Transactions Strong Demand for Rental Persists

Strong demand for rental housing persists

Conditions expected to remain tight

The Canadian multi-suite residential rental market continues to improve driven by healthy demand characteristics. Rents continue to hold at record-high levels in the nation’s larger urban areas as demand outpaces supply.

“New supply has helped to alleviate the supply shortfall to some extent, but not enough to offset the demand-supply imbalance,” said Keith Reading, Director of Research at Morguard. “In the GTA, competition for limited vacancy has been fairly intense. Students and families have struggled to source vacant units at an affordable price point. Nationally, I expect conditions will remain tight.”

Investment Market

Multi-suite residential rental properties remain a prime target of various investment groups. However, activity levels have slowed, as investors enter a period of price discovery.

“Property yields have begun to rise given a combination of higher interest rates, fears of a recession, and inflation pressures,” Reading said. “The rental sector has typically been an asset class

New & Notable transactions

1. 2. 3. 4. 5.

Address City Sale Price (Millions) # of Units Sale Price/ Unit Purchaser

Source: Morguard

20 Elizabeth St N Toronto $19.1 68

Les Terrasses Francesca 1425 Vanier Pkwy

The Vic on 5th 1124 5th Ave NW Ottawa $207.0 276

Calgary $36.8 79

9675 Papineau Ave Montreal $48.0 133 $280,882 Pulis Investments

$750,000 Centurion Apartment REIT

$465,823

$360,902 Manulife Investment Management

Akelius

123 Bellamy Rd North Toronto $94.5 250 $378,000 Hazelview Investments

that has performed relatively well during periods of economic weakness. Therefore, investors will continue to look for opportunities to invest, given the sector’s track record of stable and secure returns and its defensive investment attributes.”

Reading adds that despite the housing market correction, purchasing a home is still out of reach for many renters who struggle with rising prices. As a result, many will remain in the rental market that otherwise wouldn’t have.

Avenue Living reaches milestone

In mid-October, Calgary-based Avenue Living announced it has reached a milestone of 15,000 multifamily homes under ownership following the acquisition of a 386-unit property in Columbus, Georgia. The $52 million-purchase was in keeping with the company’s consolidation strategy, which focuses on low-to-medium density workforce housing located in key markets.

“Since entering the multifamily space in 2006, we’ve focused on creating an operating model that puts the residents’ needs first,” said Anthony Giuffre, Founder and CEO at Avenue Living. “Our experience has shown that these needs transcend geographies, which presents opportunities to expand our defensible model across key locations in Canada and the United States.”

Avenue Living has a track record of adding value to its buildings promptly after purchase, in what it calls “the first step” towards improving resident satisfaction.

“We proactively implement service and technology improvements, like security, proptech, fin-tech, and capex investments,” said Giuffre. “Through our innovative solutions and operations-first approach, we have bolstered our reputation and investor confidence. Word-of-mouth referrals have increased, and our Net Promoter Score has risen consistently — a strong hallmark in the rental industry because it represents 365 days of good service, not one simple transaction.”

“We use a rigorous research and analysis process to select each and every one of our multi-family properties,” added Jason Jogia, Chief Investment Officer at Avenue Living. “We understand local market conditions, industry and employment opportunities in the region, level of demand, and of course the potential of each property we acquire.”

ARE YOU CONTEMPLATING THE SALE OF YOUR APARTMENT PORTFOLIO/PROPERTY?

Consider the following: • Who will represent your best interest? • Who will give your property maximum exposure? • Who will deliver the highest value for your property?

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Over $7.9B

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CBRE Limited, Real Estate Brokerage

National Apartment Group – Toronto

DAVID MONTRESSOR

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