Buoyed by strong pre-sales and what appears to be an active real estate market, developer David Chard broke ground Wednesday on his sixth project in Victoria.
Chard said the time is right for Escher on Broughton Street downtown, an 84-unit condo development, which he expects will be completed within the next 22 months and will add to the revitalization of the street.
“We feel we have a nice window here,” Chard said, noting there are a number of downtown projects just wrapping up. “We will be completing this building when there won’t really be any others downtown.”
A busy market also appears to have spurred on the project.
“It’s been strong for us. Since Jan. 1, we have sold 18 units, including the last unit available in the Sovereign [in the 600-block of Broughton],” Chard said. “We’ve also had good response for Escher. We are 25 per cent pre-sold.
“We have a track record of coming out of the ground at 25-30 per cent pre-sold. We have done that with all of our projects.”
Chard said he expects interest to pick up when equipment starts moving dirt. “People know the project is real and that we are proceeding — it creates consumer confidence,” he said.
And there seems to be plenty of that, according to statistics released this month by the Victoria Real Estate Board.
Through the first three months of this year, the number of sales and prices are up in all major categories, with the condo market showing strong gains. There have been 417 units sold in the first quarter, a 17 per cent increase over the same period last year, with an average selling price of $329,000, up slightly from last year’s $326,000.
Other developers are also taking advantage of the market’s interest.
Mike Miller, founder of Abstract Developments, noted he has several multi-unit projects in various stages of completion.
Abstract sold out its 8 on the Park development near Beacon Hill Park, which is through the framing phase. Concrete is being poured at the 14-unit, mixed-use Element Beachside Residences in Cadboro Bay, which is 50 per cent sold. Abstract’s 14-unit Emerson condo development near Fort and Vancouver streets is to start excavation in June.
Miller also expects presales to start this fall for the scaled-down, 22-unit Madison project at the corner of Richmond and Oak Bay avenues.
While Miller is bullish on the condo market in the city, he said it’s not a free-for-all.
“I think there’s opportunity for committed, strategic development and in-fill, but I don’t think it’s to the point you can open the floodgates where anyone can be a developer,” he said. “You need to know what you’re doing. Even then it reduces risk, it doesn’t eliminate it.
“We will see some smart development over the next couple of years and unfortunately we will see some misses.”
Chard and Miller see the condo market revolving around local buyers, some first-timers and others downsizing from single-family homes. “It’s a small percentage (10-15 per cent) of out-of-towners, many of them want to live in Victoria and may not be ready for retirement yet, but want a position in the market,” said Chard.