gsunnyg said:
So after 6 months we're only at 26%? Wow, I wont be surprised if this switches to rental as well. Seems like theres no point of selling condos anymore for the near term.
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Actually that's not that bad. It's not like the boom days, but in this market, that is decent considering the time frame.It's been 6 months, but 3 of those Dec/Jan/Feb are traditionally the slowest months. See how it is in another 6 months, if they've only managed another 26% then it'll be interesting. Even then, that'll still be 52%. I wouldn't count this one out yet.
 
Yeah that's exactly what I was thinking, Patrick. I imagine we could see this one go ahead in the next year, if things continue as they've been.
 
It's less than 200 units. It's not a particularly large building. 52% presold over a year sounds really bad. How many years of sales would Battistella estimate for the project? It would be risky to break ground with sales below 85% to 90% given the lukewarm reception. There are still developers stuck with unsold inventory from the boom when 40% was enough to get shovels in the ground.
 
Patrick.1980 said:
Actually that's not that bad. It's not like the boom days, but in this market, that is decent considering the time frame.It's been 6 months, but 3 of those Dec/Jan/Feb are traditionally the slowest months. See how it is in another 6 months, if they've only managed another 26% then it'll be interesting. Even then, that'll still be 52%. I wouldn't count this one out yet.
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The problem is majority of the sales for new developments like this happen in the first few months of launch. If it doesn't get up to 50% by the end of the summer/fall I doubt we'll see it go ahead as a condo unless Battisella has the patientce to wait as long as it takes. But I'm willing to keep the optimism for this one but generally speaking the condo market is one depressing market right now.
 
Like I said, if it’s at 52% pre-sold after a year it’ll be interesting to see where it goes. I don’t believe 26% is that bad when you look at the two me of year for those last six months. It’s not great, but let’s see what the next six months bring, then we’ll have a pretty good idea.
I’m not saying this project will go ahead, but I’m not counting it out yet.
maestro said:
It's less than 200 units. It's not a particularly large building. 52% presold over a year sounds really bad. How many years of sales would Battistella estimate for the project? It would be risky to break ground with sales below 85% to 90% given the lukewarm reception. There are still developers stuck with unsold inventory from the boom when 40% was enough to get shovels in the ground.
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Back in the days of the boom, sales were strong in the first few months but the market has totally changed. Some projects take quite a while to get going and still get built just look at sixth and 10th, and The Royal. Those projects had sales centres going for two years before they broke ground.
gsunnyg said:
The problem is majority of the sales for new developments like this happen in the first few months of launch. If it doesn't get up to 50% by the end of the summer/fall I doubt we'll see it go ahead as a condo unless Battisella has the patientce to wait as long as it takes. But I'm willing to keep the optimism for this one but generally speaking the condo market is one depressing market right now.
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As a buyer, why would you pre-buy right now?

You’re committing to a build with no definitive start date and there’s no guarantee of values increasing substantially that a lower buy in cost shows any gains.

As an investment it’s not the best choice right now and buying to position for a future rental it’ll be hitting the market in a flood of rental developments.

For a place to live, there are new places ready to move in available now in Park Point, Royal etc.

Not that a builder should hold off if they have the backing to start construction sub 50% sales. They should expect to see more sales near and post completion now than in the boom days of selling out before the first shovel. We’re seeing it in midrise with Anthem and Truman not even selling until the project is complete. It will be interesting to see who has the cajones to do it on a tower.
 
We have to consider Battistella is a small company that usually does one project at a time. They aren't Bosa with a dozen of more high rises in development at any time. Sixth and 10th got built. Profitability is unknown. It was financed through a syndicated mortgage. Lamb and the other managers got paid. The investors probably didn't..

Battistella knew going in they were taking a chance with the market being down. I don't think they budgeted the preselling phase to last years and that these initial sales figures must be a disappointing. I don't think it's over either. I'm not thrilled with the theme or design. I still hope warmer weather brings in the nudists.
 
Condo market is a tough go, unless it's a smaller project in a good location. This one will be an interesting test of the market. Because it's the only condo proposal in the Beltline right now, it may get enough traction to carry it forward, but it's a down market these days. I wouldn't be surprised to see Battistella go for another smaller project if sales don't pick up by the end of summer. I know they have some other ideas going on. One of them is the Kensington project which is smaller and in a great location.
 
The meltdown is in Toronto as well. Calgary is set up to become the next Vancouver or Toronto. It will be a little different as investors have shifted to rentals over condos.
 
JustDandy said:
They are offering $500 assignments for BC investors only, with the meltdown in YVR this might attract some more interest over the coming months.
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Here’s their pitch to Vancouver investors:

www.vancouvernewcondos.com

NUDE by Battistella in Calgary - Vancouver New Condos

At NUDE, we’re stripping it back to what matters. We’re celebrating what’s important to you – the moments, the experiences, the laughs, the friends.
www.vancouvernewcondos.com www.vancouvernewcondos.com

I thought it was a pretty fair and convincing investment thesis, interested to hear what others think...
 
JustDandy said:
They are offering $500 assignments for BC investors only, with the meltdown in YVR this might attract some more interest over the coming months.
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Newbie question: What is an 'assignment'? is that a discount more or less? $500.00 doesn't seem like much to be honest.
 
Flipping at its greatest. An assignment is when you sell the purchaser agreement before you close on the property. The $500 is the fee you pay to get Battistella's permission to assign the unit? I have no clue what else it could mean.
 
The only reason for selling the agreement before closing (completion of the project) is if you are confident that the condo will have increased in value from the time you bought it. Unless we enter another residential construction boom, it is hard to believe any new home will increase in value in Calgary over the next few years. One can only hope, it does not lose any value.
 
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