Largely driven by necessity in the Greater Toronto Area, rezoning commercial properties for residential construction, particularly on major thoroughfares, with density in mind is a sure payout.
Cam Forbes, general manager of REMAX Realtron Realty Inc., says that can extend to rezoning residential properties, as well.
“What’s more common in the GTA is the conversion of detached or semi-detached to a townhouse with more density, or a condominium apartment, like a mid-rise or high-rise,” he said. “It’s going from single-detached or detached zoning to one with multiple zoning.”
But he says rezoning commercial to residential is where the real money is.
“Best uses are always what you’re looking for with vacant land or property that’s already developed,” he said. “In the GTA, that can change from commercial zoning to residential zoning, and as land becomes more and more scarce, particularly in the GTA surrounded by the Green Belt, the number of rezonings from commercial to residential has increased substantially.”
Forbes says streets like Bayview Ave., Kingston Rd. and Queen St. are where low-rise housing development reigned for years, but as the need for intensification arose, best uses changed.
“There have been changes to allow for greater number of floors,” said Forbes. “Again, the big picture is, because of the Green Belt and new provincial guidelines on development, there is scarcity of land in the GTA, so we have to fit more people onto the same amount of land. The two ways are horizontally and vertically, and both ae being explored and happening right now.”
Luan Ha, founder and CEO of Fundscraper, says Toronto urban core is yielding more expensive lots, and the intervention of global competitors into the market has added an additional dimension.
“In order to maximize the value of land, you’re going to have to integrate multiple uses onto a single property,” said Ha. “You can extract a little more to generate revenue. Sometimes people want an office component because it’s all about live-work-play these days. They do that to increase density. If someone acquired a piece of property and wanted to rezone and sell it at that point in time, that enhances value.”
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Rezoning a property is an arduous process, but the payout is worthwhile.