We are closely following the progress of the development application filed by DiamondCorp for the property we sold them at 538 St. Clair Ave. W. in the summer of 2022.
As part of the sale terms, we negotiated a Density Bonus Agreement that will pay us $115 per each additional square foot of Gross Floor Area (GFA) zoned beyond a base GFA of 205,000 square feet. The base GFA represents the approximate square footage of a 28 storey tower. The original application was for a 35 storey tower with a GFA of 272,961 sq ft.
After substantial consultation with the City Planning Department, they recently resubmitted their application with some amendments to the plans. The proposed building remains 35 storeys however the GFA has been reduced to 248,173. This would result in a Density Bonus payable to us equal to: $4,964,895.
A few months ago, the neighbouring site immediately north of ours, which is being developed by The Madison Group, was approved for an additional 6 storeys of height at the Commitee of Adjustment. This changed their approved zoning from 28 storeys to 34 storeys. The City’s policy framework for this neighbourhood calls for greater density on St. Clair than the buildings North of it. As a result, we believe that DiamondCorp could likely add additional density at the Committee of Adjustment as they get closer to breaking ground.
While we are encouraged by this recent resubmission, we are concerned about the potential timing of this process. In the past year and half, higher interest rates have ground the Toronto condo market to a halt. There is a growing number of resale units listed for sale on the resale market which will likely take time to be reabsorbed when the market comes back. In the past year, there have been almost no new condo sites launched for sale by developers in the GTA. While it is impossible to predict market timing, we believe it is very possible that DiamondCorp may drag their feet with this zoning process in order to delay paying our Density Bonus.
We will continue to follow this application closely and will provide updates in future as we learn more about their progress.
Please click below to download the architectural plans for the proposed development.
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