How We Sold a “New Normal” Mid-Size Office Condo
Businesses Turning to Smaller, Closed Spaces Post-COVID-19
There is no doubt that small- and medium-sized businesses are going through difficult and uncertain times. While shutdowns are creating the obvious cashflow issues, the larger problem at-hand is simply not knowing when we may return to ‘normal.’
This ambiguity makes it difficult to plan or forecast your expenses or commit to longer-term agreements with confidence. While purchasing an office condo can be a stronger obligation than renting, it may also be less risky in its structure and terms.
For instance, many businesses can get access to mortgages at historically low-interest rates to purchase reasonably-priced condos that aren’t beholden to rising leasing rates.
In addition, offices with a capacity of 10 or under may become more prevalent as firms partition off their departments to both increase productivity and maintain social distancing. Therefore, occupying this type of space not only hedges pandemic risk but may also make financial sense, particularly for professional services companies such as accounting, financial, or legal firms.
Challenge
Lee & Associates Toronto was tasked with the sale of a mid-size office condo during the COVID-19-related shutdowns. The biggest challenge here was not only in finding qualified Buyers who could secure financing but who were willing to do so during all of the uncertainty. Furthermore, given how most newly constructed office space is designed as ‘open concept,’ most existing inventory of office condos are either unfinished shells or aged units requiring tenant improvements or renovations; adding additional layers of complexity throughout the negotiation process.
Features:
- 2,000 SF Office Condo
- 4 Private Offices
- Unique Features Compared to other Condos in Building
- 2 Underground Parking spaces and 3 above-ground parking spaces
- 1 Storage Locker
Transaction
Our activity in the market with other office condos had provided us with a responsive list of known and interested Buyers, as well as a proven disposition process. Marketing the opportunity was straightforward and produced offers the next day. Given a couple of unique features, we were able to negotiate a record price, while the Seller agreed to provide some tenant improvements to help with the updating and move-in process.
Results
We were able to sell the unit conditionally within two days at a high-water mark, going for a premium price compared to sales of similar units within the same building. The Buyer was excited to officially open its new location in the city of Toronto… a win-win situation.
Bottom Line: We were able to complete the sale of our Client’s unit quickly and to the satisfaction of both Parties.
So, if you are a small- or medium-sized business owner looking to sell or purchase a ‘new normal’ mid-sized office condo in the Greater Toronto area, then contact us for a confidential assessment and opinion of value.
Jake Mondrow is a Senior Associate of Lee & Associates Toronto, specializing in the acquisition, disposition, and leasing of commercial properties, as well as providing Owners and Occupiers of commercial real estate with a full range of services.
ABOUT LEE & ASSOCIATES
Lee & Associates Toronto is a commercial real estate brokerage firm. Established in 2019, the firm provides superior market intelligence in office, industrial, and investment to meet the specialized needs of our clients. For the latest news from Lee & Associates Toronto, visit leetoronto.com.
To receive guidance on any of your commercial real estate needs, please contact Jake at 416.628.8201, email at [email protected], or visit www.leetoronto.com.