Downtown Automotive Group planning massive six-dealership, residential development

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By Jackson Hayes

TORONTO, ONT. – An ambitious new development in the southeast end of Toronto might just rewrite the rules for OEMs when it comes to dealerships in major metro markets.

In a city where land can fetch $20 million and beyond for a single acre and one that has seen several operators build vertically as a result of real estate constraints, Shahin Alizadeh may have just set a new standard.

The president of Downtown Automotive Group says his team and partners are in the final stages of zoning and city approvals for a massive project that includes several condo buildings, a handful of commercial spaces and six dealerships.

“It is all very exciting,” Alizadeh told Canadian AutoWorld this week. “This is a North America first where we are building what effectively becomes a community called Riverside Square. There will be over 800 condo units, additional commercial units on site and seven brands represented.”

The automotive component of the project, located between Queen Street East and Eastern Avenue with much of it fronting the Don Valley Parkway in the southeast corner of Toronto, has been dubbed Autoplex. The massive project calls for six separate dealerships representing Toyota, Scion, Lincoln, Ford, Hyundai, Nissan and Infiniti.

Six stores (Toyota and Scion will be retailed at the same location) will have individual branding and identification all facing the DVP. Store size will range from 35,000 square feet to over 60,000 square feet, in the case of Toyota.

Staffing will be brand specific and Alizadeh stresses it will be six entirely separate operations sharing little more than a roof and three levels of park and service area below grade.

Given its metro location, Alizadeh says the idea was to create a conventional operation without utilizing as much acreage. He also notes the project has garnered a fair bit of interest from the OEMs and other dealership groups in the country.

“I’ve had people quietly flying up from the U.S. to check it out,” he adds.

All the stores will be owned and operated by the Downtown Automotive Group, which currently runs eight stores in the city including Avenue Nissan, Infiniti Downtown, Toyota on Front and Downtown Toyota.

Autoplex will also mark the return of Ford to downtown Toronto after a nine-year absence.

“They [manufacturers] all supported it, which has been a pleasant surprise as long as they all got their own identification, branding and customer experience, which we have committed to.

The vastness of the project comes down to realities of real estate in major urban centres. Given that land values in the city are determined not by commercial venues but rather residential density, he says any dealership would have to generate an unrealistic set of numbers to justify a location like that.

“We had a large enough parcel that we could make a clear and distinguished and defined pattern where each of these elements – dealerships, commercial and residential – would all fit.”

Costs for the project were not shared though he stressed it would be “realistic” and very much within range of what a standard automotive dealership would cost with reasonable rent factor attached to it.

“We have done business models and our rent factors we envision coming out of the finished product per store will be more competitive and reasonable than the majority of the current structures going up in various parts of the country,” he says.

The auto group has partnered with Streetcar and Dream to build the development. Assuming zoning approval is forthwith, Alizadeh says a conservative estimate for dealership openings is sometime in the spring of 2018.

Read more about the ambitious project in the December edition of Canadian AutoWorld