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The Real Estate Market Ottawa’s bubbling condo market reveals a desire for more

A view of the Frontier purpose-built rental project by RioCan Living, in Ottawa’s east end.

RioCan

As an early birthday present to himself, Sam Soucy bought a condo.

Mr. Soucy was working on Parliament Hill but living near Bank Street and Hunt Club Road – about 25 minutes away – until a late release of a unit at the newly built SoBa building in Ottawa’s Centretown neighbourhood came up in early March.

He moved quickly and, within 24 hours, he had secured his first home – just in time for his 23rd birthday.

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“It was a question of timing and patience,” Mr. Soucy said. “Once you get one, you can’t waste time.”

For Ottawa, a 24-hour turnaround in a brand-new condo building was once unusual, but is now growing more common. Toronto and Vancouver may be used to the “fear of missing out” mindset, but it’s a new phenomenon here. Ottawa, faced with a crunch on supply, coupled with a young work force with one of the country’s highest median incomes, has seen its condo market grow very lively.

Ralph Shaw, a former president of the Ottawa Real Estate Board, says condo sales have increased by 60 per cent since 2015, while prices were up 7 per cent in the same time frame.

Sales of condos in January, 2019, increased nearly 21 percent year-over-year.

Despite growing demand from young buyers keen to live close to downtown, there are fewer than 10 high-rise condo projects in the works in Ottawa right now. Some, such as SoBa, are nearing completion, others are under construction or plan to have shovels in the ground this year and still others have planned occupancy dates in 2021.

Sam Soucy at his new condo in the SoBa building, in downtown Ottawa. Mr. Soucy bought the unit on his 23rd birthday.

Jess Rose

“Ottawa’s population is growing. People are moving here. It’s a good story," Mr. Shaw said. “But we’re behind the curve.” The city needs more condo supply, he said.

Sam Mizrahi, the developer behind The One development at Toronto’s Yonge Street and Bloor Street, is also behind one of the few Ottawa projects set to commence construction in 2019. He said his first foray in the city – a luxury high-rise at 1451 Wellington Street in Westboro – won’t be his last, because he’s seen a change in both Ottawa as a whole and the condo market in the city in the past few years.

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Another development, the Wellington West Lofts, will be completed at the end of 2020 and Jakub Ulak, president of developer Surface Developments, says 90 per cent of the large, $1-million-and-up units are already sold, less than eight weeks after they were released to the public.

The key to his developments success, he says, is how highly customizable the units are, no matter the price.

“We have greater opportunity to customize the cases of our cell phones than the homes we pay $1-million for, which I think is absolutely bananas,” he says.

But for every $1-million unit sold, there are even more Ottawans looking for high-rise rental in a market, according to Mr. Shaw, that’s been pinched to less than 1-per-cent availability.

RioCan Living and partner Killam Apartment Reit have nearly completed their Frontier project in Ottawa’s east end, a purpose-built rental high-rise adjacent to what will be the new Blair light-rail transit station on the grounds of a shopping plaza.

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The Frontier project is adjacent to what will be the new Blair light-rail transit station.

RioCan

Jonathan Gitlin, the chief operating officer of RioCan Living, says there was an opportunity to build something that was transit-oriented. One-bedroom rentals start at $1,550 a month, while two-bedroom units range from $1,920 a month to $2,590 a month.

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“We wanted to give that community the opportunity to live in an environment right next to a transit stop and next to a great shopping destination,” he says. “It was pioneering because there was not a lot of high-rise in that area. Although we felt it was not a tested market, we thought all the attributes were there to make it a success and make it great for the community.”

The impact of LRT will add another layer to Ottawa’s already booming condo market, according to SoBA developer Brad Lamb. Mr. Lamb, who has projects in several Canadian cities, said Ottawa is the “best place” to buy a condo in Canada.

The LRT, despite its recurring construction delays, will change the viewpoints of people who are thinking of living downtown, Mr. Lamb said.

The LRT is set to connect Blair Station in Ottawa’s east end to Tunney’s Pasture, just west of downtown.

“When [buyers] start seeing the convenience of [the LRT] and they see how their friends have a benefit, they will start clustering more downtown,” said Mr. Lamb, whose condo property, the Gotham, is above an LRT station in downtown Ottawa.

“Ottawa is finally catching up to Toronto in terms of its ‘urbanness.’ "

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Mr. Ulak said that Ottawa has changed enormously in the past 10 years and he and other developers have a new vision for Ottawa.

“There’s a lot of people [with an] entrenched [view] of what Ottawa used to be. But we’re looking forward and seeing the potential of this incredible city and people who live here,” he said. “That’s the kind of project we’re trying to build and that’s what I think you’ll see more of.”

Mr. Soucy said he sees markers of change all around him.

“It’s something we’re seeing more and more, especially if you go to the downtown core,” he said. “I wouldn’t say it represents traditional Ottawa, but the Ottawa of the future and what the city is trying to become.”

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