Many Toronto multifamily owners are finding themselves in the same situation. Holding onto ageing buildings, properties built in the late 1950s and 1960s, that don’t offer the same lust and allure of today’s purpose built rentals. Do you sell? Or do you keep it?

One important thing for owners to do is consider the current condition of your property and estimate the potential costs involved in maintaining it. If the property is starting to show signs of significant wear and tear, selling it might be a viable option to avoid future repair expenses.

Dealing with ageing multifamily property requires careful consideration and strategic planning. There are several options that property owners can explore to make the most of their investment and ensure its continued success. Here are some common approaches to handling ageing multifamily properties:

1. Renovations and Upgrades: Investing in renovations and upgrades can breathe new life into ageing multifamily properties. Updating the units, common areas, and amenities can attract new tenants and justify higher rental rates. Energy-efficient improvements can also reduce operating costs and make the property more appealing to environmentally conscious renters.
2. Repurposing or Redevelopment: Depending on the property’s condition and location, owners might consider repurposing the multifamily building for a different use or exploring the possibility of redevelopment. This could involve converting it into condominiums, mixed-use properties, or even adaptive reuse projects to meet current market demands.
3. Property Management: Hiring a professional property management company can help ensure that the ageing property is well-maintained and managed efficiently. Property managers can oversee day-to-day operations, address maintenance issues promptly, and handle tenant relations, thereby increasing the property’s overall value.
4. Evaluate Rent Rates: Conduct a market analysis to assess the current rent rates in the area. Adjusting the rent appropriately can make the property more competitive and financially viable, attracting tenants who are willing to pay a premium for the location and amenities.
5. Consider Refinancing: If the property has appreciated in value and there is equity built up, owners might explore the option of refinancing to access additional funds. These funds could be used for renovations, upgrades, or to invest in other real estate opportunities.
6. Sell the Property: Sometimes, selling the ageing multifamily property might be the most prudent choice, especially if it has become too expensive to maintain or if the market conditions are favorable for sellers. Selling can free up capital for other investments or provide a chance to exit the real estate market altogether.

Ultimately, the best course of action will depend on the specific circumstances of the ageing multifamily property, the prevailing market conditions, and, for owner’s that are family planning, whether or not the next generation is interested in continued ownership and management.