How To Identify The Next Big Arts Neighbourhood To Buy Your next Home?
We have heard of the Starbucks phenomenon on real estate values. According to Zillow, the home-value data for homes that fell within a half kilometer radius to Starbucks increased an average 96% in value between 1997-2014.
Do independent art galleries migration have a similar effect on boosting home prices in their neighbourhoods? In New York, now that Chelsea is saturated with galleries and the steep increase in rent close to the Highline is pushing out existing galleries, everyone is talking about where the next big arts neighbourhoods will be.
Art galleries take years to be profitable. On average, art gallery owners tend to prefer leasing a space for a longer term to prevent substantial rent increase. However, when the lease term ends, the tenant can be subject to significant rent increase at lease renewal. When West Queen West galleries became a destination for the arts scene, the significant increase in rent forced some galleries to source for cheaper spaces further out at the edge of the urban core in revitalizing areas.
Does the location where galleries choose to locate affects residential real estate home prices? In Toronto, West Queen West, The Junction, Brockton Village, Bloor-Landsdowne [otherwise known as Blansdowne] where gallery clusters are growing or migrating to, have also become vibrant cultural destinations for small business entrepreneurs, independent coffee houses and restaurants. Gallery and cafe hopping can often go hand in hand. In recent years, we have noticed home prices in those areas have jumped significantly as the neighbourhoods took on their new creative brand identities.
So what is Toronto's next BIG arts neighbourhood and how are the signs that these areas are developing a new brand identity? Where art gallery owners source their next locations tend to be a good indicator driving the momentum of physical and economic change in revitalizing areas. The beginnings of change in these creative neighbourhoods are sprung from these common fundamentals:
1. Situated in post-industrial old urban zones accessible to public transportation
2. Lower than average commercial rent compared to central urban zones
3. Buildings of industrial aesthetics and architectural significance, with open space, high lofty ceilings or brick and beam.
4. Near other independent small businesses like cafes and eateries to feed traffic off each other.
Currently one area that comes to mind where Queen and Dundas West art gallery owners are sourcing space as alternative location to flee high rent is the Lower Junction Triangle. The City has declared this zone a mix-used site, currently with start ups occupying the smaller buildings, and the Nestle factory nearby operating 24/7. Developer Castlepoint Numa has branded the revitalizing pocket as Lower JCT. They have partnered with MOCCA on the Perth Sterling revitalization project. The adaptive-reuse and rehabilitation of the Tower Automotive Building and outdoor plaza will showcase Canadian contemporary art exhibition as the future MOCCA location. I am look forward to seeing this area take shape.
If you are looking to buy a home in a revitalizing neighbourhood, I can make the process easy for you in navigating your home search. Feel free to get in touch!
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