Millennial Developments is Bringing Budget-Friendly Condos to Kelowna
Housing costs are a common and sometimes controversial topic of conversation in Kelowna these days, as the real estate market that continues to boom. According to the Okanagan Real Estate Board, the benchmark price for single-family homes in October was $961,600, representing an almost 30% increase over October 2020, and condominiums reached an average sales price of $477,700, up 22.5% over the previous year.
However, Kelowna wages aren’t on track with sky-high housing prices, even with the city’s active economy and low unemployment rates. Statistics Canada reports that the median income in Kelowna is just over $45,000 per year, so real estate costs in Kelowna have effectively placed many buyers out of the market, particularly young and first-time homeowners. Renters face an equally difficult challenge, with Zumper.com reporting the average rent for a one-bedroom apartment at $1644 per month in October, a 7% year over year increase, making it one of the most expensive rental markets in Canada.
With the common financial recommendation that no more than 30% of one’s gross monthly income should be spent on housing, many young Kelowna residents struggle to manage monthly rental payments and have limited opportunity to purchase a property of their own. But Millennial Developments is changing the outlook on real estate for many Kelowna residents with the Five Crossings project.
Centrally located in the Capri-Landmark district, this studio, one and two-bedroom condo development will offer prices starting in the mid-$200,000s, a price tag that is generating a lot of interest from first time homeowners looking for an opportunity to get a foothold into the booming local real estate market.
Five Crossings, which focuses on smaller space living with a wide variety of communal spaces that encourage living beyond one’s four walls, including a recreational space with a pool table, golf simulator, a stage for karaoke nights, a projection television for screening movies or sports events, and a communal kitchen and bar, as well as a large co-workspace and tech-friendly features, a cutting-edge gym with Peloton equipment, community garden and park space, and a rooftop lounge with covered atrium, outdoor barbeque center, and yoga platform.
The project is slated for sales launch in Spring 2022 and open for investment through the Five Bridges Development Project with North America Home Finance.
Five Bridges Development Project Investor Update November 23rd, 2021
We are very excited to provide this major update to all our investment partners in the Five Bridges Development Project.
We have achieved three significant milestones over the last two weeks and congratulate the development team on the excellent progress to date.
Milestone #1: Completion of the property assembly acquisitions
On Monday, November 22, 2021, the final two properties which make up the six-lot land assembly, were acquired into the development limited partnership. This marked the final step in gaining control over the land to be developed, after successfully organizing the equity capital raise and financing requirements needed to fund the purchase.
As background, the properties were negotiated for purchase in January of 2021 with conditions and closing dates scheduled throughout the year. The properties were acquired at a total purchase price of $5,916,000 exclusive of closing costs, and all six lots were appraised mid-year at a combined value of $7,000,000 prior to receiving zoning approvals.
Milestone #2: First reading for rezoning and development permit successfully passed
On Monday November 15, 2021, the mayor and councilors in the City of Kelowna council chambers reviewed and passed the first step of the application for rezoning and development permit for the Five Bridges project. The previous week, a neighborhood consultation meeting that was hosted by the development team, and the mayor, council, and city staff were very decisive in their unanimous vote of approval for first reading on the project which can now proceed to second and third readings.
Based on the timeline that was scheduled for the city approval process, and having received the first reading on the 15th, the next hearing for the Five Bridges Development Project has been set for the end of November. We look forward to providing another update following the next council meeting when the project will be put up for both the second and third reading approvals.
Milestone #3: 50 confirmed condo reservations and 10 back up list reservations
As many of you know, an option was offered for investors to reserve a spot on the condo pre-sale list to lock in their position to choose a unit before public sales launch. This was an opportunity for people who wanted to not only invest in the development of the building but also purchase a condo unit for resale or rental purposes.
We opened 50 spots and are pleased to announce all 50 reservations have now been confirmed with investors who have invested at least $30,000 in the project, and that interest levels were so high that we have also created a waiting list, in the case of any reservation becoming free.
This is significant for two reasons. The first is it demonstrates the value of the real estate that we are offering, as people understand the appeal of the price point in the market and the advantage of the site’s location. The second reason is that once those 50 reservations turn into sales, we will have pre-sold one-fourth of the building without any advertising and prior to the public launch. Both statements are strong arguments for the strength and attractiveness of this project in the Kelowna market.
Going Forward and the New Year
We are looking forward to our next progress update early next month and we have our next Meet the CEO webinar scheduled for December 9th before the holiday season begins. At that Zoom event we will be introducing a new alliance with Stact Financial that will contribute to investor’s ability to finance their real estate investments. It’s an exciting new relationship and you’ll want to stay tuned for more information.
We are now into the final offering of 9.6% preferred return units. Upon either the final forth reading approval for development permit or the completion of $5.5 million of investment received, we will change the preferred return from 9.6% to 8.4% for the last round of investment before construction commences. We are happy to speak with you and provide more details or answer any questions that you may have if you have been considering an investment but haven’t decided yet, as now is the most advantageous time prior to preferred return rates decreasing.
Thank you to everyone who has participated thus far in the Five Bridges Development Project. We are very pleased to be able to say that everything is on track and on time.
Smart Condos Come To Kelowna At Five Crossings
According to a housing supply report released by Scotiabank in May 2021, Canada is suffering from a “chronic inefficiency”, offering a mere 424 units per 1000 residents, the fewest compared against all other G7 nations. This November, Kim Heizmann, President of the Association of Interior REALTORS®, commented in a monthly report that “demand is still strong despite chronically low supply” and the “lack of new listings has really become the main theme of the year.”
Millennial Developments is bringing a new project to Kelowna specifically created to add much-needed inventory to the city with our latest development, Five Crossings. This studio, one and two-bedroom condo development will offer prices starting in the mid-$200,000s, a price tag that will be appealing to first time homeowners looking to get a foothold into the booming local real estate market, which in November saw single-family homes selling at a benchmark of $961,600 and condos at $477,700.
Five Crossings is centrally located in the Capri-Landmark district, and this development of smart suites and space-efficient homes has been designed with the needs and wants of today’s younger buyer in mind. Millennials tend to hold “quality over quantity” values, engrained in heightened eco-awareness and in a changed approach to how they view work/life balance. The pandemic further encouraged this lifestyle preference, with Semrush, a trend-monitoring software firm, reporting a 55% increase in online searches for smaller space homes in Canada last year.
But smaller spaces don’t mean less lifestyle for residents at Five Crossings, with amenities spaces that have been carefully considered, with resident facilities that encourage living beyond one’s four walls including a recreational space with a pool table, golf simulator, a stage for karaoke nights, a projection television for screening movies or sports events, and a communal kitchen and bar, as well as a large co-workspace and tech-friendly features, a cutting-edge gym with Peloton equipment, community garden and park space, and a rooftop lounge with covered atrium, outdoor barbeque center, and yoga platform. The project is slated for sales launch in Spring 2022 and open for investment through the Five Bridges Development Project with North America Home Finance.