Looking out the window of his office in the Yonge Eglinton Centre, Ed Sonshine sees a lot of construction going on.
“This is a happening place,” says the 66-year-old chief executive of RioCan Real Estate Investment Trust.
In many ways, it’s the perfect vantage point for the future of big development in Toronto. Yonge and Eglinton is seeing a surge of office and condo construction.
The number of active new condo units in North Toronto rose 166 per cent in the last three years, significantly outpacing the growth rate of the western part of downtown, where cranes are ubiquitous.
A big part of the appeal? “Transportation,” Mr. Sonshine says. When RioCan bought the Yonge Eglinton Centre six years ago, Mr. Sonshine became so convinced that the area was set for a resurgence that he moved the company’s own offices into the building, from their previous location in a King Street tower in the financial district.
“We didn’t know for sure about the Eglinton transit route, but they’ve been talking about it for 100 years, so I figured sooner or later it was going to happen,” he says.
And he was right. The province has since committed $8.4-billion to the creation of four light rail transit lines, including the Eglinton Crosstown LRT, which will run from Black Creek Drive to Kennedy Station and is scheduled to be complete by 2020.
That is still years away, but the new transit is already having an impact on the neighbourhood. Yonge and Eglinton, which not so long ago was facing decline, is experiencing a massive growth spurt that is just in its infancy. Following in the footsteps of its southern siblings, it is going to get much taller, as 30-storey-plus condo buildings become more commonplace. And while density is being encouraged, the congestion that it can cause is likely to stir up more controversy around Yonge and Eg (or as Mr. Sonshine notes it’s sometimes called, Young and Eligible) than it has in some parts of the core that are more accustomed to hustle and bustle.
But this is a train that’s already out of the station. The average price per square foot for new condos in North Toronto has risen 18 per cent in the last three years, to $636, according to data from RealNet Canada Inc. (This works out to $508,000 for an 800-square-foot condo.) While there are more cranes and higher prices on downtown’s west side, its growth rate doesn’t touch that at Yonge and Eg.
A cycle is occurring: Yonge and Eg became more attractive to residents, which attracted condo developers, who – with the added amenity of the new LRT line – are attracting more residents.
As the growth feeds on itself, new office space is being built for companies that want to tap into the growing pool of nearby residents. And condo builders are looking for ways to appeal to the area’s vast population of renters, another aspect of this shift that will change the flavour of the neighbourhood.
The impact of these changes will be substantial, say developers who are becoming increasingly active in the area. Five of them gathered recently at Grano, a restaurant on Yonge Street that’s a local mainstay. Over coffees and cakes, they discussed the neighbourhood’s transformation and why they are collectively betting billions of dollars on the area.
“We feel that this is the beginning for Yonge and Eglinton,” says Todd Cowan, a partner at CD Capital, which has teamed up with Freed Developments for a big condo development push there.
“Yonge and Eglinton needed something to give it a kickstart, and we think that this commitment for the LRT line is what really created the impetus,” Mr. Cowan says. “The thought of being able to get on the LRT ten years from now and be at the airport in half an hour or 40 minutes – that’s a pretty amazing opportunity.”
CD Capital and Freed Developments will be making a billion-dollar commitment to the neighbourhood over the next five to ten years. //“We currently have four towers plus some retail that we’re doing as a first phase,” he says. “We’re big believers that, if you look back ten years from now, it’s going to be one of those moments where if you’re not in, you’re going to say ‘Geez, I wish I had invested there.’ I’m not going to say it’s the new Yorkville, but there are some pretty smart people that invested in Yorkville a long time ago and it was transformed, and I believe in a similar way this LRT line will turn Yonge and Eglinton into a place that is much more valuable five, ten years down the road.” Mr. Cowan says.
Chris Sherriff-Scott, senior vice-president at Minto, remembers when the area was losing its mojo during the ‘90s. “It was actually in decline,” he says. “When do people know that a neighbourhood is in decline? When they wake up one day and stores are shuttered. That’s what was happening here gradually.”