There are already quite a few condo units in and around Downtown Kitchener, as well as several condominium developments. Many of these would make a fine place to live, and a sound investment. But despite their quality, it’s hard for many of them to outshine what’s to come. The number of residential units – indeed, the number of residents – is poised to more than double over the next few years.
Starting in January and February 2019, there are plans in place for approximately $1.2 billion worth of brand new developments to start construction. There will be 20 developments in total, and around half of them will be as large as – or larger than – what currently stands in Downtown Kitchener.
Getting in Early
Why should investors be excited about the brand new condos popping up in Downtown Kitchener? Well, for one thing, many of these buildings will be based on award-winning designs. In order for a development to make financial sense for the developer, it needs to be able to stand out in this growing market – and by perusing the designs, you can see for yourself the high level of quality on display.
In short, you can be confident that your investment will continue to be attractive for both renters in the short term (if you choose to go that route) and for potential buyers in the long term (if and when you put your investment condo back on the market). There are set to be over 2,500 residential units added to Downtown Kitchener – a significant number, but not infinite. If you’re keen to invest, it’s best to start looking sooner rather than later.
The Word Is Out
The new condos in Downtown Kitchener are the talk of the town, and not just in Kitchener-Waterloo. Indeed, throughout the GTA, the Waterloo Region is increasingly getting a reputation as a hotspot for investors. By getting in early, you stand to gain from this sustained popularity and media attention: again, whether attracting suitable renters, or putting it on the market again, there is a built-in market and audience for Downtown Kitchener condos.
Is Newer Better?
You can find less expensive condo units in other parts of Kitchener-Waterloo, and you can even find less expensive condo units in existing developments in Downtown Kitchener. There are two general points to consider right off the bat: first, by investing in a new-build condo unit, you’ll often have input on things like layout and design – not quite possible in a pre-existing unit. It’s also worth considering that condo fees are typically lower in new buildings (there is less need for upkeep, for example).
Kitchener versus Toronto
Toronto is the capital of Ontario, Canada’s largest city, and a continuous site of both real estate development and investment. How does the Downtown Kitchener condo market compete? Let’s consider what it brings to the table.
The price of condominium units in Toronto is famously quite high. The idea, in part, is that Toronto sits on the world stage, is a centre of commerce and industry, and thus has a population capable of perpetuating these price points. Kitchener, on the other hand, is a much more affordable city. However, Kitchener, too, is increasingly entering the world stage, with its tech industry and soaring economy.
Consider this: much of the press coverage surrounding the new and existing condos in Downtown Kitchener is marked by excitement and enthusiasm, whereas Toronto’s skyrocketing real estate prices are garnering more negative opinions. Kitchener, in general, is looked on nationally as a relatively small city (if you can call over 200,000 people small) that has managed to find enormous success, and it is seen as a very safe bet in terms of real estate investment.
Several different groups stand to gain from the comparatively inexpensive Downtown Kitchener condo market. First-time investors, or those with less assets available to work with, can take part in an incredibly hot market, rather than waiting for more money or a more affordable Toronto option down the line.
Investors looking purely for a return, and who are driven by profit margins, again stand to gain from the condo market in Downtown Kitchener. The population consolidated in Downtown Kitchener is poised to grow significantly over the next several years, and with increased competition for housing, investors can expect to see a considerable return once they put their unit up for resale.
Furthermore, with the robust tech market increasingly becoming concentrated in and around, investors can also count on a sustained demand for high-end rental units. In short, Kitchener offers much of the growth and demand a Downtown Toronto condo might offer, but without such a large initial investment required.
Where to Watch
To reiterate, there are 20 brand new developments planned at present, as well as multiple condominium developments currently standing. It’s important to know which areas to look out for, and what you’ll want to prioritize in terms of proximity.
The LRT is poised to reshape travel in both Kitchener and Waterloo. The University of Waterloo (the primary ‘incubator’ of the Region’s tech industry), and that city’s tech industry, will be more closely connected with Downtown Kitchener’s Innovation District than ever before. There are several LRT stops around Downtown Kitchener, and perhaps it goes without saying, but condo units close to these are inherently more valuable.
The Innovation District, generally, is a fantastic area to invest. With international giants like Google, the regional tech cornerstone/Launchpad of Communitech, and numerous successful startups (seemingly more each year) all nearby, there is now and will continue to be a strong demand for upscale condo units here.
Indeed, there are hotspots throughout the Downtown Kitchener condo market (don’t forget the value proximity to popular places like the Kitchener Farmer’s Market adds to a condo), but if you start at the intersection of King Street West and Victoria Street North/South and radiate outward, you will find some of the best real estate investments in Kitchener (which, in turn, means some of the best real estate investments in all of Canada).
The Sky’s the Limit
To wrap up, let’s take a look at one of the new condo developments. Created by IN8 Developments (incidentally, a Waterloo-based developer), the Duke Tower Kitchener (DTK) is set to become the tallest building the city has ever had. Valued at over $100 million, the DTK condo will stand over 30 storeys, with over 400 individual units (with prices around the $250,000 mark).
The story of the DTK shares similar themes with the other major condo developments in Downtown Kitchener. Standing at the corner of Frederick Street and Duke Street East, it will have access to the Frederick LRT stop. It’s a short walk from many Downtown Kitchener attractions, including Victoria Park, the Farmers’ Market, and Kitchener City Hall. And it’s within view of the Lang Tannery Building (home to Communitech, and the heart of Kitchener’s tech industry).
Like the other developments, it’s ambitious; it’s upscale but at an eminently reasonable price point; and it’s contributing to Downtown Kitchener’s bright future. That is just one of the developments worth taking a further look at; we encourage all investors to see the unique benefits each development has to offer.
Having earned the moniker of ‘Silicon Valley of the North,’ Kitchener-Waterloo has proven that a 1 million+ population isn’t needed to become a world-class centre of innovation. As more and more developers, investors, entrepreneurs, students, and residents come to Downtown Kitchener, it’s become clear that Kitchener is a city on the rise.
The Downtown Kitchener condo market is very much a place for any and all real estate investors (both current and aspiring) to keep their eyes on. If you’d like to talk more about Downtown Kitchener, or if you’re looking to buy a condo in Kitchener and you’d like the help of our professional real estate team – please don’t hesitate to contact us.
Written by Will Kummer