan application
The property is within the Yonge Steeles Secondary Plan area and a settlement hearing for the zoning bylaw amendment will take place on March 23.
A site plan application hasn’t been submitted, allowing the property’s purchaser to finalize the design and layout of the buildings as desired.
“It will be sold zoned,” CBRE sales representative Emelie Rowe said, “so you have that risk off the table. The zoning will be completed upon closing.”
There’s no Section 37 contribution for community benefits for the proposed development, but the site is subject to the Yonge Steeles Corridor Cost Sharing Agreement.
The offer submission deadline for 180 Steeles Ave. W. is 3 p.m. on April 12.
Improved public transit coming to the area
Work has started on upgrading the Finch subway station, which will lay the groundwork for future construction of a northward extension to the Yonge Street subway line.
A station will be located at the intersection with Steeles and a bus rapid transit line is also planned for Steeles.
“It's been a while since we built a new subway on Yonge Street and it’s definitely long overdue,” Czestochowski said. “We always like to see transportation because it helps with everything.”
Czestochowski said the prices and absorption of condos farther west near Jane Street and Hwy. 7 rose once a subway station was built there. He anticipates the same thing to happen around Yonge and Steeles, which has already been of interest for high-density residential developers for a decade.
There are two active condo projects with more than 1,200 units under construction that achieved pricing in excess of $1,400 per square foot and strong absorption, according to CBRE.
Residential rental rates in the area increased by more than 20 per cent from Q3 2021 to Q3 2022.
“We knew that, given the location, there was going to be interest,” Czestochowski noted. “We’re very happy, and it’s a mix of institutional and private developers coming forward — I'd say a little bit more slanted on the private developer side.”
Proposed developments near Yonge and Steeles
Other major residential developments are seeking approvals in the neighbourhood along with 180 Steeles Ave. W., according to CBRE.
Morguard is proposing a master-planned community with 22 buildings ranging from 12 to 50 storeys and totalling 7.2 million square feet at 6464 Yonge St.
AWIN Group of Dealerships is proposing the development of four buildings with a combined gross floor area of 935,477 square feet and 1,085 residential units at 212, 220 and 222 Steeles Ave. W.
“There is a higher and better use for a lot of these properties and they want to target density along Steeles and along Yonge,” Rowe said.