What are the stages of a New Condo Launch?

Question: What are the stages of a New Condo Launch?

It is important to understand that every condo launch cycle will be slightly different. Not all condo launches will follow the same format, however, the below example is an aggregate of how a condo launch takes place in Toronto.  As a developer goes through the stages, they will typically increase prices and remove various incentives.

Below is a graph to highlight the approximate prices as a developer goes through the stages of a condominium launch in Toronto.  NOTE: The graph is for illustrative purposes only and do not reflect real life pricing.

STAGE 1 – FRIENDS & FAMILY

This stage is typically not advertised and is only available to close friends and relatives of the developers. There is not typically an “event” to purchase at this stage. Friends and family members will be invited to purchase before they start to sell.

STAGE 2 – PLATINUM LAUNCH

Platinum Agents are those that typically sell large volume of pre-construction condominiums. Platinum Agents are typically characterized as the following:

• They tend to specialize in pre-construction condominiums and do little to no resale
• They tend to work with large volume of investors
• They tend to sell 10+ units at major condominium projects
• There are only a handful of true “platinum agents” in Toronto
• The Platinum Launch is typically the best time for investors to purchase at a new condominium with the following perks:
• Day 1 pricing, typically much lower than the other stages of a condo launch
• Typically the best perks and incentives
• Best suite selection (the “prime units” are often sold during the platinum phase)

STAGE 3 – VIP LAUNCH

VIP Agents are those that sell pre-construction condominiums but not to the same volume as a Platinum Agent. They tend to also work in resale real estate. They will be invited to the second round of sales. Prices are typically increased, perks and incentives are removed and the best suites are usually already sold.

STAGE 4 – TREB AGENT LAUNCH

Developers will then open up their sales to any TREB agent who may have clients. At this time, a majority of the best suites have already been sold and prices have been increased significantly.

Perks may be added at this time, however, the price of the units are often much higher than the perks being offered.

STAGE 5 – PRE-REGISTRATION INVITES

If you register on a developers website, you will get an invitation to be the first of the public buyers able to purchase. At this point you do not need an agent to purchase, however, prices have been increased, perks removed, many additional clauses may be added that will benefit the developer.

Even at this stage it is recommended that you have outside buyer representation to assist you through the process.

STAGE 6 – PUBLIC OPENING

The final stage of a condo launch is the public opening. By this time there have already been 5 groups before that have gotten the best suites, the best prices and the best perks. In Toronto, our very basic rule of thumb is “if you are able to walk into a sales office without an agent representation, you are way too late”.