Developer undeterred by lukewarm condo market
A Charlottetown developer is set to invest millions in a new condo development in the city, entering what appears to be a rather luke-warm condo market.
But the Canada Mortgage and Housing Corporation (CMHC) said there's still reason for developers to be optimistic.
Developer Jason Pitre, president of MRE Group, said he knows that other developers have had problems filling their buildings. but he said he is confident his $16-million condo complex will start selling long before the complex is finished sometime next year.
"Certainly there are other condo developments that have had product on the market for years and years and they’ve been unsold," he said.
Canada's Mortgage and Housing Corporation said in the past five years about 100 condo units have gone up in Charlottetown in five apartment-style buildings.
On average, it has taken each condo unit nearly an entire year to sell — that’s compared to a month or two for the average stand-alone home.
Jason Beaton, market analyst with CMHC, cautions averages can be deceiving.
"You could probably make the inference that one or two projects may have pushed the average up for all the other ones. Some of them have met with great success, and other ones have been less successful," said Beaton.
CMHC says the least successful developments have generally been the higher-end condos in the $500,000 range.
Pitre said that’s why he’s steering clear of those. Each of his Parkdale Place condos will be in the $250,000 range.
"There was a large appetite of the baby boomer market looking for condominiums at a more medium price range," he said.
Architect Robert Haggis predicts he will be working on a lot more mid-range, maintenance-free projects down the road for the area’s aging population.
"I think baby boomers are starting to look at units like this and here in PEI, it's kind of a new thing, so I don't expect it to stop anytime soon," he said.
Though Pitre said in Charlottetown, the obstacle will be finding space for future condo developments in the heart of the city.
"There needs to be more development done in the north extremity of the city," he said. "That's where you're going to find more land opportunity. It just doesn't exist in this area anymore without tearing down houses or disrupting neighborhoods that already exist."