Bancroft Business Opportunity Assessment Report

 Building Bancroft Project Business Opportunity Assessment Residential Analysis Bancroft, Ontario BUILDING BANCROFT N. BARRY LYON CONSULTANTS LIMITED APRIL 2010 February 21, 2010 Mr. Greg Black Project Manager Build Bancroft Project PO Box 790 24 Flint Avenue Bancroft, Ontario K0L 1C0 Dear Greg, Re: Building Bancroft Project, Business Opportunity Assessment, Residential Analysis Please find attached our final report on the feasibility of residential development as a component of the Building Bancroft Project. Yours truly, N. Barry Lyon Consultants Limited Mark Conway Partner TABLE OF CONTENTS 1. Introduction .................................................................................................................................... 2 2. Site Evaluation ................................................................................................................................ 3 3. Demogrphic and Economic Profile ................................................................................................. 9 4. Competetive Market Review ........................................................................................................ 17 5. Product & Concept Development ................................................................................................ 25 6. Financial Analysis .......................................................................................................................... 28 7. Conclusion .................................................................................................................................... 30 Appendix A – Detailed Financial Analysis ............................................................................................. 31 Building Bancroft Project – Residential Analysis February, 2010 Page | i 1.
INTRODUCTION N. Barry Lyon Consultants Limited (NBLC) has been retained by Building Bancroft to undertake a strategic assessment of the market potential for residential development in downtown Bancroft, Ontario. The Town of Bancroft has initiated the Building Bancroft Project as it looks to rebuild and revitalize its downtown, in an effort to counter population loss and a declining economy. A residential component is viewed as highly desirable in terms of generating activity and animation in the downtown as well as generating revenue from the sale of land. The aim of this study is to review the prevailing economic and demographic characteristics of Bancroft and then, with these characteristics in mind, work to develop an appropriate residential development program, that could be incorporated into a larger scheme. The full scheme could include features such as a new community centre, municipal offices and a major regional tourist attraction. Building Bancroft Project – Residential Analysis February, 2010 Page | 2 2.
SITE EVALUATION The Town of Bancroft is located within Hastings County in Central Ontario. The town is built in the York River Valley, centred on the intersection of Highways 28 and 62. Positioned on the southern edge of the Canadian Shield, the landscape provides a picturesque natural setting, offering various outdoor recreation opportunities, including: boating, swimming, hiking, rock climbing, golf, kayaking, cross‐country skiing, and snowmobiling. Downtown Bancroft The history of Bancroft is one steeped in milling, mining and the railroad; a lot of which is currently still reflected in the Town. The Old Station is home to the Art Gallery of Bancroft and the Bancroft Mineral Museum. The Mineral Museum plays homage to the Town’s mining history displaying locally collected mineral samples. Bancroft is often referred to as the “Mineral Capital of Canada” due to the variety of minerals found in the area, and each year hosts the popular “Gemboree” festival in late July. Also, the Hastings Heritage Trail follows the region’s abandoned rail line, providing 350 linear kilometres of multi‐use recreational space. The Old Station & Hastings Heritage Trail Building Bancroft Project – Residential Analysis February, 2010 Page | 3 2.1
Location As illustrated in Figure 1, the Town of Bancroft is located almost an equal distance between Toronto and Ottawa, and just over an hour away from Peterborough, the closest major urban centre. The following table outlines the drive‐times to several major centres and attractions from Bancroft. Table 1 Drive Times From Bancroft
Location
Direction
Toronto
Ottawa
Kingston
Belleville
Pembroke
Peterborough
Haliburton
Huntsville
U.S. Border (Thousand Islands)
Algonquin Park
SW
E
SE
SE
NE
SW
W
NW
SE
NW
Distance (km)
240
225
190
115
160
105
65
170
230
70
Drive‐
Time
2:45
3:00
2:30
1:40
1:55
1:15
1:00
2:10
2:50
1:00
Figure 1 Building Bancroft Project – Residential Analysis February, 2010 Page | 4 The area road network is centered on the intersection of Highway 28 and Highway 62. These roads provide connections to Peterborough and Belleville, and connect to Highways 115 and 401 respectively. Highway 28 continues east from Bancroft providing connections towards Ottawa and the Ottawa River Valley. 2.2
Local Community Context 2.2.1
Healthcare Bancroft is well served by healthcare and professional services for a community of its size. The North Hastings Health Centre is located in Bancroft, and along with the supplementary Bancroft Professional Centre, combines to provide a full range of medical care and services. Further, local community groups like Community Care North Hastings provide volunteer‐based support for seniors and adults with disabilities. North Hastings Health Centre The Quinte Health Care North Hastings site is comprised of both the North Hastings District Hospital and the Hastings Centennial Manor. •
Built in 2002, the North Hastings District Hospital is a six‐bed primary acute care hospital which operates a 24‐hour emergency ward (including Emergency Obstetrics). •
The hospital’s beds are designated for those patients with medical conditions, as opposed to surgical. The hospital also provides outreach clinics (Internal Medicine, Obstetrics/Gynaecology, Urology), support, diagnostic (Radiology, Ultrasound), and treatment services. •
In addition, the hospital offers Diabetes Education, Nutrition Counselling and manages a Health Records Department. •
Also, the hospital has a six‐chair Dialysis Unit, reducing the need for patients to travel to larger urban areas for treatment. 2.2.2
Education Bancroft is served by the Hastings and Prince Edward District School Board (HPEDSB; public school system) as well as the Algonquin and Lakeshore Catholic District School Board. Combined, these school systems serve Bancroft through 6 public schools and one Catholic school, namely: •
•
•
•
•
•
Bancroft Public School, junior kindergarten to grade 6; Birds Creek Public School, junior kindergarten to grade 6; Hermon Public School, junior kindergarten to grade 6; North Hastings Senior Elementary School, grades 7 to 8; North Hastings High School, grades 9 to 12; and, Our Lady of Mercy Catholic School, junior kindergarten to grade 8. Building Bancroft Project – Residential Analysis February, 2010 Page | 5 In terms of post secondary education, Bancroft is home to a satellite campus of Loyalist College. The Bancroft location offers programs in Nursing, Personal Support Worker, Paramedics, along with other programs for continuing education and adult literacy. Further, Fleming College has campuses in Haliburton and Peterborough, and Loyalist College’s main campus is located in Belleville. Bancroft, like many other communities in Ontario, bas been experiencing declining enrolment in its public school system. Between the 2007/08 and 2008/09 school years, the HPEDSB experienced a decline of 327 students at the elementary level, and a further loss of 14 at the local secondary school level1. The Province’s Accommodation Review Committee process will take place in the 2013/14 school year and will determine the potential for school closures at that time. Until then, the board will continue to shuffle administration and students between schools in order to maintain standards. 2.2.3
Shops and Services Bancroft’s Downtown area boasts a wide array of shopping and service opportunities for its residents and visitors. The main street comprises a mix of local shops and services and larger national brands, especially in terms of banks, grocers and hardware/ home improvement retailers. 2.2.4
Parks and Recreation In addition to nearby Algonquin Park, which covers 7,653 square kilometres, several parks and community recreational facilities exist within Bancroft. Local recreational opportunities include: •
Bancroft Millennium Park on the York River, this park contains a senior’s clubhouse, band shell, and walking trails. • Riverside Park, also on the York River, this park is home to a museum, walking trails and a playground. • The Hastings Heritage Trail, which offers 350 linear kilometres of multi‐purpose trails along an abandoned rail line. • Eagle’s Nest lookout also has walking/hiking trails, rock climbing, and offers panoramic views of the York River Valley. • Two local golf courses, Bancroft Golf Course and Rivers Edge. • Several community centres and associated facilities are located within Bancroft, these include: o The Bancroft Curling Club; o Bancroft Skating Club; o Bancroft Tennis Club; o Bancroft Public Library; o Club 580 (Senior’s Park); o North Hastings Community Centre; and, o Several other community centres are located in the surrounding area (Faraday, Dungannon, Maynooth, Musclow). 1
Schell, Dan. “Trying to manage declining enrolment,” Bancroft This Week, November 2009. Building Bancroft Project – Residential Analysis February, 2010 Page | 6 2.2.5
Public Transportation While there is not any full service public transit available in Bancroft, Greyhound Bus service does connect Bancroft to locations between Toronto and Pembroke, however service schedules are limited. Local transit for those in need is made available by Bancroft Community Transit, a non‐profit volunteer service. Figure 2 – Map of Key Community Facilities Source: County of Hastings Building Bancroft Project – Residential Analysis February, 2010 Page | 7 2.2.6
Senior’s Housing Supply in Bancroft Private Facilities Riverstone Residence •
•
Riverstone Residence opened in June 2009, after a renovation of what was formerly the Bancroft Hospital. This residence for healthy elderly individuals has 30 rooms, of which 10 are occupied to date. Riverstone provides meals, housekeeping, laundry and a social calendar for its residents. Prices vary, but average about $2,500 per month. It is expected that while the residence is very new, price has played a significant role in limiting occupancy rates up to this point (currently 33% occupied). Hastings Housing Corporation Facilities Centennial Manor Long Term Care •
Hastings Centennial Manor is a 110 bed Long Term Care Facility for seniors, attached to the North Hastings District Hospital. Within this facility are an Activation Department (in charge of daily activities and Restorative Care); Alzheimer Unit; Dietary Department; 24‐hour Nursing Department; and, Palliative Care Unit. Riverside Chateau (25 Station Street) •
This senior’s residence features rental apartments in a two‐storey brick building along the York River. This housing is generally occupied by active seniors. R.J. Brooks Living Centre (1 Alice St) •
This county‐run residence is an apartment building for seniors 65 years of age or older. Generally, residents at R.J. Brooks are active and independent, although some have homecare support. The building contains 40 suites, which are currently all occupied. Rent is both geared to income, and market rental rates. York River Heights Senior Citizens Complex (303 Hastings St N) •
This county‐run residence provides rental housing for a mix of elderly and younger senior clientele. Generally residents are active and independent, although some have homecare support. The building contains 32 units, which are all currently rented. Rental structure is both geared to income, and market rental rates. Building Bancroft Project – Residential Analysis February, 2010 Page | 8 3.
DEMOGRAPHIC AND ECONOMIC PROFILE In order to gain a better perspective of the residential market context, the following section provides an analysis of the socio‐demographic make‐up of the Town of Bancroft, with comparisons to Hastings County and the Province of Ontario. The analysis examines such variables as population, immigration, housing characteristics and income levels, based primarily on 2006 Statistics Canada Census data. 3.1
Population and Age Structure •
Between the 2001 and 2006 Census, Bancroft’s population decreased by 6.1% or 230 people. This decrease is relatively uncommon in Southern Ontario, especially considering the positive growth experienced in the greater Hastings County (3.6%), or growth for the Province as a whole (6.6%). •
Compared to Hastings County, and the Provincial breakdown, Bancroft has a small proportion of its population in the under‐35 demographic. In Bancroft, 35% of the population is under 35 years of age, compared to 40% at the county level, and 45% in the province. On the other hand, Bancroft has a notably higher proportion (23%) of its population in the 65 years of age and older population segment (14% at the Provincial scale). •
In 2006, Bancroft had a median age of 47, well above the Provincial average of 39. •
Interestingly, between 2001 and 2006, the proportion of Bancroft’s population under the age of 45 decreased by 7%, while the proportion of Bancroft aged 45 years and older increased by 8%. The 0‐19 year demographic also declined by 4%, while the 55‐64 age group increased by the same amount. •
While these demographic shifts are also occurring in the County and to a lesser degree in the Province as a whole, the declines in the younger age groups and increases in the older age groups are much more pronounced in the Town. Building Bancroft Project – Residential Analysis February, 2010 Page | 9 Table 2 Demographic Analysis: Population, Age, Status
Variables
Bancroft (Town)
Population
Population 2006
3,838
Pop. % change (2001‐2006)
‐6.1%
Pop. % change (1996‐2001)
0.2%
Age Structure 2006 (% of population)
0‐19 years
22%
20‐24 years
5%
25‐44 years
20%
45‐54 years
16%
55‐64 years
14%
65+ years
23%
Total:
3,855
Age Structure 2001 (% of population)
0‐19 years
26%
20‐24 years
4%
25‐44 years
23%
45‐54 years
14%
55‐64 years
11%
65+ years
22%
Total:
4,090
Source: NBLC & Statistics Canada, 2006, 2001 Census Data
3.2
Hastings (County)
Ontario
130,474
3.6%
‐0.1%
12,160,285
6.6%
6.1%
24%
6%
25%
16%
13%
17%
130,465
25%
7%
28%
15%
11%
14%
12,151,305
26%
6%
27%
14%
11%
16%
125,915
26%
6%
31%
14%
9%
13%
11,410,050
Mobility •
The root of Bancroft’s lack of population growth is evident in the population’s recent mobility characteristics. That is, unlike other areas in Southern Ontario, the vast majority of the Town’s 2006 population are considered to be ‘non‐movers’, i.e. did not change their place of residence within the proceeding five years. 64% of the Town’s population were non‐movers compared to 59% in the Province. •
Furthermore, there was very little immigration into Bancroft between 2001 and 2006, with less than half, 46%, of all movers, moving from outside of Bancroft. In comparison, 55% of the County’s 2006 population were new to the County, •
The vast majority of the Town’s population migrating to Bancroft between 2001 and 2006 were intraprovincial migrants, with only 1% percent of the 2006 population having moved to Bancroft from outside the province in the past five years, in comparison to over 3% in the County and over 12% in the Province. Building Bancroft Project – Residential Analysis February, 2010 Page | 10 Table 3 Demographic Analysis: Five Year Mobility Rates
Variables
Bancroft (Town)
Non‐movers
64%
Movers
36%
Non‐migrants
54%
Migrants
46%
Internal migrants
99%
Intraprovincial migrants
99%
Interprovincial migrants
1%
External migrants
1%
Immigrants (2001‐2006)
0%
Source: NBLC & Statsistics Canada, 2006 Census Data
3.3
Hastings (County)
60%
40%
45%
55%
97%
92%
8%
3%
1%
Ontario
59%
41%
54%
46%
88%
95%
5%
12%
5%
Housing •
About two thirds (68%) of Bancroft’s housing stock is owned, rather than rented. This is a slightly lower level of ownership than found in the County (73%) and the Province (71%), due primarily to lower average income levels and relatively large rental unit stock. •
Housing typology in Bancroft is biased heavily towards traditional single or semi‐
detached homes, representing 77% of the housing stock. The remaining 22% of Bancroft’s housing stock is split; 4% row and 22% apartment. •
The Town’s housing split is similar to the County’s but differs considerably from the Province’s housing stock, with 56% single‐family, 8% row, and 27% in apartment form. •
There is an average of 2.2 persons per household unit (ppu) in Bancroft, much less than the 2.4, and 2.6 ppus in Hastings County and Ontario, respectively. This low ratio is one of the lowest in the Province and is indicative of the older population mix in Bancroft, with the majority of households likely comprised of older couples without children at home. •
Like Hastings County, almost three quarters of Bancroft’s housing stock was constructed before 1986, as housing development in the Town (and County) over the past 20 years has been limited. Building Bancroft Project – Residential Analysis February, 2010 Page | 11 Table 4 Demographic Analysis: Housing Tenure, Type, Age
Variables
Bancroft (Town)
Hastings (County)
Ontario
Housing Tenure
Owned
68%
73%
71%
Rented
32%
27%
29%
Type
Single/ Semi‐detached house
77%
75%
62%
Row house
4%
3%
8%
Apartment, excluding duplexes
22%
18%
26%
Average # persons per household 2.2
2.4
2.6 Period of Construction
Before 1986
74%
76%
69%
From 1986 to 2006
26%
24%
31%
Note: Housing type proportions do not add to 100% and should be considered approximate, values are sourced directly from Statistics Canada community profile data.
Source: NBLC & Statistics Canada, 2006 Census Data
3.4
Income and Labour •
The most recent census data indicates that Bancroft’s largest employment sectors are manufacturing and construction (17% of the labour force); health and education (19%); and, wholesale and retail trade (20%). •
At the county level, these sectors are also the largest; however the distribution of the labour force is slightly different between these categories, with larger proportions active in manufacturing and construction. The Town also has a much larger proportion of the labour force active in primary industries than in both the County and Province. •
Census data indicates that the Town of Bancroft has experienced a decline in several industry categories between 2001 and 2006. Over this time period, the largest employment losses occurred in the business services industry (10% decline); finance and real estate (5% loss); and in the manufacturing and construction industries (4% loss). Employment in the agriculture and resource based industries saw the largest employment increase in Bancroft between 2001 and 2006 (2% growth). Overall, employment in Bancroft experienced a cumulative decline of 17% between the 2001 and 2006. •
The County of Hastings also experienced employment loss between 2001 and 2006. Like Bancroft, the largest decline was in the business services sector. In fact, no industry categories experienced growth at the county level between 2001 and 2006, with employment in the county declining by over 25%, larger than the decrease experienced by the Town. •
Median household income in Bancroft ($38,480) is lower than the County of Hastings ($49,811), and considerably lower than the Provincial average ($60,455). •
The median income for individuals in Bancroft is $20,612; again this is much lower than the median income for individuals at the county and provincial levels, where incomes are $23,916 and $27,258 respectively. Building Bancroft Project – Residential Analysis February, 2010 Page | 12 •
Low levels of income in the Town of Bancroft are the likely result of; o
the dominant employment industries in the Town; o
the recent contraction of several employment sectors; o
the large proportion of retirees; and, o
the lower cost of living In the Town compared to most other areas of Southern and Central Ontario. •
Bancroft has a low rate of employment participation, with only 54% of the population active in the workforce. This figure is well below the County of Hastings at 62%, and Ontario’s rate of 66%. This can be attributed to the large grouping of the population in older age groups, many of whom are no longer working. •
While specific numbers for the Town are not available, the recent economic downturn has likely increased unemployment rates steadily over the past year. The unemployment rate for the Kingston‐Pembroke Labour Market (which includes Hastings County) increased from 5.5% in November 2008 to 7.7% as of November 2009. Comparatively, the Provincial unemployment rate rose from 6.2% in November 2008, to 8.4% in November 2009. •
On a positive note, Bancroft is set to receive up to $616,500 in funding from both Federal and Provincial governments to be used towards improvements in water, sewer, and road infrastructure2. This funding is part of the government stimulus package and will contribute towards offsetting labour market contraction. •
While the Town of Bancroft’s unemployment figure has surely increased in light of the economic decline over the past 12 months, the large proportion of the Bancroft population outside of the active labour force means that fewer households would be directly affected by such economic shifts. •
Based on Census place of work data, there are roughly 2,850 jobs located in the Town of Bancroft; roughly double the level of employment. This is a very enviable position to be in, but not uncommon for urban centres in rural areas. This means that the vast majority of those employed in the Town, work in the Town, and that a large portion of people commute to the Town for work, making the Town a net importer of employment. •
The major employers in the Town of Bancroft include : o
o
o
o
o
o
Hastings Centennial Manor – nursing and residential care, 140 employees; Hydro One Inc. – 106 employees; Levesque Brothers – residential building construction, 90 employees; Canadian Tire – 80 employees; Quinte Health Care North Hastings – hospital, 78 employees; and, North Hastings High School – 77 employees.3 2
Service Canada, Kingston Pembroke Labour Market Monitor, October 2009. 3
Major Employers, Bancroft, Town of, July 2009. Building Bancroft Project – Residential Analysis February, 2010 Page | 13 Table 5 Demographic Analysis: Income and Labour Force Indicators
Variables
Bancroft (Town)
Hastings (County)
Ontario
Income
Number of families
1,655
52,640
4,555,025 Median household income *
$38,480
$49,811
60,455 Number of singles **
2,990
101,740 9,340,020 Median income ‐ Singles *
$20,612
$23,916
$27,258
Labour
Total population 15 years and over
3,130
106,575
9,819,420
Participation rate
54%
62%
67%
Employment rate
52%
58%
63%
7.7%***
Unemployment rate
8.4%****
Not in the labour force
45%
38%
33%
Industry (2006)
Agriculture and other resource‐
8%
4%
3%
based industries
Manufacturing and construction 17%
21%
20%
industries
Wholesale and retail trade
20%
19%
16%
Finance and real estate
2%
3%
5%
Health and education
19%
15%
16%
Business services
4%
4%
7%
Other services
14%
10%
9%
Industry (2001)
Agriculture and other resource‐
6%
4%
3%
based industries
Manufacturing and construction 21%
22%
22%
industries
Wholesale and retail trade
18%
19%
16%
Finance and real estate
7%
4%
7%
Health and education
17%
15%
15%
Business services
14%
15%
19%
Other services
17%
21%
18%
Source: NBLC & Statistics Canada, 2006 Census Data, CANISM Table 2820054
*Net income before taxes **Individuals over the age of 15 with income ***Kingston‐Pembroke Labour Market unemployment rate as of November 2009 ‐ includes Hastings County ****Unemplotment Rate as of November 2009 Building Bancroft Project – Residential Analysis February, 2010 Page | 14 3.5
Key Findings from the Demographic and Economic Analysis The Town of Bancroft is characterized by an aging population and recent population decline. Population loss or very low growth is not uncommon outside of Ontario’s major centres. This is a result of higher than normal proportions of the population within older demographic groups, limited in‐migration, and the outmigration of younger age groups. The following are other factors that are shaping the housing market in the Bancroft area: 3.6
•
Bancroft’s persons per household unit rate of 2.2 ppu further reinforces the indication that Bancroft has a high proportion of retirees and seniors. The low ppu ratio indicates that many households are without live‐in children. •
Bancroft has a larger than average renter pool, as well as a significant proportion of the population living within low‐rise apartment housing stock. These statistics are likely a result of the high proportion of seniors living the Town, combined with the legacy from transient workers in formerly dominant employment sectors. High proportions of apartment housing indicates that the typology is widely accepted as a housing choice in the Town. This is sometimes uncommon in smaller municipalities. •
The Town’s housing stock is very old, with almost 75% of units constructed more than 20 years ago. •
As new housing development has been very limited, there is the potential that some pent up demand for new downtown housing is present in Bancroft. •
Bancroft’s household income level and employment participation rate are below the provincial average. This fact is due in part to a significant proportion of the population living with fixed incomes; the dominant employment industries and recent contraction of several employment sectors; and lower cost of living than compared to most other areas in Southern and Central Ontario. •
The Town is a net importer of employment, with roughly 1,400 people commuting into Bancroft for work. New housing stock could potentially be an attractive option to this demographic segment as well. Development Activity The following analysis examines building permit data for new dwellings in the Town of Bancroft between 2005 and December 2009. •
The frequency of new development in the Town has fluctuated greatly from year to year. The most development activity was experienced in 2006 when 21 permits were issued, all for new single family homes. •
The least amount of development activity took place in 2007 (only 7 permits issued – all for single family homes), these homes were large, averaging 2,835 sq. ft. per home. •
Since 2005, 57 single family units and 12 apartment units have been constructed in the Town. The average unit size of new dwellings in the Town since 2005 is 1,934 sq. ft. However, if development from 2007 is excluded, this per unit average falls to about 1,700 sq. ft. •
Of note, a 10‐unit apartment building was constructed in 2008; each unit averaged 1,058 square feet in size. This project was a second story addition to an existing 4‐unit mercantile Building Bancroft Project – Residential Analysis February, 2010 Page | 15 building on Snow Road. The building offers geared to income rental housing for single working adults, and is managed by Hastings County Housing Corporation. Table 6 Town of Bancroft Building Permit Data
Number of New Dwellings
Year
Single Family
2005
2006
2007
2008
2009*
Totals/ Averages
12
21
7
6
11
57
Size (sq. ft.)
Total New Apartment Units Per Unit Average
Development
2
1,940
25,214
0
1,906
40,016
0
2,835
19,846
10
1,465
21,270
0
1,525
16,772
12
1,934
123,118
*Da ta a s of December 10th, 2009
Source: Town of Bancroft Building Department & N. Barry Lyon Consultants Limited
Figure 3 Number of New Dwelling Units Constructed in Bancroft per Year
25
20
15
10
5
0
2005
2006
2007
2008
3.7
2009*
Summary This data suggests that while housing demand will persist among all groups, the area of strongest growth will be in older age groups in the empty‐nester (55‐70 years of age) and the retirement categories. Some demand for townhome or apartments will also come from single persons, especially divorce casualties and widowers who do not require large homes nor want the maintenance associated with them. In all cases, the cost of housing will be a major determinant of market success. Total demand from these groups is expected to be modest. Under current conditions, demand is likely to be in the range of 10 to 15 units per year. However, by improving the amenities of downtown Bancroft through improved retail, attractions and community services, these absorption rates could be significantly enhanced. Building Bancroft Project – Residential Analysis February, 2010 Page | 16 4.
COMPETETIVE MARKET REVIEW This section outlines the immediately competitive projects located within Bancroft, as well as the collection of projects located in what is identified as the greater Bancroft‐Haliburton market area. There are very few projects in the Bancroft‐Haliburton area we look further a field to provide some market context. 4.1
The Bancroft‐Haliburton Market Area There are currently four residential projects actively marketing throughout the Bancroft‐Haliburton market area. The following are our observations of the new residential marketplace: 4.2
•
The four active residential developments that could be competitive to any housing project in Bancroft represent a total of 118 new residential units. To date, 41% (48 units) have been sold. These projects are, in some cases, not close to Bancroft but offer evidence of the nature of the local and regional residential marketplace. •
The active developments in the area are offering a range of residential types, ranging from townhomes to bungalows and typical two‐storey single detached homes. However, the most common are single family detached dwellings, with some developments selling vacant detached lots, and allowing the purchaser to choose from a selection of housing models. •
Single detached lots are typically priced between $40,000 and $68,000 depending on the size of the lot, and its location within a development. Detached homes are priced between $220,000 and $560,000. The majority of the market is typically around the $300,000 mark, with the higher end units typically being lakefront property or estate homes located in Haliburton. •
New townhome product makes up only 11% of the actively marketing supply in the Bancroft‐Haliburton market area. These units are found at the Silver Beach project in Haliburton, where unit sizes range between 705 and 888 square feet, with end pricing around $299,000. •
The target market for residential development in the region is the active retired buyer from the GTA, as well as those moving from local communities and areas in between. These buyers typically have fixed incomes (i.e. pensions) and are driven by the affordability, the beauty of the near‐north landscape, sense of privacy and exclusivity, safety and small town character as well as access to outdoor recreational activities. Bancroft’s Active Residential Projects Two residential projects are located directly within the Town of Bancroft. Both projects are currently selling vacant detached serviced lots, and offer prospective purchasers their choice in housing design. These Bancroft projects offer relatively affordable detached homes, and are characterized by somewhat slow market absorption rates. See Figure 4 for a map locating these projects. In addition to these two projects, a local landowner has sold lots in a subdivision called Granite Ridge, located in Bancroft on the shores of Vanluven Lake and Waterhouse Lake. This project has been selling luxury waterfront lots (0.5 acre lots) for several years, many of which have been built on. Currently there are six vacant lots listed with a local real estate agent for prices ranging between Building Bancroft Project – Residential Analysis February, 2010 Page | 17 $59,000 and $79,000. There is no developer/builder linked to the subdivision, all construction is contracted by individual property owners. 4.2.1
•
•
•
•
River’s Edge Golf Course & Community The River’s Edge project is located on the North Edge of Bancroft about 4 km (a 5 minute drive) from downtown. The River’s Edge community is the residential component of the Rivers Edge Golf Course project. The residential development features a total of 170 detached lots set on treed fairway lots or lots backing onto the York River. The project is currently selling its second phase. Since opening in 2007, River’s Edge has released 26 lots and has sold 15, or 58%. This sales pace translates into an absorption rate of about one lot every two months. So far, two new homes have been purchased from the developer in addition to the sale of the respective lots. These homes sold for $325,000 and $345,715 respectively. River’s Edge Golf Course and Community, Bancroft Building Bancroft Project – Residential Analysis February, 2010 Page | 18 4.2.2
•
•
•
•
Village Estates The Village Estates project is located on Williams Drive, about 2 km southeast of Bancroft’s downtown. The land for this development was purchased in 2003, subdivided and serviced in years thereafter. The project began selling lots in 2008 and to date have released one phase of 23 serviced single detached lots, of which 12 are sold (52%). These sales translate into an absorption pace of 0.6 lot sales per month. The lots range in size between 48 and 80 foot frontages, ranging in price between $42,000 and $49,000. The land owner has partnered with a local contractor who will build homes to buyers’ specifications. Recent home purchases have ranged in price between $220,000 and $250,000. Two homes currently for sale are priced at $269,000 (1,200 sq. ft.) and $279,000 (1,700 sq. ft.). This project will likely be developed over several phases. The land owner noted that they own an additional 60 acres adjacent to the Village Estates lands, and are starting to look at opening another block of land for development. Village Estates, Bancroft Building Bancroft Project – Residential Analysis February, 2010 Page | 19 Building Bancroft Project – Residential Analysis February, 2010 Source: County of Hastings & NBLC Figure 4 – Map of Active Residential Projects in Bancroft Page | 20 Bancroft
Haliburton
Haliburton
Village Estates
Stothart Creek
Silver Beach Lifestyle Community
2007
2007
Greg Brown Construction
Silver Beach Developments
2008
2007
Michael Wade Construction Co. Limited
1529036 Ontario Ltd
Oen Date
2 & 3‐bed bungalows / bungalofts
2 & 3‐bed townhomes
3 & 4‐bed detached
Serviced detached lots, custom or model home choices. Condo apartments in a future phase.
Serviced detached lots, custom homes with builder‐
partner. Additional 60 acres future phase
Unit Types / Notes
9
48
11
118
10
2
12
15
36
22
23
26
# Units/ Sales to Lots
date
Actively Marketing Residential Projects Near Bancroft
Builder
Building Bancroft Project – Residential Analysis February, 2010 Bancroft
Rivers Edge Golf Course & Community
Totals (4 Projects)
Source: N. Barry Lyon Consultants Limited
Location
Project Name
Table 7 82%
41%
28%
9%
52%
58%
% Sold
Pricing
$299,000
$39,900 ‐ $559,000
$389,000 ‐ $559,000
$299,900 ‐ $494,700
Page | 21 705 ‐ 888
705 ‐ 3,807
1,221 ‐ 2,500
1,820 ‐ 3,807
Lots: $39,900 ‐ $71,000
1,400 ‐ 1,700+
Homes: $299,000 ‐ $399,000
Lots: $42,000 ‐ 48' to 80' (lots) $49,000 1,200 ‐ 1,700 Homes: $220,000 ‐ $279,000
Unit Sizes (sq ft)
4.3
Other Active Projects Other actively marketing projects located outside of the Bancroft‐Haliburton market area include: •
•
•
•
The Landing Townhomes o
Located in Apsley (about 45km south of Bancroft), Timberline Custom Homes has constructed 25 waterfront townhomes on Anstruther Lake. These homes have been primarily targeted to seasonal buyers. o
The project began selling in 2005 and has sold 21 units to date at a rate of about 0.4 units per month. Townhomes are 1,100 sq. ft. 2‐bedroom units, ranging in price between $269,900 and $309,900. Kingsview on Balsam Lake o
Located on Balsam Lake in Coboconk (about 60km south of Haliburton), the Katlin Group is constructing a 30 unit gated waterfront community with condominium ownership. o
Homes are 3 and 4‐bedroom detached units, ranging between 1,600 and 1,900 sq. ft., with pricing between $500,000 and $710,000. Since opening in 2007, 20 have been sold (67%). Maple Walk Estates o
Located in Fenelon Falls, the project is comprised of 20 townhomes and one detached home, and is being marketed towards active adults. The development is within walking distance to shopping and waterfront amenities (Cameron Lake). o
Pricing ranges from $219,900 (1,165 sq. ft.) to $229,900 (1,390 sq. ft.). Since opening in 2007, the project has sold 15 units, and an additional phase of 13 units will be released in 2010. 122 Homewood Condominiums o
Located in the Village of Hastings, builder Sunrise Estates has constructed a 6‐unit bungalow‐style condominium; each unit is 750 sq. ft. o
Since opening in the summer of 2009 no units have been sold. Units were originally priced at $169,900 but have recently been reduced in price to $129,900. In general, this review illustrates that the range of pricing and product positioning is wide and a broad selection of homes is available. Most of these new home projects suffer from slow sales. In each project, the reasons for slow sales may be different but in general, seniors tend to be very selective and are highly mobile and frequently not in a rush to move. A growing trend for this group is to stay in the family home for longer periods. Building Bancroft Project – Residential Analysis February, 2010 Page | 22 4.3.1
Muskoka Wharf, Gravenhurst It is useful to examine the Muskoka Wharf project in Gravenhurst. While in a totally different market context, the project has illustrated the importance of public investment to the residential market. The investment of the public sector in the new wharfs, the museum and other infrastructure effectively transformed this area and changed the market perception of the Town in general. The investment supported the development of the Muskoka Wharf condominium development, which sold briskly despite any previous market experience in higher density development in Gravenhurst. Muskoka Wharf, Gravenhurst 4.4
Future Supply •
Upcoming projects include River’s Edge Condominium Residences. In discussions with the project’s sales agent, it was noted that the developer is currently holding on its plans to build a phased development of 12, two‐storey condominium buildings, each with 8 units, this may be incorporated into a later phase (96 units total). Based on original plans, these units are expected to be comprised of 2‐bedroom (1,100 sq ft) and 3‐bedroom unit types (1,550 sq ft), with anticipated end pricing ranging between $229,000 and $289,000. •
Watercolours, a retirement lifestyle condominium development in Haliburton has received OMB approval. However, it is currently on hold as it undergoes design revisions and attains site plan approval. o The development will be a four‐storey condominium building overlooking Head Lake, and is being marketed as an aging‐in‐place retirement community. o
The project will provide its residents with over 75 support programs, available through a pay‐as‐you‐go style plan. o
Units are expected to include 1‐bedroom, 1‐bedroom and den, 2‐bedroom and 2‐
bedroom and den configurations, with sizes between 580 and 1,200 sq ft, and unit pricing between $165,500 and $340,000. O The project is expected to be comprised of about 150 condominium units in total. Building Bancroft Project – Residential Analysis February, 2010 Page | 23 4.5
Resale Product The following table outlines the resale market activity throughout Bancroft from 2004 to 2009. •
The overall average sale price for resale product in Bancroft is $150,197; however the annual average has steadily increased since 2004. The 2009 average for resale homes in Bancroft was $180,512, up over $21,000 from 2008. •
The average sale value of $180,512 suggests that there is likely a range of resale product available from the $160,000 to $300,000 range. •
Homes typically average 88 days on the resale market, this is indicative of the slower pace of sales activity realized throughout the market area. •
Both the new home and resale markets are modest in terms of pricing and activity. Market indicators suggest that new downtown development priced around $250,000 would be effective in attracting potential purchasers who currently own above‐average homes, without excluding prospective purchasers from the local area. Table 8 Summary of Residential Resale Transactions in Bancroft, 2004 ‐ 2009
Year
2009
2008
2007
2006
2005
2004
Totals:
No. of Transactions
37
37
35
58
48
65
280
Average List Average Sale Price Price $190,714
$180,512
$166,213
$158,960
$153,460
$142,463
$162,776
$153,900
$139,435
$133,278
$140,625
$132,297
$159,264
$150,197
Source: Bancroft and District Real Estate Board, NBLC.
Sale to List Price 93%
96%
93%
95%
96%
94%
94%
Building Bancroft Project – Residential Analysis February, 2010 Page | 24 5.
PRODUCT AND CONCEPT DEVELOPMENT The Building Bancroft initiative could represent a good opportunity to remedy the lack of recent investment and development in Bancroft’s downtown, and to incorporate new residential product at the same time. The site plan as originally proposed on the west side of the river was not considered well suited for residential development. However, subsequent revisions to that plan have improved the opportunity for the proposed residential development to be successfully integrated as part of a new downtown revitalization plan. Given Bancroft’s demographic structure, and the dominant empty‐nester/ move‐down buyer group, there is an opportunity to provide a different, more modern housing option to the Town. The housing choice for these groups are now limited to detached homes in town, older rental buildings and assisted seniors housing. None of these options are ideally suited to empty‐nesters who are simply looking to downsize in an area that is attractive with nearby amenities. There is only one resale condominium apartment building located directly downtown (at 16 Alice Street). This building is approximately 20‐years old, and currently, only one unit is available for purchase. A new condominium apartment offering in conjunction with a renewed downtown aesthetic, and investment in new community facilities could be successful in fulfilling the demands of an unserviced niche market. This affordable product offering would allow purchasers the ability to live in Bancroft with the ability to walk to shops and services, enjoy the local recreational opportunities and community facilities. We therefore see the potential for a modest residential component of a new residential development in downtown Bancroft that could begin with a small, 40‐unit apartment building along with an initial phase of townhomes as part of an overall redevelopment project. For success, the project would have to consider these principal requirements: •
The maximization of river views and access with respect to the proposed development site; •
The scale of the project must be limited to market conditions; •
A limited number of floor plans; •
Balconies or terraces for each unit; •
Lower cost construction through the use of wood or potentially steel frame; •
The site must be physically linked with pedestrian connections to some of the other community facilities and aesthetic improvements also being discussed as part of the Building Bancroft project. In terms of the project’s sales process; presale strategies in weaker market areas do not always produce favourable results. This is, in part, due to the unfamiliarity of purchasing a condominium, and waiting up to 24 months for occupancy in these areas. It is also indicative of the weaker demand characteristics. Presales maybe necessary to securing traditional financing, however, if financing could be made available that would allow construction to proceed ahead of the sale program; the project could attract much more interest, reduce buyer uncertainty and likely improve the pace of sales. Building Bancroft Project – Residential Analysis February, 2010 Page | 25 5.1
The Empty‐Nester/ Move‐Down Buyer Groups The principal buyer group will be empty‐nesters. The following characteristics must be considered in the design, pricing and overall positioning of the apartment and townhouses: •
The first of the baby boomers are about to turn 65, marking the entry of this powerful wave of the population into the traditional age of retirement. •
These seniors however, are far healthier and active than prior generations. They tend to stay in the family home longer and when they do decide to down‐size, it is typically a slow process. •
Seniors today are also more knowledgeable about real estate, design and finishes, and are market savvy. •
Most seniors are not in a hurry to make a purchase decision are mobile and have a wide variety of choice. •
As most seniors are beyond their years of wealth generation, pricing is crucial. •
In communities such as Bancroft there are often few choices for seniors looking to down‐
size. Typically, they have a choice between older rental apartments and retirement homes. As many do not see the need to for assisted living, nor do they wish to pay rent for an old apartment (often for the first time in their lives) they choose to stay in their family homes. A condominium or townhouse offers a choice that: o
Allows them to preserve some of their equity for future needs; o
Gives them access to new construction that can feature modern finishes and design features; o
Provides better security; o
Is largely maintenance free; o
Provides the ability to “lock and leave” for more carefree travel; and, o
Provides new opportunities for socialization. Furthermore, a new downtown condominium apartment project may have the potential to attract a limited number of younger first time buyers. Condominium product can act as a supplement to rental stock, and offers good quality housing to those currently in rental units. As there is a large proportion of renters in the Town, this type of development may also represent an investment opportunity for local purchasers looking to own an equity property. 5.2
Suggested Product Type Based on NBLC’s analysis of Bancroft and the surrounding market area, it is expected that a 40‐unit condominium apartment development with large two‐bedroom units and an additional 8 townhouse units could be viable, especially when coupled with a good downtown development location. The potential for an additional 4 to 8 townhome units may exist as a later phase of the development, though it would likely require some time before the second phase of development could commence. •
Condominium apartments should be 800 to 1,000 square feet in size, while townhomes should be larger, ranging from 1,300 to 1,500 square feet per unit. Building Bancroft Project – Residential Analysis February, 2010 Page | 26 •
Pricing for condominium apartments should range between $215 and $225 psf (end pricing between $180,000 and $215,000). Townhome product could likely sell at higher end‐pricing, at rates between $160 and $170 psf (end pricing from $221,000 to $240,000). •
It is expected that if current economic conditions continue to improve or remain constant, a new development could be absorbed at a rate of approximately 3 sales per month. This assumes that the development is located on a quality development site, and is supported by an adequate marketing effort. Table 9 Suggested Residential Product Parameters ‐ Building Bancroft
Housing Type
Tenure
No. Units
Apartment
Condo.
40
Townhouse
Condo.
8
Size
$ PSF
End Price
800
1,000
1,300
1,500
$225
$215
$170
$160
$180,000
$215,000
$221,000
$240,000
Source: N. Barry Lyon Consultants Ltd.
Building Bancroft Project – Residential Analysis February, 2010 Page | 27 6.
FINANCIAL ANALYSIS 6.1
Development Scenario The development scenario is as follows: •
•
•
•
6.2
The development contains 40 condominium apartment units within a 3 to 4‐storey wood frame building with parking at grade. An additional 8 condominium townhouse units are also considered in the financial analysis. Condominium units average 1,100 sq. ft. in size, at an index price of $220 psf. Townhome units average 1,700 sq. ft. per unit, priced at $165 psf. Total residential gross floor area is estimated to be roughly 65,000 sq. ft. Methodology and Assumptions The methodology employed in the financial analysis is a Residual Land Value (RLV) analysis. The basic methodology determines the sales revenues attributed to the project, less the hard and soft costs of developing the project, resulting in a calculated “Residual Land Value and Profit”. The developer’s profit is then subtracted from this amount to determine the RLV (in future dollars), or the value attributed to the site once all revenues and costs associated with the proposed development are accounted for. This value is then discounted to the present day to give the RLV, or land value of the site, in present dollars. Some general assumptions employed in the pro forma analysis are as follows: •
A gross to net efficiency of 88% for apartment units, and 100% for townhouse units; •
A developer’s profit of 10.0%; •
A discount rate of 10.0%; •
A cost inflator of 1.0% per year; •
A revenue inflator of 2.0% per year; •
An above grade construction cost of $120 per square foot for apartment units, an above grade parking cost of $30 per square foot, representing a blended construction cost of approximately $121 per square foot for apartment units, in present dollars; •
An above grade construction cost of $75 per square foot for townhouse units, an above grade parking cost of $30 per square foot, representing a blended construction cost of approximately $75 per square foot for townhouse units, in present dollars; •
An residential absorption rate of 3.0 units per month; •
A residential parking ratio of 1.0 space per residential unit, and 0.2 spaces per apartment unit for visitor parking; •
Marketing to begin in 1.0 years time; and, •
Provisions for the proposed Ontario Harmonized sales tax is based on the average recommended achievable end price for a residential unit. A complete list of assumptions and the detailed pro forma analysis is provided in Appendix A. Building Bancroft Project – Residential Analysis February, 2010 Page | 28 6.3
Results of the Financial Analysis Based on the development scenario and noted assumptions, the development would generate a present land value for redevelopment of approximately $493,984 representing approximately $3,625 per apartment unit, and $43,625 per townhouse unit, at an overall $7.94 per square foot buildable. The findings from the financial analysis are summarized in Table 9 below. For the detailed financial analysis, please refer to Appendix A. Table 10 Summary of Results of Financial Analysis
Condominium Apartments
Condominium Townhomes at Grade
Total
Number of Units
40
8
48
Average net Unit Size (Square Feet)
900
1,400
0
51,037
$220
11,200
$165
62,237
$209
$198,000
$231,000
$203,500
0
0
0
$10,437,357
$1,940,969
12,378,325
$6,586,431
$883,541
$129
$79
7,469,972
$120
$2,621,690
$451,780
$51
$40
$9,208,121
$1,335,320
$180
$119
$1,229,236
$605,648
$30,731
$75,706
1,834,884
$38,227
$24
$54
$29
$1,024,690
$190,452
$25,617
$23,807
1,215,142
$25,315
$20
$17
$20
$144,983
$349,001
$3,625
$43,625
$493,984
$10,291
$3
$31
$8
Item
Project Stats
Gross Residential Area (Square Feet)
Index Revenue Per Square Foot
End Price per Unit
Retail Area (Square Feet)
Revenues
Total Project Revenues
Development Costs
Total Project Hard Costs
Total Project Hard Costs Per Square Foot
Total Project Soft Costs
Total Project Soft Costs Per Square Foot
Total Project Costs
Total Project Costs Per Square Foot
3,073,470
$49
10,543,442
$169
Profits
RLV and Profit (future$)
RLV and Profit Per Unit (future$)
RLV and Profit Per Square Foot (future$)
Total Profit (future$)
Profit per Unit (future$)
Profit per Square Foot (future$)
Residual Land Value
RLV (present$)
RLV per Unit (present$)
RLV per Square Foot (present$)
Source: N. Barry Lyon Consultants Limited
Building Bancroft Project – Residential Analysis February, 2010 Page | 29 7.
CONCLUSION The Building Bancroft project has the potential to successfully include residential development as one of its components. The site plan as originally proposed on the west side of the river was not considered well suited for residential development. However, subsequent revisions to that plan have improved the opportunity for the proposed residential development to be successfully integrated as part of a new downtown revitalization plan. The lack of condominium projects, or projects marketed towards active empty‐nesters in Bancroft presents a current a market opportunity for the development of low‐rise condominium apartments and townhomes. In this regard, the potential development represents a unique opportunity in Bancroft’s marketplace. Based on NBLC’s financial analysis, a modest development of condominium apartments and condominium townhomes are likely financially feasible at the land value suggested. However, this assumes that the project meets the criteria established in the report. The key criterion is that the residential component is accompanied by significant public investment in community or cultural facilities that serve to improve the aesthetic and amenity of the downtown area. Building Bancroft Project – Residential Analysis February, 2010 Page | 30 $1,024,690
$20.08
Condominium Apartment Building $31.16
$190,452
$23,807
$17.00
Traditional Condominium Townhouses
RLV per Square Foot (present$)
Total Profit
Profit per Unit
Profit per Square Foot
1,041
GRA (square meters)
0.00
Required Visitor Parking Stalls (per residential unit)
Building Bancroft Project – Residential Analysis February, 2010 1.00
Required Resident Parking Stalls (per residential unit)
0.20
‐
Proposed Density/Site Coverage
Parking Unit & Area Statistics
‐
1.00
0
62,237
‐
51,037
5,782
62,237
56,112
36,233
48
Total
$19.52
$25,315
$1,215,142
$7.94
$10,291
$493,984
Land Area (SF)
11,200
0
4,741
51,037
44,912
1,276
88.0%
900
40
$25,617
$3,625
36,233
48
Total
Land Area (acres)
Gross Livable Area ‐ GRA + retail (GLA, SF)
0
11,200
Gross Residential Area (GRA, SF)
Retail Area (SF)
1,400
11,200
Total Residential Saleable Area (SF)
100.0%
Gross to Net Efficiency (GNE, %)
Average Gross Unit Size (SF)
1,400
Number of Units
Average Net Unit Size (SF)
8
$2.84
$43,625
$144,983
$349,001
RLV per Unit (present$)
$220
$198,000
Total Residual Land Value (present$)
$165
900
40
Condominium Apartment Building $231,000
Index Revenue per Square Foot
8
1,400
Average Net Unit Size (SF)
Number of Units
Traditional Condominium Townhouses
Model Pro Forma for:
Building Bancorft Residential Development
Condo Apartments and Townhouses
End Price per Unit
Residential Unit & Area Statistics
A) ASSUMPTIONS
SUMMARY
Financial Analysis
nblc
APPENDIX A – DETAILED FINANCIAL ANALYSIS NOTES
Included in above grade design for Townhouses
No Site Selected
Estimated
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
NOTES
Page | 31 Disclaimer
Every reasonable effort has been taken to ensure that the information, analysis, conclusions, and recommendations in this report are accurate and timely. No responsibility for the information, analysis, conclusions, or recommendations is assume
by N. Barry Lyon Consultants Limited or any of its employees or associates.
8
0
$0
$0
Site Servicing Connection Fee (lump sum estimate)
3.00%
3.00%
Contingency (% of total hard costs)
Building Bancroft Project – Residential Analysis February, 2010 $750
$1,000
Landscaping Cost (per residential unit)
$20,000
$121
$0
$0
$75
$0
$0
Blended Construction Cost (PSF, Present$)
Blended Road Construction & Servicing Cost (per linear metre)
Signalized Intersection Cost (lump sum estimate)
$30
$123
$30
$76
Above Grade Parking Cost (PSF)
$0
Blended Construction Cost (PSF)
$0
$75
$120
2.00%
Above Grade GLA Construction Cost (PSF)
2.00%
$0
$228
10.00%
20.00%
70.00%
2.00%
2.00%
10.00%
10.00%
$198,000
$220
2,032
0
0
40
Below Grade Parking Cost (PSF)
Hard (Construction) Costs
Costs
Revenue Inflator
$0
$170
Average Attained Price over Marketing Period
Retail Index Price ($25 PSF net @ 7.5% Cap rate)
10.00%
% Sold at Completion
$0
20.00%
% Sold During Construction
Parking Revenue (per stall)
2.00%
70.00%
2.00%
Price Increase at Start of Construction
% Sold During Pre‐Construction (Pre‐sales)
10.00%
Final Deposit (% of end price per unit)
Price Increase at Construction Completion
10.00%
End Price (per residential unit)
Initial Deposit (% of end price per unit)
$165
$231,000
Residential Index Price (PSF)
Revenues
Total Parking Area ‐ Above Grade (SF)
0
0
0
0
TYPICAL Total Parking Area ‐ Below Grade (SF)
SURPLUS Total Parking Area ‐ Below Grade (SF)
0
Estimated Area per Stall (SF)
REQUIRED Total Parking Area ‐ Below Grade (SF)
0
0
Number of Parking Stalls Sold
83%
0
40
0
8
Number of Residential Parking Stalls
48
0%
0
Number of Visitor Parking Stalls
0.000
% of Total Parking Stalls Sold
8
Total Parking Stalls Constructed
Number of Commercial Parking Stalls
0.0
Required Non‐Residential Parking Stalls (PSF)
$209
$203,500
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Estimated
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Includes cost inflator
Per N. Barry Lyon Consultants Limited
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Per year
Per N. Barry Lyon Consultants Limited
Included in pricing
These figures are calculated based on the above factors
Per N. Barry Lyon Consultants Limited
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Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Deposit amount required prior to occupancy
Deposit amount required prior to construction
Based on (Average Net Unit Size)*(Residential Index Price)
Per N. Barry Lyon Consultants Limited
Included in above grade design for Townhouses
Page | 32 0.00%
Cash‐in‐Lieu of Parkland Dedication Levy
1.00%
2.00%
5.20%
Lender's Administrative Fee (% of total hard costs)
Purchasers' Interest Rate on Deposits
HST Fee
0.78
0.00
1.00
0.16
Years prior to Land Sale
Years to Begin Marketing after Land Purchase
Building Bancroft Project – Residential Analysis February, 2010 Construction Period (months)
8
3.00
Absorption Rate (sales per month)
Presales Period (years)
1.00
10.00%
22
0.00
3.00
10.00%
10.00%
Profit Margin (% of total revenues)
10.00%
5.20%
2.00%
1.00%
5.55%
$500
2.00%
2.00%
$735
2.00%
Discount Rate
Development Rates & Timing
$500
5.55%
After Sales Service (per residential unit)
Excess Deposit Insurance Cost
Interim Financing Rate
2.00%
TARION Enrolment Fee (per residential unit)
2.00%
2.00%
2.00%
$814
Marketing Cost (% of total revenue)
$1,000
$50,000
$1,000
$50,000
Condominium Legal Fees (per residential unit)
General Legal&Planning Costs (lump sum estimate)
Sales Commission Fee (% of total revenue)
$850
2.00%
$850
Construction Management (% of total costs)
General Overhead Expenses (per unit)
3.50%
3.00%
3.50%
3.00%
Development Project Management (% of total hard costs)
0.81%
1.03%
2.72%
1.92%
$0.55
$0.75
$0.00
0.00%
$0
0.00%
$0.00
$0
$1,000
Consultants (% of total hard costs)
1.37%
0.92%
Municipal Land Transfer Tax Rate
Municipal Tax Rate ‐ Commercial
Provincial Land Transfer Tax Rate
1.92%
2.72%
Municipal Tax Rate ‐ New Multi‐Residential
$0.75
$0.55
Building Permit Fee ‐ Multi‐Residential
Building Permit Fee ‐ Multi‐Residential
Building Permit Fee ‐ Commercial
0.00%
$0.00
Public Art Contribution (% of total hard costs)
$0
$0.00
Education Development Charge (avg. $ per SF Commercial)
Section 37 Contribution (per residential unit)
$0
$1,000
Education Development Charge (avg. $ per residential unit)
Soft (Development) Costs
Municipal Development Charge (avg. $ per unit)
Page | 33 Per N. Barry Lyon Consultants Limited. Entire project (including towns) is constructed as Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
If rental or luxury quality apartment units, GST is 5.00%
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
10 year Canada Bonds, plus 175 basis points
Per N. Barry Lyon Consultants Limited
Security on deposit amount exceeding $40,000 per unit (TARION coverage)
Per TARION enrollment fee schedule, based on end price ‐ Updated Jan 2010
Includes co‐brokerage fees, NBLC estimate
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Per N. Barry Lyon Consultants Limited
Includes architectural and engineering consultants, per NBLC
N/A
Per Ont. M. of Finance
Per Town of Bancroft
Per Town of Bancroft
Per Town of Bancroft ($PSF of GRA)
Per Town of Bancroft ($PSF of GRA)
N/A
N/A
Per N. Barry Lyon Consultants Limited
N/A
Per Town of Bancroft
Land Cost ‐ RLV to be determined
$3,710
$3,215
$30,924
$25,491
$16,994
$6,879
$58,000
$38,090
Property & Land Transfer Tax
Provincial Land Transfer Tax
Municipal Land Transfer Tax
Consultants
Development Project Management
Construction Management
General Overhead Expenses
Legals&Planning (lump sum allowance)
Sales Commissions
$12,196
Building Permit Fees
Building Bancroft Project – Residential Analysis February, 2010 $8,000
$8,400
Municipal Development Charges & Other Fees
Soft (Development) Costs
$8,093
$25,734
Contingency
$0
Site Connections
Landscaping
$0
Site Preparation and Demolition
Above & Below Grade Hard Construction
$204,938
$40,000
$34,607
$125,915
$188,873
$228,775
$1,175
$1,175
$10,041
$38,277
$40,000
$189,789
$30,535
$20,357
$50,000
$6,295,750
C) PROJECTED COSTS
$849,714
Condominium Apartment Building Traditional Condominium Townhouses
Hard (Construction) Costs
$10,437,357
$10,246,896
$0
$0
$161,081
$29,380
$1,940,969
$1,904,521
$0
$0
$29,939
$6,509
Condominium Apartment Building Total Revenues
Revenues from Sale of Units
Revenues from Sale of Parking
Revenues from Sale of Retail Area
Interim Occupancy Charges
Recoveries (TARION)
B) PROJECTED REVENUES
Traditional Condominium Townhouses
0.67
0.75
Occupancy Period beyond Construction (years)
1.83
8.00
0.75
0.67
Occupancy Period beyond Construction (months)
Insurance Period beyond Construction (years)
0.67
8.00
Construction Period (years)
$243,028
$98,000
$41,485
$142,909
$214,364
$259,699
$4,390
$4,885
$22,237
$46,677
$48,000
$215,523
$38,628
$20,357
$50,000
$7,145,464
Total
$12,378,325
$12,151,416
$0
$0
$191,020
$35,889
Total
Includes architectural and engineering fees
($PSF of GLA or % of total hard costs, or fee per unit or)
Page | 34 Includes development charges, Section 37 contribution, Public Art contribution & park de
Per cent of total hard costs (not including land cost)
NOTES
Covers carrying cost of loan (interest rate +1% return) for 4 month interim occupancy per
Enrolment fees are recoverable from purchasers
Includes revenue inflator for total period prior to pre‐sales
Includes revenue inflator for total period prior to pre‐sales
NOTES
To calculate TARION insurance costs
Prior to purchasers' take‐out financing, period accounting for interim occupancy charges
$31.16
PSF of GRA
Building Bancroft Project – Residential Analysis February, 2010 $43,625
Per Residential Unit
$349,001
$37.07
PSF of GRA
Total Residual Land Value (present$)
$51,900
Per Residential Unit
Total Residual Land Value (future$)
$415,196
$2.84
$3,625
$144,983
$4.01
$5,114
$204,546
Condominium Apartment Building Traditional Condominium Townhouses
E) RESIDUAL LAND VALUE $20.08
$17.00
Profit PSF of GRA
$25,617
$1,024,690
$23,807
Profit per Unit
$190,452
$24.09
$54.08
RLV and Profit PSF of GRA
Total Profit
$30,731
$75,706
RLV and Profit per Unit
$1,229,236
D) PROFIT CALCULATIONS
$605,648
Condominium Apartment Building Traditional Condominium Townhouses
Total Residual Land Value and Profit
$9,208,121
$20,000
$1,335,320
$4,000
After Sales Service
$532,839
$26,300
$66,440
$857,399
$204,938
Total Costs
$1,778
$99,035
$10,286
TARION Enrolment & Excess Deposit Insurance
GST
$86,690
Construction Loan Financing Costs
Purchasers' Interest on Deposits
$38,090
Marketing
$243,028
$7.94
$10,291
$493,984
$9.96
$12,911
$619,742
Total
$19.52
$25,315
$1,215,142
$29.48
$38,227
$1,834,884
Total
$10,543,442
$24,000
$631,874
$28,078
$76,726
$944,089
NOTES
NOTES
Page | 35 Includes lender's fee + interest charges on construction loan (80% of land+hard+soft cos