A man by the name of Manzoor Khan stole 20 million dollars from condo owners across the city. 20 Million Dollars. That’s a massive figure. It’s hard to wrap your head around such a large sum

This man was the president and owner of Channel Property Managed and managed 9 different condominiums in Toronto.

He opened up fake bank accounts in the each of the condo’s names.

He authorized fake bylaws and falsified papers that authorized him to borrow millions of dollars from a lending institution.

He did this all without anyone noticing. Not the board of directors, not the condo owners, and not even the employees really knew what was going on.

It was months before anyone caught on to his scam. It was only when the property management company began to default on payments, that the lender issued a notice to the condo board. And that’s when the scheme unraveled. But by then it was too late, Khan had vanished.  Speculators claim that he had fled with the money to Pakistan.

Madame Toastmaster, Fellow Toastmasters, Welcomed Guests,

Now those condo owners are on the hook for 20 Million.

This could have happened to anyone. It could have been you.

What do you do when your condo board announces you owe a lender 20 Million? Some people have succumbed to depression. Some people have tried to sell only to realize their units have become unmarketable. The negative media attention and resulting stigma has destroyed their condo’s reputation and nobody wants to buy.

They’re losing money on their investment; their units are selling for significantly less than a year ago.

Some people worry that the maintenance fees will increase to the point they can no longer afford to pay, or worse, a special assessment will be issued against the condo owners and they’ll be forced to pay thousands of dollars up front.

The truth of the matter is, that no one really knows what the future holds for each of these condos. The owners have pooled together and filed a lawsuit against Khan and his property management company. The case has gone to the superior court, but it could be years before they see an outcome.

This cautionary tale is not meant to scare off condo owners or condo buyers. This is an unprecedented case.

Sometimes despite your best efforts, there isn’t anything you can do. There are bad people in this world. And whether it’s in real estate, banking, in the stock market, in business fraud exists.

But there is something you can do to reduce the risk: your due diligence.

Future condo buyers: make your condo offer conditional upon the your lawyer’s review of a current status certificate.

The status certificate is a disclosure document which describes the financial state of the condominium, including information about maintenance fees, the condo’s budget, the amount of money in the reserve fund, special assessments, lawsuits, the status of the building insurance, etc.

Be diligent. Sit down with your lawyer and go over the document line by line.

If there is anything in that document that indicates the condominium is unhealthy, your lawyer will let you know. And you can walk away from the deal, with your deposit back in full.

Current condo owners: join the condo board. You’ll learn more about condos than you ever thought possible. You’ll have influence over how your condo is run, and at the very least, you’ll know where your maintenance fees are going.

In the meantime, we need to wait and see how this lawsuit plays out. Will the court recover the $20 million? Will the lender have to take a loss? Will the condo owners have to pay? These questions still need to be answered.

I’m certain that when the court announces a verdict, we’ll be reading it in the newspaper the next day.

Disclaimer: The preceding commentary is the opinion of Hanna Stecewicz and does not represent the interests or opinions of Right at Home Realty Inc., Brokerage or the Toronto Real Estate Board. Therefore, Right at Home Realty will not be held responsible and/or liable for any of the opinions herein.

Then:

This Neo-Gothic structure was built in 1913 by architects by Burke, Horwood and White. Originally, it was the headquarters of the Methodist Church of Canada until the church converged with another denomination and became the United Church. In 1985, CHUM (Canada Broadcasting Corp. which owned CityTV and A-Channel) acquired the building. In 2007, CTV Globemedia (owns CTV Television Network) acquired CHUM. In 2011, Bell acquired CTV (and CHUM…and everything else).

Despite it’s long history of being passed on from corporation to corporation, the architecture has remained the same, but it goes without saying that thousands have been spent to maintain the building.

What defines this building as Neo-Gothic are the terra-cotta carvings and crests beneath each set of three windows. Neo-Gothic architecture commands strong vertical lines and a sense of great height. With it’s pointed finials (the ornamental pinnacles protruding from the roof), 299 Queen St W certainly has a looming presence.

Now:

It’s known as the iconic Much Music building. The constant influx of celebrities attracts teens from all corners of the GTA. The streets are shut down once a year in June when Much Music hosts the Much Music Awards. It’s a definite treat for youngins hoping to catch a glimpse of Miley Cyrus, but a “screeching” headache for local residents who know well enough they need to leave the city until it’s all over the next day.

Not a traditional characteristic of Neo-Gothic architecture is the CityTV turned CP24 truck that projects through the eastern wall of the building. That CP24 goes through great lengths to bring us the news eh?

Forgive my sad attempt at a joke. I’ll just stick to real estate.

Then:

Looking south onto the seemingly quiet Bedford Rd. The CN tower was absent from this view until 1976.

On the right is the Creed’s Storage Vault building, which was the storage and cleaning location for Creed’s Fur Ltd.

Creed’s was a women’s specialty store which specialized in furs and high end designer fashion. The retailer opened it’s doors in 1916 but went bankrupt in 1990.

The building itself is designed in the Art Deco style, embellished with hard-edged designs and geometric shapes. To keep costs down, ornamental treatment was limited to the most visible parts of the building.

In Ontario, the style was adopted by wealthy and very fashionable patrons who wanted the Art Deco detailing to make their buildings look lavish and exotic.

Now:

The building was converted into residential lofts in the mid 80s. Named the Creed Lofts, the space contains 19 multi-level units with 13 foot ceilings, skylights, and atriums. The original building had only two stories, the third storey was added during the loft conversion.

Then:

205 Yonge St and it’s twin 199 Yonge St were formerly the Bank of Toronto. Both buildings were built in 1905 by architect E. J. Lennox. The structure, made of grey limestone, is a prime example of neo-classical architecture.

Neo-classical buildings were constructed on the traditional Georgian plan but the Greek empire became the standard for architectural decoration. Detailing became more refined, delicate, and elegant.

The focus of 205 Yonge St are the four Corinthian flutes (Greek columns with channels cut vertically in the shafts) adorned at the top with an Acanthus (Mediterranean plant whose leaves are stylized into decoration for the column) framing the entrance. The domed roof, carvings, cornices all added to the richness of the architecture, which ultimately showcased the wealth of the landowner.

The buildings were designated as a heritage site under the Ontario Heritage Act in 1975.

Now:

The two buildings still exist today. They’ve been the home of a bank, a Heritage office, even a dentist’ office but they’ve been vacant for the last 25 yeas. Today, the landmark is known as “The Bird Poop Building”. If you’ve ever walked by either of the buildings, you would notice the horizontal surfaces are covered in pigeon droppings. Although the city has put up netting to keep the birds off, it still isn’t enough. It’s a shame to see a structure that was once a symbol of wealth turn into a such derelict state.

The good news is that MOD developments announced it’s purchase of 199 and 205 Yonge St and plan develop the property into a 60 storey condo, which will incorporate both neo-classical buildings into the architecture. The condo has been named “Massey Tower”.

While I have never sold pre-construction condos to my clients, and won’t be selling this one, I think it’s a necessary evil. If the city won’t spend money to bring the historical structures back to their former glory, I welcome a developer to step in.

Then:

This factory was built in 1907. It was the home of the Wrigley Gum Factory.

The Industrial Revolution had brought steel, plate glass, and mass-produced components. These enabled a world of bold structural frames, with clean lines and plain or shiny surfaces. In the early stages, a popular motto was “decoration is a crime”.

The side view of this building is completely unadorned. The front of the building however, does show case a repeated geometric motif between the windows.

Now:

The company moved the manufacturing operations to Leslie and Eglinton, and in 1998 Atria developed the building into residential lofts. 245 Carlaw Ave is now home of the Wrigley Lofts.

The building has been preserved wonderfully and residents can enjoy all the characteristics a hard loft has to offer from 14 foot ceilings, exposed brick and wood beams, concrete floors, large fluted columns and floor to ceiling warehouse windows.

For those who can afford loft living (a 1 bedroom, 1 bathroom unit sold in March 2012 for $499,000), the space is filled with inspiration. William Wrigley Jr. founded Wrigley at the age of 29, with only $32 in his pocket. He started out as a soap salesman. He offered merchants two packs of gum as a thank you. When the gum proved to be more popular, he made it his focus.

The company was acquired by Mars Inc in 2008 for $23 billion.

“Go confidently in the direction of your dreams. Live the life you have imagined.” - Henry David Thoreau.

If you haven’t heard, the story is about a run down 1200 sq ft property that sparked a 31 person bidding war. Nothing special, nothing that really deserved 31 people fighting over it.

If I could sum up the whole debacle in one word, I would call it disgraceful.

Madame Toastmaster, Fellow Toastmasters, Welcomed Guests,

Before you start pulling out your hair, know this: Real estate prices have not shot up 150% over night.

So how could something like this happen?

It’s the result of an unethical, uneducated, and disrespectful tactic put forward by the Seller and the Real Estate Agent who listed the property for sale.

Here is the secret that no one else will tell you.

The little bungalow in Mimico was $200,000 underpriced to begin with. A mere tactic to lure in some unsuspecting Buyers.

The tactic goes like this:

1. Listing agent meets with Seller of a $600,000 property.
2. Listing agent may or may not know the market value of the house, convinces the Seller to list for $200,000 less than what the true value is.
3. Listing agent counts on naïve Buyers to ­­­throw in offers, and eventually arrive at a sales price that is 150% over asking.

I’ve been in the real estate business long enough to know this is wrong.

1. It’s unethical. The Real Estate Council of Ontario has distinct rules about this type of practice. What has been demonstrated here is false advertising. The Seller never had any intention of selling a $600,000 property for $400,000.  It’s illegal for Starbucks to advertise a $4 latte, and charge you $6 at the counter. Why isn’t it illegal in real estate?

2. It’s uneducated. I’ve had conversations with my colleagues and we wonder if perhaps the agent didn’t even know how to determine the market value. The most difficult job for a listing agent is to price a house. It’s a moving target, and it takes experience to get it right. If you list too high, you’ll scare off a large pool of Buyers. If you price too low, you may be leaving money on the table.  A knowledgeable listing agent would apply the market conditions, competitive listings, and strategy to determine the listing price.

3. It’s disrespectful. To pull in 30 Buyers into a what is basically a game, shows exactly how little regard the listing agent had for people’s time and emotions.

To add fuel to the fire, the listing agent double ended the deal, which basically means he cheated.  First he reviewed all 30 offers with the Seller. Then he called the 31^st Buyer – his own client – and let him know the highest offer on the table is $600,000. If his Buyer client wants the property, all he needs to do is add a $1 to the highest bid and he’ll come out the winner. Whether or not his Buyer client’s offer was $1 higher or $1,000 higher, we’ll never know. The point is his own client had an unfair advantage and the listing agent was motivated to play unethically because if he can double end the deal, he can double his commission.

So what happened to the 30 other bidders? They walked away stressed out, defeated, and broken hearted.

There will be mixed feelings in the room after this speech. Some of you will be completely appalled and sympathetic towards the 30 poor bidders left with nothing. Some of you might think a listing agent should do everything in his power to get the maximum price for his Seller.  Fair enough.

There’s only one thing I want you to remember, and it’s that there’s a right way and a wrong way of doing business.

When you conduct yourself in a manner that’s unethical, uneducated, and disrespectful – it’s the wrong way.

In my opinion, I think the Seller and Listing Agent could have obtained the same financial outcome without the dramatic misleading scheme.

The lesson I want you to take away is for the potential Buyer.

If you ever find yourself in this position – where you’re up against 30 or so bidders – do your research. Find out what similar houses on the street have sold for. If you know ahead of time the house is worth around $600,000, you won’t waste your time or emotional well being offering anything less.

Disclaimer: The preceding commentary is the opinion of Hanna Stecewicz and does not represent the interests or opinions of Right at Home Realty Inc., Brokerage or the Toronto Real Estate Board. Therefore, Right at Home Realty will not be held responsible and/or liable for any of the opinions herein.

Then:

The detached building with a storefront is an example of Edwardian Classicism. Edwardian Classicism provided simple, balanced designs, straight rooflines, un-complicated ornament, and relatively maintenance-free detailing. These buildings generally have a smooth brick surface and many windows.

The building still exists today, relatively unchanged. Although it’s morbid past creates a stigma.

306 Davenport Rd is the address that’s famous for the “Just Desserts Shooting”. On April 5th 1994, three armed robbers invaded the storefront, which at the time was the Just Desserts Cafe. When a dispute broke out amongst the patrons who refused to hand over their wallets, one of the robbers fired his shotgun killing an innocent bystander inside the cafe.

Today:

The building has been listed for sale in 2000, 2001, 2003 and 2010. Today, the building is leased out to the Subway Sandwiches franchise.

I wonder how Subway’s sales are impacted by the cold blooded murder of 1994. Perhaps the crime has been forgotten?

Then:

The Bloor St  United Church was built in 1889. It’s a prime example of Gothic Revival, an architectural style which brings medieval details and building practices to the Ontario climate. The list of Gothic features on this building is long, but the famous characteristic is the lancet arche. The acutely pointed arche is used in every door and every window. The larger windows are decorated with a trefoil, a pattern overtop of the window composed of three foils or leaves.

The church also features green spires, or steeples, which are the tapering conical structures on the top of the tower.

Amongst the trees, the church is simply majestic.

Now:

Portions of the church have been demolished, and additions have been built. While the new architecture is in sync with the old architecture, there’s an obvious age difference between the dark brooding century old brick and the neoteric add on. Take away the romantic trees, throw a hotel in the background, new pavement, streetlights, bikes, cars and anything else modern in the foreground and you end up with a very perplexing image.

It just doesn’t feel right.

Then:

The photo focuses on two houses, 65 Dagmar Ave is the 2 storey house on the right directly behind the tree and 67 Dagmar Ave is bungalow on the left.

Both homes are Victorians, although without the bells and whistles, such a ornate gables, quoining or decorative trim. Regardless, the architecture still reflects the Victorian era, the sharply angled and steeply pitched roofs, and lack or symmetry are a giveaway. The homes on this street, especially 67 Dagmar Ave, were once inexpensive “worker’s cottages” in the Leslieville.

The neighbourhood began as a small village back in the 1850s and was home to gardeners and workers employed at one of the brick-making factories in the area.

Now:

67 Dagmar Ave has since then been demolished and sold as vacant land to a developper in ’91 for less than $100,000. It was developped into a Victorian style triplex in ’92. It was on and off the market for a few years until 2001, when it was sold to a buyer for $320,000. In 2010 it was sold again for $600,000. Not a bad return.

65 Dagmar Ave still exists today, although spruced up. The enclosed porch is gone, new windows, new doors and a fresh coat of paint was added. Since the life span of a sloped roof like the one seen here is 20-30 years, it would have been replaced as well. The end result, a sleeker look to keep up with the modern times, yet still keeping the integrity of the historic architecture.

My how that tree has grown!

I’m a real estate agent, and I’ve had a few clients ask me about CityPlace, but I don’t give them sugar coated answers. A real estate purchase is a big deal, for many it will be their largest investment. My clients need to be confident that whether it’s 1 month from now, or 5 years down the road, they will have the same confidence in the purchase that they did on day 1.

So I give my clients all the information they need to make an educated decision when it comes to buying a condo at CityPlace.

Madame Toastmaster, Fellow Toastmasters and Welcomed Guests,

Do you want the good news or the bad news first?

Good: Price, Architecture and Amenities

Price: A quick MLS search for 1 bedroom condos under $300,000 in the downtown core (south of Bloor between Dufferin and the DVP) will produce hundreds of listings. 42% of those listings are from City Place.

Architecture: The architecture impacts the Toronto skyline in a positive way. The materials, glass and brick, seem appropriate for a complex that is contemporary but which also inhabits land that comes out of Toronto’s industrial past.

Amenities: The complex does have a community feel to it, and is designed to bring neighbours together. The amenities, which are shared between the buildings, include a 30,000 sqft recreation center with swimming pools, squash courts, a bowling alley, basketball courts, a rock climbing wall, tennis courts, running tracks and full fitness facility.

Bad: Supply and Location

Supply: There are eight condominiums in CityPlace, and around 4,000 units.  If panic selling was to take place, and “only” 10% of the owners at CityPlace were to list their units, there would be 400 units on the market to choose from. This is an extreme example, but you get the idea. It’s not going to be easy to sell if you have so much competition.

Location: It’s right on the Gardiner – and it’s loud. There’s nothing around either, no restaurants, no coffee shops and it’s still a long walk to the subway. Spadina Ave bisects the complex, creating an enormous traffic nightmare for residents especially during rush hours as commuters use the road to get on and off the Gardiner and Lakeshore.

Ugly: Quality

Quality: These buildings went up so fast, I question their quality. Plus with 90% renters in the complex, the buildings aren’t cared for – I’ve heard of people throwing cat litter down the garbage chute, and letting their dogs litter the hallways. This all directly impacts your maintenance fees. I would say with confidence, that the buildings at CityPlace are mistreated. When the condo corp is forced to spend money on constant repairs and clean-up – it becomes expensive for the condo owners. As the reserve fund, money set aside for maintenance, becomes depleted – maintenance fees go up.

Conclusion:

In the end, it all comes down to preference. As long as my client’s have all the information, it’s up to them to decide whether they should buy at CityPlace or not. I have helped a Seller client sell a unit at CityPlace, but I have never helped a Buyer client buy at CityPlace, at least not yet. Perhaps my clients acknowledge the fact that there are many condos out there with higher value than CityPlace Either way, I stand by the mantra: You get what you pay for.

Disclaimer: The preceding commentary is the opinion of Hanna Stecewicz and does not represent the interests or opinions of Right at Home Realty Inc., Brokerage or the Toronto Real Estate Board. Therefore, Right at Home Realty will not be held responsible and/or liable for any of the opinions herein.