Upscale condos such as at 181 Davenport in the ritzy Yorkville neighbourhood aren’t just for mature buyers. Successful young entrepreneurs and professionals are also buying at luxury addresses.
For veterans of the Toronto real estate market, it takes a lot of sticker to create a shock. There’s become a plethora of buyers in the luxury condo market, with rising prices in all neighbourhoods, especially the tony ones, and a growing number of downsizers eager to remain in the city.
As Mimi Ng, sales and marketing VP for Menkes which developed the Four Seasons Hotel and Private Residences, points out, “a million-dollar suite is not too uncommon these days.”
But what is taking agents and sales people by surprise is the age of many luxury buyers. “When that luxury buyer walking through the sales centre door is in their late 20s, you do sit up and take notice,” says Barbara Lawlor, president of Baker Realty.
Ms. Lawlor, who handles sales for the Ritz-Carlton Residences which start at $2.2 million, says she’s seeing more buyers in the under-40 bracket. Though some are lawyers and stockbrokers, more are entrepreneurs, “hugely busy with 24-7 careers and used to making decisions very fast.”
Janice Fox, director of sales for the Four Seasons Private Residences, is finding the same thing. Young purchasers snapping up suites, anywhere from $1 million to $30 million, are mostly successful entrepreneurs in real estate, high tech, media, fashion, or design. “They’re sure not resting on their laurels after university,” she says. “And it’s astounding what they’ve achieved at such a young age.”
As much as they earn, they like to spend, notes Ms. Lawlor, “as long as it’s the best of the best, both in service and brand name.”
Sam Mizrahi, whose company has developed luxury condos at 133 Hazelton Lanes and 181 Davenport, finds that young buyers “strapped for time, are looking for services and amenities that allow them to manage their lives. So valet parking becomes a necessity because it saves time. And the concierge – the true concierge who can get milk in the middle of the night, secure theatre tickets, or arrange an entire party – is invaluable.”
Location fulfills that need too. “Yorkville is so close to work and the subway that whisks you there,” Mr. Mizrahi says. “It’s also close for leisure. You can walk to theatre, art galleries, or nearby Ramsden Park’s jogging trails and tennis courts.”
While resale isn’t the primary reason for buying at these prestige addresses, Ms. Fox has seen a lot of young buyers in the Four Seasons bar or restaurant. And they’re usually talking real estate. It makes sense, she adds. “They’re pretty proud of what they’ve achieved so they’re interested in keeping abreast of prices.”
Even their parents express surprise at the amount they’ve paid for an apartment, Ms. Fox says, but what’s possibly more surprising is that most pay cash. “They’re really savvy financially, and calculate the smartest way to pay. If they have a mortgage it’s because that’s the best choice.”
Even more surprising, Ms. Lawlor adds, is how difficult it is to pick this buyer out in a crowd: “Sometimes they show up in jeans and sneakers, which proves you can’t judge a book by its cover.”
This buyer has more than a working knowledge of interior design. “Given how much they work, I don’t know where they get the time to learn about design,” Ms. Fox says, “but they’re very well versed in the trends.”
A lot of time is spent on “minutiae” like grout, plumbing fixtures, appliances, and cabinet finishes. Plus, they regularly bring catalogues from European or Japanese furniture designers to the sales centre to show the kind of look they’re after, wanting the suite that will best showcase the furniture they have or intend to buy.
Ms. Lawlor notes the same: “This young buyer is very particular about design, and very clear about their wants: The kind of view, the suite’s layout, the kitchen colours and so on.”
Mr. Mizrahi finds the young buyers, especially at 133 Hazelton, are just as likely to incorporate a wine cellar as older buyers, whether it’s a component of the kitchen, or an entire room devoted to wine.
Like their peers in other economic brackets, they are out a lot. If they are entertaining at home, Ms. Lawlor says “they’ll hire someone to do the cooking. Why not? You’re living on top of a hotel like the Ritz and all great food is at your beck and call.”
More important to this buyer, Ms. Fox says, are closets and bedroom, as well as the living room where they’ll relax. Any interest in other areas – especially kitchen – is mostly about esthetics. “They’re sure not picking an oven for how fast it cooks a roast,” she quips.
The young buyer is single, mostly male, although Ms. Lawlor has sold suites to “a few amazing young women.”
As demographer David Foot, bestselling author of Boom, Bust and Echo, says “demographics explain two-thirds of just about everything … social trends come from population shifts.”
As Foot explains it, declining births over the 1960s and 1970s – thanks to the Pill and more women in the workplace – resulted in fewer workers in their late twenties and thirties. The tail end of that Bust generation, born between 1967 and 1979, in particular has done “extremely well since the mid-1990s,” Foot says. “They got really good jobs in the new millennium … they’re on front end of small and medium businesses, they’re energetic, and don’t have a lot of competition.”
Also raised on high tech and new media, which crosses all cultural boundaries, this group is truly global, sharing the same values and striving to achieve the same goals, Ms. Fox notes. “They seem to have no sense of [geographic] boundary and feel confident in their success regardless of location. Many of these clients operate a number of businesses in multiple countries simultaneously and this is their norm.”