World’s tiniest condos: Safety deposit boxes

How small can condos go? How about the size of a safety deposit box.

They won’t have balconies or bathrooms, but these new ownership units — believed to be a first in the world — should go a long way toward easing the overwhelming demand for a safe place of your own to store valuable documents, precious jewellery and even your final will and testament.

“We’re selling cubic inches, not square feet,” says Nigel Lawson, vice president for condo developer Parallax Investment Corp. which plans to start preselling the first privately-owned SafeBox Condominium Vaults this weekend.

The carefully-guarded boxes have to be registered as condos — even though they are a mere fraction of the size of Toronto’s incredibly shrinking residential apartments — because each one will be individually owned.

And, yes, the boxes will be subject to dreaded maintenance fees and property taxes.

They’ll even have parking, within a secure zone where you can load and unload your valuables out of sight of prying eyes.

Parallax hopes to have at least 4,500 of the tiny condos in its first facility, an industrial building on Steelcase Rd. W. in Markham that it hopes to open in July.

The building will be fitted with a 2,000-square-foot vault, 24/7 Chubb Edwards security and staff during business hours who will man a reception area that looks like a hotel lobby.

Small “gold” boxes (25 cm wide by 61 cm long by 8 cm deep) will sell for $3,600. Annual maintenance fees will be $109 plus about $64 in property taxes.

Bigger “platinum” boxes (25 cm wide by 61 cm long by 20 cm deep) are $5,500 plus $273 annually in maintenance fees and $97 in property taxes.

“Safety deposit boxes are a valuable commodity and in such high demand, some banks have a seven-year waiting list,” says Stephen Wong, a real estate agent who is marketing the boxes on behalf of Parallax.

“Expansion of the Toronto area’s population has coincided with the shrinking of banks opening new branches so young people basically cannot find safety deposit boxes, and their parents aren’t giving theirs up yet because they still need them.”

TD Bank has told customers they will be paying 40 per cent more to rent safety deposit boxes after April 1, acknowledging that “we see huge demand, across many demographics, that actually outstrips supply.”

The new fees — from $60 for a small box to $125 for a large — haven’t been raised in five years and “reflects the high value customers place on these highly secure storage spaces,” a bank official told The Star recently.

Wong has delivered 100,000 flyers in the North York and Markham area the last 10 days and has already had a lot of interest, including one buyer looking for 15 of the gold boxes.

“It’s a new concept so people just want to understand how they can get title to the box. Once they know it’s like any condominium they’ve ever bought, except this one is a bit smaller, they are 100 per cent comfortable,” said Wong.

The concept has proven to be especially popular among ethnic communities in suburban Toronto neighbourhoods who prefer the notion of owning, rather than renting, whether it be a home, office or store, says Wong.

Lawson hopes to build similar facilities in Mississauga or Brampton, Calgary, Montreal and Vancouver.

“Those who are buying seem to have confidence to invest because it’s real-estate related. I guess that’s because everybody has made money on condos the last few years,” says Wong.

But he stresses the concept is so new, it’s impossible to know what the future holds in terms of flipping the unit.

“I’ve told people, don’t expect this thing to make money in days or weeks or years. But give it some time and, just like any real estate, it’s bound to appreciate.”

Price growth in Canadian property market slowing, data suggests

Price growth in the residential property market in Canada is slowing with the latest MLS Home Price Index from the Canadian Real Estate Association (CREA) showing its smallest increase since June 2011.

Year on comparisons continued shrinking, providing further evidence that Canadian home price growth may be topping out, said CREA.

The index in February 2012 was up 5.1% from its year ago level, the smallest increase since June 2011 and the fourth consecutive month in which gains slowed.

Toronto posted the largest increase at 7.3%, but momentum continued fading. Price increases also moderated further in Calgary at 2.5% and Montreal at 1.6%. Gains decelerated in all housing categories tracked except two storey single family homes.

The Aggregate Composite MLS Home Price Index rose 1.1% on a month on month basis in February 2012. Prices were up most for two storey single family homes at 1.6%, while townhouses and apartments saw smaller gains at 0.4% and 0.5% respectively.

‘Home price growth is generally slowing. At the same time, price gains and trends differ among housing markets tracked by the index,’ said CREA president Gary Morse.

CREA chief economist Gregory Klump pointed out that the MLS Home Price Index typically rises in February from the previous month as demand increases leading into the spring housing market.

‘The monthly price increase in February this year was less than what we saw in either of the past two years, which is more evidence that the trend for Canadian home prices is slowing,’ he added.

Among housing categories tracked by the index, single family homes posted the biggest month on month gains in most markets, particularly in Toronto where they are in short supply relative to strong demand.

Interest in the market for condo apartment units has increased recently, particularly Toronto’s condo market. With Toronto’s year on year increase in the MLS HPI for apartments at 4% it is likely that Toronto’s condo market will remain of particular interest.

The MLS HPI shows that price gains are decelerating for condos in Toronto. In other markets, year on year price gains for condo apartment units are near the overall rate of consumer price inflation. This suggests that the condo market is not overheating.
A number of new condominium apartment projects have been completed in the GTA over the past year. Some of these new units have been listed for sale, resulting in a better supplied market.

The number of months of inventory for condo units in the GTA on the Toronto Real Estate Board’s MLS® System is running close to its long term average. This suggests the GTA condo market is balanced, which is consistent with moderate price growth.

CREA also points out that the number of condo developments due for completion annually is unlikely to result in a glut of supply relative to demand and consequent price correction. Barring an unexpected spike in interest rates, economic downturn or overly restrictive further changes to mortgage regulations, the condominium apartment market is likely to remain balanced for the foreseeable future, it concludes.

Toronto Port Authority picks Oxford Properties to develop downtown land

The Toronto Port Authority has chosen a consortium led by Oxford Properties Group to redevelop its downtown property south of the Lakeshore at Bay St.

In line with the city’s goal to expand the financial services sector further south, Oxford, the real estate branch of pension fund OMERS, and the TPA plan to develop “high quality office and commercial opportunities,” according to a news release.

The 1.8 acre site includes a parking lot and the historic Toronto Harbour Commission building at 60 Harbour St. The building will be preserved and its current tenants, including the Harbour Sixty steak house, are expected to stay put.

Oxford and the TPA will consult the public as part of the planning phase and hope to start construction in the “next few years.”

The TPA, a federal agency that also owns Billy Bishop Airport, did not release any financial details but said its choice was the result of a rigorous procurement process.

Dundee International REIT Announces $81 Million Bought Deal Financing and Secondary Offering

DUNDEE INTERNATIONAL REIT (TSX:DI.UN) and LSF REIT Holdings S.à r.l., an affiliate of Lone Star Real Estate Fund (U.S.) L.P (the "Selling Unitholder") have entered into an agreement to sell 8,000,000 units of Dundee International REIT (the "Units") on a bought deal basis at a price of $10.10 per Unit to a syndicate of underwriters led by TD Securities Inc. (the "Underwriters"). Dundee International REIT will issue 4,000,000 Units for gross proceeds to Dundee International REIT of $40,400,000, and the Selling Unitholder will sell 4,000,000 Units for gross proceeds to the Selling Unitholder of $40,400,000 (collectively, the "Offering"). The Underwriters will have an option to purchase up to an additional 600,000 Units from Dundee International REIT at a price of $10.10 per Unit and 600,000 Units from the Selling Unitholder at a price of $10.10 per Unit (the "Over-Allotment Option"), exercisable in whole or in part at any time for a period of up to 30 days following closing of the Offering.

Dundee International REIT is currently at various stages of due diligence and negotiation with respect to over €300 million of potential acquisitions of office properties in Germany. All of the properties are located in major cities and are leased on a long-term basis to tenants with strong covenants. Dundee International REIT expects to continue its negotiations in respect of these acquisitions and will actively pursue these and other acquisition and investment opportunities. However, there can be no assurance that any of these discussions will result in a definitive agreement and, if they do, what the terms or timing of any acquisition would be. Dundee International REIT intends to use the net proceeds from the sale of Units to fund future acquisitions and for general trust purposes. Dundee International REIT will not receive any proceeds from the Units sold by the Selling Unitholder.

"We are very pleased with the opportunities to grow and diversify our business by adding high quality accretive acquisitions to our portfolio in Germany" said Jane Gavan, Chief Executive Officer of Dundee International REIT.

Upon completion of the Offering, the Selling Unitholder will hold exchangeable notes of a subsidiary of Dundee International REIT that are collectively exchangeable into Units representing an approximate 7.2% economic interest in Dundee International REIT (an approximate 6.0% economic interest if the Over-Allotment Option is exercised in full).

Closing of the Offering is expected to occur on or about April 17, 2012. The Offering is subject to certain customary conditions, including the approval of the Toronto Stock Exchange.

This press release is not an offer of securities for sale in the United States. The units being offered have not been and will not be registered under the United States Securities Act of 1933 and accordingly are not being offered for sale and may not be offered, sold or delivered, directly or indirectly within the United States, its possessions and other areas subject to its jurisdiction or to, or for the account or for the benefit of a U.S. person, except pursuant to an exemption from the registration requirements of that Act.

Dundee International REIT is an unincorporated, open-ended real estate investment trust that provides investors with the opportunity to invest in commercial real estate exclusively outside of Canada. Dundee International REIT's portfolio currently consists of approximately 12.5 million square feet of gross leasable area of office, industrial and mixed use properties across Germany.

This press release may contain forward-looking information within the meaning of applicable securities legislation. Forward looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Dundee International REIT's control that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. These risks and uncertainties include, but are not limited to, global and local economic and business conditions; the financial condition of tenants; our ability to refinance maturing debt; leasing risks, including those associated with the ability to lease vacant space; and interest and currency rate functions. Our objectives and forward-looking statements are based on certain assumptions, including that the Canadian and German economies remain stable, interest rates remain stable, conditions within the real estate market remain consistent, competition for acquisitions remains consistent with the current climate and that the capital markets continue to provide ready access to equity and/or debt. All forward-looking information in this press release speaks as of the date of this press release. Dundee International REIT does not undertake to update any such forward-looking information whether as a result of new information, future events or otherwise, except as required by law. Additional information about these assumptions and risks and uncertainties is contained in Dundee International REIT's filings with securities regulators, including its prospectus dated July 21, 2011 and its latest MD&A.

Home prices across Canada show signs of topping out, real estate association says

OTTAWA — Canadian home prices appear to be topping out, according to a monthly survey from the Canadian Real Estate Association, Canada's largest realtor group.

Prices rose in February at the slowest pace since June 2011 — up 5.1 per cent year-over-year — marking the fourth consecutive month in which gains eased, CREA said.

The fact that prices rose only 1.1 per cent from the previous month added to the argument, said Gregory Klump, CREA's chief economist.

"The rate at which prices are growing has been slowing for some months now," said Klump. "The monthly price increase in February this year was less than what we saw in either of the past two years, which is more evidence that the trend for Canadian home prices is slowing.

February is normally one of the busiest months for real estate, Klump added, "however, price increases have generally been getting smaller, and trends suggest that price increases will continue to shrink."

Price gains decelerated in all housing categories except two-storey homes, single-family homes.

Toronto posted the largest price annual increase at 7.3 per cent, although momentum there also continued to ebb, CREA said. Prices also moderated in Calgary and Montreal at rates of 2.5 per cent and 1.6 per cent, respectively.

Re/Max Forecasts Busy Spring Ahead for Canadian Real Estate

Real estate agents Re/Max are forecasting a busy spring for the Canadian real estate market, as major markets in the country have performed quite strongly since the beginning of the year. Its market trends report surveyed 15 Canadian markets, and found 12 had reported increased sales activity in January and February compared to the same period last year.

According to the survey more than half of the cities had seen increases into double digits, mainly due to lack of supply and strong demand, setting the scene for a busy spring. Continued low interest rates, and the strength of consumer confidence have both contributed towards this scenario, as has the relatively mild winter that has brought house hunters out earlier than normal.

Average prices increased in 14 out of the 15 markets, and prices in Toronto and St John’s, N.L., increased by more than 10%. This was at least partially due to low levels of inventory, and bidding wars are becoming more common for the most sought-after property.Inventory levels of houses for sale are also low in Saskatoon, London-St Thomas, Hamilton-Burlington, Ottawa, and Saskatoon.

The best performing markets in terms of sales volumes were Halifax-Dartmouth, where sales increased by 35%, Saskatoon at 21%, St John, NB. at 20%, and Regina and 16%. However Vancouver, Winnipeg and Kitchener-Waterloo have seen housing activity soften this year, and sales have fallen by 16% in the Greater Vancouver area, by 4.5% in Kitchener-Waterloo, and by 0.2% in Winnipeg.

Although sales are expected to remain strong this year, price gains are likely to be marginal especially compared with previous years. However this will vary, as some markets are suffering from low levels of inventory, and this will help push up prices, and other markets such as Saskatchewan and Newfoundland are benefiting from a strong local economy.

Canadian home sales and prices up in February

TORONTO An initial meeting of the spring weather has helped Canadian home sales rise in February after two months of decline and defying predictions that the market begins to cool.

"The Canadian housing market remains strong, with an unusually mild winter we add a little 'extra juice to the mix," said BMO deputy chief economist Douglas Porter.

The Canadian Real Estate Association said Thursday that home sales rose 1.4 percent in February, bringing the third of months during the fall months in the month of January.

Compared to a year ago to increase sales of royal houses 8.6 per cent to 36 937 homes sold in Multiple Listing Service of CREA.

CREA said the market remains balanced as both home sales and the number of newly registered homes increased 1.9 percent, reaching its highest level since May 2010.

The increase in supply should help keep the market balance in the future and growth of home prices in check.

"A rebound in new listings in Toronto and Montreal, Canada two most active markets, offset a haven in new listings in Vancouver, Canada's third largest market," CREA said in a statement.

Vancouver is the fastest cooling in Canada, with February sales down 18 percent from levels a year ago heated.

This February has been a boom in sales of properties Mångmiljonhus operated by foreign buyers, mainly from Asia, picking up properties in specific areas, such as multicultural Richmond and West Vancouver luxury.

Which also served to skew the national average house price is higher - a recovery that was not planned for this year, said Gregory Klump, CREA's chief economist.

"Data for February confirm, but other factors are currently under national average prices up. More important is the housing market in Toronto, where an optimal balance between supply and demand continues to drive some of the strongest gains the prize in the country, in particular for the individual stand-alone buildings. "

A preference in recent months, single family homes, which are generally more expensive than condoms, have helped to buoy the national average house price.

The national average price of homes sold in February was $ 372,763, an increase of two percent on their treatment during the month of last year.

The average house prices in Vancouver are still double the national average, $ 806,094. But the Toronto market has now taken over as the country's engine for growth, with sales increasing by 12.2 percent and house prices up 10.6 percent from a year earlier in February to $ 454.470 .

A Toronto bungalow that has recently made headlines was sold for $ 421,800 below the asking price, with the winning bid is a student with funds from their parents in China.

While more buyers are prices of some of the hottest markets, a little 'if in doubt - how to market Vancouver last year, an influx of foreign investment are driving up the value of the home Toronto.

But Toronto real estate agent Elli Davis said that while many of its lists to receive more offers - a bit 'on the part of foreign investors - She does not think the offers are responsible for the running of the foreign prices.

"They (foreign investment) has been common for years," said 29 years of industry experience, he added that most of his buyers are from Toronto.

"No matter who it is, if someone wants to pay more than anyone else, this is what the market is."

Industry observers, who are careful of house prices, suggested Canadian real estate market, which has been driven by low mortgage rates because the recession will soon be cool - but many expect a "soft landing".

Others have called for a more drastic drop in sales and home prices, says that the market is overheated, creating a housing bubble could soon burst.

But Porter of BMO said the modest increase of two per cent of house prices hardly justifies the predictions of a devastating housing crash.

"It 's just possible that a high percentage of Canadian media and analysts in Toronto, the Canadian housing market perception deeply influenced by the strength of the local market?" Porter asked.

On a weighted basis, giving each region, regardless of size, same weight, the prices have increased even more - by 4.6 percent over the same period last year, a leap that "raise eyebrows in Ottawa" , says CIBC economist Avery Shenfeld.

"Policymakers are increasingly concerned about the risk of exceeding the price of housing (and related mortgage) that would like Canada to a harder landing on the road," he said.

"It increases the chances of a political solution at times this year on house price momentum will continue with measures at home and mortgage rather than an increase in interest rates can have a weapon in question."

Ottawa has acted with more stringent lending standards three times in the last three years to reduce the risk of overborrowing by the most vulnerable to higher interest rates.