All Forum Posts by: Jeff C.

I am putting together my first multi-family residential development (4 storey building, 61 units) in Toronto and looking for general advice on locating investors to fund the deal. I have a schematic set of architectural drawings and from the drawings I have set up a rough proforma which, so far, is looking like it could be a profitable endeavor. Which types of investors should I target? I've heard of angel investors, would like typically get involved with real estate developments? Or is there a better route to take?

Thanks Chad. Great points. 

The construction pricing is for wood frame assembly which is why it's on the lower side. I got this price from a local prefab wood-frame builder. 

The site is located right in the heart of the city which is why it is so expensive. Hoping to work out a better price though. Keep in mind that single family houses sell for way over 1 million in this city. 

I appreciate your input. 

yes, there are discounts on the soft costs because there are cost savings on the construction loan due to the expedited construction process. 5m is actually pretty low in Toronto for this size of a property. The market is expensive here. $550/sf is a pretty conservative number. I'm working on projects that are selling between $750-$1100 per sf. $550 per sf is the average number for all of Toronto so I used that to be safe. Yes, I'm aware that affordable housing is geared towards low-mid income. There are 100,000 people on the affordable housing waiting list and the city is waiving major fees to entice developers to build more affordable housing. 

I'm not entirely sure yet about the subsidiary corporation that would be used. The city of Toronto has recently announced their desire to partner with private developers in an effort to build on the number of affordable housing units required to meet the current demand. I don't yet what that means for my plans

Hi Michael,

The parking requirements vary depending on which part of the city you're in. I have designed a number of high-rise buildings in this area and because it's so close to the downtown core, and is highly accessible via public transit, the general parking ratio that we use is roughly .3 cars per unit. 

One aspect that I didn't mention in my original post is that I would like to market this development as affordable housing. If that works out, I may be able to reduce the parking requirements even further (and also reduce development and permit fees).

Hi All,

I just joined the forum and would like introduce myself.  I am an architect in Toronto, Ontario and just beginning my journey in real estate investment and development. I bought my first property last year and did a complete overhaul to the space. I am planning on selling the property in the next few months and will move on to the next property. I am also working on building a new 4 storey multi-family residential development here in Toronto (see my post from yesterday in the Real Estate Development and New Construction Forum). 

I have over 10 years experience designing and building low-high rise residential, hotel, office, and commercial developments and I am more than happy to share my knowledge with all of you. 

I look forward to sharing experiences with all of you and continuing along this exciting road. 

J

Hi All,

This is my first time posting. Please excuse the long post. 

I am an architect in Toronto, with over 10 years experience in the design and construction of high-rise residential buildings. I am working towards transitioning from architect to developer. I am trying to get my first development in motion. 

A friend of mine is looking to sell a 14,000 sf site in downtown Toronto. I have reviewed the zoning by-laws and have determined that the site can hold a 4 storey commercial/residential building. Of course, there is potential to rezone the site for more density. 

Over the last couple of years, I have been developing various plans and construction details for prefabricated micro units. Market research has showed me that micro units sell very well here. I have talked to a few prefab builders in the area and they have given me estimates that could save upwards to 20% on overall costs. Most of the cost saving appear to be related to time saved and thus reduced interest payments. I have seen some great examples of prefab micro units in New York and San Fran and would like to put together a similar type of development. 

I have taken the plans that I have developed, and applied them to my friends property. The goal would be to build a wood-framed, prefabricated structure with mostly micro units. 

Here are the stats that I have come up with:

4 Storeys,

61 residential units (mostly micro units under 350sf, with small percentage of 2bd and 3bd as well),

17 at grade parking spaces

Here are the rough project costs. Keep in mind that this is the first pro-forma that I've created and is probably quite a bit off the mark:

TOTAL HARD COSTS 

Ground Floor – 13,736 ft2 x $210/ft2 = $2,884,560

Second to Fourth Floors – 30,849 ft2 x $135/ft2 = $4,164,615

Sub Total - $7,049,175.00

10% Contingency - $704,917.00

Total Hard Costs - $7,754,092.00

ESTIMATED TOTAL PROJECT COST FOR STICK-BUILT OPTION

Land cost - $5,000,000 

Soft costs - $ 775,409.00 - ($17.39 per square foot)

Hard costs - $7,754,092.00 ($173.95 per square foot)

TOTAL PROJECT COST FOR STICK-BUILT (INCLUDING LAND) - $ 13,529,501.000

MODULAR SAVES APPROXIMATELY 20% ON OVERALL COST.

TOTAL PROJECT COST FOR MODULAR (INCLUDING LAND) - $ 11,829,501.000

PROJECT VALUE

Total saleable area = 29,000sf

Total value of units + retail space = 29,000sf x $550 per square foot = $15,950,000

Total potential profit = $15,950,000 - $11,829,501 = $4,120,499.00

I would like to know if I am way off the mark, or close with my estimates. The price per square footage for construction were taken from our local price index for wood framed construction. The 20% cost savings would obviously vary. 

I would also like some advice on how to move forward in attracting investors/partners to make this development work. The numbers seem good to me, but I simply don't have the experience to know for sure. 

Any advice would be greatly appreciated.

Thanks all!