- What A 290,000 sq ft industrial building was acquired through a court-ordered sale
- Why Buyer TAS paid $209/sq ft
- What next TAS intends to renovate the building and divide up the industrial area into smaller leasable commercial spaces
Toronto private developer and asset manager TAS has purchased a distressed industrial warehouse in Toronto’s Scarborough district for $60.5m via a court-ordered sale, Green Street News can reveal.
The firm paid $209/sq ft for the 290,000 sq ft building at 1500 Birchmount Road. Avison Young represented the buyer and seller in the deal. The deal closed on Oct. 10.
The property was among several assets previously owned by Canadian real estate investor Chris Hinn that have been in default since 2018. In addition to the Birchmount property, Hinn owned Woodbine Centre and Rexdale Mall in Toronto.
Private mortgage lender Romspen Investment Corp. petitioned the Ontario Superior Court to appoint a receiver in early 2023 to recover over $305m of unpaid mortgages for the malls and 1500 Birchmount. First Commercial Bank also held a mortgage on the property of $37.4m.
The court named Ernst & Young receiver in May 2023.
Amid the attempts to settle with lenders, Nicefaro Enterprises had agreed to purchase 1500 Birchmount, but the firm ultimately chose not to complete the deal. The property had been listed last year for $95m, or $317/sq ft two years ago.
Tenants include Bond Academy, a private academic institution, as well as a shipping firm and a telecommunications centre operated by a Bell Canada subsidiary. TAS says it will retain all existing anchor tenants.
The firm also will convert 208,000 sq ft of vacant space into smaller areas that can be leased for commercial uses. The organization’s mandate is to acquire, renovate and lease commercial space, renting a portion at below-market rents to local businesses and community groups. Building upgrades are also planned to improve energy efficiency.
1500 Birchmount, on 22 acres, is near the busy Birchmount and Ellesmere Road intersection. The property includes 7 acres of vacant land. The building has 13 shipping doors, including 11 for truck loading and two with drive-in access. The maximum clear height is 20 feet.
The site is 2 km from the nearest Highway 401 on-ramp and 4 km away from the closest entrance to the Don Valley Parkway, via Lawrence Avenue. The expressway provides a direct connection to downtown Toronto, which is 10 km away. There is a TTC bus stop 300 m from the property.
The 58-year-old building was once a key local manufacturing facility for Nestlé Canada. It was originally used as a factory by specialty chocolate maker Laura Secord.
In July, TAS listed an 86,000 sq ft Scarborough industrial property at 772 Warden Avenue for $27m, or $314/sq ft.
Article updated at 1 p.m. ET on Oct. 25, 2024, to clarify that TAS leases a portion of its commercial space at below-market rents.