There's something to be said for sticking to what you know, and EY Properties certainly knows the rental-apartment game.
That's why the third-generation Greater Victoria company is plowing ahead with a 104-unit rental property at the corner of Burnside Road West and Tillicum Road, where the firm will also be building a new commercial headquarters. The company is in the early stages of construction despite the economics.
Industry insiders have long held that the economic case hasn't existed for purpose-built rental accommodation because of high land prices, construction costs and the limited rent an owner can expect - even though the rental vacancy rate is low at around two per cent.
But, says EY Properties president Ernie Yaki-movich, the rental market is still the kind of ground his company prefers.
"We are primarily in the rental business, that's our core business and we felt the condo market is a difficult market to time and it seems to be a bit saturated - there's a lot of condos built," he said. "We wanted to follow our core business."
Yakimovich also said most of the company's other rental stock are older buildings and it was time for something new.
"There's been very little new product [that's been] built in rental and we felt if we built a building that was new and modern we'd be all right," he said, adding it didn't hurt that borrowing costs are at all-time lows. "This will be the first pure rental building built in Saanich in 25, 27 years."
There have been plans for other rental units in Greater Victoria, including the 120-unit, 12-storey Hudson Mews tower behind the Hudson development; proposals for units at the Dalton Hotel on Yates Street; and the reimagining of the Queen Victoria Hotel on Douglas Street.
EY Properties' new building, which will share the block with EY Properties' 2,500 square-foot head office planned for the corner of the lot, will borrow from all of the company's other properties.
Doug Yakimovich, EY Properties' project co-ordinator, said the building will be highly energy-efficient, constructed to at least a gold BuiltGreen standard and take the best from all of their other properties.
"This will be a very exciting building, we've been able to go through and look at the issues in other buildings and see what works and what doesn't and basically improve upon it," he said. "It will be a far superior building than anything that's out there in the rental stock."
From environmentally sound products and materials and more energy-efficient suites, the building itself offers some new features such as a unique streetscape that will replace straight sidewalks beside roadways with setback paths that meander through trees and landscaping away from traffic, as well as a courtyard that could become a community focus.
The building will also be the first six-storey wood-framed building in Saanich.
Ernie points out they are also offering fewer parking spots, which he claims is actually a plus.
"There will be much less parking than in most buildings in the past, the trend is toward less car usage," he said, noting the building sits on major transit corridors, across from a shopping mall and easy walking distance to a recreation centre and the Galloping Goose Trail.
Doug's sister Angela Oakley, EY's property manager, said renting the building out will not be a problem.
"There's plenty of demand right now for new stock, people want new more than old, the new generation wants everything to be modern," she said. "And this should come online at a very good time."
The more than $10-million project broke ground in September and is expected to be complete by the end of 2013.
Oakley said they anticipate being able to rent it completely within eight months of opening the doors. An improved economy and more jobs in the city, spurred on by the increase activity in the shipbuilding sector, will help.
The bachelor, one-, two-and three-bedroom units will range in size from 375 square feet to 975 square feet and will rent for between $775 and $1,700.
For Ernie Yakimovich, who joined his dad George in the family business before bringing his two children into the firm, the start of a new era and new building is a little bittersweet.
"It is exciting, but there is a bit of sadness involved in that we were on this corner for 20 years and then tore that down," he said, noting the planning of this project started back in 2003. "This is a result of the community coming together and inputting their thoughts on what should happen here."
According to Doug Yaki-movich, that could mean more new construction in the future.
"This building will be an impressive focal point on the corner, and I think it will spark other development throughout the area," he said.
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