EXCLUSIVE: Why You Should Invest in The Eglinton by Menkes
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The Eglinton by Menkes Video Transcript
Hi and thanks for checking out this video. My name is Andrew la Fleur and I’m a Realtor that specializes in helping people invest in pre-construction condos in Toronto. I made this video to give a brief overview of why Menkes newest project called The Eglinton is a great investment opportunity and to show you exactly why you will want to invest in this condominium project. ok so there’s the building there. it’s going to be a beautiful 34-storey tower at yonge and eglinton. and we know that Menkes is one of the best builders in Toronto and their buildings are built to a very high standard and have fantastic amenity spaces. In short, Menkes is without question one of the top-5 builders in Toronto and you know the building will be great. you probably also know that because the building is going to be located at yonge and eglinton that this location is absolutely amazing. the Crosstown LRT subway along Eglinton is going to produce a real estate boom along Eglinton avenue over the next decade. yonge and eg is soon to become the 2nd most important transit hub in the GTA. you probably also are aware that Yonge and Eglinton has some of the best schools, shopping, restaurants, and employment options in all of Toronto. in fact, a Toronto Life survey said Yonge and Eglinton is the #4 best place to live in the City. but what you really care about as a condo investor are the numbers and I’m happy to say that THE EGLINTON has some amazing numbers that I’m excited to share with you. before I do though, one question I get asked a lot is, “how do I make sure my condo investment will go up?” if your condo investment has these two things, your investment is very likely to go up significantly in value. and i’m very pleased to say that THE EGLINTON by Menkes hits both of these factors out of the park. let’s take a closer look. first of all, the insider pricing for this building is definitely under current market value for the area. Here’s a map of the yonge and eglinton neighbourhood. here is where the future LRT stations will be located – one at Yonge street of course where the subway is now, and one at mount pleasant. and here is where the Eglinton is located – right between them both. Let’s compare the Eglinton – a pre-construction condo project, to currently existing, resale condo buildings in the area to see how prices compare. So I’m going to compare it all of the newest buildings in the area because they are obviously the most relevant. the buildings that I’m going to look at are as follows: We have minto quantum towers here, 83 redpath here, 900 mount pleasant here, Tridel’s republic buildings here and here, and also 88 broadway. all these buildings were completed between 2008 and 2010. side note, hard to believe nothing has been completed here in the last 4 years. this area is really starving for new condo product. now here are the average resale prices for units in these buildings for the year 2014 so far. minto quantum prices are averaging $589 per square foot. not too bad right? if you are used to the downtown market these numbers might surprise you because they are in fact higher than a lot of so called prime buildings downtown! next 900 mount pleasant is 596, 83 redpath is 614, republic south is 622, 88 broadway is 626, and republic north is a very strong 665 dollars per square foot on average this year. wow! now, how about The Eglinton? what are the insider prices like for the building? well check this out, the eglinton’s average starting prices are only $577 dollars per square foot. nice right? ok so that’s for resale. now let’s also compare The Eglinton which again is a pre-construction condo project, to other pre-construction condo projects in the area. once again, here’s the map, there’s the future LRT stations which are opening shortly after the eglinton gets completed. here’s the eglinton building at redpath and eglinton. the buildings we are going to look at are as follows: 101 erskine by tridel, 155 redpath by freed, minto’s 30 roe project, then 2221 yonge, the madison condos (which of all the new buildings are the closest to being completed), and E Condos. so how do prices at the eglinton compare to other new, not yet finished buildings in the area. here we have 101 erskine at 618, 155 redpath and 30 roe are close there, then it jumps up a bit at 2221 yonge, and the top of the heap are the Madison and E condos which are all well over $700 per square foot for currently available inventory in these buildings. and as before, the eglinton by menkes is waaaaay below the rest of the pack at $577 per square foot. so that’s great. that’s exactly what we want to see as condo investors. so to summarize we have resale buildings averaging around $615 per square foot, new buildings averaging around $675 psf, and the menkes average starting prices are around $577 per square foot. so definitely the eglinton is priced below market value let me show you an illustration of how this would work if you were to invest in the eglinton. this chart is just made up numbers but it proves a very powerful point. so forget about the new condo pricing for a moment and just look at resale which are existing product, we know that these units are being bought by real people today for this price here – approximately 615psf. now could these units be worth in 5 years time? well, if we assume they will appreciate at 3% per year on average, they will be worth approximately $713 per square foot in 5 years. why 3%? well that is about half of the historical average of property price increases in Toronto at 5-6% so let’s be conservative and keep it simple. so if you are buying the eglinton today at 577 psf in 5 years time that could be a very nice ROI. but… let me take this a step further let me show you the “secret sauce” of pre-construction condo investing before i take it a step further, let me take a quick step back. if you look at this hypothetical chart, if you bought one of these existing resale condos today at 615psf, in 5 years time it might be worth 713 psf. assuming you have 20% down payment on the condo, you will see a very nice 79% return on your down payment over the 5 years. now you already figured out that you are better off buying menkes the eglinton at a rate below current market values and if you do that instead of a 79% return on your down payment, you could be looking at a 118% return on your down payment. Great. that’s awesome… but here’s the thing in 2019, those resale buildings that start today at $615psf those buildings will be 9-11 years old in 2019 so in 2019, if you buy a unit at menkes the eglinton today, that unit will be a brand new unit, and these other buildings will be considered old buildings at 9-11 years old. so obviously, if you were to sell your unit in 5 years time, you would be able to command a premium over whatever these buildings are selling for, because yours is brand new and theirs is 10 years old. how much of a premium? hard to say but let’s be conservative and call it a 5% premium which in this illustration would be 748 dollars psf. so now check this out. if you are buying below market value today at the eglinton and selling for a premium in 5 years time, you could be looking at not a 79% return, not a 118% return, but potentially a 148% return. and that is really the “secret sauce” of pre-construction condo investing buy at a discount, and sell at a premium pretty amazing, right? so that takes care of the Under market value part of the UP investing equation, but what about the Positive cash flow? will condos at menkes the eglinton be cash flow positive? well i’m very happy to tell you that yes, pretty much all units in the building look like they will be cash flow positive and this is partly due to the great prices for units in the building as well as the tremendous strength of the rental market at yonge and eglinton. here are the average rental rates for these same condos that we analyzed before in the area. $1650 for a 1 bedroom with no parking, $1800 for a 1 bed plus den with no parking, and $2650 for a 2 bed, 2 bath with parking. again, these numbers are better than many prime areas downtown. with these kinds of numbers and with the boom that is going to happen at yonge and eglinton over the next decade i’m confident these rates will only go up. if you’d like specific examples of cash flow analysis at the eglinton, just email me so that i can arrange to get you the full investor’s package that will include cash flow analysis along with floor plans, insider prices, incentives and more. ok thank you very much for taking the time to watch or listen to this video. once again i’m your trusted condo expert – Andrew la Fleur and please email me at andrew@truecondos.com or call me at 416-371-2333 to book your suite at The Eglinton today before prices go up. until next time, bye.
