TEK Tower (30 Francis) | 45 fl | U/C

[creative]

Do we have any idea what percentage of units were sold? I’m wondering if a large percentage of investors have indicated that they will be unable to close. These were selling for over 1000 sq/ft I believe. Heavily marketed in Toronto to potential investors being told that they could assignment sale with a huge profit before taking possession. Corporations in Toronto are buying huge blocks of empty condos to sit on hoping the market eventually improves. Would be interested to know from any insiders what is happening here.

[tomh009]

I would not expect the developer to allow buyers to walk away from their deposits. Maybe one could negotiate a settlement but the contract doesn't just allow one to not close.

The Toronto case, these are companies planning to do rentals, that are buying all available units in buildings that are mostly unsold. Again, don't know whether they are doing some kind of a settlement with people who are unable/unwilling to close.

[panamaniac]

I would not expect the developer to allow buyers to walk away from their deposits. Maybe one could negotiate a settlement but the contract doesn't just allow one to not close.

The Toronto case, these are companies planning to do rentals, that are buying all available units in buildings that are mostly unsold. Again, don't know whether they are doing some kind of a settlement with people who are unable/unwilling to close.

I've never heard of a case where the deposit was returned, unless it was the developer who refused to close the deal.

[tomh009]

I would not expect the developer to allow buyers to walk away from their deposits. Maybe one could negotiate a settlement but the contract doesn't just allow one to not close.

The Toronto case, these are companies planning to do rentals, that are buying all available units in buildings that are mostly unsold. Again, don't know whether they are doing some kind of a settlement with people who are unable/unwilling to close.

I've never heard of a case where the deposit was returned, unless it was the developer who refused to close the deal.

Definitely not returned. You can't even walk away from the deposit, though, without the agreement of the developer.

[creative]

You can walk away and be sued. Blanket appraisals are being done on some new condo buildings to help people close. I would not want to complete a deal on a property that is worth 100k or more less than I paid. Builders also don’t want to get stuck with an inventory of unsold units or units where people are unable to close. The corporations buying up empty condos in Toronto aren’t necessarily buying up the entire building. I’ve read where, in some instances, they are being selective in what they are purchasing. Avoiding the sub 500 sq/ft units. My guess is that this building will entail a lot of different deals to keep loses to a minimum.

[tomh009]

I would not want to complete a deal on a property that is worth 100k or more less than I paid.

It's not desirable, no--neither is a stock market investment (on margin!) that dropped $100K. But, in both cases, you have legally bought them.

But would you really want to go to court for this? Most likely the developer would be successful in recouping damages (including that $100K drop in selling price!) from you, as you would be in breach of a binding contract.

[creative]

Unfortunately, many of these buyers never had the means to be able to ever close the deal. They were sold a bill of goods that they would be able to flip the property before ever taking possession. If they are unable to secure a mortgage then what other choice do they have? Corporate buyers will come in and buy up properties at a huge discount and the developer will sue to get the difference.

[ac3r]

Man I love our housing market. Can't think of any country besides Australia that has their economy so tied up into sketchy real estate deals at all levels.