Darin Rayburn is retiring from his positions as president and CEO of Melcor REIT and Melcor Developments. (Courtesy Melcor)
Real estate has been a passion for Darin Rayburn from the moment he accepted his first job in the industry three decades ago.
As he exits his roles as president and CEO of Edmonton-based Melcor Developments (MRD-T) and Melcor REIT (MR-UN-T), Rayburn said he intends to remain involved in his “retirement” years.
“Once real estate is in your blood it stays in your blood. I don’t have any specifics to tell you at this point; I can tell you that my goal is to stay in real estate. What that looks like, we’ll wait and see,” Rayburn told RENX.
Melcor announced in August that Rayburn would be retiring at the end of 2021 from both divisions of the company.
On Wednesday, Melcor Developments announced Tim Melton is succeeding Rayburn as CEO and executive chairman of the board, effective immediately.
Naomi Stefura, Melcor’s chief financial officer, has also been promoted to the new role of executive vice-president in addition to continuing as CFO.
Rayburn will assist with the transition until his retirement Dec. 31. He also remains as CEO of Melcor REIT until year-end.
“Tim has been a big part of this company for a long, long time. Tim and I were working hand in hand and it seemed like a natural transition at this point for Melcor Developments as they figure out where the company is going and progressing,” said Rayburn.
“For him to be involved and for Naomi to get promoted really makes sense.
“It makes the transition smoother. It’s business as usual at Melcor.”
The Melton family is Melcor’s largest shareholder. Tim Melton had been serving as Melcor’s board chair.
The attraction of the real estate industry
Rayburn said two aspects of the business have kept him involved in real estate for the past 30 years, including the relationships with other industry professionals.
“That really appealed to me,” he said, quickly moving on to the second. “Honestly, too, I like the thrill of the chase. Real estate is about the thrill of the chase. It’s about creating a legacy, when you develop or buy or whatever you create, to be able to drive by it every day and see it and feel it.
“I also love the fact that it’s bricks and mortar. You can touch it, you can understand it.”
For the immediate future, he plans to take care of some personal business ventures.
“I plan to remain active in the Alberta real estate market . . . I’ve got my own holding company,” he said. “I’ve got some investments that I will be focusing more on.
“I’m excited for what’s next, but I’d be lying if I said there wasn’t that nervousness about leaving the company I’ve been such a big part of for so long and a group of people I’m so, so fond of,” he said.
“It’s been such an incredible learning journey and I leave Melcor with wonderful memories, and experiences and friends. I’m sure that’s going to carry through to my next chapter.”
Rayburn’s time at Melcor
Rayburn has spent 19 years at Melcor, holding CEO and senior board roles since 2013.
An Alberta native, he graduated from the University of Alberta with a bachelor of arts in economics and political science.
“I wanted to go to law school. I wrote my LSAT and did pretty well, but I took a year off just to work and make some money and in that year off I got my first job at Cambridge Shopping Centres and here I am 30 years later, still in my year off,” he said.
That first job? Wrapping Christmas presents.
“I became the management trainee at Cambridge Shopping Centres and I was (in) Edmonton at three different Cambridge shopping centres for a total of three years.”
He then spent nine years with Oxford Properties Group – including two years in Winnipeg – and eventually became its general manager in Edmonton.
Rayburn then joined Melcor in 2002 as vice-president of investment properties.
“One of the things I’ve learned over the years is that real estate is dynamic. It ebbs and flows. Especially coming from Western Canada and Alberta, you go through up markets, you go through down markets,” Rayburn said, “and I’ve learned there’s opportunities in every market.
“One of the things we did so great at Melcor Developments is we looked for the opportunities before they were hot. We were investing in the U.S. in 2008-2009 when other people weren’t. We expanded our commercial portfolio starting in 2002,” he continued, noting that was the reason he was initially hired by Melcor.
“And 2002 in Alberta it wasn’t that great here, let me tell you.”
Melcor established in 1923
Melcor has been in business since 1923. The company has built over 140 communities and commercial projects across Western Canada and today manages 4.66 million square feet in CRE assets and 603 residential rental units.
That represents an asset value of $2 billion – close to 90 per cent of the assets in Alberta.
Melcor has been a public company since 1968.
“You don’t survive that long by taking uncalculated risks. A big part of our culture here has always been, you know risk and reward is important, but understand what the risk is and what you’re giving up to pursue that risk,” said Rayburn.
Melcor launched the REIT in May 2013, the week before a significant change in the interest-rate climate and a year before the Alberta recession started in late 2014 with a collapse in oil prices.
“But having said that, if you look where the REIT’s come from, it’s doubled in size. Even during these tough times we still found opportunities, whether it’s from buying third-party assets or from buying Melcor Developments’ development assets. We were still able to grow,” said Rayburn.
“Without a doubt, though, where the challenge has been is when REIT unit values were depressed.
“It’s trying to find a deal that’s still accretive if you have to raise money by selling your unit value. Not just the Melcor REIT but all REITs, whether it’s Alberta or everywhere, face those types of markets. You have to find ways to get a bit more creative.
“Creativity has become an important part of any real estate transaction, whether buying or selling or developing or leasing. We’ve definitely had to be a little more creative on every deal and understand the hot buttons for buyers or sellers or tenants. That’s been important.”
As a company with a long history, there are also memories of tough times from the past. That is something that has been passed down to current management.
“Financing has been important. Melcor survived the ’80s – one of the few companies that survived the ’80s – and you sort of realized how important it was not to be over-leveraged. How important it was to have that great relationship with your bankers and your institutions,” he said.
“I don’t think that’s changed but I think that has been heightened.
“This strange time” of COVID
“Low interest rates right now is what’s keeping the real estate market moving during this strange time.”
Before moving on, Rayburn said he wanted to ensure Melcor got through the COVID-19 pandemic on strong footing.
“Challenging times for sure but also incredibly gratifying to lead our teams through the most uncertain times of my 30-year career,” he said.
“We initially cut our distributions in both Melcor REIT and Melcor (Developments) early in COVID anticipating the worst, but have since raised the distribution twice in the REIT as we move our way through the recovery.
“We took some criticism in the REIT from a vocal minority but were also applauded by many unitholders as it was the right thing to do considering the circumstances.”
Many of the initial cost-cutting measures have been reversed over the intervening 18 months.
“We defended our actions and the market accepted it, as evidenced in the increased REIT unit price from pandemic lows,” Rayburn said. “While the REIT distribution is not back to pre-pandemic levels, it is moving closer.
“Shares in Melcor Developments are above pre-pandemic levels – hit a low during the pandemic of $5.88, today at $14.40. For the REIT, the units are not yet at pre-pandemic levels but inching closer – pandemic low of $3.26, today at $6.72.
“I’m proud and encouraged by our recovery and the future outlook for both companies is strong. In fact, one might argue stronger than the pre-pandemic outlook.”
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.
