How A Toronto Church Is Getting Into The Real Estate Development Game And Helping The Community
When the leadership of an Evangelical church in suburban Scarborough was plotting what to do with a sprawling parking lot that was mostly empty six days a week, the group saw what many would: development potential.
One of the church’s pastors and its CEO, Kern Kalideen, who formerly worked in risk management for a bank, has watched religious institutions do the same elsewhere. But he suggests there are downsides to parting with a parcel of land.
“I’m seeing that a lot of churches have property, but they don’t have any other option other than just selling it to a developer, getting a cheque. And they either have to move or they get a restricted space and sometimes they end up with more problems,” he explains.
None of the above appealed to Kalideen and Global Kingdom Ministries, so the church chose a different path.
After talks with some developers, which didn’t prove fruitful, the church decided to have a hand in developing its own land. “Basically all they (developers) wanted was [for us] to sell the land, and they would try and do their own thing. And the church would be left with this development on their doorstep,” he tells Toronto Storeys.
“We have been in the community for pretty long, and we want to be able to build a community ourselves.”
Most churches don’t have the resources or expertise to pull that off, but the Scarborough church, born in the ‘50s, has an advantage.
In 2014, Kalideen launched KJK Ventures Inc., with the aim of helping charitable organizations intensify the land they own, and his company partnered with Global Kingdom Ministries on a project, dubbed Trinity Ravine Towers, to develop the church’s parking lot at 1250 Markham Rd.
“To develop property… most churches don’t have the cash to do that, so they make the choice of selling it rather than taking on that risk themselves. But through my company now, we’ve got a team of people who are willing to work with the churches to help them through that process,” he says, noting KJK works on commission.
Building condos on the site may seem like the natural choice, but here, too, the church went in another direction.
If Kalideen and company constructed condos, unit sales would be one-time transactions. Purpose-built rental apartments can provide a steady return — and it’s a model KJK is looking at for future projects. But the church settled on a more unconventional option in response to demographic demand.
Trinity Ravine offers “life lease” residences to buyers 55 and up. About 550 units will be spread across two high-rise towers, rising 27 and 29 storeys, respectively.
Basically, for a lump sum purchasers get an endless lease to a unit.
Available life leases start at $270,000 — a little less than the typical price of a condo in the area, according to Kalideen.
As in a condo building, residents pay maintenance fees to cover upkeep. There are additional options offered, like meal plans and health services, depending on need, but there are no rental fees as some other life leases involve. Life lessees can sell their Trinity Ravine leases at any time, though the church retains first right of refusal and will maintain a waiting list.
A lease can be added to an owner’s estate, but if nobody from the estate is at least 55, the new owner would either need to rent out the unit through the church or else sell if they one day inherit it.
“Our mandate is to be multi-generational,” said Kalideen. “Now we are concentrating on the seniors in our community.”
Doing so made the municipal approvals process easier for the applicant, suggests Ward 38 Coun. Glenn De Baeremaeker, whose ward the project is within.
“There is a massive need for seniors housing… across the city of Toronto,” he says. To date, there have been zero community complaints about the project, he adds. “I wish every development application could be this easy.”
So far, the project’s first phase has sold out and half the units in the second phase are spoken for. Kalideen says, “There’s quickly becoming a significant need in the community for these types of places.”
The pastor and real estate entrepreneur says there are some 140 examples of life-lease communities throughout the province, including others in Toronto such as Shepherd Gardens, which neighbours Scaborough’s Agincourt Mall.
The Canada Mortgage and Housing Corporation, the country’s housing agency, says it doesn’t “collect robust data” on life leases, and “in the last couple of years, we’ve seen only a couple of these in the GTA.”
Ahead of Trinity Ravine Towers’ anticipated summer groundbreaking and projected 2020 completion, KJK is working with four Ontario churches on similar projects in varying stages of development.
Looking forward, Kalideen expects more to turn to companies like KJK as greying church congregations shrink and donations dwindle.
He says, “The congregations are getting older and the buildings are getting older, so they have to look at a different model. But still many churches want to stay in their area, so I foresee this being a model that could be extrapolated… across the city.”