structuring your real estate like a business - mar 31, 2016

Matthew Lee, Managing Partner [email protected]

(416) 937-5251

[Volition (vō-ˈli-shən): the power to make your own choices or decisions; free will.]

Tonight’s Meetup is brought to you by…

416.410.9905 [email protected]

Looking to learn tonight

A challenge you're currently facing that you can't figure out how to get past

Your next action step in Real Estate Investing

25 MINUTE NETWORKING BREAK Write your questions up on the

whiteboard!! (and we’ll answer them after the break!)

Why The Annex? (And Investment Strategies That WORK!)

1. Employment growth Employment growth is strongest in downtown Toronto

OBSERVATIONTD Economics

Since 2006, the Toronto region has seen a revival of population growth in its downtown core. While decades prior saw an exodus of baby boomer families heading towards the outer-suburbs for larger and more affordable housing, the last five years have seen a very different trend. Young echo boomers have now become a key demographic. These individuals and young families are choosing quicker commute times, proximity to amenities, workplaces and transit, locating themselves in the downtown core’s many mixed-use communities. Moreover, employers are now catching on to this recent trend and are increasingly locating themselves within the downtown core as well, hoping to attract this highly-educated, highly-skilled labour force. This also reverses a prominent trend of the last few decades in which businesses were choosing to locate in other municipalities in order to avoid the high commercial real estate costs of downtown Toronto.

Move over baby boomers

Chart 1 shows this dramatic reversal in population trends. The pace of population growth in the downtown core more than tripled in the 2006-2011 census period relative to previous cen-suses. It also outpaced growth in the four surrounding suburbs – the Halton, York, Peel, and Durham regions – something that has not happened since the inception of those municipalities in the early-1970s.

This shift was driven in large part by the growth in the echo boom population (Chart 2) which, as of 2011, is now the largest age group in Canada. Born between 1972 and 1992, these 19 to 39 year olds represent roughly one-quarter of Ontario’s popula-

TORONTO - A RETURN TO THE CORE

Highlights • Toronto’svibrantdowntowncorehasseenarevivalofpopulationgrowthoverthelastfiveyears,

driveninlargepartbyagrowingEchoBoomersegment.• Thishighly-skilled,highly-educated,andyoungpopulationistradingthelargerand(relatively)more

affordablehousingchoicesoftheirparentsforproximitytotransit,work,andamenities.• Thegrowingdesiretolocatedowntownhaspromptedawaveofcondodevelopment.Anincreasing

numberofbusinessesarealsoacquiringofficespaceinthecoreinordertobeclosertothisgrow-inglabourpool.Newbusinesscreation,employmentgainsandpopulationgrowthinthedowntowncorearenowoutpacingthatinthesurroundingsuburbs,reversingadecades-longtrendofexactlytheopposite.

• Overall,thesetrendsrepresentahugeopportunityfortheCityofToronto,butitdoescreatechallenges.Notably,thecity’salready-strainedroadandtransitinfrastructurecouldfaceadditionalpressure.

January 22, 2013

Francis Fong, Economist, 416-982-8066

CHART 1: POPULATION GROWTH IN THE GREATER TORONTO AREA

15.717.2

18.6

13.7

4.3 5.0 4.6

16.2

0

5

10

15

20

1991-1996 1996-2001 2001-2006 2006-2011

Peel,YorkDurham*,andHaltonRegions DowntownToronto**

*DurhammostlyreferstoAjaxandPickering,**Trinity-Spadina&TorontoCentre;Source:StatisticsCanadaCensusesofPopulation

%changeinpopulation

profile TORONTO - 1

Toronto Employment Survey 2014 REVISED August 2015

This bulletin summarizes the highlights of the 2014 City of Toronto annual Employment Survey, marking its 32nd consecutive year.

This information resource presents a picture of change in Toronto’s economy throughout the past three decades.

For more information, please visit us at www.toronto.ca/demographics/surveys

Highlights

• The 2014 survey counted

1,384,390 jobs. • Toronto's overall employment in

2014 is up by 1.5% from 2013 adding 20,850 jobs to Toronto's employment base.

• Full-time employment has continued to stay above the 1 million mark for the eighth consecutive year.

• Part-time jobs increased by 1.7% over 2014, totalling 320,860 jobs.

• The Office sector remains the largest sector in Toronto, accounting for almost 1 out of every 2 jobs.

• The Institutional sector was the fastest growing sector in 2014, growing by 4.9% and adding 11,010 jobs.

• The number of establishments surveyed in 2014 was 75,180, a net gain of 430 establishments.

• In 2014, there were approximately 562,370 jobs in Toronto's Downtown and Centres, comprising 40.6% of all jobs in the City.

• Etobicoke Centre was the only Centre to gain employment in 2014, adding 690 jobs and growing by 7.9%.

• North York Centre remains Toronto's largest employment Centre outside of the Downtown with 34,830 jobs.

• In 2014, there were approximately 398,750 jobs in Toronto's Employment Districts, accounting for 28.8% of jobs in Toronto.

• 83.2% of all Manufacturing sector establishments in the City reside in the Employment Districts, representing 92.1% of all Manufacturing jobs in Toronto.

• The number of Manufacturing sector establishments in Toronto remained the same over 2014 with no net loss of establishments.

1,000,000

1,050,000

1,100,000

1,150,000

1,200,000

1,250,000

1,300,000

1,350,000

1,400,000

1983

19

84

1985

19

86

1987

19

88

1989

19

90

1991

19

92

1993

19

94

1995

19

96

1997

19

98

1999

20

00

2001

20

02

2003

20

04

2005

20

06

2007

20

08

2009

20

10

2011

20

12

2013

20

14

Num

ber o

f Job

s

Full Time 1,063,540

Part Time 320,860

77.1% Toronto jobs are Service Based.

47.9% of Toronto jobs are in the Office

sector.

The Institutional sector was the fastest

growing sector in Toronto in 2014.

5,030 business establishments were

new to Toronto in 2014.

Toronto Job Count 1,384,390

1.5% 2013-2014

34.9% of Toronto's jobs

are located Downtown

Toronto Employment Survey 2015

This bulletin summarizes the highlights of the 2015 City of Toronto annual Employment Survey, marking its 33rd consecutive year. This information resource presents a picture of change in Toronto’s economy throughout the past three decades. For more information, please visit us at www.toronto.ca/demographics/surveys

Highlights

x The 2015 survey counted 1,422,280 jobs, an increase of 37,870 jobs or 2.7% from Toronto's overall employment base in 2014.

x Full-time employment has surpassed the 1 million mark for the ninth consecutive year.

x Part-time jobs increased by 7.3% from 2014, an addition of 344,350 jobs.

x The Office category remains the largest sector in Toronto, accounting for almost 1 out of every 2 jobs.

x The survey counted 75,710 establishments in 2015, a net gain of 530 establishments.

x In 2015, approximately 587,490 jobs were located in Toronto's Downtown and Centres, 41.3% of all jobs city-wide.

x North York Centre, with 35,000 jobs, remains Toronto's largest employment Centre after Downtown.

x Yonge-Eglinton Centre has Toronto's highest employment density with nearly 30,000 jobs per km2.

x In 2015, there were approximately 407,420 jobs in Toronto's Employment Areas, 28.6% of jobs in Toronto.

x 83.1% of all Manufacturing category establishments and 91.2% of all Manufacturing category jobs, are in Employment Areas.

x The Manufacturing category added 20 new establishments in 2015.

Web page Printout

TOcore - Planning Toronto's Downtown

What's New?

TOcore Phase 1 Summary Report and Phase 2 Directions

The TOcore Phase 1 Staff report went before Toronto and East York Community Council (TEYCC) on November10, 2015 and was subsequently adopted by City Council at its December 9, 2015 meeting. A copy of the StaffReport and the accompanying TEYCC presentation (in both video and hard copy) and available here:

TOcore: Planning Toronto's Downtown Phase 1 Summary Report and Phase 2 DirectionsPresentation Video (TOcore presentation begins at the 9:25:00 time spot)

Phase 1 Background Reports

Several background reports were prepared as part of TOcore's initial 'taking stock' phase. This section will beupdated as reports are made available.

TOcore Retail and Service Commercial Land Use Study (December 2015) Appendices to this report areavailable upon request to [email protected] Zoned for Dancing: A Comprehensive Review of Entertainment in the Downtown (December 2014) - aresearch report by graduate students at the University of TorontoTOcore Community Services and Facilities Study - Phase 1: Taking Stock (forthcoming)Downtown Parks: Phase 1 Background Report Summary (forthcoming)TOcore Transportation Summary Brief - Phase 1: Taking Stock (forthcoming)TOcore Energy: Existing Conditions (forthcoming)

Overview

Since 1976 the residential population Downtown has doubled, with over 240,000 people now calling Downtown home. With almost 480,000 jobs, Downtown is today the largest and most accessible employment centre in the region, notable for its concentration of jobs in finance, government, creative industries, higher education and health care. In fact, one-third of all jobs in the city are within the core. With a population growth rate of 18% since 2006, Downtown is growing at four times the rate of City of Toronto as a whole.

2. Outgrowing Condos into Houses

Young professionals are getting married and having kids, and are growing out of their 750sqft downtown condos

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RELATED STORIES

Condo prices to rise in most cities in2013, demand to continue

Toronto's condo boom won't bursthousing bubble: RBC

Most Canadian home buyers wouldavoid bidding war: study

City over suburbs: Downtown Toronto's population growth triples with youngerinflux

A construction crane stands in front of the CN tower in downtown Toronto. (Pawel Dwulit/THE CANADIAN PRESS)

Andy Johnson, CTV Toronto Published Tuesday, January 22, 2013 1:33PM EST

Toronto's downtown core is booming as a group of highlyskilled, highlyeducated young people known as “Echo Boomers” eschew thesuburban lifestyle their parents chose and instead opting for an urban lifestyle in the city centre.

According to a new report from TD Economics analyzing the trend, growth of Toronto’s downtown population has more than tripled in the past fiveyears.

The Echo Boomers – children of Baby Boomers who born between 1972 and 1992 – are driving the new trend as they get married, have childrenand purchase homes in the city.

"These individuals and young families are choosing quicker commute times, proximity to amenities,workplaces and transit, locating themselves in the downtown core's many mixeduse communities," thereport states.

For this generation, proximity to work, a shorter commute and access to city transit is a fair tradeoff for thehigher realestate prices and smaller properties their parents fled to the suburbs to avoid. The movementhas resulted in a seemingly endless crop of new condominium buildings in the downtown core.

As a result, Toronto's downtown is experiencing business growth, employment gains and population growthat rates that outpace the surrounding suburbs and reverse a decadeslong trend in the other direction.

The study reveals a startling shift in recent years when growth in downtown Toronto is compared to growth in Peel, York, Durham and HaltonRegion – essentially Toronto's suburbs and bedroom communities.

Between 1991 and 2006, the growth rate in the suburbs was between 15.7 per cent and 18.6 per cent. Over the same period, growth in thedowntown ranged from 4.3 to 4.6 per cent.

But between 2006 and 2011 a massive reversal took place. Growth in the suburbs dropped from 18.6 to 13.7 per cent, while growth in thedowntown spiked from 4.6 per cent to 16.2 per cent.

•  Growth of Toronto’s downtown population has more than tripled in the past five years.

•  They get married, have children and purchase homes in the city.

•  Proximity to work, a shorter commute and access to city transit is a fair trade-off for the higher real-estate prices and smaller properties

•  Echo Boomers are now the largest age and a higher proportion of them live downtown than anywhere else

•  While formerly run-down neighbourhoods have experienced significant gentrification as young people purchase properties, then renovate them.

At the other end of the renovation spending spectrum will be first-time house buyers in the 24- to 44-year range, looking to add a basement apartment so the rent will help pay their hefty mortgages. 40 per cent are expected to do renovations aimed at turning the old family home into a great entertaining space — in many cases with a basement apartment to help grown children get on their feet or save for a house.

3. Millennials Will be the biggest cohort since the Baby Boomers to affect

the housing market

14

15

4. Condos Currently meeting the needs of young 20-somethings, but

eventually they outgrow them

How does this impact prices? It’s basic economics. The prices of the home types we aremaking more of (condos) are relatively flat, while the prices of the home types we are making far fewer of (detached houses) are rising. In July the RealNet New Home Price Index for lowrise homes (detached, semidetached, townhouses and link homes) reached a record high of $806,395, an increase of 17.7 per cent over the previous year. Meanwhile, the price index for highrise homes (condominium apartments, lofts and stacked townhouses) increased by only 1.2 per cent, to $446,398.

5. Transit Investing around transit hubs give an extra 15-20% lift in

values and rents.

What Does It All Add Up To???

14 Symington Ave

Toronto Ontario M6P3W1

Sold: $700,000

List: $589,000

Taxes: $2,559.58 / 2015 For: Sale % Dif: 119

SPIS: N Last Status: Sld

Plan M23 Pt Lot 10 DOM: 8

Att/Row/Twnhouse

2-Storey

Irreg:

Fronting On: W

Acreage:

14.67 x 125 Feet

Rms: 7 + 3

Bedrooms: 3 + 1

Washrms: 3

1x4xGround, 1x4x2nd, 1x4xBsmt

MLS#: W3279329 Seller: Jamaal Joseph And Bertram Evingston Joseph Occupancy: Partial

PIN#: ARN#: Contact After Exp: N

Holdover: 90

# Room Level Length (ft) Width (ft) Description

1 Living Ground 12.96 x 11.64 Laminate Window

2 Kitchen Ground 12.30 x 11.32 Ceramic Floor Ceramic Back Splash W/O To Yard

3 Dining Ground 11.32 x 8.36 Ceramic Floor Large Window

4 Br Ground 11.64 x 10.00 Hardwood Floor Window

5 Living 2nd 14.27 x 10.99 Hardwood Floor W/O To Balcony Window

6 Kitchen 2nd 11.32 x 8.36 Ceramic Floor W/O To Balcony

7 Br 2nd 11.32 x 9.02 Hardwood Floor Closet Window

8 Living Bsmt 16.24 x 10.00 Vinyl Floor Combined W/Dining

9 Kitchen Bsmt 9.02 x 6.72 Vinyl Floor

10 Br Bsmt 11.32 x 7.05 Laminate Closet Window

Contract Date: 8/04/2015

Expiry Date: 11/30/2015

Last Update: 8/13/2015

Sold Date: 8/12/2015

Closing Date: 9/10/2015

CB Comm: 2.5%

Leased Terms:

Original: $589,000

Toronto W02 Dovercourt-Wallace Emerson-Junction Toronto 114-14-Q

Dir/Cross St: Bloor / Symington

Kitchens: 2 + 1

Fam Rm: Y

Basement: Finished / Sep Entrance

Fireplace/Stv: N

Heat: Forced Air / Gas

A/C: None

Central Vac:

Apx Age:

Apx Sqft:

Assessment:

Laundry lev:

Exterior: Brick / Insulbrick

Drive: Lane

Garage: Detached / 2.0

Park Spaces: 1

UFFI:

Pool: None

Prop Feat: Fenced Yard, Park,

Public Transit

Zoning:

Cable TV: Hydro:

Gas: Phone:

Water: Municipal

Water Supply:

Sewer: Sewers

Waterfront:

Retirement:

Farm/Agr:

Oth Struct:

Spec Desig: Unknown

Client Remks: Ideal Investment Opportunity In A Great Location!! Minutes To Subway And Go Station!! Great Curb Appeal! Victorian Style House With

Three Self-Contained Units! High Ceilings On Main & Second Floor; Lovely Front Veranda; Second Floor Balcony; Deep Lot With Fully Fenced Yard,

Storage Shed, And Detached Garage; Separate Front Entrance To Basement. Steps To Bloor Street - Close To All Needs! Don't Miss It!

Extras: Electric Light Fixtures; 3 Fridges; 3 Stoves; Gas Burner & Equipment.

Brkage Remks: Offers To Be Reviewed Tuesday, August 11th @ 7:00Pm, At Lb Office. Please Register By 5:00Pm. Attach Schedule B & Form 801 To

Offers W/ 24 Hour Irrevocable. Deposit Cheque Must Be Certified & Herewith.

List: RE/MAX REALTRON REALTY INC., BROKERAGE Ph: 416-782-8882 Fax: 416-782-3329

DINO LUCA, Salesperson 416-782-8882 VINCE LUCA, Salesperson 416-782-8882

Co-Op: RIGHT AT HOME REALTY INC., BROKERAGE

Suneil Kaul, Salesperson

Prepared by: MATTHEW RICHARD LEE, Salesperson

RIGHT AT HOME REALTY INC., BROKERAGE

895 Don Mills Road Suite 112, Toronto, ON M3C1W3 416-937-5251Printed on 01/21/2016 4:07:02 PM

Toronto Real Estate Board (TREB) assumes no responsibility for the accuracy of any information shown. Copyright TREB 2016

The 4 Risk Factors in Real Estate (and How to Mitigate Them!)

•  Don’t just buy because it’s “CHEAP” •  Don’t spend your cashflow!! Build reserve fund for

unforeseen problems.

Property Risk

•  Buy in markets with strong economic fundamentals •  READ: “Secrets of Canadian Real Estate Cycle”

Market Risk

•  Know your tenant profile, attract a high-quality tenant •  SCREEN, SCREEN, SCREEN!!

Tenant Risk

•  Educate yourself & keep up-to-date •  Build your “Real Estate Dream Team”

Investor Risk

Exte

rnal

In

tern

al

Ben Myers Become a fan Senior Vice President, Market Research and Analytics, FortressReal Developments. Fifteen years of real estate researchexperience.

Posted: 12/16/2015 6:08 pm EST Updated: 12/21/2015 12:59 pm EST

Toronto And Vancouver Real Estate Is Undervalued Globally Speaking

For over a decade, the articles, commentary and analysis focusing on the Toronto and Vancouver housing markets have addressed highlevels of mortgage debt, speculative investors, foreign buyers and the inevitable unfolding of the markets when interest rates inevitably rise.It has been hypothesized that the unraveling of these major housing markets will inflict pain on the entire Canadian economy.

Should we keep waiting another 10 years for this scenario to play out, or should we come up with new explanations for what is happening inthe Toronto and Vancouver housing markets?

Perhaps the biggest problem is a comparison problem. When you go out shopping for anything, you compare the price of the item you wantto the price you paid before, or you compare the price to a similar item whose price you know.

You check out a couple of different stores in the mall, perhaps you go online or head south of the border to an outlet store -- you'll get apretty good idea if something is a deal or if it's overpriced.

The same applies to house prices. If you paid $400,000 for a condo downtown, does it makes sense to pay $500,000 for a bigger unit up thestreet, or $700,000 for a house in the suburbs? You might even contemplate moving out of the metro area altogether to a smaller city ortown a couple of hours away, because you know the prices are 40 per cent lower.

This method of comparison was valid when Toronto and Vancouver were second-tier global cities. But that has changed. These markets haveascended to the ranks of world-class cities. One way to identify a global city is to review their price-to-rent and price-to-income ratios. Thehigher these ratios are, the greater the likelihood that the area is attracting foreign dollars and disrupting the relationship between thesevariables.

Rents are typically constrained by the incomes of local renters, while prices are not, as foreign capital snatches up homes to keep as vacationproperties or to rent to relatives at a discounted price. In addition, desirable places like Toronto and Vancouver build brand new luxuryproperties, areas gentrify quickly and existing properties are renovated and resold at much higher prices.

Some owners of rental older properties do few improvements and see less rapid rental growth, but they envision simply selling theirproperty for the next big condo project. Income numbers skew low as local residents sell to affluent local buyers with business (and notpersonal) income or foreign buyers that don't report their salaries in Canada.

All of these extreme factors become greater and more influential in global markets, rental rates and incomes appear lower than they shouldbe, and prices skew higher.

Featuring fresh takes and realtime analysis from

HuffPost's signature lineup of contributors

March 18, 2016

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Investment Strategies That Work

5 years ago: •  $350,000 •  20% downpayment ($70,000) •  Mortgage of $280,000. •  Closing costs and LTT: $10,000 •  Total: $80,000 •  Monthly Cost of living: $1900 Now: •  It's worth $400,000 (3% appreciation over 5 years) •  Every 5 years, you pay down roughly 13% of the mortgage •  Mortgage is now $240,000 •  Currently: $160k of equity (You started with $80k!)

Sell condo: •  $400,000 •  Disbursement fees (Realtor, lawyer, etc.): $20,000 •  Takeaway: $140,000 •  Capital gains tax: $0

5 years ago: •  $350,000 •  20% downpayment ($70,000) •  Mortgage of $280,000. •  Closing costs and LTT: $10,000 •  Total: $80,000 •  Monthly Cost of living: $1900 Now: •  It's worth $400,000 (3% appreciation over 5 years) •  Every 5 years, you pay down roughly 13% of the mortgage •  Mortgage is now $240,000 •  Currently: $160k of equity (You started with $80k!)

House in the Annex: •  $850,000 (Triplex) •  Total cash required: $115,000

•  Downpayment 10%: $85,000 (owner occupied) •  LTT and closing: $30,000

•  Total mortgage amount: $783,000 •  Mortgage: $765,000 •  CMHC insurance (2.4%): $18,000

•  Live in basement unit, rent out the other 2. Total Rent $3500 •  Rent main floor: $1750 •  Rent 2nd floor: $1750

•  Monthly costs: $4200 •  Cost of living:

•  $700 (down from $1900) •  Still have $25k in hand from the sale •  You now own a HOUSE in downtown Toronto, near the

subway line.

1.  Investor-focussed Real Estate Agent 2.  Advisory/coaching/mentorship for Real Estate Investors 3.  Joint Venture Partnerships

Matthew Lee, Managing Partner [email protected]

(416) 937-5251

Services we offer:

If you take your financial goals seriously and are looking for a mortgage team who understands the big picture –

we would love to serve you!

1-855-410-9905 or 416-410-9905 www.CalumRoss.com

1) •  Next meetup is April 21. •  Shayle Rothman – Expert Real Estate

Investment Lawyer

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3) •  Niran for real estate advice/coaching. •  Contact me if you want to buy your next

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