Almega Co. is redeveloping this College and Ossington building in Toronto to become a mixed-use commercial centre. (Courtesy Almega Co.)
Almega Co. has unique origins, a charitable business plan and ambitions to be the top real estate, asset and property management company in the world.
“I know that sounds crazy now, but I’m young and ambitious and driven,” Almega president and chief executive officer Basem Hanna told RENX.
“Crazy” perhaps, but Hanna has steadily grown both Almega and other companies he’s been involved with. Almega is about to take its next major step, developing a $125-million apartment building along Sheppard Ave. W. in Toronto.
It was initially set up so a handful of professionals in the small Coptic Christian community of Egyptian immigrants Hanna is part of could aggregate capital and establish a footprint in real estate.
The investor pool has since expanded, but Hanna’s focus is still on attracting small investors as opposed to institutional financing.
“It’s a different approach and I hope that it works,” he said. “I’m not saying that I would never take institutional money, but my goal is to go the other way. It takes longer, but I think the juice is worth the squeeze.”
Almega is dedicated to acquiring and operating stabilized, income-producing commercial and residential properties in Canada and the United States.
The goal is to create a profitable and well-managed portfolio for both aspirational and well-seasoned investors.
Almega Property Management
Almega Property Management was formed early on to manage the company’s own investments as well as those of its investors.
“Our property management portfolio is a series of one-off units, including individual condo units, rental homes and anything a passive real estate investor would own,” said Hanna.
“We find that’s a completely underserved area of the market, in the sense that most of these people will buy a pre-construction condo or home with the intention of using it as a rental property (and then realize they don’t want to manage it).”
Almega’s services include: rent collections and owner payments; moving facilitation and inspections; maintenance requests; resident screening and selection; owner representation; unit insurance; and resolving tenant disputes.
Almega didn’t initially offer property management services to third parties, but has seen this segment of its business grow substantially since it started actively promoting it in January.
Hanna said Almega has more than 200 units under active management in Toronto and is taking on 30 to 50 new ones a month, while leasing 20 to 30 units per month.
Almega’s first four funds
Basem Hanna, president and CEO of Almega Co. (Courtesy Almega)
Almega’s first fund purchased three multifamily residential buildings and one industrial property.
The second fund acquired an assembly of three properties on Queen Street East in Toronto’s Beaches neighbourhood that were converted into a large daycare facility which was needed in the area.
Almega’s third fund bought a mixed-use retail and residential building at College Street and Ossington Avenue in Toronto.
It’s being converted to house a daycare facility on the second and third floors and a gym on the main floor. A medical services office tenant is targeted for the basement.
The fourth and most recent fund is dedicated to a new mandate Almega launched late last year to develop apartment buildings in Toronto and buy and reposition underperforming assets in the United States.
Almega’s American strategy
“We think that the U.S. is a great place to earn income,” said Hanna, who was involved with buying American properties for 15 cents on the dollar during the financial crisis of 2008 when he was with The Rose Corporation.
Hanna is now seeking opportunities in garden-style apartment buildings in Arizona and Florida, which have recently experienced major spikes in people contracting COVID-19, and thus could potentially offer some bargains.
“I think the U.S. is headed for a correction and I want to be ready to take advantage of it if it happens. If it doesn’t happen, it’s no big deal. There are limited expenses associated with doing due diligence and kicking tires on deals.”
New Toronto apartment and future prospects
An equity raise was completed in December for the Toronto apartment project that’s now going through the zoning process. Hanna is proposing a 270-unit apartment building with shared office space and a daycare facility at 824 Sheppard Ave. W., between Allen Road and Bathurst Street.
“We probably have, between our under-development assets and the properties that we manage, between $300 million and $400 million of real estate in our portfolio that we look after,” said Hanna. “The whole purpose of our asset management business is to produce yield.
“It’s not about earning multiples and selling out. I believe in holding assets for the long term and producing incremental cash yields for our investors, of which I’m one of the biggest.”
Almega is looking to acquire what Hanna calls “a trophy piece of land in downtown Toronto” that can yield between 600,000 and 800,000 square feet of future development. He puts the probability of success of acquiring the property at 60 per cent.
The company is also looking at a 220,000-square-foot development site in midtown Toronto which Hanna envisions becoming a similar project to 824 Sheppard.
Hanna’s other ventures
If you’re wondering where Hanna got the money to ramp up the size of Almega’s investments, let’s go back to that industrial property the company acquired with its first fund in 2013.
The original plan was to convert the 70,000-square-foot building into a self-storage facility, but Hanna became interested in the burgeoning legal cannabis market and instead used it to grow marijuana.
Hanna put his real estate career on hold from 2014 to 2017 to launch a company called TerrAscend, which has received licences to grow medical and recreational cannabis. It quickly grew to more than 100 employees. Hanna was president and CEO before the business and the building was sold for a very healthy premium.
“TerrAscend is probably one of the top-10 cannabis companies in the world right now and it’s something that I’m very proud of,” said Hanna, who remains a shareholder.
While Almega is once again Hanna’s primary focus, he started another company called TREC Brands which curates cannabis products. He chairs the company’s board.
“I’m still very intimately involved with the cannabis space, just because of the knowledge I have and the connections,” said Hanna. “People want to lean on me for my expertise and opinions.”
A friend of Hanna’s created a Toronto-based company called Ledn Inc. that offers Bitcoin-backed loans and Bitcoin savings accounts. Hanna has been an advisor since October 2018 and says Ledn has been growing month-over-month.
Charitable endeavours
Almega has 14 employees and a few people on contract, and Hanna said it’s hiring one or two people a month.
“Our values are trust, respect, equality and compassion. We live those day-to-day. Every single employee of our business is an owner.”
In addition, both Almega and TREC Brands are donating 10 per cent of their profits to charities.
Almega employees choose where its money goes, while TREC Brands charities are chosen by its consumers via social media and emails. Money has thus far gone to homeless and women’s shelters, Black Lives Matter and other organizations.
Almega has also been putting property management fees into a COVID-19 relief fund since April to help struggling tenants in its units pay their rent.
“My life motto is to give more than you take,” said Hanna. “I’ve been broke for way more years than I’ve had money and I still know what that hustle is like. I haven’t forgotten it.”
TORONTO – The Toronto Regional Real Estate Board says home sales in October surged as buyers continued moving off the sidelines amid lower interest rates.
The board said 6,658 homes changed hands last month in the Greater Toronto Area, up 44.4 per cent compared with 4,611 in the same month last year. Sales were up 14 per cent from September on a seasonally adjusted basis.
The average selling price was up 1.1 per cent compared with a year earlier at $1,135,215. The composite benchmark price, meant to represent the typical home, was down 3.3 per cent year-over-year.
“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” said TRREB president Jennifer Pearce in a news release.
“The positive affordability picture brought about by lower borrowing costs and relatively flat home prices prompted this improvement in market activity.”
The Bank of Canada has slashed its key interest rate four times since June, including a half-percentage point cut on Oct. 23. The rate now stands at 3.75 per cent, down from the high of five per cent that deterred many would-be buyers from the housing market.
New listings last month totalled 15,328, up 4.3 per cent from a year earlier.
In the City of Toronto, there were 2,509 sales last month, a 37.6 per cent jump from October 2023. Throughout the rest of the GTA, home sales rose 48.9 per cent to 4,149.
The sales uptick is encouraging, said Cameron Forbes, general manager and broker for Re/Max Realtron Realty Inc., who added the figures for October were stronger than he anticipated.
“I thought they’d be up for sure, but not necessarily that much,” said Forbes.
“Obviously, the 50 basis points was certainly a great move in the right direction. I just thought it would take more to get things going.”
He said it shows confidence in the market is returning faster than expected, especially among existing homeowners looking for a new property.
“The average consumer who’s employed and may have been able to get some increases in their wages over the last little bit to make up some ground with inflation, I think they’re confident, so they’re looking in the market.
“The conditions are nice because you’ve got a little more time, you’ve got more choice, you’ve got fewer other buyers to compete against.”
All property types saw more sales in October compared with a year ago throughout the GTA.
Townhouses led the surge with 56.8 per cent more sales, followed by detached homes at 46.6 per cent and semi-detached homes at 44 per cent. There were 33.4 per cent more condos that changed hands year-over-year.
“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for homebuyers,” said TRREB chief market analyst Jason Mercer.
“This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”
This report by The Canadian Press was first published Nov. 6, 2024.
HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.
Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.
Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.
The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.
Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.
They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.
The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.
This report by The Canadian Press was first published Oct. 24, 2024.
Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.
Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.
Average residential home price in B.C.: $938,500
Average price in greater Vancouver (2024 year to date): $1,304,438
Average price in greater Victoria (2024 year to date): $979,103
Average price in the Okanagan (2024 year to date): $748,015
Average two-bedroom purpose-built rental in Vancouver: $2,181
Average two-bedroom purpose-built rental in Victoria: $1,839
Average two-bedroom purpose-built rental in Canada: $1,359
Rental vacancy rate in Vancouver: 0.9 per cent
How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent
This report by The Canadian Press was first published Oct. 17, 2024.
