If timing is everything, David Chard may have it all.

The developer behind The 834, a 14-storey condo development that broke ground on Johnson Street in Victoria yesterday, said the project is going ahead as the economic downturn is ebbing and the local housing market appears to be improving.

"It's the right product for the time," Chard said. "We have enough comfort to put our shovels in the ground."

The fact the development has sold 40 per cent of its 112 units certainly gave them confidence to start construction, Chard said.

He also noted construction costs have come down significantly, as much as 20 per cent, and borrowing costs remain low, making this a good time for buyers.

The 834 is geared for first-time buyers and the units will not be large. The units will start at $198,900 for 450 square feet and range up to $700,000 for an 800- to 900-square-foot penthouse.

More than a third of the units will be priced at between $200,000 and $350,000, Chard said.

Also, he said, a number of the pre-sales have been to investors who are looking for rental property, since unlike with most condos, owners will be able to rent the units out.

The development at 834 Johnson St., the largest residential construction project to break ground this year, is the third development from Chard, following on the heels of the Corazon on Cormorant Street, completed in 2006, and the Juliet condominium project at the corner of Blanshard and Johnson streets, which was completed last fall.

"Bringing people downtown has been our focus," he said.

It's certainly welcome, according to Victoria Mayor Dean Fortin.

"Cities should be interesting," said Fortin, noting The 834's entry-level prices should bring a healthy mix of people to the downtown core.

"It certainly makes for a more vibrant and active downtown."

Fortin said The 834 is part of a trend toward more affordable housing in the downtown area, pointing out Dockside Green and The Railyards projects are also establishing affordable components.

Chard may not be finished building in the core when The 834 is complete -- completion is projected for late fall 2011 -- as he says there are other sites downtown that his company is considering for development.