A building code change in Ontario could potentially lower costs for investors, say experts.
“The main impact will likely be the speed with which building can be done, and the cost will be lower, which means that certain projects which were not economically feasible now will be,” added Claude Boiron, an investor and commercial real estate broker.
Revisions to the Ontario building code, which came in on January 1, will now allow wood-frame construction for residential and mixed-use commercial buildings up to six storeys in height. The previous limit had been four storeys.
“Wood frames mean cheaper construction costs for investors and provides more options,” said Vince Santino, VP of development at Minto Communities. “To be able to deliver that to buyers, especially investors, gives us another tool to be able to do that.”
Toon Dreessen, president of the Ontario Association of Architects, explained that wood-frame construction provides a better return on investment in terms of construction costs.
"There is typically a break-even point in concrete or steel construction, depending on local conditions, where these don’t generally provide as good a return on investment at the lower end of the scale," he said.
"In larger cities, such as Toronto
, concrete construction only tends to start making financial sense at the eight storeys and up level."
Other Canadian provinces, including B.C., Alberta and Quebec, had previously introduced similar revisions.
Claude Boiron will be speaking about commercial property investment at CREW’s InvestorForum, which will be held on March 28 and 29 at The International Centre in Toronto.
Register here to attend the event
Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate
Investment Hot Spots:
Arcola, Lakevale, Colebrook, Forest Grove, Bear Lake