Toronto construction eyesore sits idle for 2 years, as housing developers under financial strain
CBC
A luxury Toronto condo project that's been sitting idle for at least two years is irking its Forest Hill neighbours, bringing into focus a problem experts say has been fuelling the city's housing shortage: multi-residential building projects that start—then appear to stall.
The site on Russell Hill Road used to be a single-family home, before it was demolished in 2017. Construction of a four-storey condo project started, then stalled. Frustrated neighbours say the concrete shell draped in blue and green building wrap has sat on a muddy construction site that's seen little activity for at least two years.
"It's pretty awful," resident Carol Roup told CBC Toronto.
"And I know a lot of other residents feel the same way ... I'd like it finished, built and looking like a real house, or demolished."
Property records show Newpoint Developments bought the property in 2015 for $3.3 million and demolished it two years later. Today, only a concrete shell of the four-storey project has been completed.
The situation at Russell Hill Road isn't uncommon. Across the country, developers who bought land pre-pandemic now find themselves facing a perfect storm of high labour and material costs, and a sagging real estate market.
New condo sales fell by 68 per cent in 2023 compared to 2021, making it the slowest year for new condo sales in 15 years, according to a report last month from Urbanation, an organization that tracks condo market conditions.
And experts say it's not just the smaller developers, like Newpoint, that are hurting. Even the largest players are feeling the pinch, when it comes to moving their projects from the drawing board to completion.
Matti Siemiatycki, a professor of geography and planning at the University of Toronto, points to the mega project at the corner of Yonge and Bloor streets as another example of a development on prime land that's fighting the headwinds of sudden market change.
"With prices now softening, with interest rates having risen, with issues with supply chains and labour force, this can pose real challenges," Siemiatycki said.
But he says smaller project developers, like Newpoint, which can play a big a role in solving the city's housing crisis, are also being hit hard.
"We're hearing about mega projects like The One at Yonge and Bloor... but we can also hear it for mini projects... that are critically needed, but can face some of the same challenges," Siemiatycki said. "The prices of (building) those units may have risen, but what they can actually sell for may not have gone up in concert."
That appears to be the case, to some extent, with the Newpoint development, whose president Stefano Tognarelli told CBC Toronto in a statement that the project remains "important" to Newpoint.
"The project has been affected by unforeseen delays as a result of the COVID crisis, along with continued construction cost escalations and fluctuating market conditions specific to mid-rise projects," Tognarelli wrote.
