In a city starved for rental accommodations, condo-quality purpose-built rental buildings are both fulfilling a need in the market and expected to burgeon in the coming years.
“There’s a major trend in Toronto in which people are selling their primary residences and moving into rentals, and as they age there will be a growing need here, as there is in New York and Vancouver,” said Sunny Sharma, president and co-owner of Leading Edge VIP. “It’s the ease of life and having that carefree environment of locking their doors and traveling to wherever their hearts desire.”
While downsizers often purchase condo units, Sharma notes that renting is cheaper than buying.
Toronto is presently rated an alpha city, but as it continues maturing and reaches alpha-plus status, the homeownership rate will inevitably drop and the rental rate surge.
There are signs that it’s already started. The Livmore is a purpose-built rental building in Toronto’s downtown that appears to have taken inspiration from Manhattan’s myriad high-end rental apartments. Replete with a concierge and a slew of amenities, including a canine wellness centre, The Livmore could very well be a glimpse into what’s to come.
Todd Nishimura, director of marketing and leasing for Vertica Resident Services, the property manager for The Livmore, says Toronto has a well-documented dearth of purpose-built rental buildings, and that extends to the luxury market. But make no mistake, the demand exists.
“For realtors, it’s difficult when they have clients in transition or who are doing home renovations and need something for a year,” said Nishimura. “We’re addressing something in the market that’s a higher level of quality and sophistication, as well as being centrally located and having a high number of amenities. It’s another option available to them that, up until now, wasn’t.”
While condo rentals comprise a considerable portion of the city’s rental stock, Nishimura cautions about the unpredictability of landlords.
“If you live in a condo, you could have a great landlord or you could have an absentee landlord who lives in Montreal or Munich,” he said.
Although there is greater demand for standard-quality purpose-built rentals, upper-end stock is a cog in the wheel and succours mobility through different market segments.
“By offering something like The Livmore, which is higher end, it’s the trickle-up phenomenon,” said Nishimura. “Any supply in the A-quality building is good because there are people in the B-quality buildings who would move up if the opportunity was available to them, and down the ladder other people will move up too. We believe supply of any kind is good because the city needs more.”