The first of a two-part interview with Paul Golini of Empire Communities. Part 2 follows next Thursday. We begin by Part 1 talking about Golini's background and the history of Empire Communities, their transition into the highrise business, and continue with a discussion of Schoolhouse Condos, O2 Maisonettes, Rain Condos, and Eau du Soleil.

Paul Golini (right) speaks with interviewer Dumitru Onceanu, image by Ed Skira.

I've read that development wasn't always your first calling, and you almost went into the restaurant business. Tell us about that story, and how did you get your start in the industry?

My father was in the sewer and watermain business when I was growing up, and my mom ran a restaurant. Although you find boys being attracted to big heavy equipment, I was a foodie early on, so I was attracted to the restaurant business from its service and people aspect – that's something that's really helped me grow within the building and development industry – but I did join the development company that my dad started with his partner Andy Guizetti, and my two business partners earlier on. The three of us started Empire Communities.

So it's a partnership between the Golini and the Guizetti families?

Yes, it's Andy, Dan, and myself, and my father is chairman of the board.

How has the company evolved over the years, and how did you begin?

We started building single family homes in the Hamilton area, and from there we specialized in master-planned communities and became very experienced in the entire development process from buying the raw land, to the visioning and the planning, to building the homes and delivering them to our home buyers. We liked the fact that we controlled the entire process. From there, in the '90s we had a piece of land in Richmond Hill on Yonge Street when there were no condos in the 905. We were one of the pioneers in Richmond Hill.

Which one was that?

Empire Place, and it was in '97.

Where is it?

Just north of Highway 7 and south of 16th Avenue, on the east side of Yonge. It's three buildings – 415 units – and that was our first highrise project; since then we've loved the highrise business. From there we have basically specialized in doing highrise in 416, and most of our single family homes, townhomes, and ground-related product is outside the 905. Actually we skipped over the greenbelt.

Interesting, so tell us about that experience.

In hindsight we looked like stars because before the greenbelt legislation came into play, we actually bought large tracts of land outside the 905 in the Hamilton, KW, Brantford areas. It just so happens that we landed in places that were designated for growth, not designated as greenbelt, and that's where we focused our master-planned communities.

How is it different doing a master-planned community versus doing one-off homes here and there, or even a small boutique project like Schoolhouse for example?

The committment both from a financial and a time commitment for a master-planned community is much deeper and longer. You're there for years. You know that you're going to run into resales within your existing community as you're building, because you're building in multi-phases. It's a different approach. You need to become a community partner so to speak, whether it's with charities, whether it's with the neighbourhood associations, etc. The one-off projects, it doesn't mean that you're not putting in the same effort, but from a time point of view, you're in and out much quicker. Schoolhouse for example, it's still a niche neighbourhood type project in the Annex, but obviously it's more of an urban project. We loved it, but I can tell you that to do retrofit projects right and to get it right from a construction perspective is not an easy job.

Schoolhouse in the Annex, rendering courtesy of Empire Communities

How did you come across Schoolhouse, and the property?

Schoolhouse was brought to us by someone who had invested in it when it went up for sale. They knew they wanted to turn it into a residential project, but we ended up picking it up and running with it. We really wanted to do something different in that neighbourhood, and create a project that would become a legacy project. Those are the types of projects that you do and that are remembered, their uniqueness in the marketplace but also in the neighbourhood. There is a sense of pride in terms of being involved in a project like that.

What part of the challenge attracts a developer like you to Schoolhouse. 

There's a definite construction and engineering challenge, and at the core we are a construction company as well; my partner Dan Guizetti is an engineer. Our roots are from the York Excavating side, which is our sister company, so we understand construction. We get attracted to those challenging projects where in the end you can't really tell what went on, but there was years of planning to get this melding of the old and the new to work.

What kind of backgrounds do you and your other two partners come from?

So I come from an economics and marketing background. My partner Andy comes from accounting and finance, and my partner Dan who's the President is an enginneer.

Many developers have made an almost complete transition from their previous low-rise business and now find themselves exclusively in the high rise market. You are still active in both. How do you find running a company that specializes on two almost completely different built forms, and what's your experience with it?

We believe that the demand for low-rise will exist as long as there's land. So we're committed to putting the same amount of time, money, and effort into both disciplines – the low-rise ground related project and the high-rise – for two reasons. High-rise is lumpy from a cashflow perspective: by the time you invest in land, bring it through approvals, and launch, a typical sales season would last a year – not weeks like we've been spoiled for the last few years – then you're waiting years to build, and occupy, and your cash is tied up for years. With single family ground product you sell a house, you build a house, and you close a house, notwihstanding the capital-intensive process where you're putting in the infrastructure on the streets. We really think that they complement each other, so we are committed to growing both businesses.

How has the low-rise product evolved over the years, given that land is also becoming more scarce?

It's just a natural end result of land going to record levels that the lot sizes are getting smaller. When we got into the business 20 years ago, the standard was a 50 foot lot, and now you're looking at 30 and 32. Back then you would never imagine that a family would actually buy a 30 foot single family lot.

Sounds like we're returning to the post-war days?

Yes, and I've even heard of smaller single family lots. It's not as much about the land, but it's more about the square footage when it comes to the single family homes. People say that they don't build them like they used too. That's not really the case because we build them much better than we used too, between building code improvements between the past few code changes, and the committment to adding energy efficient technologies into our homes, the homes these days are much better than they used to be.

You mentioned your transition into the high-rise market in Richmond Hill. You were one of the first ones to do so. What was your experience going from suburban to urban? 

We took an approach which we believe was part of the strategy, and that was to surround ourselves with the best consultants. If you're going to make that transition into high-rise, don't try to fit a square peg into a round hole. They are two different businesses, whether it's sales, marketing, or construction obviously. Homeowners are homeowners, so from a customer service and experience perspective, you treat people the same, but the timelines are also different. People are buying and waiting for this building to go up, so we wanted to make sure that we didn't just try to take all the practices we had in low-rise and just try to force them to work in high-rise. We surrounded ourselves with the best high-rise architects, surveyers, engineers, and we wanted to make sure that our first buildings went well so that the learning curve was shortened. In fact after Empire Place on Yonge Street in Richmond Hill, we went on to develop another three buildings in Richmond Hill, and from there high-rise just became part of our business.

Where did you go after Richmond Hill? Now you're focused entirely in the southern half of Toronto.

So we moved to North York, a project called the Continental at Yonge and Finch, which went really well, and then we moved down to Lake Shore with Beyond The Sea, and a few projects in the downtown core.

O2 Maisonettes, rendering courtesy of Empire Communities.

Tell us about the O2 Maisonettes. You're acting as construction manager for the 14-storey building containing exclusively 2-storey sky townhomes. 

Definitely a great concept to bring the townhome low-rise experience and put it into a vertical building structure, and well received in that area, attracting people that are seeing east of Yonge Street a place that they're not afraid to call home anymore. Since our launch of O2, you've seen a lot of development on the east side.

Are you looking to attract a different demographic than just the typical investor?

I think so, there's actually the end user, whether they work at the hospitals, or they teach at Ryerson, there's an end user/investor component to the project. 

Eau du Soleil, rendering courtesy of Empire Communities.

Eau du Soleil has received a lot of buzz in the online community owing to its unique architecture: the sweeping design, the towers, the base, the transition between the two, and the large terraces. Tell us about it?

The architect is Zeidler, and so we brought him on board because we wanted to create an anchor architectural building for that strip along Lake Shore. It's at the tail end of the high-rises along that area. We're next to a greenspace that's owned by Toronto Region Conservation Authority which we are incorporating from a landscape perspective into our landscape design, so it ends that strip properly and it's not disjointed. For the building itself we wanted to make a statement. Toronto is ready, and we've seen some great examples of amazing designs from an architectural perspective in Toronto. This is another example of trying to do something different. We're also very tall for that area.

How has it been received?

So far it's been very well received. We've had some great feedback and support and Toronto is not afraid to go high anymore.

What kind of mix of suites are we expecting to see?

There's actually an interesting phenomenon happening. We've gone with a typical mix that we've seen in the city, with the small suites ranging from 400 square feet up to 1,000, however we are getting investors from an end-user perspective – they're investing but they're really end users – putting suites together on the upper floors, and taking advantage of that.

So they're asking you to do engineering and design changes to accommodate them?

Yes, so we've had some purchasers already say 'we're taking two suites, we're putting them together, because we want basically 2,000 square feet, or we want 2,500 square feet', which is interesting. They're taking it from the perspective that this is not a bad place to live, and whether they are going to live there themselves or rent it. For example at Schoolhouse we had some larger units that hadn't sold. We recently put them on the market on MLS for rental, and within weeks we had multiple offers and leased all the remaining inventory, all big products, so we're seeing that there is actually demand for the bigger rental product. That speaks to perhaps the fact that when these buildings are eventually actually built, that the demand for rental for the bigger units will still be there.

Rain Condos in Oakville, rendering courtesy of Empire Communities.

Might that say anything about the market itself evolving? Are you seeing more people wanting larger units, or is it still a niche market?

Realistically, the bulk of all our sales as Empire, and the industry in general, are still the smaler units. The one bed and the one bed + dens are still the average. However, in our project in Oakville [Rain] we sold a lot of the smaller suites to investors, and what we found is that we have a number of suites we thought were large enough, but the end user needs them a little bit bigger. They're coming in saying '1,000 square feet, two or three bedroom? We really want 1,200 or 1,300 square feet.' We're looking at designing some suites for that end user. It speaks to that particular project, and to the fact that we need to do our research and to guage the market, and this speaks to the fact that we can't just keep doing what we've been doing and assume that we're going to keep selling. We can't take things for granted, and we need to get back to basics with respect to knowing the demographics, understanding the end user, because at the end of a project, regardless if investors are buying 2-3 years out, or not, in the end there are always end users in the building - rented or owned - you have real people living in these buildings. You need to understand that we can't just assume that design it, launch it, and they will buy it anymore. 

Join us next week as we continue our conversation with Paul Golini on Eau du Soleil, his role at BILD, as well as aspects of affordability and sustainability in construction.