Regarding 49 Ontario, I think you've made a good attempt at trying to determine its value, but I have some other perspectives:
1) Given that a good development margin is ~15% it's very easy for small errors in cost estimates to radically change the overall value of the project.
2) Downtown TO development land (with approvals in place) has been selling for $180 to $190 per buildable square foot in the last couple years.
3) The recent bank loan of $80M secured by 49 Ontario would not have been made unless the bank was confident there was a large delta with the land value.
4) Developers generally are not going to build if it means destroying the land value of the property. They will wait for better conditions. That creates the conditions for land values to rebound in time.
5) Gov'ts are continuing to remove costs from rental developments to get developers moving because of 4)
5) The fact that Cooper is an experienced developer and is ready to build 49 Ontario is highly suggestive that he sees a path to developing it that preserves the carrying value (~$160 per buildable square foot).
So, my bet, is that the value of 49 Ontario will not be written down. We will find out for sure soon...
Regarding 49 Ontario, I think you've made a good attempt at trying to determine its value, but I have some other perspectives:
1) Given that a good development margin is ~15% it's very easy for small errors in cost estimates to radically change the overall value of the project.
2) Downtown TO development land (with approvals in place) has been selling for $180 to $190 per buildable square foot in the last couple years.
3) The recent bank loan of $80M secured by 49 Ontario would not have been made unless the bank was confident there was a large delta with the land value.
4) Developers generally are not going to build if it means destroying the land value of the property. They will wait for better conditions. That creates the conditions for land values to rebound in time.
5) Gov'ts are continuing to remove costs from rental developments to get developers moving because of 4)
5) The fact that Cooper is an experienced developer and is ready to build 49 Ontario is highly suggestive that he sees a path to developing it that preserves the carrying value (~$160 per buildable square foot).
So, my bet, is that the value of 49 Ontario will not be written down. We will find out for sure soon...
I added a new perspective of my own. A "5 cap" on new assets becomes only a 4 cap after the management fee.