Hersh Condos: Mastering the Art of Pre-Construction Sales with a Sweet Edge

In the competitive world of Greater Toronto Area (GTA) real estate, Hersh Condos has carved out a distinct and highly successful niche: excelling in the sale of pre-construction condominiums and townhomes. This isn’t just a testament to their deep market knowledge and strategic approach; it’s also a reflection of a unique brand identity, personified by its charismatic president and broker of record, Hersh Litvack, affectionately known as “The Sweetest Guy in Real Estate.”

A Unique Brand: More Than Just Business Cards

Hersh Litvack’s moniker isn’t merely a catchy slogan; it’s deeply integrated into the company’s marketing strategy. His business card, a licensed replica of a Hershey chocolate bar, complete with wrappers featuring the brokerage’s information, is a memorable and highly effective marketing tool. This innovative approach ensures that Hersh Condos stands out in a crowded market.

Each year, Hersh Condos distributes approximately 5,000 of these distinctive chocolate bar business cards. “I’ve had more fun with these business cards than probably anything,” Litvack shares, highlighting their success in generating conversations and leaving a lasting impression. This playful yet professional branding strategy is a cornerstone of their memorable approach to real estate.

The Sweet Deal of Pre-Construction: Benefits for Buyers and Realtors

Mitch Parker, the marketing and sales director for Toronto-based Hersh Condos, underscores that pre-construction properties offer significant advantages for both prospective buyers and real estate agents.

For Buyers: Customization and Investment Potential

Purchasing a pre-construction condo allows buyers an unparalleled opportunity to acquire a brand-new, never-lived-in home tailored precisely to their specifications. This includes selecting finishes, floor plans, and often even minor structural adjustments before construction begins, ensuring the home truly reflects their personal style and needs. Beyond customization, pre-construction units present a compelling investment opportunity. In a rapidly appreciating market like the GTA, these properties often see a significant increase in value between the initial purchase agreement and the final possession date. This appreciation can translate into substantial equity gains for buyers before they even move in.

For Realtors: Enhanced Commission Structures

For real estate agents, specializing in pre-construction condos often means access to significantly higher commission rates compared to resale properties. Parker explains, “On virtually all of our deals, the agent gets four- or five-per-cent commission – depending on what we work out with the developer – and the part Hersh gets is totally independent from that.” This attractive commission structure makes pre-construction sales a lucrative avenue for agents looking to maximize their earnings and build a specialized portfolio.

Hersh Condos’ Strategic Business Model and Developer Partnerships

With approximately 15 years of experience, Hersh Condos operates on a sophisticated business-to-business model. They are not a direct-to-consumer brokerage; instead, they serve as a crucial intermediary, marketing projects from their builder clients directly to a vast network of real estate agents. These agents, in turn, introduce the properties to their own client bases. This approach leverages the extensive reach and expertise of the agent community, ensuring projects gain maximum exposure and sales velocity.

The brokerage’s reputation for success is evident in its ongoing projects. They are currently spearheading the marketing efforts for the latest phase of Charisma Condos by Greenpark Group in Vaughan, Ont., and the highly anticipated Ultra Towns townhomes by City Park Homes in Thornhill, Ont.

Navigating Pre-Construction Risks: Ensuring Buyer Confidence

The pre-construction market in the GTA faced scrutiny in 2018 due to a number of project cancellations. Data from Urbanation, a leading condo analytics firm, revealed that 4,202 new condo units were cancelled from January to mid-December 2018. However, the market has since stabilized, largely due to increased regulatory oversight and a focus on reputable developers.

Improved Market Stability and Regulatory Measures

The situation significantly improved in 2019, with Urbanation reporting that “virtually every project launched for pre-sale in the second quarter had received planning approval, reducing the risk of cancellations, which have been on the rise over the last couple years.” This trend indicates a healthier, more predictable market environment.

Further enhancing buyer protection, Tarion, the administrator of the Ontario New Home Warranties Plan Act, announced new regulations effective 2020. These rules mandate that builders provide buyers with comprehensive information sheets, integrated into the purchase agreement, highlighting key risks and considerations associated with buying pre-construction condos. These sheets detail critical information such as the potential for projects to remain uncompleted, early termination conditions, the development’s status (including zoning approvals and construction start dates), and the expected occupancy date, empowering buyers with full transparency.

Due Diligence: Partnering with Reputable Builders

Mitch Parker emphasizes that agents and buyers can significantly mitigate risks through diligent research and selective partnerships. He advises asking crucial questions of developers: “What are some of the finished developments they’ve done? Have they finished on time?” The track record of a builder is paramount.

“You really want to make sure you’re working with one of the bigger and more reputable builders because the likelihood of them cancelling a project is much, much less than if you’re working with a guy who’s brand new or was a home builder who decided to do a condo tower for the first time,” Parker stresses. Hersh Condos embodies this principle, maintaining stringent selection criteria for developers, despite being approached by numerous new or less experienced builders. “It’s our reputation at the end of the day,” Parker states, underscoring their commitment to quality and reliability. Over the years, Hersh Condos has proudly partnered with industry stalwarts such as Minto, Kingsmen Group, and Lamb Development Corp., further solidifying their reputation for working with the best.

The Promising Future of GTA Real Estate and Lifestyle Communities

While pre-sale condos “are typically going to be a little bit more expensive than resale,” Parker asserts that “you’re buying for less than what the building will be worth in the future.” This forward-looking perspective underpins the investment appeal of pre-construction properties.

Parker holds a strong conviction that Toronto area real estate, despite its current high values, remains “cheap” relative to its projected worth in the next 10 to 15 years. He predicts, “In the next number of years it’s really the GTA that’s going to do exceptionally well. It’s not going to be a big deal in 10 years to say, ‘I live in Vaughan and jump on the subway to go downtown every day.’” This vision of enhanced connectivity and continued growth positions GTA communities as prime investment zones.

Beyond investment, modern buyers are increasingly seeking a holistic lifestyle rather than just a dwelling. Recognizing this, condo and townhome builders are now focused on developing comprehensive communities that prioritize “livability and accessibility.” These integrated developments ensure that essential amenities, such as shops, restaurants, parks, and transit options, are all within a short walk or quick commute. “They’re not just dropping a building in the middle of nowhere,” Parker notes, highlighting the shift towards thoughtful, community-centric urban planning.

Innovative Sales Strategies and Agent Empowerment

Hersh Condos employs a multi-faceted approach to sales and agent support, ensuring maximum effectiveness and client satisfaction.

Empowering Agents Through Education

A key strategy involves hosting regular seminars for agents for each development they handle. These educational sessions are designed to equip Realtors with in-depth knowledge of the projects, enabling them to confidently and effectively market to their clients. “We just ran one where we had about 250 Realtors in our office,” Parker recounts, illustrating the scale and impact of these events. Agents then bring their clients to sales centers on specific evenings, a method that has proven highly successful. During a recent sales event for a project in Burlington, Ont., an impressive 133 units were sold in a single evening, showcasing the power of this collaborative approach. “We don’t really put a salesperson into a sales centre and grind the sales out one person at a time. We find that typically doesn’t work,” Parker explains, emphasizing their preference for high-impact group sales events.

Unprecedented Buyer Incentives

Hersh Condos is also renowned for crafting innovative incentive programs that captivate buyers. For the Ultra Towns development, a collection of 55 luxury townhouses priced from $1.049 million to $1.3 million, they introduced a groundbreaking incentive: purchasers receive a $100,000 cheque back from the developer on closing. This substantial cash-back deal offers immense flexibility, allowing buyers to cover approximately 24 months of monthly mortgage payments, maintenance fees, and property taxes, or significantly reduce their initial down payment. “It’s something unique that we’ve never done before,” Parker notes, adding, “We think $100,000 is really enough to pique someone’s interest.” This bold incentive highlights Hersh Condos’ commitment to creating exceptional value for their clients.

Digital Experience: Supporting Agent Success and Ethical Practices

Further extending their commitment to agent development, Hersh Condos recently launched “The Hersh Condos Digital Experience” podcast. The primary goal of this platform is to help agents refine their skills and elevate their professional practice. The podcast features valuable insights, including advice from Hersh Litvack himself.

In one video, Litvack provides practical guidance on leveraging social media to build a robust personal brand. In another, he passionately advocates for the paramount importance of integrity and client-centricity in real estate. “If you’re just looking for your commission, it’s never going to work for you… If you’re looking out for your client, commission just comes naturally,” he advises, encapsulating the ethical foundation of Hersh Condos’ philosophy.

Conclusion: The Sweet Success Story of Hersh Condos

Hersh Condos stands as a beacon of innovation and success in the pre-construction real estate market. Through unique branding, a strategic B2B model, rigorous developer selection, and a steadfast commitment to educating and empowering both agents and buyers, they continue to shape the landscape of new home sales in the GTA. Their forward-thinking approach, coupled with an unwavering focus on client satisfaction and ethical practice, ensures that Hersh Condos truly lives up to its reputation as “The Sweetest Guy in Real Estate,” delivering sweet deals and sweeter outcomes for everyone involved.