In previous days, Grupo 4S was invited by an investment fund to visit real estate projects in Toronto, Canada. The travel was based on determine the comparative attractiveness of the Canadian projects along other markets. Beyond the results of such assessment, the trip allowed us to identify better real estate development practices in diverse perspectives. Some of these may have fast implementation in enhancing the projects of our country.
From our first thought, these are the ten lessons that Canada may contribute to our vision of real estate development:
Collaboration between developers. The system PATH is the underground commerce route that is labeled today as the world’s largest shopping centre. Originally emerged from a group of projects that made the first connections and wagered the doubt. Nowadays EVERY emblematic project seek to have a connection to this system that has become a part of the city’s lifestyle. Something with such magnitude to a city that has had a low start since the private investment.
Urban art. Worldwide, the city’s guidelines cause economic incentives or submitting them. Any developer wants to believe that their field is special and that no rule should be implemented there. Canada is no exception, so they decided to channel those economic desires towards urban art. The main boundary of the terrains in Toronto it’s the CUS, therefor any developer who would want to built else, must invest a sum of money to urban art and enhancement of the public space of its project (this has reached the point of streets being made of granite floor). We must show publicly the “incentives” that government collects due to distortion of rules and spotting these lended resources in the same impacted spaces.
Understanding the demographics of the vertical life. In Toronto’s down town, where most of of the new developments are residential, it is very rare to find a single kid. The city met that the dynamic down town belongs to those demographic single or two people residencies going through their young or adult phase. Under this precision, families look up for suburbs where it boosts their attraction based on the public scholar systems. To divide the city in different demographics boosts better public collaboration.
Break the project scale. The verticality involves a problem in the large scale projects: Time. to break the long times of development, out northern neighbors are separating the projects into three or even four individual sections. Each section has its vertical flow, condo scheme and single amenities. The delivery dates, consequently, may be different and it is not rare to see an inhabited project in its podium stage where the construction is yet executed in its final levels.
Micro investors market approach. In Canada it is not necessary to have pre-sold the 70% of a project to be able to request a bridge loan. This system gives solidity to the financial sector and has provoked that the projects get settled in the sales to the stockholders segment. The developers act with transparency on their boundaries and open a clear communication channel with the clients. Given the fact that the demand of the downpayment es low (10%) the selling to speculators gets promoted. The city has an occupation of 99% so this type of buyers are not feared.
Leverage on consumer brands. The real estate projects are creating alliances of collaboration with Premium brands, mainly the fashion. Thus, there exists addition of brands like Fendi, Armani and Hermès in projects currently on sale. There is an interesting advantage of what it achieves with the leverage of high value brads positioning.
Amenities operated by third parties. The big scale amenities’ operation, generally, is expensive on the sustenance of the project. Consequently, the pattern on Toronto’s projects goes to the engagement of third party operators who can open their services to public. The most common goes regarding to sport teams, where the area is given on bailment so the operator installs the best category equipment. Altogether, that synergy benefits the services of a single project without increasing the maintenance costs.
Interior Art. Each project must be conceived as a public space and so deserves an artistic rendering (a soul). No matter the budget or the area are small, each project in Canada is introduced along a vision of creative inspiration. A sentimental link that reminds us to the perks of surrounding ourselves of that bohemian life that embellishes a city. In Mexico yet being legatees of artistic talents we hide behind economic pretexts to split ourselves from the world of art.
Join the vision of architecture to furnishing and interior design. The urban spaces which it would reside the next generation will be much more compact than what we are used to today. Nevertheless a small space contaminated by the wrong furnish may have a negative connotation. Thereupon, in the architectural vision there are presented certain key pieces of furnishing that lead to a better use of the proposed space. Such pieces are available through a developer and its commercial team.
To market the city to the world. Nowadays the 25% of Toronto’s purchasers arrive from other countries: China, India and Brasil are only some of the destinations that already are memorable to the “brokers” of our northern neighbor. There is a clear contagious welcoming and affection to their country. It urges that Mexico rethink a strategy to place out cities to the international backdrop.
Meanwhile leaving one of the showrooms that we visited I faced the caption: “You’ve changed.” Nothing is more truthful after facing a fulfilling housing development perspective.
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