A 26.4-acre property in Oakville, Ont. called a coveted “trophy asset” has been bought by Argo Development Corporation, where it plans to build low- and mid-rise housing.

Purchased for $33 million, 1303 Dundas St. W. is proposed to have 108 townhomes and 34 single-detached homes. A portion of the site is set for mid-rise housing in three acres of future development blocks, according to an urban design brief document. Further details such as the height and number of units are yet to be determined.

With only about 10 to 15 sites remaining for residential development in private hands in Oakville, it was a “really logical infill piece” for Argo, according to Nick Steele, a senior associate at CBRE, which advised the transaction.

The largest landowner by area in Oakville, Steele said Argo took an interest because it is adjacent to active projects by Treasure Hill Homes and Mattamy Homes, and is supported by existing retail and transportation. Argo is based in the neighbouring city of Burlington.

“High-quality, well-located infill sites” like 1303 Dundas St. W., “are always going to appeal to a wide audience of purchasers,” Steele said.

Argo declined to comment for this article.

A desired property for decades

The property was purchased by Argo from Whiteoaks Communications Group, an Oakville radio company. Owned by Whiteoaks for over 40 years and eyed by local developers for decades, the broadcaster sold the property to help it finance the acquisition of three other radio stations from Bell Media, Steele said. 

The site is a short walk or drive from Oakville Trafalgar Memorial Hospital and several nearby retail plazas. It also offers direct access to creeks, parks and trails.

It is located along the Dundas Street West arterial road, with access to Highway 407. Transit access and a pedestrian-friendly landscape will be priorities in the development plans, the urban design brief says. For example, Oakville GO Station will be under six kilometres away and Oakville Transit bus routes run along Dundas Street W.

The three-storey townhomes would vary from standard variants to dual frontage and back-to-back, with lot widths at 18, 20 and 24 feet. Lot widths for single-detached homes are to be 40, 42 and 50 feet.

Argo, which has dozens of projects finished or in development across the Greater Toronto Area (GTA), has several completed projects in Oakville including the 80-unit West Oak Trails, and Iroquois Ridge consisting of 200 homes.

In a blog posting, local brokerage Dan Cooper Group said Oakville’s housing market will likely continue to be impacted by population growth. It cites the town's potential as a commuter centre for Toronto, and falling interest rates that make it easier for buyers to afford a home.

The average selling price of a home in Oakville in January was $1.4 million, according to MLS data cited by Zolo. Detached homes are being priced at $1.9 million on average, while townhomes are going for an average of $1.1 million.

Hot regions for residential land transactions

As downtown core assets and the high-rise market in large cities such as Toronto are struggling from slow absorption and poor end-unit sales, Steele said secondary and tertiary markets are hotspots for residential land sales.

“If there’s logical infill locations and land is well priced, there’s an opportunity to transact, and that’s sort of where this site falls,” he said. “Anything longer term that you won’t be able to put into development for a few years is struggling because there’s no cash flow on land.”

Established builders and developers have used the past 36 months to solidify their financial positions and focus on planning and construction, Steele observed. Real estate companies without the banking relationships or planning expertise of the more experienced players have struggled in comparison, he added.

Steele said there are a number of other residential development sites on the market across the region. For example, CBRE is marketing an approved site at 4415 Sheppard Ave. in northeast Toronto which is planned for a mid-rise residential property. 

Steele believes it will make the most sense as a rental project, because stagnating condo sales in Toronto will push developers to switch these projects to rental housing so the economics are viable, an opinion shared by Ben Myers, president of Bullpen Research & Consulting.

The Canada Mortgage and Housing Corporation’s push for more rental housing and Toronto’s tax incentives and rebates dedicated to rental buildings are additional sweeteners.

“That missing middle, mid-rise rental is so essential and we just don’t have enough of it across the GTA,” Steele said.

Other Argo communities in development in Oakville include the 3,000-unit Trafalgar, Bronte Green planned for 1,875 units, and Joshua Creek with 1,640 units.