November 10, 2010
Buzz Talk would like to introduce you to Jason Lester, Chief Operating Officer of Dundee Realty Corp, one of the brains behind the King Edward Private Residences [map]–a project that will see parts of the King Edward Hotel converted into regal condominiums.
Dundee Realty has also been heavily involved in various projects in the Distillery District revitalization, including Pure Spirit, Clear Spirit and The Gooderham, as well as more recent collaborations with Streetcar Developments, such as 2 Gladstone.
Let’s hear what Jason had to say when we caught up with him!
What part of the city do you call home?
Avenue and Davenport.
How long have you been involved in development in the city?
Specifically with development, probably the last six years. But I’ve been involved in real estate in one way or another for about 25 years.
I started my career in accounting but I had a lot of real estate clients in the first three years so, for example, I was on the audit team, auditing Great Gulf Homes and a few other larger developers. Then I got involved in the management side of things, in small developments, so I’ve done everything from A-Z.
Prior to the development gig, I was with a company called Residential Equities REIT, almost since its inception, which grew up to 11, 000 units of apartments complexes across Canada. And I was the Senior Vice President there, involved with everything from acquisitions, asset management and property management.
So you are currently working on the King Edward project?
Yup, a block away, I can see it from my window right now.
Last we heard, 142 units out of 145 had been sold, is this still the case?
As a heritage site, how did this characteristic inform the marketing process for the King Edward?
We certainly played it up. One of the first things we did after we acquired the property in March of last year was to hire a historian to get as many facts as possible and assist us with not only learning about the project, but marketing it also.
We appreciate the value in understanding the stories and the important events that occurred in this landmark building, and that it is information that purchasers would want to seek out and understand as well, as they made their purchase decision.
Do you think a lot of the purchasing of the King Edward has been based on the historical value?
Absolutely. The King Eddy will be one of the few historical hotels, anywhere around the world, that you can actually own. They just spent a hundred million pounds renovating The Savoy in London, but they did not turn any of it into condominiums.
So this is very, very unique to turn a heritage hotel, or part of a heritage hotel, into condominiums. Think about it…every time you walk through those doors, you’re going to be a part of its history.
iPhone, Android, or Blackberry?
I’m a Blackberry guy. We’re a Blackberry company and it works for me, that’s about all I need to know.
How important was it to maintain the original building, and incorporate it into its new identity?
Well, people have been looking at acquiring and doing something re adaptive with the King Eddy for the last twenty years, with various ideas.
And a lot of those ideas talked about demolishing some components of it, like putting in a new tower, and we just felt because it’s so significant, including the fact that it sits on one entire city block, that there was nothing that we wanted to destroy–or demolish and re-adapt.
We felt that it was most appropriate just to convert what was already a commercial component (floors 3, 4 and 5) that really did not have a large significance, into residential use. Because originally, those were all hotel rooms.
Dundee also worked on various developments in the Distillery District. What is it about historical sites that attract you specifically?
One thing for sure is the uniqueness and the authenticity of the real estate. It’s not a brand that gets manufactured, it gets built up over time. I don’t think we’d take just any historical property, but, it must be something that would have a very favourable past as well as very favourable potential for doing something in the future.
There are a lot of other historical buildings out there that may not be the right type of opportunity for re-adaptive or renovation use.
Tim Horton’s or Starbucks?
Ah! I don’t even drink coffee! How about Coke vs. Pepsi?
OK, Coke vs. Pepsi?
When buying from such an established company as Dundee, it must give the buyer some piece of mind – how big a part do you think that plays in a purchaser’s decision-making process?
For both the Distillery District and the King Eddy, one element that is a little bit distinctive is that the developer is not going away in either one of those properties. We have to maintain another component of the property as part of their investment so we’re joined at the hip with those purchasers.
For the Distillery District, we built one tower as part of a multiphase project, so again, we have always taken a very long term approach.
We may not have been in Toronto for 50 years as is the case with other developers, but we’ve been developing real estate as a company since the mid-90s, about 15 years now.
What’s the first thing you look for when buying a piece of land or building?
Well, in Toronto there’s well in excess of 200 projects that are under development right now in various stages, and that’s a very crowded marketplace to compete in.
One thing that has to come out right away, you’ve got to visualize who your buyers are at the beginning and visualize what the project is going to cost to get built out.
You have to think “how is this project going to differentiate itself from the other 200 projects that are out there”, or at least within the competitive stack–there might be 20 projects in the downtown east core, and we have to think about how we’re going to make it distinctive.
Do you try to focus on areas that are under-represented in the market or do you find a piece of land and then insert that equation?
We’re fairly opportunistic in how we look at real estate projects, so I guess we get to know the local markets within a specific neighbourhood.
We have a certain investment in downtown east Toronto, we feel very comfortable in that neighbourhood and we know the attributes that make a successful project there so we’re always looking for new projects and opportunities within that quadrant.
We’re not really that spread out within the GTA overall but another area that we have a bit of a beach head in is the west side, where we’re doing 2 Gladstone with Streetcar.
And again, we feel very comfortable in the downtown west, and we’ll continue to be active there as well. There’s not many larger opportunities there but it’s something that us and Streetcar will work well together on in the future.
What makes King Edward a special part of the city, is there a certain charm it brings to that location?
Our head office for Dundee Realty and Dundee REIT, for all of Canada, is just a block away. So this is where I spend a lot of my time.
To get from my office to the King Eddy, I go down Toronto street, so on the west side you have the original head office of the Consumers Gas Company, which is now the Rose Water Supper Club. And before you get down to King street, is Toronto’s first post office.
It’s wonderful to have a really nice mix of historical buildings and more current buildings. I guess the way I look at it is: my business is an extension of my family. And with families, there are generations, and this is the neighbourhood where Toronto has its generations…..I’m getting sentimental [laughs] but it’s the right spot.
What’s your favourite vacation destination?
Anything exotic! How about Peru, the Inca Trail. And too many places in Asia. Burma and Nepal were right up there, hiking the original Everest trek. And pretty well anywhere in Thailand. I took a year off between 3rd and 4th year in university and spent almost a year in Southeast Asia.
What’s next for Dundee Realty?
Well, some of it I can talk about, some of it I can’t….our continuing commitment to downtown Toronto is going to be what’s next. We feel very comfortable with that so you’ll see our name up with a few new projects. Announcements coming in late winter/early spring 2011.
We’ll be greatly anticipating them!
You’ll likely be pretty excited.
Ok then! Thanks for your time!!!
See our past posts on the King Edward here and come back next week for more Buzz Talk interviews with the hottest in Ontario development!