It's Monday! There's a new premier in Alberta! What a day to be alive, huh? Here's some more news: the good weather is revealing a mess, property flippers may have to meet with the taxman, Target had a crazy year in Canada, and Oakville businesses are seeing tough times.
With the weather improving (finally, hopefully), the snow covering our fair city is starting to melt. And as that snow melts, the accumulated detritus of an entire winter will be exposed, making the sidewalks and parks and basically everywhere there was snow—meaning everywhere in the entire world, probably—filthy. Luckily for would-be spring enthusiasts across town, governments exist in part for just this reason. City cleanup crews will be dispatched across the city in just over a week, as the temperature is rounding 7 C and teens are starting to think about skipping school to do ollies in the parking lot. (Teens still do ollies, right? It’s so hard to keep up with youth culture.)
Developers and real estate flippers seem to have led the aggressive incursion of “luxury” condos into downtown Toronto, and the Canada Revenue Agency is finally looking into potentially improper practices from one of these groups. “Flippers,” a term and vocation popularized during the height of the U.S. housing bubble by such shows as Flip This House, Flip That House, and Flip Men, often buy rundown properties and fix them up before selling them for a profit. In the Toronto condo market, though, flippers can turn a profit without putting in any work. Simply by purchasing a unit and sitting on it for a few years before reselling, it’s possible to make a tidy sum. The CRA claims that since April 2013, it has audited the 579 people who conducted such deals, and slightly more than half of those investigations resulted in penalties.
What a wild year it’s been for Target in Canada. The major American retailer opened 124 Canadian stores in a single year and expected to turn a profit by the end of 2013. Instead, the company lost almost $1 billion. “We didn’t come to Canada just to operate in one year and go home,” CEO Tony Fisher told the Toronto Star, which sounds good because opening 124 stores only to close them the same year would be a terrible business plan. Now, Target is planning to turn a profit in Canada by 2018, within five years of opening, and will open just nine stores in 2014, and five a year after that, until reaching 150 locations. Consumer response has been cool for a number of reasons, including a lack of stock and higher prices than the American locations.
The rich people in Oakville are no longer quite as rich as they once were. Regular folk can be forgiven for wondering why it matters, and really, it might not in the big picture—but for upscale retailers who built their businesses to cater to rich Oakvillites, the change is serious. Of the many stores focused on Oakville’s traditionally wealthy residents (four and a half times as many Oakville residents earn more than $191,000 per year than the national average), designer consignment clothing shops seem to still be faring well. This could still be a troubling sign, though, since consignment shops rely on people selling clothing at a fraction of the price they paid and others willing to buy designer items second-hand. Neither of those are traits typically associated with rich people who are enjoying continued success.