A global recession and the resulting consumer appetite for value has stalled or slowed a number of higher-end residential developments in Greater Victoria, but it seems to be playing into the hands of at least one developer.
Chard Development, which in November completed the Juliet condominium project at the corner of Blanshard and Johnson streets, and the Corazon on Cormorant Street in 2006, has announced it is ready to go ahead with a third residential tower in Victoria's downtown.
Chard intends to start demolition this summer at 834 Johnson St. to make way for a 110-unit tower called The 834.
The project, which is expected to be finished in the late fall of 2011, is geared for first-time buyers and people wary of dealing with a condominium purchase beyond the $350,000 level.
"We are going for a more affordable, well-priced condo here that is in reach of many first-time buyers or those looking to move up," said president Dave Chard. "It's a high-quality building with high-quality finishes but we are not at the same luxury end that a lot of other condos that have come on stream over the last few years are striving for."
The units are also not going to be big, though Chard said the layout and design should provide a sense of space. The units will start at $198,900 for 450 square feet and range up to $600,000 for an 800-900 square foot penthouse.
Chard said more than a third of the units will be between $200,000 and $350,000. With interest rates continuing to drop that could mean many consumers might be able to buy a condo for the price of renting."We think that's a pretty attractive price point," he said, noting a reduction in construction costs of 15 to 20 per cent in the last two years and a softening of real estate prices in Victoria has allowed his company to "pass on the reduced costs to consumers" and go ahead with construction despite economic uncertainty.
"You're not going to see as many new projects as we've seen in recent years because of the economic situation but we are fortunate in that our building has been designed to reflect the affordability people are looking for," he said. "Any new product coming on has to come on at that new consumer price expectation level."
But any new product coming on stream in Victoria these days still has to deal with the economic reality that consumers may be slow to reach for their wallets and there's still a large inventory of new condos.
Chris Markham, president of the Victoria Real Estate Board, said a project like The 834 may see success because it won't be completed until late 2011.
"They probably won't get the presales though," Markham said with a nod to the existing inventory. "But if they have the wherewithal and are able to hold off then they may be able to do it. But right now we have enough supply."
Presales for The 834 will start in May, with a goal of selling half the units before demolition of the existing structure starts this summer.
One of the other selling features of the project could be the accessibility of the units for some older customers, as half of the building will be designed with an eye for ease of movement for older people or those with disabilities.
"It may be for the move-up buyers, maybe older and looking to move into a premises they are going to be able to stay in for a long time," said Chard.
