Ecoasis Developments LLP has engaged Jones Lang LaSalle (JLL) to review options for Bear Mountain, its residential development on the outskirts of Victoria. An ambitious repositioning of the project following Ecoasis’ acquisition of the site in 2013 led, last fall, to the first new release of building lots and residential units since the financial crisis. All 27 building lots and 14 townhouse units in the Cypress subdivision sold out. An additional 13 townhouse units will be released soon, with a further six designated for a third release. Approximately 73 building lots are also awaiting release. Elevate, a highrise development, has been approved for 203 units.
“This is not about a capital raise; this is about an opportunity for Ecoasis, being investors, to continue to move the project forward as part of a partnership or outright sale,” Ecoasis CFO David Clarke said last week. “It’s taking advantage of the strength of the Victoria market.”
Ecoasis president and CEO Dan Matthews, who saw the Kadenwood project in Whistler to completion, told Business in Vancouver last April that Bear Mountain was firmly on track after the financial crisis of 2008 put paid to the project Len Barrie launched in 2002. Clarke expects the review to take two to three months, with implementation of recommendations taking a further two to three months.
Jon Ramscar, a senior vice-president at JLL who is part of the team handling the strategic review, said the scale of the project makes it an attractive opportunity for investors within North America, Europe or Asia (JLL’s CEO in Asia is part of the review team).
“You have a significant amount of development scale which is development-ready,” Ramscar said, noting the project’s $1 billion gross development value. “There’s an opportunity for someone to come in here and benefit from the work in progress and infrastructure.”
A total of 4,500 units are planned for the property, of which approximately a third have been built or are under development. The current offering includes 772 acres, of which 40% will remain undeveloped.
Downtown land prices
Fifteen years ago, a record-setting $15 million bid for a one-acre lot in the 1900-block of West Georgia stunned local developers – including Wall Financial Corp., Westbank Projects Corp., Cressey Development Corp. and Polygon Group – who hadn’t even come close. The price worked out to $126 per buildable square foot, a price Millennium Development Corp. deemed “absolutely ridiculous” (four years later Millennium set its own record by agreeing to pay $225 a buildable square foot for the site of the future athletes’ village on Southeast False Creek).
Plus ça change, mes amis, plus ça change!
Colliers International reports the latter half of 2016 saw record-setting deal prices, with Landa Global Properties Ltd. paying $55 million, or $454 per buildable square foot, for 1810 Alberni Street. A hot market for land and constrained supply have more than doubled the average price per buildable square foot to $500 today from $225 in 2015.
In some cases, Colliers says, prices have reached as high as $575 a buildable square foot.
The knock-on effect for housing prices is clear, according to Colliers: “[The] finished price per square foot for concrete condominium products has been increasing alongside the cost of land.” The agency notes that with finished condos selling for upward of $1,760 a square foot, developers are justified paying higher prices on the front end.