[Surrey] Whalley District | 6 + 35 + 37 + 46 fl | U/C

[CoryHolmes]

Originally Posted by skymaster

Maverick life lol. Are they trying to cater towards the hipster community something

What, like the Grüv? Complete with excessive umlaut?

[kh177]

The developer is selling this site now

[osirisboy]

Originally Posted by kh177

The developer is selling this site now

Oh good! Maybe someone will propose something actually iconic

[Shift]

Originally Posted by kh177

The developer is selling this site now

More details?

[Nites]

Originally Posted by Shift

More details?

I think he meant pre-sales. Apparently they sold out in 7 hours.

https://www.nestpresales.com/listing...k-North+Surrey

[CoryHolmes]

Originally Posted by kh177

The developer is selling this site now

Really? Is every project in that area doomed or something???

Originally Posted by osirisboy

Oh good! Maybe someone will propose something actually iconic

All I want is for that part of town to get some love and revitalization. Is that too much to ask?

Originally Posted by skymaster

I think he meant pre-sales. Apparently they sold out in 7 hours.

https://www.nestpresales.com/listing...k-North+Surrey

... oh I guess I should read the whole thread before getting worked up, eh?

In all seriousness, I'm just glad for that corner to get some development.

[Shift]

Originally Posted by skymaster

I think he meant pre-sales. Apparently they sold out in 7 hours.

https://www.nestpresales.com/listing...k-North+Surrey

I'm pretty sure Maverick is Tien Sher's new 5-storey project on the north-east corner of 108 & Whalley Blvd - not the Whalley District tower site.

[osirisboy]

Originally Posted by Shift

I'm pretty sure Maverick is Tien Sher's new 5-storey project on the north-east corner of 108 & Whalley Blvd - not the Whalley District tower site.

So this isn't the 6 storey part of the whalley district?

[Equinox71]

Originally Posted by osirisboy

So this isn't the 6 storey part of the whalley district?

No - I believe it's for the low rise on the north side of 108th (right beside Balance, the micro-unit building).

[Westbased]

Yeah the sold out building is on 108th Ave!

According to some sources there were very little actual end users who bought the units...the vast majority were sold to a group of investors who work with the developer. At the end of the day I can see these being flipped at $100 more psf than what the investors bought for.

[kh177]

Originally Posted by Shift

More details?

Sorry, was posting from phone before. Isn't the project in the below link this project (there's a brochure in the link as well)? Apologies if not:

http://looplink.canatl.avisonyoung.c...RID=0&IP=false

Without any context, seems to me the developer got it through rezoning and is now selling it (at a big profit). Most likely to be bought by a different builder/developer who may a) build according to Tien Sher's plans b) try to change the plans, or c) sit on the land.

Nothing wrong with the developer's decision, but this might push back the timeline for this one.

[Westbased]

Originally Posted by kh177

Sorry, was posting from phone before. Isn't the project in the below link this project (there's a brochure in the link as well)? Apologies if not:

http://looplink.canatl.avisonyoung.c...RID=0&IP=false

Without any context, seems to me the developer got it through rezoning and is now selling it (at a big profit). Most likely to be bought by a different builder/developer who may a) build according to Tien Sher's plans b) try to change the plans, or c) sit on the land.

Nothing wrong with the developer's decision, but this might push back the timeline for this one.

Wow that is the project in question...I had no idea they put the site on sale!

I wonder if there were issues with project funding or perhaps investors backed out.

[Blease]

Out of all the projected developments in Surrey, this one always seemed more about marketing and less about substance.

[EhJay]

So he doesn't have the money or something happened with council. That's unfortunate as it really would have transformed the top of the hill coming into Surrey.

[kh177]

Originally Posted by EhJay

So he doesn't have the money or something happened with council. That's unfortunate as it really would have transformed the top of the hill coming into Surrey.

With zero knowledge of what happened with council (beyond the project getting approved last year), I think it's also likely the developer just wants to cash out. Housing market has slowed recently, maybe the developer's happy with the uplift from zoning (risk-free if it sells). At this point, I think only marginal returns left (developer's profit) compared to the increased land value. Not familiar if the dev has other projects on the go, seems unlikely they ran out of money in this market, tbh, but you never know.

Might not even sell if other developers aren't interested / can't get to his price.

[Westbased]

I think the return from developing is still very very significant.

According to the sale brochure its around 950,000 square feet. Construction cost at $600 (over estimating) is $570 million. Sale prices could be blended average around $900 is $855 million. Leaving a margin of $285 million. Minus taxes, fees, other soft development costs etc. still leaving a large profit.

However, if he can get a buyer around $100 million without any of the risk or time cost I think its a fair decision.

As Bleaze mentioned above, it really does now seem this was their plan all along, market a massive revitalization of a run down area and then flip it once approvals are in place.

[kh177]

Originally Posted by Westbased

I think the return from developing is still very very significant.

According to the sale brochure its around 950,000 square feet. Construction cost at $600 (over estimating) is $570 million. Sale prices could be blended average around $900 is $855 million. Leaving a margin of $285 million. Minus taxes, fees, other soft development costs etc. still leaving a large profit.

However, if he can get a buyer around $100 million without any of the risk or time cost I think its a fair decision.

As Bleaze mentioned above, it really does now seem this was their plan all along, market a massive revitalization of a run down area and then flip it once approvals are in place.

I think you're about right - I could be wrong but the way I view the rough math is:

$725 PSF revenue ($850 PSF sales at ~83% efficiency)
$500 PSF dev cost
$115 PSF land cost (residual value)

$90 PSF developer profit (~15% margin) (bidding process: developers usually bid up price until one can pencil in just a ~15% return)

Considering unzoned land is going for $60 PSF low rise - >$80-90 PSF high-rise, I think developer would want >$100 PSF for a ready-to-build site, so it makes sense to me.

So yeah about $110mil to sell today (risk free almost). Buyer can generate about $85mil in profits over 5-8 years (assuming no big surprises in financing/construction/closing costs), but likely gets lots of leverage from pre-sales/const financing, so someone probably will be able to make it work.

I think you and Blease are right - project was over-represented in the news over the last 18 months for sure (plus a recent "puff" piece on the developer in BIV).

[Shift]

Im pretty sure Tien Sher just doesn't have the financial capability, resources, or experience to develop a project of this size. The have zero experience in high-rise projects, or anything of this scale. They are a proven 5-storey wood-frame developer.

Makes more sense for them to flip the site now that they have 3rd reading - along with some fairly well progressed architectural plans by Chris Dikeakos architects. Doubt the design will change (3rd reading was based on it) - another developer with more experience will just take over the project.

[EhJay]

Come on Concord. Buy the whole project, let it sit for 15 years, and then slowly build up one building every 2 years.

[scryer]

Originally Posted by Shift

Im pretty sure Tien Sher just doesn't have the financial capability, resources, or experience to develop a project of this size. The have zero experience in high-rise projects, or anything of this scale. They are a proven 5-storey wood-frame developer.

On top of that, this would be a very challenging area to develop as you would be needing to aggressively market to a demographic that may not necessarily think that the area is desirable. Basically you have to convince people to be the change and that they will be the people that truly gentrify the area. But once the first building is in then the rest will be easy.

Still it's not easy trying to convince people that you are a trustworthy developer that's developing in a shady area (let's be honest here...), and that you are starting with your signature tower for the entire project.

I'm not surprised that it happened.