The micro-condominium units proposed for the Jan-ion Hotel redevelopment would be priced between $100,000 and $150,000, delivering a new type of real estate offering to the capital region.
Tiny units have been developed in Vancouver and elsewhere, but condominiums built in Greater Victoria are typically larger, with higher price tags.
Vancouver developer Reliance Properties, which has built micro-lofts in Vancouver, is hoping for similar success here with plans for small units, starting at 300 square feet, in the Jan-ion at the foot of Johnson Street near the Blue Bridge downtown.
Reliance expects to submit a development permit application to the city of Victoria by month's end, company president Jon Stovell said Thursday. "We have been working feverishly on design of the project."
If all goes according to plan, construction would start in summer 2013, Stovell said.
Financial plans hinge on the ability of the developer to put up a new structure next to the Janion. About one-quarter to one-third of the 100-plus units would go into the Janion, with the remainder slated for the new building which would be built on former Transport Canada land, he said.
Stovell was speaking at a event hosted by the Urban Development Institute's capital region chapter on Thursday night to showcase Victoria and its projects to Vancouver members. Reliance holds two key downtown properties on each side of the Johnson Street Bridge, which is being replaced. The Janion is on the north side and the Northern Junk property is on the south. Revised plans for a commercial-residential development on the Northern Junk property have been submitted to city hall after going through city advisory committees. "The building was split into two buildings and more refinement occurred about landscaping," said Stovell. He is hoping that project will go before Victoria's governance and priorities committee in November for referral to public hearing.
Built in 1891, the Janion was empty for more than three decades before Reliance bought it in June. The old masonry is not beyond rescue, Stovell said. "But it's going to be a fairly heroic economic effort to bring the building back to life."
Stovell is confident a broad market exists for micro-units. He said potential buyers include business travellers, parents wanting a home for their children at university, up-Island residents seeking a place in downtown Victoria and those who work downtown.
"It's the walkability," Stovell said. "It's just a very, very urban place and that's a good place for small compact units because the idea is that your living and your dining room aren't in your apartment ... they are outside."
And their prices are below what's being sold these days in the capital region. The average price of the 127 condos sold last month was $320,304, while the median price was $263,450.
Ray Blender, Re/Max Camosun general manager, said micro-units would likely be bought as investments to use as vacation rentals or by single people working in the downtown core. The micro size is popular in other cities, he noted.
He's not so sure that parents of university students would buy them because they often purchase condos within walking distance of schools. He also figures that business travellers would likely be on expense accounts or here for short-term stays.
Blender recalls when the Mermaid Wharf condo project on Swift Street sold out quickly with compact units of about 400 to 500 square feet. "From that, I can see people buying these as an investment."
In Greater Victoria, condos usually run 700 to 800 square feet, with entry-level prices between $250,000 to $350,000, Blender said.
For the past two years in the condo market, "there's really no strength if you're looking at appreciation because, with the amount of new development, it keeps the prices down."