Image copyright Talullah Haq Image caption The Talullah Haq group bought the properties after they sold four hectares of land at a nearby mall for $9.5 million
Downtown Toronto’s downtown core has gone up for auction, with 10 of the 31 properties sold in a final bid of $36.9 million (€35.8 million, £30.3 million) – or about $122,000 per square metre.
The event is the first of its kind in North America, the New York Times reports.
Some of the properties sold at a loss, and some have already begun preparations to be abandoned.
Image copyright Simos Landscape Image caption The vacant shops and office blocks in the downtown core will be demolished
The sale, the Times reports, was a test to see if a steady sale would start to trickle down to the streets and create a standard business and residential base in one of the world’s most expensive cities.
New York reached out to Toronto for help in developing a downtown business community last year as its grid works crumbled.
Image copyright Watson Photo
Image copyright Talullah Haq Image caption As many as 2,000 jobs could be lost because of the auction
Toronto Mayor John Tory told the Times that “no-one should be shocked that these buildings aren’t going to be affordable in the very near future. That happens for a lot of reasons around here.”
Bruce Dale, a real estate executive who led the development team that handled the sale, said the demolition price is consistent with the market value for nearby property, although it could only be reasonable to expect the average buyer to lose money.
One bidders riled up councilors and appeared to hurl an object during the bidding.
The auction was intended to gauge demand and the City of Toronto said it was pleased at its success.
The downtown area has seen two decades of steady demographic change as tens of thousands of young and tech-savvy workers flock to its streets.
But as with many other high-priced cities, it is struggling to find the right mix of housing and commercial space to meet their demands.
The smaller Toronto Downtown Tourism District, which encompasses many of the targeted properties, saw a 9% decrease in overnight stay counts in 2017 compared to the previous year.
Image copyright Simpson Thomas
Image copyright Raisins Park Image caption The five-acre park site located close to subway’s Yonge-Dundas station is valued at $23.9 million
The Talullah Haq Group was the only firm to purchase multiple properties. The group is planning to transform a city-owned five-acre park at Second Line and Finch Street East into Toronto’s biggest urban park.
Mr Haq told the New York Times that the 12 commercial and industrial parcels they bought to date total over 30 acres, and added that they had already begun demolishing a number of buildings to build stores and residential units.
Mr Haq said the company had planned to sell properties on Leaside Avenue for 20% to 50% less than the average valuation, but he was unsure about a wider sale of some properties.
The city will be leasing the vacant buildings to local businesses until they are eventually abandoned, and an inspection by the City of Toronto found some of the properties required major renovations to be ready for new tenants.
It was not immediately clear what the total value of the land and buildings will be in total once they are abandoned, but there will be about 2,000 jobs lost as a result of the sale.