Casa Condominium is a beautiful and breathtaking building.

It’s in a great area, it has great amenities, the layouts are fantastic, and the finishes are all upgraded.

Investors are likely going to make money, BUT, they have to sell their units first…

You know that expression, “paper profit?”

I find that more people use this expression when speaking of equities and other short-term securities, but paper profits (or losses) are common to every type of investment.

How many among us held on to an equity too long when we could have sold for a higher profit?  How many times did you see a paper profit of $4.50 on your $9 shares fall to $3.00 before selling?

There are paper profits on almost every new condominium in our city, but there’s one catch: you have to realize that profit for it to have any meaning!

Casa Condominio Residenza, or “Casa” as it is known to just about everybody except the stupid marketing genius who decided to go with a fake Italian name, is located at 33 Charles Street just south of Yonge & Bloor.

Yorkville it is not, but you wouldn’t know from the prices that sellers and investors alike are trying to reign in.

Cresford Developments, who are known for successes such as Quad Lofts, Boot, and Windermere by the Lake, and such (massive) failures as MYC Condos, Mode, and Stratford in Lawrence Park, completed the project in early 2010 and put their stamp on the downtown condo market.

The building is very hard to miss as it rises 45-stories and there are no buildings even remotely close to that height in the surrounding area.  Perhaps this picture does it more justice:

How long do you figure that massive “Cresford.com” banner will remain on the top floor of the building?

The glass exterior is very sleek and seems to be what most developers are striving for these days and I suppose by default, it’s what buyers want.

The design looks very similar to Sp!re at 33 Lombard Street or even 22 Wellesley Street, both of which are square glass towers built within the last few years.

There are 404 units in this 45-storey building which are as small as 366 square feet, and many were leased out during the occupancy phase.

What seems troubling, if you’re an investor in the project or just a concerned citizen, is that there are currently forty-three units for sale in the building.

This represents a little over ten percent.

I find that number to be absolutely staggering.

There are five bachelor condos for sale between $229,000 – $259,000.

There are six 1-bedroom condos for sale between $314,900 – $322,800.  That’s a very narrow price range to have SIX condos competing for buyers, wouldn’t you agree?

There are 1-bedroom-plus-den units for sale at $419,000, $425,000, $432,900, $439,000, $439,000, and $442,900.

And of course, there are two ‘luxury’ units for sale by the developer at $1.5 Million each.

When a building is first registered as a condominium corporation, there are usually a litter of units that come onto the market at the same time as investors look to turn that paper profit into realized dollars, and finally rid themselves of a financial obligation that is likely taking money out of their pocket every month.

When you consider property taxes, maintenance fees, and mortgage interest, you’re likely losing money each month if you have a tenant, and you’re bleeding money if you don’t.

There have been thirteen sales at 33 Charles Street since April 30th of this year and those range from a low of $259,000 to a high of $672,000.  Note that these only represent sales on the MLS system, just as the 43 units currently for sale only represent those listed with a Realtor.  There could be other private listings just as their could be other private sales.

But it’s the price that shocks me more than the volume of inventory, and don’t think for a moment that those two aren’t tied together.

A bachelor condo is offered for sale at $239,000, which seems fair if you consider how far $239,000 goes in Toronto these days.

But back to the conversation we had last Thursday about incredibly small spaces; this condo is not a typical “bachelor” condo of 505 square feet as we have all grown accustomed to in the past few years.  This is a condo of only 366 square feet.

That’s a whopping $653 per square foot and that’s not including parking, for those of you that want to compare apples to apples.

It it just me, or does $653 sound like a lot for a square foot of real estate on Charles Street?

Ask Peter Freed, and he’d probably tell you that this is a mere starting point for the great future of Toronto real estate; or at least that’s what he’d say about the King West area.

But with the sheer amount of product available at 33 Charles Street right now, how can sellers expect to rake in this kind of money?

This isn’t Yorkville, and while I don’t necessarily see more value in King West right now, I know that the general public certainly does.  I’d rather live at 75 Portland or 20 Stewart than 33 Charles, but perhaps the future will tell a different tale.

Investors at Casa Condominium have to decide whether they want to cash out and take their profits at perhaps 90% of the levels they hoped for, or whether they’re going to hold out for that extra $15,000 and watch this thing all the way through the summer and beyond.

Imagine a seller still holding a unit when the leaves are turning in October.  You wouldn’t think it’s possible, but I’ve seen it happen time and time again.

Would a seller lose $10,000 in taxes, maintenance fees, and mortgage interest to chase an extra $20,000 that he may or may not get?

Absolutely.

I congratulate every investor in this project who plunked down a deposit five years ago and is now going to be rewarded financially, but if I had a client in the building, I’d urge them to sell quickly before that number “43” grows to “53.”

The only thing worse than five similar properties for sale at the same time as yours, is seven…