Vancouver’s row of multimillionaires on Alberni Street is regaining momentum after a lull in the West End luxury market in recent years.
Since 2018, the West End condo market had slowed, particularly on the luxury and ultra-luxury side. But as the world slowly returns to normal, and immigration and tourism with it, the downtown luxury market is ready to get back to business, says developer Kevin Cheung, managing director of Landa Global Properties.
The company has invested heavily in Vancouver’s Alberni Street Electric Corridor with three projects, including a pair of 43- and 48-story passive house towers at 1468 Alberni Street. towers, designed by Robert AM Stern Architects of New York, with Vancouver MCM Partnership. Its 1650 Alberni Tower, in partnership with Asia Standard Americas, is designed by SOM, the architects of One World Trade Center in New York.
Asked a year ago, Cheung said developers who had projects to launch had put them on hold. He described the mood as one where developers were cautiously waiting and wondering who would have the guts to jump in first. This year, the atmosphere is a little different, and he is therefore one of the first to launch presales, for his 1818 Alberni project, which was on hiatus.
“With immigration and tourism coming back and people coming downtown, we basically wanted to bring our project to market,” Cheung said. “We have confidence in the market, but it is not yet a proven market. We are not in the middle of a recovery where everything is coming back and there are a lot of product launches. We are not there yet. But we have so many projects in the Alberni Corridor, so we have to go.
Cheung said other developers who have yet to launch their marketing efforts are on hold, waiting for buyers to return. Bosa Properties’ 1515 Tower, designed by German architect Ole Scheeren and part of a global trend for “jenga-style” high-rise buildings, was launched last fall. It came right after the launch of Jim Pattison Developments’ 2 Burrard Place.
As for the other luxury projects in the West End, says Mr Cheung, “they have not yet been launched, but I know they are in the planning stage. During our market meetings, [marketer] Bob Rennie presented a bunch of numbers on all the projects that could be launched next year. There are a lot of players in the same boat in terms of waiting to go.
Two weeks ago, Mr. Cheung began previews for 1818, a 21-story, 54-unit boutique tower designed by Rafii Architects. This is one of the shorter buildings as it is close to Stanley Park and it caters to the type of shopper who appreciates an exclusive view and Rolls-Royce car service. The price is $2,300 to $2,400 per square foot, and as of last week, Cheung had already sold about 18 units in the building. These prices are conservative compared to pre-pandemic prices, he said.
He originally planned to build two units per floor, but due to the pandemic crisis, he reconfigured the floor plates to include two small two-bedroom and one three-bedroom that takes up half a floor. To his surprise, the three bedrooms are selling the fastest, with prices starting at $3.8 million. Both bedrooms start at $1.8 million.
“For a downtown project, having 2,000 square feet, half a slab on the ground, is very rare,” he explains. “I don’t think you will find this offer on rue Alberni, except for the penthouses. Having a stack of large three-bedroom rooms with water views is quite unique.
Alberni Street has seen luxury shopping for years, but in terms of housing it is now a new row of multi-millionaires. It becomes the workhorse of elaborate architecture and an equally decadent lifestyle. Mr Cheung says the transformation is largely the result of the city’s West End Community Plan, which covers the downtown peninsula area between West Georgia, Burrard, Stanley Park and English Bay. Andy Yan, director of the City Program at Simon Fraser University, said the median household income in the West End is just $51,000.
“I think in the West End community plan they put all the highest densities on Alberni Street and a bunch of sections that don’t have social housing requirements. The city has designated the street as very upscale,” Mr. Cheung said.
“I’m sure you’ve heard of comparisons to Rodeo Drive, where Alberni starts at one end with luxury brands and a small residential segment and ends with Stanley Park, so it’s a very limited offering. With the heights and essentially with the building policy, we had to show leadership in design and sustainability, and that led to all these ‘stararchitects’. That’s how it formed.
As for the buyers, Cheung said he didn’t know the demographics, but he believed they were end users, not investors.
The recovery in the luxury market, however, also coincides with an increase in immigration and tourism, indicating that foreign wealth is driving the market.
Condominium marketer George Wong, director of Magnum Projects, said the downtown market slowed in 2018 and continued to stagnate for the next few years, with some recovery in the fall of 2020. In 2021 , promoters began to launch projects that were waiting. margins. The luxury market isn’t quite where it used to be, but it’s expected to pick up steam.
Mr Wong marketed Three Harbor Green more than a decade ago, and the penthouse that then sold in the $11 million range is now listed for $49 million. The market for this type of house, however, is extremely niche.
“It’s for the super, super, super rich…there are very few people on this planet who can afford it, and that caliber of people are people who don’t even live here full time. It’s a second home.
Last summer, he marketed 2 Burrards for $1,900 a square foot, and the project has “done extremely well,” says Wong. There are degrees of luxury in the West End, he says.
“The luxury condo would be in the $2-5 million price range, and the high luxury would be in the $5-12 million price range. I would say the sub-$5 million luxury price bracket has done well, but it hasn’t returned to where it was in 2017. The luxury market has yet to find its way back, as super We miss the rich. And COVID had stopped many international trips. But once it opens up again… Canada is so sought after for the purpose of living and for the purpose of raising children, only for the purpose of security.
Very few locals can afford this type of product, he says.
“Even our luxury product is cheap [for international buyers].”
In order to attract investors to 2 Burrard, they lower the prices and make suites smaller.
“There was a lot of anxiety about how people would react downtown, so at 2 Burrard we had 239 homes and we wanted to make sure we had a good business card for the budget and the appetite of the people. investors.
“Investors had stayed away from the city center for some time. So we were very observant and really concerned about that, and we didn’t know if they would come back. … We wanted to be more conservative to test the market, so we also reduced the sequels to entice the investor.
The result was that over 65% of the project was sold to investors.
“It’s pretty healthy. We were very happy with how it turned out.
Once China emerges from lockdown and those shoppers return, the downtown market is expected to pick up even more, he said. Buyers from all over the world buy in Vancouver, but China is the world’s biggest buyer: wealthy buyers with available capital.
And foreign wealth is driving the super high-end rides coming downtown, Wong said. This has been the phenomenon for fifteen years. Although Chinese cities are on lockdown, these buyers are still finding a way to buy properties in Vancouver. And for those super-wealthy buyers, many of the homes are second homes, not primary residences, he says.
“A lot of people from China can’t travel, but once that’s eased we’re going to see a big influx.
“People are finding ways to send money here. Living in China hasn’t always meant livability, has it? And Vancouver is very attractive.
“Some take out their money and buy without coming here.”
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