Are Rennie Layoffs the Canary in the Presale Coal Mine? Kerry Gold Storeys May 21, 2025

Both Bob Rennie and the foreign buyers ban were in the news again in May when Greg Zayadi, president of Rennie announced significant reductions in the company's head office staff. This prompted journalist Kerry Gold to question whether what was happening at Rennie was 'the canary in the coal mine'. 

Here are extracts from her story.

Zayadi noted that, conversely, companies were short staffed as buyer demand soared during the rapid acceleration of 2017 to 2019 and the COVID-related market peak of 2021. Times have changed, and Rennie Group – one of the biggest real estate marketers in Canada – reduced its staff from 123 to 92 people.

Other marketing companies are quietly doing the same, according to developer and real estate consultant Michael Geller. Geller, who’s been working in the industry since the 1970s, said the big news these days is when a developer finds a way to actually launch a presale project. A key part of the downturn is the absence of the investor.

Up until recently, condominium towers relied on the pre-sale of at least 60% of the building to obtain financing to begin construction. Around half of those pre-sale buyers were investors, but government policies and a higher interest rate have chased those investors away, including foreign buyers.

“[Foreign buyers] weren’t a major segment of the market, but they did buy, and they were part of that investor market,” said Geller. “People wanted to ban short term rentals and ban speculators, and they succeeded.”

Condos have subsequently lost their day in the sun, with the current market mostly driven by end-users, such as families who need affordable space to grow. That’s why townhouse developer Polygon is one of the few big developers who are selling in this market. But not enough end-users gravitate towards pre-sale units, which can take years to complete, and prove impractical for those who need a place to live sooner rather than later.

“It is one of the biggest downturns in part because projects can’t proceed without presales and the cumulative effect of all those legislative changes and taxes have taken the investors out of the market,” said Geller. “Right now, it’s an end-user market, and if you had to identify the most popular housing form right now it’s townhouses. Ground-oriented townhouses are generally seen as the most marketable and desirable type of housing rather than apartments and six-storey wood-framed buildings, and apartments in 20-storey buildings.”

Andy Yan, associate professor of professional practice in urban studies at Simon Fraser University, said the fact that townhouses are still marketable, while presale condos aren’t, is a sign that the market and resident needs are two different realities. People want housing to grow families, or to live in for many years, while the market is producing tiny studios and one-bedrooms more suitable to investors who are speculating on ever-increasing values. In Toronto, the proliferation of tiny condos earned them the nickname, “dog-crate apartments.”

“They’re building Mini Coopers while people need station wagons,” said Yan.