How to Invest in the GTA’s Newest Downtown with Jason Lam
Affordability is a real problem across the GTA and Durham Region and Ajax is no exception. Central Park Ajax will be the first new condominium in Ajax in 27 years. In today’s episode of the True Condos Podcast, Andrew la Fleur discusses the plans for the new downtown Ajax and how Central Park Ajax will kick off this mixed use community very soon.
Click Here for Interview Transcript
| Andrew la Fleur: | On today’s episode, we are sitting down with Jason Lam, sales manager with Melbourne Real Estate, and we’re talking about Central Park in Ajax, exciting new project that’s coming up in Ajax. Now, we had some technical difficulties on today’s episode, so we are joining the interview as it is already in progress. Enjoy.
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| Automated: | Welcome to the True Condos podcast with Andrew la Fleur, the place to get the truth on the Toronto condo market and condo investing in Toronto.
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| Andrew la Fleur | It’s an exciting time to be in real estate right now, and certainly to be in real estate in the GTA. It’s very interesting at the moment. Now, speaking of the GTA market, let’s maybe start there, Jason. I’d like to hear your thoughts on the state of the market in general in the GTA right now, and do you see … Like, what are the problems in the market, or what is the number one problem in your opinion in the GTA market right now?
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| Jason Lam: | Well, to talk about the market as a whole, it’s incredibly healthy. I mean, we’re talking about a record number of sales, a record number of price point … A lot of people looking outside of the core to find low-rise. I think the condominium marketplace is really satisfying entry-level price point as well as people that are not interested in living outside of the core. What’s helping in terms of the negative aspect is price point. As much as it is a good thing that we’re in record sales, the price point is becoming a lot more difficult to find for a lot of young families, old families, single individuals, that are trying to purchase a home. It’s funny. Whereas in Toronto, you know, the detached, semi-detached low-rise, whether it’s 850,000, 1.1, 1.3, $1.5 million, there will always be a product in the 300, 400, $500,000 range.
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| When we go outside the core, like the Markhams, the Richmond Hills, the Newmarkets, the Vaughans, the Etobicokes, the Mississaugas, Brampton, Ajax, Pickering, Scarborough, even that price point is becoming incredibly high. What’s going to happen is that that price point’s going to hit a pinnacle, and there will be no entry level. There won’t be an opening price point in the 2, 3s, and 4s. It’s not unusual where you see North York and Richmond Hill and some of those smaller municipalities that I named earlier is that when they saw the price point getting to such a point, they acknowledged that they had to start building condominiums to have that price point to keep people from leaving, going further and even further. That takes us into Ajax, really.
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| Andrew la Fleur: | Interesting. Yeah, okay, so you’re referring to the fact that … I think I understand what you’re saying, but just to clarify for the listener, you know, in Toronto, yes the average price of a home is … now it’s over a million bucks, but there’s plenty of condos in the city of Toronto as you say, basically. You can still afford to buy a home … It’s going to be a condo … but you can still afford to get something 200, 300, $400,000 range. As you go into some of the suburban markets of the GTA, the trend has been the same thing; the low-rise housing has gone up. Some of the markets have responded by adding more condominium product to the market to, like you say, to keep people from leaving and to keep people coming in. Well, yeah, let’s jump into Ajax, where obviously we want to talk about Central Park Ajax, but what has been the story in the city of Ajax as it pertains to condos versus houses and affordability?
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| Jason Lam: | Well, Central Park Ajax will be the first condominium in the last 27 years to be built in the town of Ajax.
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| Andrew la Fleur: | Oh, whoa, whoa. Whoa, let’s back it up just a sec. First condominium? That is amazing. First condominium in the town of Ajax in 27 years?
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| Jason Lam: | That’s correct.
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| Andrew la Fleur: | Wow.
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| Jason Lam: | What makes Ajax unique, and one of the things we like to talk about is, you know, Ajax is not that far. It’s about 35 minutes from downtown Toronto. If you look at 35 minutes northeast, 35 minutes north, 35 minutes northwest, 35 minutes west, and you compare what the resale housing looks like, whether it’s semi-detached, detached, as well as to condo market, you’ll notice that Ajax is a lot less expensive. However, what we’ve noticed over the last 3 years is that Ajax leads Ontario in terms of a capital appreciation at approximately 33%, which has Markham at second at 32%. The average age of Ajax is the lowest of Ontario, so what that tells us is that a lot of the people that grew up in Toronto and went to school in Toronto, people that work in Toronto that are looking to purchase in Markham, Richmond Hills, Newmarket, Vaughn, Etobicoke, Mississauga, Brampton, Oakville, they can’t find affordability. They cannot afford those homes, so they’re all moving to Durham region, Ajax, Oshawa, Whitby, Pickering.
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| At the rate that they’re capitally appreciating, these people, they look at Ajax and say, “It’s actually really close to Toronto.” Being so close to GO Transit and having 401 access, it allows them to continue to work in Toronto but affordability is met. However, if they keep on this road of capital appreciation, within the next couple of years, there’s not going to be a whole lot to afford. The average house in Ajax is approximately $575,000, which a lot of your listeners probably had no idea.
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| Andrew la Fleur: | Right, right, yeah. Yeah, I guess that the secret’s sort of out now. Maybe 3, 4 years ago people didn’t realize the value that there was in Durham region. The secret’s sort of out now. The prices have increased in Ajax, what’d you say, 33%, which is in the past few years, which is the highest, yeah, higher than Markham, higher than Richmond Hill, other areas like that, which you traditionally think are the hottest areas, but yeah, look at Ajax. It’s really, it’s been booming, and it’s going to continue to boom because it is still, Ajax and surrounding areas, Durham region, but in particular, Ajax at the center of the region, it’s still the cheapest … I guess you could say the most affordable real estate in the GTA.
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| Jason Lam: | That’s correct. When we look at Burlington being 60 minutes area, Branson being an hour away, Newmarket being an hour away via GO Transit, Richmond Hill an hour away, Markham 40 minutes away, Ajax is actually closer. Our site is 3 minutes away to GO Transit. 3 minutes away to 401, so it’s incredibly accessible. You’re right that the secret’s been out for a while now, and in the Richmond Hills, the North York, the Vaughan, the Etobicoke, the Mississaugas, I think 5 years ago, 10 years ago, they noticed the trend of the low-rise being so expensive. From a city planning point of view, they acknowledge that we do need high-density, we do need affordable residential dwelling units. They saw that ahead of time. Ajax is on the same path as the Richmond Hills, the Markhams, the Newmarkets, the Vaughan. They’re just a little bit behind. All of the statistics show us that, hey, people are migrating from the city of Toronto to the town of Ajax, and they’re making Toronto money. They work in Toronto. 47% of people of people that live in Ajax work in Toronto. 80% of the people that live in Ajax do not work in Ajax.
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| Andrew la Fleur: | Right, right. It’s sort of the ultimate commuter town really in that respect. Like you said, a huge percentage of people in Ajax are working in the city, and what else do we know about the people who live in Ajax? You also mentioned they’re the youngest people in Ontario?
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| Jason Lam: | Yeah, exactly. Average age is 36 years old. They have some of the highest average incomes in Ontario as well. They get 20% higher average incomes than Toronto.
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| Andrew la Fleur: | 20% higher average income in Toronto. Wow.
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| Jason Lam: | Correct. Exactly, so there’s a lot of expendable income. I think what Durham’s trying to do, what the town of Ajax is trying to do, they’re trying to create a new downtown. They’re trying to spark the whole field of growth and rather than leave Ajax to where you can work in Ajax. Our development here, again, is 3 minutes to Go, 3 minutes to 401. It’s directly across the street from the town of Ajax’s City Hall. I can throw a baseball with a no-bounce hitting their building. This is a mixed-multi development, so it’s not just residential. We’re talking about a full ground-floor retail which will be approximately 33,000 square feet of retail. The second floor will have commercial office spaces, and then we’ll have residential units on top, so this will be the perfect environment for a live/workplace scenario. It is a mega project. It’ll be about 3,000 units when it’s all said and done. We’ll have about 200 retail shops. We’ll have 150 office spaces. This will be the new downtown of Durham, dare I say. I think this will really change the identity of Durham. It’ll change how people live in Durham because I think what’s going to happen is us being the first condo in 27 years, when the price point hit its critical mass …
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| Again, it’s about 575 right now. In 3 years’ time, because that’s how long it’ll take for us to build, the capital appreciation is going to keep pushing, and affordability is going to be that much more rare. People that are moving now or have moved to Ajax that are building their roots, they don’t want to go from Ajax and move to even further out. There’s going to be nothing in the 2, 3, $400,000, maybe even $500,000 range, and this will be the only community. You and I know best that when we have mixed-use condominium/residential units, that is sort of the epitome. That’s where you get your highest rent. That’s where you get highest resale, is when you can really truly create that convenient lifestyle. Walkability is so important in municipalities like Ajax and smaller cities [crosstalk 00:14:09]-
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| Andrew la Fleur: | It’s so rare, yeah.
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| Jason Lam: | It’s so rare; everyone drives.
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| Andrew la Fleur: | Yeah.
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| Jason Lam: | This will be … You know, we’re already sitting at an 83 Walk Score, which is a great thing. We’re just going to go even higher once we’re done.
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| Andrew la Fleur: | Wow, 83 Walk Score for the location of the building right now. That’s really good. That’s better than some spots in downtown Toronto actually.
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| Jason Lam: | Absolutely. Absolutely.
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| Andrew la Fleur: | Oh, yeah, so it’s, yeah, it’s decent right now basically, but like you said, it’s only going to improve when the development comes in. Yeah, maybe give us some … You buzzed through some great facts and figures about the project. I want to back that up a little bit and zero in on the Central Park project. You’re going to be launching the first building there very soon. It’s a first building of many. Like, maybe paint us a little bit of a picture of the … What is the sort of master plan here entail? How big, how many units, how many buildings, and then how does Central Park, the first building, fit into this? Or, is Central Park the name of the building, or is it the name of the entire neighborhood? How should we speak about it?
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| Jason Lam: | Central Park is the name of the community. Phase 1 is going to be our first release, which will happen very soon. It’s a mixed-multi-use mega project that we like to call … It’ll entail approximately 3,000 residential units. It’ll have about 200 retail spaces, 130 office spaces, and they’ll be a 6-phase development that will be approximately 10-12 towers. The town of Ajax has been incredibly supportive. They’ve really been with us every step of the way, and I really think that the local community … They’ve been waiting for this for a long time. We had people that are downsizing, people that have grown up in Ajax, and the truth is, they can’t afford a resale house in Ajax.
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| Andrew la Fleur: | Yeah, you’re getting a lot of interest I know from a lot of different people all across Durham in particular. Like, who are you hearing from the most? Where do you see the real pent-up demand specifically?
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| Jason Lam: | Yeah, I think people that want to purchase or own or rent something in the Durham area, whether it’s a 1-bedroom or 1-plus-den or a 2-bedroom or a 3-bedroom, their only options are a house. I think people are looking at a different option in terms of lifestyle, how they’re living their lives, because a lot of these houses don’t have that Walk Score. They don’t have the local amenities where they can walk conveniently to the bank, to do their groceries, to have a drink. I think they’re looking for a different way of life. They don’t want to move west to get a glimpse of what it’s like to live the big city dream, right?
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| Andrew la Fleur: | Yeah. Yeah, the picture’s really starting to come together hopefully for the listeners. Hopefully those people are thinking about investing in the project where you’ve got an affluent community, one of the wealthiest communities in the GTA. It’s one of the youngest if not the youngest in terms of age in Ontario, so it’s young. They’re making money. Most people, you know, a huge chunk of the population are working in Toronto, so they know the city life. They appreciate the city life. They appreciate the city wages, certainly, but they like, they want to live outside the city for personal or affordability reasons. It doesn’t really matter per se, but I think, yeah, I think that the project like this and the master-planned community like this with an urban sensibility, it just makes perfect sense for … It wouldn’t work in every part of the GTA, a suburban part of the GTA, but I think in Ajax in particular, there should be just a real strong acceptance and absorption of this type of product. I think it’s going to do really, really well.
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| Jason Lam: | Absolutely. There’s no competition in this marketplace. The people that have paid off their homes and they’re looking to down-size, they’re empty-nesters. They want to pass their houses onto their kids, and they want to live a little bit more of a hassle-free lifestyle. They can’t find that. I think your investors, your purchasers, your listeners, are going to have access to phase 1 of 6 phases. They’re going to be able to truly be at the ground floor and invest in a community that is going to grow, and the statistics tell us that the local market, the housing market there, is only going to increase, and the affordability is going to be so rare. They will own the cheapest real estate but also probably one of the most highly sought-after pieces of real estate because of the mixed-multi-use aspect.
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| Andrew la Fleur: | Yeah, like you said-
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| Jason Lam: | People from different parts of Durham, even gentrifying, you know, going into Ajax just to be part of that lifestyle because the 401 connects them all.
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| Andrew la Fleur: | Yeah, absolutely, I mean, Durham region, it’s so well-connected via Go, via the 401, and of course the 407 is going to be opening up just 2 minutes away as well. The 407 connection is … I don’t know. Is it open already? Or, it’s opening very soon, I know, to …
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| Jason Lam: | Yeah, it’s still under construction. [crosstalk 00:19:41]-
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| Andrew la Fleur: | Yeah, just like 2 minutes … Yeah, it’s like 2 minutes away from Central Park as well, right? Just down the 401, boom, you’re at the 407 connector as well, so anybody who’s working in Markham, Richmond Hill, those sort of employment corridors to the north, your commute it’s going to be such an easy commute if you drive as well from a location like this. Yeah, like you said, it’s going to pull in, you know, anybody living in Oshawa, in Clarington, in Pickering, anybody who’s looking for affordable housing in Durham with an urban feel, with an urban sensibility in a walkable neighborhood. This is it.
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| Jason Lam: | Absolutely. I agree with you. We’re looking over the last 10 years, you know, the age range between 20 and 29 years old has grown 71%. They are young people that are looking at their options and looking at Durham and Ajax in particular and saying, “That’s the place. That’s the place I want to start to build my roots. That’s the place where I want to have kids,” and they’re not going to want to leave because they realize, and I think a lot of your listeners do not realize, how close Ajax really is to Toronto in comparison to the bigger-name markets like your Markhams, your Bramptons, your Oakvilles. We are just as close if not closer. The thing is the cat’s kind of out of the bag, but there’s still a lot of people that don’t realize the potential, the growth potential. As everything else grows, being 35 minutes away like Ajax is, it’s only a matter of time until the price point will get to the point where the north and the west will look … Well, what they look like today, and there will be no entry-level. This is a good time to invest in this product. Our incentives are going to be absolutely through the roof. It’s not something I can get into right now, but I’m sure you’ll have a package. You’re one of our platinums, so I envision we’ll see a lot of you.
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| Andrew la Fleur: | Yeah, absolutely. Looking forward to getting that information, and to you the listener listening right now, depending on when you’re listening to this, you might already have the package in your hands, and I look forward to hearing from you, or you might be eagerly waiting for it, and I’ll get it to you very soon. Jason, it’s been great chatting with you about it. Is there anything else that people should know, or is there any other questions that I should be asking you about Central Park Ajax, about this opportunity, that I haven’t asked you yet, and what would that question be?
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| Jason Lam: | I think we’ve gone over a lot of things. I think it’s very rare do you get to build a brand new downtown. It’s very rare that we get that opportunity to be the first investor, the first building. You know, Unit #1 of 3,000 and to see what direction this will take Ajax into. There’s a lot of municipalities that have done that along the way that we didn’t really get to be a part of, but this is a chance for us to be a part of a brand new development, a mega project that will take Durham to another level and obviously the price point is going to be a big factor of why we’re going to sell so well. We’re also getting a big demand of people that are looking for 2, 3, 4-bedroom options that are down-sizing that currently live in Durham, so it’s going to be a nice mixture of purchasers and investors, but I think the one thing is just the magnitude of this. What does this mean for Toronto? For Ajax? For affordability? You know, you can be first in line.
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| You know, the truth is, you can buy in this development, the only development in the last 27 years, where there’s no competition, where your average income is 20% higher than Toronto, where you have the highest capital appreciation in Ontario, or you can buy in Toronto where there’s a fair amount of competition, but obviously, both markets are very healthy, but this is just you will be the only one. I think that’s what really draws a lot of the investors out is that they want to be at the ground floor when it’s all said and done.
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| Andrew la Fleur: | Right. Ground floor of something unique, like you said. This is just stage 1. I mean, you got to have the vision. The investors who have the vision and understand the bigger picture of what’s happening over the next decade [crosstalk 00:24:22], they’re going to do the best.
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| Jason Lam: | [crosstalk 00:24:23] … so true.
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| Andrew la Fleur: | Yeah, those [crosstalk 00:24:24]-
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| Jason Lam: | … a game-changer. This will change Ajax basically for the rest of time, and they’re going to be the first to take this step in the Durham region. Essentially, if this thing really, really comes through, I envision Ajax to be more or less the downtown of Durham. That’s a good thing.
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| Andrew la Fleur: | Yeah, yeah, yeah. Well, I know there’s just so much investment, that potential for that whole area around there as well. Very exciting. Very exciting. Looking forward to working, again, with you, Jason, working on this project, and making a lot of investors a lot of money. It’s exciting.
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| Jason Lam: | Well, you always make it at phase 1, right?
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| Andrew la Fleur: | Absolutely, yeah. This is phase 1 right now. Here we go. Thank you very much, Jason. If people want to learn more about you and different projects and things that you’re working on with Millburn, what’s the best way for people to get ahold of you or find out online?
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| Jason Lam: | You know, you can find my LinkedIn. I will be at Central Park Ajax, so you can meet me personally, or you can talk to Andrew la Fleur. I’m sure he can [crosstalk 00:25:39].
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| Andrew la Fleur: | Absolutely.
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| Jason Lam: | We’re not hard to find. We have so many projects on the go. We’re always trying to make sure that we find the best product to bring to market and use the best platinum agents to represent us well. I’m thankful that you’ve been a part of so many of our launches. A lot of student housing launches together. This was just one of many projects, unique projects, that have a great story, that have an untapped market, that really has no competition; I think that’s what you want when you’re investing. I don’t think you want to be one of many. You want to be one of one.
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| Andrew la Fleur: | Absolutely. Great. Okay, thanks a lot, Jason. I appreciate your time today.
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| Jason Lam: | Thank you so much.
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