It’s a foolproof cheat sheet for landlords investing in condo buildings: look no further than the retail spaces underpinning those highrises for clues revealing the type of tenant that you’ll likely attract.
“The retail portion of any building plays a huge role in setting the tone for the neighbourhood and the building,” says agent Andrew Harrild, who specializes in condo sales in Toronto.
“It’s the first impression that a [renter] gets when they walk into a building. It’s on the street level, it’s hard to ignore… [Depending] on the nature of the commercial space, it can be a positive or a negative.”
Indeed, Harrild says most people don’t want to live above a McDonald’s or a car dealership, but coffee shops, trendy bars and restaurants, and other convenient amenities are certainly great selling features for prospective tenants. These amenities are especially important for new developments where there is no existing infrastructure.
“The perfect example of that is CityPlace [in Toronto],” says Rob Ackerley, an agent who also specializes in condos.
“There was no established neighborhood, so there are a variety of commercial ventures in these ground floor units… [Residents] are reliant on these spaces to bring in amenities, like grocery stores and bars and restaurants and banks; the types of daily things that people need.”
The type of amenity also needs to compliment the tone of the neighbourhood. For example, an area that is predominantly young families would not be well-served by a new sports bar, but a day care centre in the building would appeal to residents.
A perfect example of this, Harrild says, is the Toy Factory Lofts in the Liberty Village neighbourhood of Toronto.
“[The building] has a great coffee shop called Balzac’s on the ground floor,” he says. “I always point that out when I’m showing the building and that makes it more of a selling feature, rather than a 24/7 McDonald’s.”
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