The construction rate of multi-family dwellings in Canada continues to steam forward, with record highs being posted in 4 of the past 5 years. The growth in multifamily units presents some unique challenges when analyzing data sets, since multiple units exist within a single address or X/Y coordinate and need to be taken into consideration when developing your analysis. Let’s review some of the potential issues raised by this shift into multi-residential units.
The Impact on Infrastructure
The increase in Condo construction draws heavily on the infrastructure required to service them. An example of this is a recent report by the Ministry of Government and Consumer Services which ordered the provincial safety agency to commission a report on elevator availability and maintenance. The request for proposal, which was issued by the Technical Standards and Safety Authority states “Ontario is currently experiencing one of the largest construction booms in residential properties in North America (and) a rapid growth in the number of elevators,”.
High-rise construction requires specific planning of services, as higher densities can break traditional models that are based on regional boundaries such as postal codes – often requiring a larger concentration of services. The ability to sketch out the density caused by high rise building enables analysts to better define territories in modelling out future service requirements.
Book of Business Modelling
With over 109,000 condo units added to the downtown Toronto market since 2010 – insurers have an ever increasing need to model their current and prospective business against the current condominium market to ensure they are not over or under represented in certain buidlings. This can be a major challenge – for any new building. The number of units available within a particular building can vary widely, making it challenging to ensure that you are in properly targeting new business and ensuring current business is not over-representated.
The following graphic shows the state of condominium builds since 2010 in the city of Toronto – note the variability in number of units in each area – and the resulting impact on any book of business.
Marketing to Highly Profitable Clients
If you are a utility or telco provider, your opportunity to maximize profitability is high in the condominium and multi-family dwelling market. Being able to bring services to a high number of end users with minimal expense is a key opportunity presented by the trend of higher density housing. It does, however, require that marketers be able to target end users accurately and understand who is within reach of newly laid infrastructure.
This is an opportunity that plays out across major markets throughout Canada. The following chart shows the expectation of continued higher production of multi-family starts vs. single-detached for the city of Calgary.
With more families moving into these multi-family dwellings, a more profitable opportunity for marketers to reach out to these customers begins to present itself.
With the continued production of multi-residential dwellings, marketers and operations managers have an excellent opportunity to combine their current client data with accurate location intelligence data to understand where new, profitable business opportunities are emerging across the country.
If any of these situations apply to you, you may want to check out the new DMTI / Teranet Condo Concentration Insights offering here.