Thursday, March 22, 2012

What's wrong with this picture?

Let me ask you... what's wrong with the picture above?  

Click on it to enlarge and take a look at it for a minute.  

The picture was taken this morning and captures the corner of Cambie and Marine in Vancouver - site of this week's hottest Real Estate topic; the four hour sell-out of the development known as Marine Gateway.

In case you aren't aware of what went on, Global TV provides this synopsis:

Marine Gateway, and the 415 pre-sale units that sold, is big news because at a time when listings are soaring and sales have been falling off a cliff, the pre-sales at this development have bucked the negative trend.

In fact it has completely turned that trend on it's head.


Let's put that into perspective.

A sell-out of pre-sale condo unit offerings hasn't happened in Vancouver in over six years.  As Global TV noted in this story, you have to go back to the Woodward's presale in 2006 - before the collapse of the world financial markets - to match an opening day pre-sale sellout of a condo development.

And Marine Gateway sold out even faster than that Woodward's development.  

Woodwards (with similar prices) took 12 hours to sell 536 units.

At Marine Gateway people started lining up last Thursday. And as the lineups began, news spread that over 11,000 people had pre-registered for this development.

But by Saturday morning only about 100 - 150 people had actually lined up (one commenter over at Vancouver Condo Info pegged the number at only 106).

So 106 people bought over 400 units?


Interestingly when you watch the Global clip, one buyer laments she was only able to secure a 1 bedroom condo (without an available parking spot at that). How come? Did she come late and miss out?

No... she stresses she showed up on time.

Even more curious is the fact that Global didn't find anyone to talk to that walked away empty handed.


One can't help but observe that this was a very carefully planned and prepared offering.  As the Global story notes, Rennie Marketing Systems had a lot at stake here.

Checking craigslist in the week before the offering, the infamous Condo King wasn't leaving much to chance.  There was clearly significant marketing and networking done prior to the sale.  

As you can see by these ads (click to enlarge), other realtors were already on board offering the units to customers in advance of the Saturday opening. They were even offering to rebate 20% of their commission to get you on board early:

A lot of preparation went into trying to make this pre-sale a one day success.

Watching the Global TV clip you quickly notice the emphasis being placed on promoting the key feature of Marine Gateway: it's location on the Canada Line. Rennie bends over backwards to replace the R/E mantra of "location, location, location" with the new mantra of "transportation, transportation, transportation."

It's a theme I suspect we will see a lot of in the coming months.

In fact, a few days after the Global piece above aired, we are treated to another treatise emphasizing the "transportation, transportation, transportation" mantra:

And it's in this latest piece we get a glimpse of a wider issue at play here.  

Apparently Bob Rennie has 3 other developments about to go to market along transportation lines. 
  • Next month Rennie will pre-sale of 300 units at another Canada Line Station - Brighouse Station in Richmond.
  • In September he will launch 230 units at Coquitlam Centre where the new Evergreen Line line will be opening.
  • And a month after that 1,100 units, two towers, will go to market along the original Skytrain line in Vancouver at Joyce Road.
Can you imagine how crippling a flop in sales last Saturday could have been? Failure to sell out at Marine Gateway would have been devastating.

I wonder how disappointed Rennie Marketing was when only 106 people showed up in the sales line up by Saturday morning?

But Marine Gateway didn't flop.

Instead we were witness to  THE MOST SUCCESSFUL pre-sale launch in Vancouver history, a perfect event for what is touted as the cutting edge model of what's crucial to real estate sales in the modern city.

All accomplished in the midst of a market which has been screaming negativity week after week from the likes of the mainstream press with their talk of a housing bubble ready to burst.

Amidst negative statements on debt and the real estate bubble from the Governor of the Bank of Canada and similar statements from the Federal Finance Minster.

Amidst warnings from the heads of some of the nation's biggest banks on the threat of a bursting housing bubble.

And all framed by several months of negativity of actual sales results released over the past few months.


I can't help but think of all the shenanigans we have seen over the last few years.

I think they call it 'staging'.

You know what I'm referring to.... development marketers hiring people to stand in line, creating a 'buzz' for a pre-sale. Staged helicopter tours supposedly flying wealthy Asian buyers around proposed new developments. Realtors bringing in 'surprise' competing parties just before a couple is about to make an offer on a house (thereby pressuring you to act right away).

All done in the name of 'staging' the right 'optics'.

So what are the optics created by Marine Gateway?

Would it be wrong to cast such a suspicious eye on a record breaking sellout anomaly that occurs at time when other realtors are openly talking about how dead the market has been so far this year? When only 1% of the registered people interested in the development actually show up on sales day?


Which brings us back to the picture at the top of this post.

As I said, it was taken this morning... a full five days after what has been a supposed record breaking pre-sale sellout in a dead market wherein only about 106 people lined up and created a 415 unit sellout of a development which will be a springboard for a host of new developments with a "transportation, transportation, transportation" theme.

That picture is conspicuous for what is NOT there.

Let me ask you... when was the last time you saw a developer sell out an offering and not promote the crap out of that success with "SOLD OUT" banners plastered across every conceivable sign posted on the property?

It's been five days and there is nary a single 'sold out' sticker anywhere.

I could understand the day of, or maybe even no stickers until after the weekend was over... but nothing a full five days afterward?

Especially when this is the first of several developments being launched along the transportation network by the same promoter this year.

Perhaps they're waiting until after Cam Good's helicopter makes a fly by?


(Note: follow up post available here)


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  1. Excellent post.

    I bet a bunch of units were bought by the realtors working with Rennie to create the 'sold out' euphoria. They're probably holding off on slapping sold stickers up in hopes that stragglers will still contact them with enquires from all the hype and they can then unload some of their self bought stock.

  2. Great analysis! Spot on!

  3. Well, sounds like great marketing! Today it is "transportation," yesterday it was "location." We've heard "buy now, or be priced out forever."

    Then the banks have special deals on cheap rates.

    I've noticed over the past few years, real estate people have been very good at marketing and creating hype!

    And with mortgage rules not changing, this gives them another "win."

    Oh, well, c'est la vie!

  4. I used to live in Marpole and drove past this location all the time. I hope this Marine Gateway development doesn't happen. Besides, this is the most ludicrous place for a condo tower -- it's all industrial (waste) land to the west, east, and south. Plus the intersection of Cambie and Marine is pretty busy. What kind of neighborhood is that? Oh, and the flight path into YVR will be providing plenty of noise to potential future residents.
    Save your remaining industrial land Vancouver. Your residents still need someplace to work or conduct their business.
    I will no longer refer to this as Marine Gateway but "Marinegate", like Watergate.

  5. That second Global piece isn't news, it's an advertisement. If they were real journalists it would have been more along the lines of real estate marketer claims to have sold out new development, is it really true?

  6. I agree with you Whisperer. Rennie had to have a sell out. I'd love to know how many Realtors signed pre-sale agreements to snap up what Rennie couldn't move that day (with escape clauses that allows them out in case they can't re-sell them).

    Rennie NEEDED a sell out for this effort on day one.

    He sure didn't seem all that excited and enthused for Global when he got it, did he?

  7. Rennie needed this publicity to counter the OV fiasco that's severely tarnished his reputation as the "bullet-proof" marketer.

  8. This is the type of analysis the MSM should be doing, but they are too lazy and stupid to do it.

  9. Well... it does have to almost 'sell out'. Projects need to get somewhere around 80% pre-sales to get financing. Otherwise they won't build. So I doubt that it's not sold out, but maybe not all to end users. Rennie's team have probably been working for months lining up buyers/investors. This did not occur in a day. Perhaps, some blocks of pre-sales were signed to realtors who will then sell quietly market while its built. It's all about passing the risk from the developer to the pre-sale buyer.

    Here's a good clip from a CBC Marketplace program "Condo Crunch":

  10. "Traffic Pattern Changed", indeed.

  11. Someone at work mentioned the grate Bob Rennie was replaced at OV marketing. Can anyone confirm or deny?

  12. I drove by this place today and yes, I can confirm that there's no "sold-out" sign at all. Also, I notice that the site is surrounded by various "amenities": garbage station to the east, skytrain track to the west, electrical substation and railway track (also saw a few rail cars for oil transport) to the south, and the busy Marine Dr / Cambie to the north. Buyers, pick your poison.

  13. Stunningly refreshing counterbalance to the hype.

  14. Sold out is a mute sentence unless it justify the price co- relation with the sale.If you have heard this starting $269 and two bedroom unit for $350 there is no surprise since the old units in the neighbourhood are more expensive than this project If you look at the unit price at 33 main and 28 Fraser,Those units are at double rate compare to this sold out project.So there you go,Sold out because it's cheap.

  15. In Vancouver, real estate is a sport and the players are amateurs. This is better than reality TV. Vancouver needs condo police to make sure condo marketing is above board. We have Vancouver City Police, Translink Police so why not Condo Police?