We have the experience to connect you to the right buyer for your development. We also provide the following services:

  • Recommend a decision to sell or hold.
  • Arrange Transactions.
  • Provide options of profit distribution.
  • Establish ways to mitigate capital gain tax.

We can provide an appropriate recommendation for questions such as:

  • Who are the right tenants or buyers in today’s market?
  • It’s worthwhile to build and sell for immediate profit or hold unto the project to generate cash flow?

Factors To Estimate The Cap Rate.

  1. Occupancy level and length of stabilization.
  2. Location.
  3. Construction type.
  4. Rent levels.
  5. Lower Capital Expenditures.

The cap rate for new apartments should include questions such as:

  1. Does the building have a two year history of consist operation?
  2. Has the building been sold and leased up?
  3. Is the new building already built but vacant?
  4. Is the current phase in the conceptual phase ?

The more the NOI grows compared to operating expenses, the more cap rate grows. NOI is also founded to be higher in newer buildings as operating expenses tend to be much less and as a building ages so does the expenses.

Net income grows significantly when the rate of revenue and expenses are at the same and operating ratio is below 50%. New buildings tend to have operating ratio of about 35% or less.

An Example:

An older building with 50% operating expenses that will increase 5% and a limit of rising rents will result in only 3% NOI growth. With operating expenses running at 5% and NOI at 3%, very soon operating expense growth will exceed the growth of the old building’s NOI.

With a new building the case is different. A new building, for an example, has an operating expense of 30% with operating expense growing at 5% and NOI growth is at 3%. The dollar value of NOI growth in the first few years will increase. This illustrates despite operating expenses outgrowing NOI, the monthly revenue of a new building is significant enough to sustain growth.

Toronto Market:

As Ontario’s capital city, Toronto has a vibrant history of change and growth, ranging from its early occupation over 1,000 years ago to its current status as North America’s fourth largest city. Toronto is Canada’s largest municipality and is made up of the former cities of Toronto, North York, Scarborough, York and Etobicoke, and the former borough of East York. The city is home to a large immigrant population, and is a national and international hub for finance, communications and cultural life.

In Today’s current market, Toronto has become a city of exponential growth in condominium projects throughout the city and the rise of skyrocket value in the housing market. With boom in real estate, the city is accommodating such rise with growing the infrastructure of transportation with new instalments of Union-Pearson Express, the Toronto-York Spadina Subway extension and the Eglinton-Crosstown LRT.

The second largest rental apartments market in Canada is found in the area of Old Toronto (pre-amalgamation of city of Toronto) and East York (one of the five boroughs), with the island of Montreal coming in first.

The areas in the downtown such as Liberty Village and West Queen West have been rejuvenated to attract young individuals to work and live there. The desirability of neighbourhoods with close approximate to the downtown core has lead to the rise in housing prices that has increased the demand for rental units.

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