Behind the Deal: Allied's 460 King West Buy
Allied Properties REIT earlier this week bought 460 King West, the vacant 1875 building that formerly housed Global Village Backpackers hostel. CEO Michael Emory told us exactly what's in store.
The $15M acquisition completes Allied's ownership of the eastern and southern perimeter of that block, Michael tells us. The heritage building has 20k SF of leasable area and 4k SF of surplus land to the west, a parking lot. Allied now owns everything on the west side of Spadina Avenue between Adelaide Street and King West, Michael points out, and "essentially" the entire stretch on the north side of King West between Brant Street and Spadina. (If this were a game of Risk, everyone would be surrounded.)
The deal creates an "enormous intensification opportunity," Michael says. Allied owns the 11k SF parking lot immediately north of the property, at 78 Spadina. The firm wants to build a new LEED Gold structure that will integrate the heritage building it just purchased and potentially portions of two adjacent Allied office properties, 80-82 Spadina and 96 Spadina. But it'll be a few years before that happens, says Michael. Meantime, Allied plans to restore 460 King West for retail use at grade and office use above.
The new hybrid structure envisioned by Allied will be the "lynchpin of an intensification project" that is "as good or even potentially better" than the firm's striking Queen Richmond Centre (QRC) West development (rendered above), currently rising on the northwest corner of Peter Street and Richmond Street, with a glass tower perched above a four-storey brick heritage building.
On the same day Allied purchased 460 King West, it unloaded 860 Richmond St. W, a property it said was "neither strategic… nor particularly well-located" within the King West submarket for office use. Acquired as part of a portfolio deal, the property was an "orphan" Michael tells us, stranded out on Richmond's westernmost end. "There isn't much of a possibility for us to build a concentration [of properties] that far west on Richmond." It sold for $6.3M. (Looks like Daddy Warbucks swooped in with his checkbook.)
