Toronto Condo and Real Estate Blog

Suite sizes have shrunk, but clever design makes every inch count

By Terrence Belford - Globe and Mail

When architect Ludwig Mies van der Rohe coined the phrase “less is more,” he did not have today’s crop of condominiums in mind.

But the words he used to capture his minimalist approach to design perfectly describe what is happening to condos in Toronto.

While overall square footage of suites has shrunk, the usable living space within their walls has grown.

Today’s 900-square-foot, two-bedroom condo has about as much living space as an 1,100- or 1,200-square-foot unit did at the beginning of this decade, architects and designers say.

Granted, little can be done with a 480-square-foot, one-bedroom unit, but as suites get into the range of 750 square feet and above, today’s designers can work wonders transforming wasted space such as hallways into functional spaces for living, dining and entertaining.

“It may seem like a paradox, but it is true,” says Paul Maggiacomo, president of Tanner Hill Associates Inc.

His company is currently doing interior spaces on projects such as Gramercy Park right next to the Wilson subway station.

“Costs of construction and land have driven prices up but at the same time there has been a revolution in design,” Mr. Maggiacomo says.

That revolution finally reflects an understanding that condominiums are not just rental suites under another name, says Sol Wassermuhl, president of Page + Steele-IBI Group Architects. You can see Page + Steele’s skills in projects such as the Hazelton, the Ritz Carlton and Maple Leaf Square.

“The whole design paradigm has shifted,” he says. “The process has become much more complicated and complex. Equally important, interior designers are now brought in once we have settled on the size of each floor plate. They work with us to create the working drawings for each suite.”

In the past, Mr. Maggiacomo says he and his colleagues would be given finished working drawings and told to do their best with decisions already made. Now they get a say in the design process right from the start.

For more than 20 years, developers turned out condos that differed little from rental buildings. Designing rental units is based on making life easier and more profitable for landlords. Rental buildings only have value to tenants as long as they lived in them. They care zip about operating costs because the landlord picks up that tab. If they do not like the building they can move.

Developers, architects and designers understood how to turn out rental buildings. The fact that condos were dramatically different had yet to set in.

Condominiums represent a U-turn in that lasting value proposition. A year or so after residents move in, the developer walks away from the project; it no longer has a stake in its continued success. Owners of the suites are the ones on the hook to keep maintenance standards up and operating costs down. And, since for many this may prove to be their home for decades to come, they want their building to deliver a certain lifestyle.

“That is one of the biggest shifts,” Mr. Wassermuhl says. “The first is creating a building and suites that represent lasting value for residents and the second is that condos are all about lifestyle. It is a very different sensibility.”

Developers now get the point. Buyers do not want those loading bay-like rectangles that served as the GTA’s rental suites right up until the end of the 1980s, they want homes that combine as much livable space as their pocket books can afford, designed in innovative ways in a building that is easy to maintain and operate, surrounded by all the lifestyle bells and whistles.

So, how have designers managed to pack all that useful space into shrinking floor plates? The first thing they do is get rid of hallways, Mr. Maggiacomo says.

“In the old days, you had a long hallway leading to the living area with bedrooms arranged in sequence along the sides of the hallways,” he says. “Now, the front door opens right on to the suite or a small foyer. Bedrooms open off the main living and dining area.

“If it is a two-bedroom suite, we split them putting one on either side of the living/dining area. That not only gets rid of those hallways but also ensures greater privacy.”

If there is a single bathroom, designers can create what Mr. Maggiacomo calls a “poor man’s ensuite.” The bathroom has two doors, one of which opens to the master bedroom while the second opens to the living/dining area.

Open-plan designs also lend themselves to better use of small spaces. Breakfast bars serve to separate kitchens from dining rooms and if you make the breakfast bar high enough, guests can’t see the dirty dishes piled in the sink, he says.

Kitchen cabinetry can run right up to the ceiling, making best use of vertical space rather than the horizontal.

Will condos get much smaller? Unlikely, Mr. Maggiacomo says. “We are pretty much pressing against the sides of the envelope now.”

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By John Barber - Globe and Mail

Talk about a green shift: For the first time in generations, developers are now building as much housing inside city limits as they are in outlying suburbs. The result of surging condominium construction coupled with a steady decline in green-fields housing starts, the new balance suggests strongly that the age of sprawl in Toronto has passed.

One thing is certain: There is no end to high-rise construction in the central city. Record sales from 2007 have turned into record construction this year, with 11,200 new units started in the first seven months of 2008 - more than the total number of housing starts in all 2007.

“We’re forecasting record levels of high-rise starts for 2008 and very high levels for 2009,” said Canada Mortgage and Housing Corporation analyst Jason Mercer. Despite a decline in suburban, low-rise construction over the first seven months of 2008, he noted, regional housing starts are up 32% over the same period this year.

The stage for this year’s dramatic construction boom was set last year when sales of new high-rise apartments outstripped sales of front-door housing for the first time ever. The result today is more high-rise construction in Toronto than virtually anywhere else on the continent.

There are 99 high-rise buildings under construction in Toronto, according to Emporis.com, a website that tracks buildings worldwide, which ranks it second among North American cities to New York City, with 179.

On a per capita basis, however, there is currently twice as much high-rise construction in Toronto as there is in New York. On an absolute basis, no other U.S. city is comparable. Chicago has 54 high-rises under construction, Boston has 14 and Atlanta 19.

Toronto is already No. 10 in the ranking of world cities with the most skyscrapers, according to Emporis. Among world cities with more than two million people, it ranks third - behind Hong Kong and Singapore - in most skyscrapers per capita.

But nothing is more indicative of the future than the current location of regional construction crews. Prior to the latest wave of condominium construction, outlying suburbs held a virtual monopoly on new-home starts in the Toronto region, leading to widespread fears of population loss and economic “hollowing out.” As a result, many observers were slow to note the city’s gradual recovery of market share. None predicted what occurred in the first seven months of 2008, when housing starts in the city and the 905 suburbs drew even.

Affordability is not the only factor behind the central-city revival, according to Mr. Mercer. “You’re seeing new projects across the spectrum in terms of pricing,” he said. Just as important, according to some analysts, are new provincial policies that restrict green-fields development in favour of urban redevelopment.

In fact, the trend back to urban living began long before Queen’s Park threw its weight behind it, and it is accelerating despite growing concerns about central-city job growth. This year it reached a level that overthrows the conventional image of Toronto as a city of homes beneath a leafy canopy.

Today Toronto is unquestionably a city of apartments, extremely compact in its core, with steadily intensifying suburbs. The sprawl that seemed to characterize it for so long was never as bad as it seemed, at least in comparison with similar U.S. cities - and now it has stopped.

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By John Partridge - Globe and Mail

Housing starts rebounded sharply in August, with the seasonally adjusted annual rate jumping to 211,000 units from 186,500 in July, far outstripping Bay Street forecasts of about 190,000, Canada Mortgage and Housing Corp. said Tuesday.

Ontario accounted for the entire gain, with starts in the country’s most populous province climbing 81% to 86,500 from 47,800 in July, but falling in every other region, CMHC said.

The agency attributed the rebound mostly to multiple-unit starts, with those in urban areas jumping 25.2% to 114,700 units, after falling 20.2% in July.

“After a brief pause in July, the volatile multiple segment bounced back to a level of activity that is more consistent with our forecast for this year,” CMHC chief economist Bob Dugan said in a news release. “Most of the volatility in housing starts over the last three months reflected swings in multiple starts in Ontario.”

The July drop marked just the fourth time in 5-1/2 years that the seasonally adjusted annual rate had fallen below 200,000 units.

The unexpectedly strong rebound came a day after figures from Statistics Canada for the value of building permits issued in July also surpassed expectations, rising by 1.8% to $6.4-billion, instead of the 1% forecast by economists, following a 5.3% drop in June.

Still, the CMHC’s start figures can be a misleading guide to the state of the housing market and the economy at large, because they often represent investment decisions and sales made by builders and developers a year or two before construction begins.

TD Securities cautioned against reading too much into the August performance, even though the 13.1% increase almost fully reversed the previous month’s 13.6% drop.

“On balance, this does not necessarily mean that housing remains healthy,” Charmaine Buskas, senior economics strategist, said in a research note. “It should be taken for what it is – a snapback from a previously large decline. The Canadian housing market does have some headwinds that will bring down activity in the next couple of quarters.”

Royal Bank of Canada was a little more sanguine about the numbers.

“The jump in August starts provides some optimism, along with last Friday’s August employment report, that the economic picture may not be as bleak as the GDP numbers implied over the first half of this year, where the economy recorded essentially no growth,” assistant chief economist Paul Ferley said in a commentary.

Still, Mr. Ferley said this optimism needs to be tempered by the fact that strength in the August housing numbers was narrowly based in the volatile multiples component in Ontario. “As well, the earlier deterioration in affordability will likely reassert a downward trend in the starts data going forward for the remainder of this year and through 2009,” he said.

As a result, Mr. Ferley reiterated that the bank still expects starts next year to average a little over 180,000, down from a recent annual peak in 2006 of 229,000.

However, the pace of decline is modest compared to the drop that has occurred in the U.S., where the 965,000-unit level of starts represents less than half of the recent annual peak in 2005 of 2.073 million units.

CMHC said that nationally, starts of single-family dwellings rose 2% to 71,200 units in August.

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Contact the Jeffrey Team for more information - 416-388-1960