Teardown Vancouver apartments sell for $980K
August 2, 2018
A scarcity of land in Vancouver has caused many owners of older rental and condominium projects to sell the entire building to developers who plan to construct higher-density housing on the sites.
Under a change to provincial legislation two years ago, if 80 per cent of condo owners vote to dissolve their strata corporation, the building can be sold for development. Previously, a unanimous vote was needed. Depending on the location and zoning, prices per unit of the aging complexes can lead to windfall payments to the owners.
In a recent case, an old four-storey 53-unit condo project in the popular West End of the city drew 18 bids from developers and sold for $52 million—or more than $981,000 per suite. The sale price of the site, near iconic Stanley Park, worked out to $875 per buildable square foot. This is the cost before hard construction and all soft costs—such as marketing, sales commissions, legal fees and city fees—are factored in.
The current record in the city for a dissolution sale is a 60-year old, 12-unit townhouse project near the University of British Columbia, which sold two years ago for more than $1.1 million per unit.
Based on such land values, new condos built on the sites need to sell for more than $1,600 per square foot to allow the developer to realize a profit, according to industry estimates.