1,000-plus new London apartments nearly ready, but it’s not enough: Builders

London’s tight apartment rental market will see some relief this year with more than 1,000 new units soon to be available, but it may take a decade to fully meet local demand, one builder says.

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The city has seen cranes and highrise developments dot the skyline in recent years and many are nearing completion, offering hope to lift London’s record-low 1.7 per cent vacancy rate.

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But the flip side is the steady flow of traffic fleeing the high cost of life in Toronto will not slow down, and the city needs to keep building, said Vito Frijia, president of Southside Group.

“It will take a decade to get the levels up to where they need to be, so we can build again for the market,” Frijia said. “We’re becoming a suburb of Toronto; a lot of our home activity is people relocating from the Toronto area. That’s what’s fueling this.

“The pipeline from Toronto has not stopped.”

In a snapshot of some rental unit construction by a few prominent London builders, more than 1,000 apartments are expected to hit the market by year’s end.

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Southside will begin renting 98 apartment units in October in one building at 805 Southdale Rd., charging $1,800 and $2,100 a month for one- and two-bedroom units. It began renting a 78-unit building on Drew Street in northeast London in November, with two-bedroom apartments starting at $2,050 and it’s almost full.

This fall will also see 36 townhomes on the market, also at 805 Southdale, for $2,500 a month, Frijia said.

Richard Sifton, Sifton Properties’ chief executive, agrees low vacancy rates will remain a concern for years.

“It’s a longer-term issue,” Sifton said. “But if you add 1,000 units, it will be a lot better than nothing. It puts a tooth in it.”

Sifton Properties will begin leasing 75 units in the fall in one building, Spektra at West5 on Riverbend Road in the city’s west end. It expects another 85-unit building to open in 2025, also at West5.

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Downtown is bracing for one of its biggest residential developments as Old Oak Group will begin leasing the first phase of its Centro developments at Talbot and Fullarton streets. In November, 250 units will hit the market, with 400 more units expected in 2025 and 2026.

“We’re very excited to have the first phase of the site ready to be up and running. We think it’ll make a big difference,” said Robert Bierbaum, Old Oak’s vice president of operations. “We’re looking forward to seeing the impact this will have on the downtown.”

The Centro’s one-bedroom apartments will rent for $1,600 and two-bedrooms for $2,100. It’s expected to house more than 1,000 people when it’s done.

In addition, Old Oak will begin leasing a 122-unit building at James and Talbot streets near downtown in the late fall, offering 1,400 sq. m. ft. two-bedroom units. It has not yet set a price on the luxury units.

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“The city is represented by its downtown. It has a lot to offer and we’re committed to the core. We want to provide housing, to bring people to it,” Bierbaum said.

London has seen an increase in listings long before the new units come online. According to the rentals.ca website, there are 1,280 apartments listed for rent this month, compared to 817 in October.

York Developments is leasing its 270-unit Aqui tower on King Street downtown, and will add another tower at 1761 Wonderland Rd. in 2025, said Summit Sud, York’s vice-president of leasing. One-bedroom units will rent from $2,000 and two-bedrooms cost $2,250, he said.

Tricar Group will open a 12-storey, 169-unit building this year, the fourth and final phase of its Westmount Estates development at Southdale and Wonderland roads, said vice-president Adam Carapella. “We’ve just started leasing in the last month and have already leased over 40 units. First occupancy is July of this year.”

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Rents start at about $1,700.

The site of the former Victoria Hospital on South Street is home to a development called Vision SoHo Alliance, a mix of affordable, geared-to-income and market-rate apartments. The first tower is expected to begin renting this fall when one of the builders, Medallion Corp., is expected to open up more than 200 market-rent apartments, said Greg Playford, a mortgage broker who’s also on the London Community Foundation’s housing advisory committee .

“Construction is going well and we may see more buildings in 2025” begin leasing, Playford said.

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