A massive 48-storey condo tower planned where a once iconic Toronto landmark stood for decades has been cancelled by a major developer.
Located in the heart of downtown Toronto at Dundas Street East and Jarvis Street, Menkes Developments’ 520-unit condo project, called Elektra Condos, was set to replace Filmores Gentlemen’s Club, according to the project’s website.
Menkes Developments confirmed to the Star that the project was cancelled due to insufficient sales.
“This decision was not made lightly, but we believe it is in the best interests of all parties not to unrealistically prolong matters in the face of continuing market uncertainty,” Jared Menkes, president, highrise residential, said in a written statement on Tuesday night.
Deposits are being returned to buyers with interest, Menkes said.
Menkes said they are going to pivot to creating a purpose-built rental building.
“We expect to be in a position to commence construction in the near future as we continue to work through obtaining final approvals from the various levels of government helping us facilitate this housing project,” he said.
“As in our past projects, updates will be provided to the various stakeholders, as appropriate.”
The Star obtained an email that appears to be from Menkes to brokers, outlining the reasoning behind the cancellation, which said that sales were insufficient to meet the requirements for project financing.
Typically developers need to pre-sell 70 per cent of condos to get financing to move forward.
Menkes did not respond to a question about how many units were pre-sold.
According to previous reporting in the Star, the building and an adjacent parking lot were sold to Menkes Development in 2020 for $51.5 million.
The building, with its landmark neon sign, is more than 100 years old, and was first known as the Wilton Court Apartments.
It became Filmores, a strip club and hotel, in the mid 1980s, and was listed as a heritage property by the city in 2016, due to its Edwardian architecture.
Filmores is closing the 212 Dundas St. E. location on Jan. 31, according to social media posts. A “final curtain” at the end of the month was also announced via the marquee sign outside the establishment last week.
They did not respond to a request for comment.
Daniel Foch, chief real estate officer of Valery.ca, an AI-powered real estate brokerage and technology platform, said the project cancellation by a major developer is indicative of just how strained the real estate market is.
“To me it really just shows that even the biggest developers with the best models can’t figure out a way to economically deliver units in today’s market,” he said.
To help lower costs for consumers and developers, Foch said development charges — fees the developer pays to the municipality — need to come down to help reduce pricing.
