Mixed-Use Development: No Longer Just A Trend

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It’s official: homebuyers are increasingly comfortable passing on larger living spaces, when stacked up against urban conveniences (according to a recent report by PwC and ULI). Looking at the report, entitled Emerging Trends In Real Estate, it’s easy to see how/why mixed-use development is becoming the norm – it’s blurring industry lines as commercial and residential developers discover the opportunities that mixed-use properties bring. The desire of tenants to be able to live, work, and play in an urban location is driving further demand for projects that could offer residential, retail and office space all in one convenient location.

This isn’t a new concept. In major global markets such as Asia, you have second and third floor retails. To put it simply, this type of building is just a better use of density. It creates complete communities that offer more options – which also happens to be a direct aim of Ontario’s Growth Plan.

There are a few of our current clients that are attempting to speak to this growing trend, while addressing the concerns of homebuyers who may otherwise not be drawn to rural/suburban living – namely due to long commute times. Queensville, which is poised to become a 6000 home community, will be a place where families can live and work. This is the same for New Seaton (in North Pickering), which will become home to more than 20,000 residents and developer Sifton, who is going to be introducing a new smart community in London (Ontario). All three of these communities will include mixed-use development ranging from office spaces, restaurants and different classes of residential living spaces – communities within communities.

What was once emerging is now a norm, with our population growing (rapidly) and developers looking for ways to attract homebuyers in an increasingly competitive marketplace. The needs/wants of homebuyers are shaping and challenging development, and it’s intriguing to see how the challenges are met.

Home Buying Practices In The Technological Age

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Is retail dying? It’s a fair question to ask amidst lowered sales projections by large players like Wal-Mart. There’s no denying that the general public is more comfortable than ever with the concept of making both small and large purchases online. In fact, within five years online purchases will account for 8% of the total retail nationwide. Close to 50% off all transactions involve the Internet in some capacity if you factor the research that consumers often do before making an online or physical purchase. This brings up the question, could this comfort level with online spending transcend into the real estate industry?

Well, with increased transparency displayed to homebuyers – and builders giving floor plans, finishes and detailed information on the minutest details of a home’s development online – it seems inevitable that engaged buyers would be able to take the next steps. This type of thinking is already being applied overseas. In India, for example, Tata Housing works with banks to facilitate the entire home buying experience online – and has had lots of success thus far. Meanwhile in China, E-House China Holdings Ltd is leading the peer-to-peer lenders phenomenon, which finances (and manages) down payments for new buyers 100% online in minutes. Could this type of concept apply to a North American housing market?

A recent Harvard report has shown that brick and mortar retailers still control between 94% and 97% of total retail sales. A vast majority of consumers who appear to be liberally shopping online are doing so from trusted retailers. Metrics are also a bit skewed when you consider that most consumers who purchase online visit physical locations to check out the products beforehand. So this raises the question, is it reasonable to believe that buyers would purchase a property without physically experiencing it? Perhaps, in the case of condos or new builds without models; however, there are also security issues in play – and one would have to take a great amount of due diligence around the genuineness of the transaction. Is retail dead? Not yet – and neither are traditional home buying practices (for the time being).

A Recent BAM Success Story

Sean Mason

At BAM, there’s nothing that makes us happier than helping our clients achieve their bottom line goals – in our minds we are the clients. Working with BAM means we become a part of your team and we do everything we can to champion your brand. So you can imagine how excited we get when we’re able to share successes with everyone.

I’d like to share the recent success story from one of our clients, Sean Mason. He’s an exciting new builder in Barrie who is doing some really innovative things. We’re talking a community of truly green homes. From being ENERGY STAR compliant throughout, to the materials used in the construction and the actual community design, they are homes designed to be healthier for you and your family. BAM has a long history with Sean, spanning seven years. Sean had previously led Mason Homes (his father’s company) to be the first ENERGY STAR standard builder in Canada and has twice won BILD’s Green Builder of the Year award – but this community of smart towns is the first for Sean Homes, which is Sean’s own company.

This past weekend it opened to the public, and we couldn’t be happier with the results. There was a great turnout, and a healthy number of homes sold – to say that Sean Homes was well received would be an understatement.

Marketing Automation Comes To BAM

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Back in the beginning of August I told you all about the next big thing for our team – marketing automation. To BAM, marketing automation was all about providing registrants and website visitors personalized content based on online behaviours – what they click online, in eblasts, etc. At the time, if you recall, I mentioned how excited we were about the benefits that this type of relationship building creates for our clients.

Well, as of this week, I’m especially happy to report that we’ve deployed our first set of emails – and if you’re registered with Queensville, one might already be in your inbox. Six versions of our first personalized community eblast were created and deployed to registrants based on survey questions they answered during the registration process. We’ll now be able to gather extensive after-the-click tracking on each email so that we can further craft personalized messaging that will speak to the individual interests of the recipients. This is no different than the customized content that sites like Amazon or eBay generate for their customers.

Our newest team member, Zoë Ong, is quarterbacking this new initiative. Zoë, who previously worked at itracMEDIA, a marketing automation firm, is currently in her second week here at BAM. She has a strong background in the field and, when asked, had this to share on the topic:

“Marketing automation helps you target the right people more effectively. It only makes sense to use a user’s interests and browsing habits to deliver meaningful content they want to see.”

BAM is thrilled to have Zoë on the team, and I’m confident that she will help us take our digital thrust to the next level because the stats speak for themselves – 63% of companies that are outgrowing their competitors use marketing automation software. In the end, the real value added is the relationships this type of marketing creates between our clients and potential homebuyers – and we’re excited to be a part of it.

To Suburb or Not To Suburb – Population Growth Raises Dilemma for Homebuyers

Toronto’s population will increase to 6,682,061 by the year 2025, which represents a generational spike of 59.2 per cent. This will make Toronto the 24th most crowded city in the world – a rank higher than New York City. This is a huge increase and, as per the Provincial Growth Plan, this extreme growth will be managed by (among other things) intensification. This creates a new dilemma for first-time and established homebuyers – do we move up or move out?

The implication is that depending on your preference, you can either live a condo lifestyle (full of urban opportunities) or move out – meaning outside of the city core. A 2014 Home Location Preference Survey (by RBC) revealed that the latter is becoming ever more popular with 42% of respondents indicating that home buyers (assuming equal home costs) would prefer a detached home on a modest lot, townhouse or condo in a suburban location (within walk or bike to amenities). They also indicated that they’re willing to commute 30 or more minutes as long as they had access to the GO. This number is an increase from 39% in 2012. This trend is also reflective of the economic reality as 82% said that affordability affected (or would affect) their purchase.

This trend can definitely be seen when you look at the immense interest in Queensville, a development project outside the GTA core that is heavy on amenities making it possible to do everything (even work) right within your community. As well, the recent opening of the 404-highway extension creates potential for quicker (than usual) commutes into the city. Likewise communities such as Sean Homes in Barrie is more than accessible by GO Transit, and offers home buyers an amazing value.

Buyers want it all – a suburban experience with the amenities of its urban counterpart. The Provincial Growth Plan is making this a reality as a way to manage the growth of our province. What are your thoughts? Click here to check it out the 2014 Home Location Preference Survey for yourself.

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