Beyond the Bricks
Lanterra Developments will redevelop Toronto Sutton Place hotel into condominiums
February 17, 2012
Ryan Starr
SPECIAL TO THE STAR
Earlier this month, Lanterra Developments announced it had acquired the Sutton Place Hotel and will be redeveloping the venerable but timeworn tower into a luxury condo.
Lanterra president and CEO Barry Fenton thinks the iconic hotel, built in the 1960s on Bay St. and Wellesley St. W., could use a bit of sprucing up — “a diamond in the rough,” is how he described it in a recent interview.
The developers plan to preserve core elements of the existing building but convert Sutton Place’s 400 hotel rooms into 600 or so condos. The company has said it’s evaluating the possibility of including a boutique hotel as well.
The base of the Sutton Place tower will be expanded to accommodate 20,000 square feet of retail space and the height of the 33-storey building will be increased by nine floors, giving it “greater prominence in the immediate area,” Lanterra says.
In a press release, the developer vowed that the reborn Sutton Place will “renew and revitalize the character of the neighbourhood.”
The Sutton Place is only the latest urban renewal project for Lanterra, a developer that in just over a decade of operation has shown a flair for reinvigorating some of Toronto’s more tired-looking parts.
Just north of the Gardiner Expressway, Lanterra is helping transform what was once the no man’s land between Front St. and Lake Shore Blvd. W. into a bustling hub of condos, retail and entertainment.
The Residences of Maple Leaf Square on Bremner Blvd. includes two towers, the boutique Hôtel St. Germain, offices and more than 100,000-square-feet of retail space.
Nearby along York St., Lanterra is building Ïce Condos, two soon-to-be iconic towers (67 and 57 storeys) with an adjacent office building and landscaped public square.
“Eight years ago we were looking out to see when the cows would come home to graze,” says Fenton. “We really busted a gut, but now we’ve created a city within a city.”
South of Fort York, WaterParkCity — Lanterra’s maiden development — was a pioneering project in what is now a condo cluster at Bathurst and Fleet Sts.
“Before that there was nothing there at all — it was far off the beaten track,” says Lanterra chairman Mark Mandelbaum. “We spoke to investors and banks at the time and they said we were absolutely nuts. Now it’s a cool place to live.”
Similarly, he notes, Lanterra’s Treviso project at Lawrence Ave. W. and Dufferin St. — which will include two eight-storey buildings and a 20-storey tower, with 1,500 units and retail space — has injected new life into an area the developers felt was “seedy” but had potential. “Now people are looking to do more development in the area,” Fenton says
“We like to create canvasses that people can continue to paint on.”
Fenton and Mandelbaum
joined forces to form Lanterra in 2001 after working together on the development of One Bedford, a 32-storey condo at the northeast corner of Bloor St. W. and Bedford Rd.
Prior to that, Fenton had been the president of a real estate firm that specialized in commercial and residential buildings. Mandelbaum had spent more than two decades doing residential and commercial land development with his family’s business, H&R Developments.
The timing of Lanterra’s inaugural project, WaterParkCity, couldn’t have been worse. “It went to market the week of 9/11,” Mandelbaum says. “Maybe not such an auspicious start.”
In just over a decade, however, Lanterra has built itself into a major player in the Toronto condo world, a developer responsible for having built some of the city’s more high-profile projects. In addition to Maple Leaf Square and Ice, Lanterra has developed the Toy Factory Lofts in Liberty Village and the Murano and Burano towers along Bay St.
Partnerships can be
tricky business. So how does the Lanterra duo keep it together?
“It helps to be totally different,” Mandelbaum suggests during a recent interview at the sales centre for 3018 Yonge, Lanterra’s latest condo project, a 12-storey project just south of Lawrence Ave. ( www.3018yonge.com).
“And when you complain to one another you have to listen,” adds Fenton.
“We’re very different, but our skills complement each other and I think we respect one another’s contribution and role,” says Mandelbaum, whose job is overseeing design and architecture and the marketing of Lanterra’s projects. Fenton manages acquisitions and construction. “But we can both step into each other’s roles,” he says. “And we often do.”
It hasn’t all been smooth sailing for Lanterra.
The company came under fire last summer following reports of glass falling from its Murano building near Bay and College Sts., as well as at its One Bedford property.
Lanterra has responded by replacing the tempered glass on the balconies with laminate glass, at a cost of millions. The developer will be using the same laminate glass on the 3018 Yonge project. Although it’s more expensive, Mandelbaum says, “we’re not going to screw around anymore.”
“The fact of the matter is that the tempered glass behaved exactly the way it should,” he adds. “If it breaks, it’s supposed to crumble into little pebbles. But if people are walking down the street and it starts raining glass, they get antsy. I can’t blame them.”
“At the end of the day we solved the problem,” says Fenton, who notes that Lanterra wasn’t the only developer dealing with falling glass issues, just the most high profile.
In the end, though, Lanterra’s reputation didn’t suffer greatly as a result of the debacle, he says. “We’ve opened up several other sites since and we’ve been very successful.”
In the next two years the company expects to bring more than 3 million square feet of development to market.
In addition to the Sutton Place project, Lanterra will be redeveloping an entire block of Yonge St. south of Wellseley St.; the proposed plan calls for two 58-storey condo towers with 960 units. Lanterra is also planning a project of over 1-million-square-feet for the south side of Bloor along the curving portion of the road that runs between Sherbourne and Parliament Sts.
It may be full steam ahead for Lanterra in 2012, but can development in Toronto really continue at such a torrid pace?
“I believe the market is healthy and robust,” says Fenton. “I think it’s becoming more difficult to acquire good sites . . . but we’ve had healthy (price) increases for the last number of years and I’m still very bullish on the market.
“If you asked me where I’d invest money today, I’d be buying units in Toronto with the assumption that I’m not here to flip it; that over the next 10 years it will appreciate substantially.”