By Doris Pearlman, MIRM Possibilities for Design

When traveling north of the border recently, I found Canada’s market extraordinarily vibrant, particularly in Ontario where condo sales are red hot.

The market is so hot, some observers are wondering what lessons U.S. builders and marketers can take away from our neighbors to the north.

The Canadian Market Is Strong and Resilient

According to Peter Comyns, sales manager for PMA Brethour Realty Group, one of Canada's leading real estate research, marketing and new-home sales firms, favorable factors include a less chaotic economy and the county’s banking system.

“When most of the world’s markets crashed after 2007, Canada’s housing market experienced a relatively short eight-month downturn, causing investors worldwide to turn there for a safe haven,” Comyns said. “The Canadian banking system was regulated to a greater degree, creating less post-housing-boom chaos.”

He also cited stricter lending requirements governing qualifications and downpayments and far fewer home equity loans than in some U.S. markets.

Also, from 2000 through 2008, the rise in housing prices was less rapid in Canada than in many U.S. markets. This resulted in a much softer landing for the Canadian market, with current prices higher than they were in September 2008.

Attracting a steady, educated, immigrant workforce is another factor that has bolstered the Canadian economy, Comyns said. Of the 200,000 people who immigrate to Canada annually, 60% — or 120,000 — move to Toronto.

High-tech companies such as Google and RIM, which makes BlackBerry smartphones, have corporate campuses in the Toronto metropolitan area and this employment base also has strengthened the new-home and rental markets there.

The Toronto rental market, which is expected to produce 22,000 units this year, is attracting investors at a steady pace, especially since it’s expected to grow to 90,000 units by 2030-2040, according to demographic projections.

Bold, high-contrast paint details appeal to the targeted young, professional buyer — while making small spaces appear larger.

Success in the Suburbs

Kitchener, Ontario, a once-crumbling industrial town about an hour from Toronto, is now a thriving suburb with a healthy housing market.

“Kitchener is quickly morphing into a favorite hub of high-tech companies, university students and others wishing to escape Toronto’s traffic and high prices,” said Anne Marchildon, vice president of sales and marketing Andrin Limited, which recently completed a successful condominium community in Kitchener and opened a sales pavilion for another.

Known locally as the “Silicon Valley of the North,” RIM recently announced it would be filling 600 new positions in Kitchener.

With downtown Kitchener designated as a Building Improvement Area (BIA) and residents and businesses committed to redeveloping it, Andrin, along with the city of Kitchener and the BIA, is developing City Centre, which will include condominiums, retail space, a cafe, gallery, public and private parking and the rehab of a historic boutique hotel.

When complete, City Centre will include 400 units in two towers, according to Marchildon, with construction beginning once 80% of the building is sold — a lending requirement common in Canada.

The 3,500-square-foot sales pavilion created to sell the condominiums showcases two fully furnished models and includes a 2,000-square-foot presentation and sales area.

Prospective buyers — predominantly young professionals, singles and couples, along with some move-down buyers and investors — are considered tech-savvy and environmentally conscious. To appeal to this demographic, sales center displays emphasize flexible floor plans, green features and high-tech living — and the structured parking will have accommodations for electric cars. Homes at City Center start at $189,900, with an average price of just under $350,000.

A dining room can serve as an office, which displays flexibility in small spaces.

Selling Urban Living in a Suburban Setting

Most of the prospective buyers have a decidedly urban and “West Elm/Crate & Barrel” contemporary sensibility, said John Limiero, of Possibilities for Design, which merchandised the model suites.

Floor plan designs make the most of the space, incorporating additions such as a command center in the hallway and rooms that serve a variety of uses. “Demonstrating flexibility is key in the Canadian market,” says Limiero.

Andrin offers its buyers standard appointments such as granite countertops, stainless steel kitchen appliances, energy- efficient front-loading laundry centers and upgraded baths in order to compete for the attention of this young, techno-hip buyer.

The builder also offers an audio/video wiring package that enables residents to tie their smartphones and computer tablets into their in-home AV systems, an option that has been extraordinarily well-received.

“We wanted to not only meet, but to exceed, the expectations of this buyer, and that’s what we did,” said Marchildon.

Comyns and the PMA Brethour sales team has been a crucial element of City Centre’s success as well, she added. “The co-broke market in Kitchener/Waterloo is much less entrenched and sophisticated than that of the greater Toronto area, and the effectiveness of your on-site team is critical to the overall success of the project.”

A technology niche was carved out of a hallway to provide home owners a place for plug-ins and docking stations.

Showcasing Lifestyle — the Canadian Way

Marchildon believes another element of the success of City Centre has been the merchandising team’s ability to accurately interpret the needs of the community’s prospective buyers. While most are tied to their iPhones, BlackBerries and iPads around the clock and sustainable living is important, these downtown dwellers are used to making the most of smaller spaces.

With floor plans at City Centre ranging from 510-1,150 square feet, the builder’s objective was to create and demonstrate functionality and livability. The marketing team decided to show two models — a 680 square-foot home with one bedroom and den targeted toward singles; and a 915-square-foot, two-bedroom home with a command center geared to a young married couple and conveying a slightly more sophisticated feel.

“Spaces tend to be tighter than in many U.S. condo markets and, as spaces shrink, concessions must be made to accommodate function and livability,” said Limiero,  

Scale becomes paramount — but that scale also must be smart.

Marchildon insisted that sofas had to be at least 72 inches to 84 inches wide in order to seat three people. And both models feature a small dining table that can provide space for a sit-down formal dinner, a party buffet or studying.

Equally important to the builder, merchandising team — and the buyer — is functionality.

So a technology niche was carved out of a hallway to provide home owners a place for plug-ins, docking stations and email checks, and the home office also can be used as a formal dining room or guest room.

The sales center demonstrates “the livability of condominium spaces and the flexibility to accommodate a wide variety of lifestyle needs,” said Marchildon.

Creating Memories

White-on-white wallpaper was used on a bedroom accent wall to create depth and interest. In fact, every bedroom wall modeled at City Centre features a memory point, such as the headboard of white metallic circles that contrasts with a mulberry brown wall to create depth and interest.

Hard-working, high-contrast paint details — such as gray and yellow stripes on a dining/living room wall — also create impact while visually magnifying two adjoining spaces.

“It was important to create a vibrant and bold statement for this young buyer,” said Limiero.

Construction of the residential units is expected to begin next spring.

Doris Pearlman, MIRM, is the founder of Possibilities for Design, Inc., a nationally-recognized, award-winning interior design and merchandising firm based in Denver. Pearlman, an active member of NAHB’s Institute of Residential Marketing, regularly teaches IRM courses and was recognized with IRM’s Excellence in Education Award in 1999. For more information, visit the Possibilities for Design website, or call Perlman at 303-571-0325.

A version of this article originally appeared in Sales + Marketing Ideas magazine.

---

Subscribe to Sales + Marketing Ideas Magazine for Cutting-Edge Information

For additional cutting-edge sales and marketing information, subscribe to NAHB’s Sales + Marketing Ideas magazine (www.smimagazine.com).

Click here to learn about membership benefits of the National Sales and Marketing Council and the Institute of Residential Marketing.