Shahin Alizadeh has a sense of satisfaction that his plan to build an autoplex in downtown Toronto combining automotive, residential and commercial elements – the first of its kind in North America – has reached the point where it has gone from a concept into a reality and that it might be a blueprint for the future of retailing cars.
While the residential and commercial elements are a year away from completion, the automotive component is up and running and the signs of the dealerships can be seen by anyone driving down or up the Don Valley Parkway, the main artery to the downtown core.
For the 69-year-old Alizadeh, who began work as a lot attendant 50 years ago and started Downtown Automotive Group (DAG) in 1992, the project is a dream come true. In 2011, he bought five acres for a total of $50 million and now it houses 11 brands representing Toyota, Ford/Lincoln, Hyundai/Genesis, Nissan/Infiniti and Chrysler, Jeep, RAM and Dodge. Last September, the dealerships all began operating, but there still remained some municipal hurdles for signage, which was finished in late July.
“I think we all look for those sort of pinnacles of our careers – that’s something that no amount of money can every give you – the satisfaction of knowing what you’ve contributed or what you’ve accomplished as someone within that particular segment of the industry,” said Alizadeh in an interview with Canadian auto dealer. “I’ve never done anything but the car business. I don’t know any other industry. I’ve learned about the condo development business because I’m a partner in it, but would I be excited about doing another condo project? Believe it or not, no.
“I’m a car guy and to me this is what I do. This is what my passion is. This is what excites me. People excited me, good people that have contributed to our success.”
After acquiring the land and realizing he could not financially take the chance of strictly using it for automotive dealerships, he met with principals from Streetcar Developments and Dream Unlimited to discuss incorporating residential and commercial elements into his autoplex.
“The idea was to have an automotive complex that would be carved out of a roughly $500 million project, which included their venture,” Alizadeh said. “Today I’m sure it would be a lot more than that.”
He said the next part of the plan was to have OEMs become involved, but said the initial reaction was mixed. He said those who didn’t have any representation in the downtown market jumped on it, but the ones whose products he was retailing in that area were skeptical.
“At that point in time, this type of a concept hadn’t gained any type of recognition, let alone traction,” said Alizadeh. “A lot of dealers gave it very little chance of even happening. They said it was something that ultimately wouldn’t be blessed by OEMs.”
After a year of working with his partners on planning and developing the project, he received buy-in from several OEMs and said each one wanted its own identification. He brought forward a plan to have each of the dealerships built with a similar box look three stories high, which they all accepted, but he said the external imaging was “not an easy proposition.”
He said they hadn’t been used to someone telling them to give up their traditional identification.
“That was provably the biggest hurdle we went through, to get a common look within the entire complex, and that quite frankly defied all the traditional imaging that everybody had,” said Alizadeh.
He said he promised the OEMs they could have everything their hearts desired inside their buildings, but unless they all agreed to the same external look the City of Toronto would turn down the project because it wanted one common theme that would be branded with signage. Once that was done, the project received the City’s blessing.
In late, 2015, a ceremonial ground-breaking took place, but he said it took a year to create the kind of infrastructure within the buildings that made sense. For example, rather than use thousands of feet for a parts store, he bought a machine that is on a carousel seven stories high.
“Those were the types of nuances we had to look at,” said Alizadeh. “It was a lot of collaboration, a lot of what I call give and take.”
He those types of things created time delays and added cost.
Making room for the condominium complex required tearing down the Toyota store on the property and building a semi-finished store, which happened in November 2019. He said for another 1½ years, the project stood still because of the COVID stops and starts and a workers’ strike.
“The last 2½ years were painful in so many ways,” he said. “Up until the last six months, everything was falling to pieces. It was a very time consuming, frustrating at times, but exciting at the same time because you could start to see that it would eventually come together. The net result is what you have today.
“The one thing I say to our team is sometimes when you build something and develop it and complete it, you are so entrenched in it you actually don’t realize what you are building. You kind of underestimate the significance of it.”
Following the final municipal approvals for brand signage, Alizadeh posted to LinkedIn his thoughts on the completion of all the dealership buildings from renderings to the actual physical structures and his gratitude to everyone who helped make the project come to life.
“It was almost a combination of excitement and disbelief that it’s actually finished,” said Alizadeh. “It’s finally at a point now where we’re operational and we are fully functioning. Now it becomes normal, routine stuff that we all need to cope with as a group.”
He said since the summer, chief operating officers from many global manufacturers have visited the complex and have been fascinated with it.
“Obviously they compliment the finished product, they compliment the vision and all the rest of it, but what I’m sensing is they are also looking at how this may fit into the future of retailing,” said Alizadeh. “I say that not in any way discounting what they need or what their image programs are going to be or any of that. I’m just thinking out loud because I have sensed it from everyone when they look at it and they say it makes sense.
“Our project, quite frankly, has become a talking point in terms of how things can be done. I think we’ve opened up some eyes to what is possible if you put a collaborative partnership process together to decide how we attack the next phase of our retailing in this country or this continent.”
He has a 120,000 square foot warehouse off site in which he plans to house inventory. He said the days of dealerships packed with automobiles on lots is a thing of the past.
“In my humble opinion that ship sailed 2½ years ago,” said Alizadeh. “Before the pandemic, among the group we probably had about 1,500 in stock. Today we’re sitting on about 250. That gives you a perspective.”
