Bosley Realestate

Toronto’s Booming Technology Economy And Our Real Estate Market

June 9th, 2021 | Real EstateCollege Street/Little Italy

Did you know Toronto is ranked as one of the most livable cities in the world? In 2021 we cracked the Top 20, rising 10 spots over the last year alone! Toronto is #3 in North America in terms of the pace of growth, according to a recent report by Ryerson University Moreover, we ranked in the Top 15 on the list of cities that afford an ideal work/life balance.

As a young city (and country for that matter), we're like an adorable toddler undergoing a formative growth spurt! 

 

 

We're In The Age Of Information

As the world becomes more firmly dependant on and interwoven with the new post-industrial economies, Toronto is increasingly a hot spot for tech development and investment, mostly because we're on the zeitgeist of everything NOW. For the most part, we're young, liberated, progressive, inclusive, tolerant, multi-cultural, forward-thinking, engaged, polite, respectful, competitive, fair, and on the cutting edge of mood.

In fact, according to the Legatum Prosperity Index for 2020, Canada ranked 14th overall, and ranked even higher for important factors like personal freedom, and education!

What’s behind this sustained growth? The tech section is flying in Toronto, which by all accounts is set to ramp up as we re-open our borders and get back to business as we move beyond the pandemic. And this isn’t just welcome information for job seekers. Homeowners should take note, as this marked growth will help to sustain real estate prices in the long term.

Certainly, success in real estate means identifying trends as they are rising. Given the sheer size of tech’s role in the local economy, it bodes well for both commercial and residential real estate - and also for secondary benefits for other local sectors where all of these workers will spend their money.

 

 

 

Toronto's Technology Ecosystem

Toronto is kind of a big deal when it comes to tech companies; we seem to be the go-to city for company headquarters!

According to the 2019 report from commercial real estate group CBRE, Toronto was ranked the fastest-growing tech economy in North America and was ranked number three for available tech talent.

This is notable because tech workers comprise a significant number of workers in the Canadian economy (according to CBRE, 5.3 per cent of the country’s entire workforce). In Toronto, these workers need somewhere to live, which is good news for the sustained growth of Toronto’s real estate market.

Also, a major draw for Toronto (versus some other U.S.-based tech hubs) is a “common sense” immigration policy, which continues to draw high-end talent. Read: “A 'Massive Advantage': Foreign Talent Bolsters Canadian Economy”. With borders re-opening, immigration is expected to resume and see an uptick. The report cites that the main factor behind Toronto’s allure for the tech sector is the high concentration of calibre highly-educated talent to draw from. And in an industry that relies so heavily on innovation, this is a crucial criterion.

 

 

 

Numerous Brands Expand Presence In Toronto

There has been a flurry of announcements from well-known companies setting up shop or expanding their current tech presence in Toronto, adding jobs and/or offices.

Lured, in part, by the incredible pool of tech talent here in Toronto, delivery app Door Dash is setting up its first non-US engineering office. Uber is doubling the size of its tech team in Toronto, and Pinterest is expanding its tech presence here!

And Google is opening one of their three new offices in Toronto, expected in 2022, which promises to employ hundreds of tech workers (the other two offices are slated for Montreal and Waterloo).

Even Wayfair and Cloudflare intend to join the party! As the article mentions, as of April 2021, Toronto’s office towers have seen some impressive new tenants set up shop and plaster their name on the door, including Netflix, Reddit, Tik-Tok, and Pinterest. 

One thing that all of these companies have in common is they're gravitating to the incredible pool of tech talent here in Toronto, which is discussed in this Toronto Star article: "How A Toronto Tech Boom Is Keeping The Local Economy Going — Despite The Pandemic". According to the article, 67,000 tech workers arrived in Toronto between 2015 and 2019, and now tech workers comprise 10 percent of the local workforce.

Uber spokesperson Laura Miller really summed it up quite well in this quote taken from the above article:

“Toronto sets a high bar for developing diverse, world-class talent. Establishing our global tech hub in this city gives us the chance to play an active role in the community and create more opportunities for skill development and diversity in Canada’s tech ecosystem,” Miller said.

And that tech ecosystem is well-known throughout the world. The more tech firms that set up shop in Toronto, the more that will follow; executives are taking notice of the moves and the subsequent success of their competitors.

According to this article, entitled, "Canada's Pensions Revamping Real Estate", growth in tech has outpaced the energy sector by 2.5 and 3 times the overall economy.  Similarly, the region from Waterloo to Toronto comprises the second-largest tech cluster in North America, known as 'Silicon Valley North'. We are talking about 15,000 tech companies, 200,000 tech workers, and over 5,000 tech start-ups, and 16 universities and colleges. That is the infrastructure for the creation and deployment of a large pool of skilled tech workers.

 

 

 

Growth And Affordability

As a sector ramps up, and employees flock to a city (even with the assumption that a segment of these employees will Work From Home), the cost of real estate goes up. It’s the old supply-demand dynamic. While this price appreciation is good news for homeowners, will it exacerbate the issues we're already facing for the lack of affordable housing in Toronto?  

More to the point - particularly for these corporations - will it impede their recruitment efforts by directly impacting employees living and working in the affected cities? 

We only have to look at San Francisco as one of the top tech hubs in North America to see some of the challenges. Their real estate market is also prohibitively expensive. Demonstrating the relationship between affordability, real estate, and the ability for a company to grow and prosper (i.e. attract and retain talent), prominent San Francisco employer Google has pledged billions to create affordable housing in the Bay area - some of which is to be constructed on their own land. Creating housing for your employees? Yes, it's a solution, but it also smacks of modern-day serfdom. 

Here are three informative articles: "Google's $1 Billion Attempt To Fix Bay Area Housing Crisis", "Google Pledges $1 Billion To Ease The Silicon Valley Housing Crisis It Helped Create" and "Google To Invest $1Bn To Fight The Tech-Fueled Housing Crisis"

 

 

 

A.I. Appeal

The growth of tech relies not only on economic and demographic support but on a commitment to research and innovation. 

As a sidebar, I wanted to mention how, in the latest wave of the tech boom, Canada - and Toronto in particular - is becoming known around the globe as “the” city for work on artificial intelligence. 

The University of Toronto, well-regarded for its drive behind innovation and research, began construction on the first phase in an expansive innovation complex, in 2019. This first offering is a striking 750,000 square foot complex that will “turbocharge the next wave of Canadian innovation, advancing how A.I., biomedicine, and other disruptive technologies can enrich lives”.

Click here to read “How Canada Became A Hotspot For Artificial Intelligence Research” and “The University Of Toronto Is Building An Enormous New Innovation Complex”. When it is completed, the complex will be the “largest university-based innovation node of its kind” and serve as a major hub for student- and faculty-led startups in Canada.

This complex will not only figure prominently in the A.I. vertical in the world, but will also add a new visual dimension to U of T (whose downtown campus is noted for lovely scenery, historic monuments, and historic architecture). Click here to read my post about the University of Toronto and how it is a major player in the city and in the world.

For more about this AI complex, and its expected role in the sector, check out "U of T’s New AI Research Hub Is A Building Where Innovation Could Truly Happen" and "University Of Toronto Receives $100M Donation To Fund AI Research & Build Innovation Complex".

 

 

 

The Toronto Real Estate Market

Toronto's physical growth, economic expansion, cultural fostering, and coming-of-age exuberance as a city is the perfect complement to the technology economy, which is also, too, only in its infancy. By tapping into the diversity Toronto is renowned, cultivates, and celebrates, any technology company has the opportunity to capitalize on the city's synergy and channel it into developing its global brand. With a multi-cultural imprint (for example over 180 languages and dialects are spoken in Toronto, with 79 multi-lingual publications published in Toronto), it provides the foundation for a company to expand its talent pool across the globe.

Plus, global citizens find us cool and hip as we read in "Vogue's Cool Girl’s Guide to Toronto".

With Toronto's booming technology economy our real estate market - particularly within the original City Of Toronto - may have an economic resilience we underestimate and, given the current pace of growth, portends a consistent rise in property values.

 


 

Are you engaged in technology? We've found those who love technology also love loft living, as they're amazing creative incubators of higher thinking and creativity! Historically speaking, industrial conversions and live/work spaces were first flocked to by artists and creatives looking for new approaches to domesticity and self-exploration! If you're a tech guru, searching for the quintessential unique urban space, you'll love our new listing - a stunning 2bed (open second bedroom), 1bath loft space in the Button Factory on Clinton Street!

Looking for a heart-grabbing vintage brick and beam loft? Here's a dynamic space that just came to market! I hold The Button Factory very close to my heart, as I led the sales & marketing program for this charming brick and loft condominium of just 13 units back in 1993, prior to its conversion. I also resided in the complex for its first 18 years! This two-level loft townhouse is one of the more special Toronto real estate offerings on the market right now and nestled in a 'Triple A' location, this is ideal for the Buyer craving all the magical qualities unique to loft living!

Here is An Authentic Brick & Beam Loft Townhouse In Little Italy’s Button Factory, offered for $1,569,000!

 

 

Want to see this beauty in person? Contact Steven Fudge: steve@urbaneer.com.

 


 

May we be of help? If Toronto real estate is on your radar, whether as a current homeowner or as a potential buyer moving, it's important to map your dwell hunt or your property selling strategies with the guidance of those who can apply the big picture to your immediate goal. Like the Urbaneer Team! Well-liked, well-respected, and welcoming, the Urbaneer team takes great pride in our excellence. Consider engaging us for a free consultation.

Thanks for reading!

 

If you enjoyed this blog, you may like these other Urbaneer.com posts:

Toronto Loves The CN Tower (And So Do I!)

Gentrification, Densification, And The History Of Toronto Real Estate

The Psychology Of Real Estate, Housing & Home

 

~ Steven

Steven Fudge, Sales Representative

& The Innovative Urbaneer Team
Bosley Real Estate Ltd., Brokerage - (416) 322-8000

- we're here to earn your trust, then your business -

 

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