11-15-2015, 10:37 AM
I appreciate that. Of course as a buyer you'd like to see RE values low so that more people can afford to live and work along the LRT. No argument there. I would suggest to you that this sort of intensification will succeed only if the developers can benefit, i.e. profit, from this as well.
We're discussing why the Ottawa St property isn't being redeveloped. Put yourself in the position of a potential developer. In fact a developer who owned the property since 2012 did just that. Presumably they know more about this sort of stuff than we do. Yet they decided to sell the property rather than develop it. And they sold it to someone, a car dealer, who likely isn't going to have to invest much new money into it in order to operate his business on it.
This is consistent with my speculation that there may be a RE bubble forming along the LRT route. Lots of RE is getting developed with new residential and business capacity. We both agree that this is good. All this activity also drives up prices for anyone who wants to buy land and redevelop it. That's also fine if they can find buyers/renters. But what if too much capacity gets built too soon? Prices will drop and developers will start losing money. Why would a developer, especially one who's looking to enter the fray fairly late, want to risk being part of that?
George claims he didn't want to sit on land that he didn't want to develop. That land also wasn't generating any revenue so his investment was losing money by way of opportunity costs, property tax, maintenance, etc. Wright bought the property from him because it solved an immediate business problem--he could grow his business--and it also gave him the option to redevelop the property in the future if LRT-based intensification made that a viable business proposition.
I don't see a problem. Is there a shortage of residential and/or commercial space along the LRT route? Will there be a shortage when LRT service begins? I suspect no to both. So what's the big rush to redevelop even more land right away? Why would anyone want to take that risk if they don't have to?
We're discussing why the Ottawa St property isn't being redeveloped. Put yourself in the position of a potential developer. In fact a developer who owned the property since 2012 did just that. Presumably they know more about this sort of stuff than we do. Yet they decided to sell the property rather than develop it. And they sold it to someone, a car dealer, who likely isn't going to have to invest much new money into it in order to operate his business on it.
This is consistent with my speculation that there may be a RE bubble forming along the LRT route. Lots of RE is getting developed with new residential and business capacity. We both agree that this is good. All this activity also drives up prices for anyone who wants to buy land and redevelop it. That's also fine if they can find buyers/renters. But what if too much capacity gets built too soon? Prices will drop and developers will start losing money. Why would a developer, especially one who's looking to enter the fray fairly late, want to risk being part of that?
George claims he didn't want to sit on land that he didn't want to develop. That land also wasn't generating any revenue so his investment was losing money by way of opportunity costs, property tax, maintenance, etc. Wright bought the property from him because it solved an immediate business problem--he could grow his business--and it also gave him the option to redevelop the property in the future if LRT-based intensification made that a viable business proposition.
I don't see a problem. Is there a shortage of residential and/or commercial space along the LRT route? Will there be a shortage when LRT service begins? I suspect no to both. So what's the big rush to redevelop even more land right away? Why would anyone want to take that risk if they don't have to?