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ViveRE investing in 'new sector' of seniors housing – Real Estate News EXchange



IMAGE: ViveRE Communities Inc. logo.A former junior mining exploration company turned multifamily real estate investor is carving out a niche in the seniors housing sector. ViveRE Communities Inc. (VCOM-X) has grown out of the former NSX Silver company, slowly but steadily adding to its portfolio of rental apartment properties since 2017.

NSX Silver was having trouble attracting capital in 2015 so it sold its silver exploration rights and began looking for alternatives. In July 2016, it received a proposal to move the company into the multifamily real estate business,  focused on the opportunities presented by an aging population.

A subsequent private placement in August 2016 brought a group of real estate professionals and investors to NSX, and the vision was put into motion.

10 million Canadians over age 65

“There are presently approximately 10 million Canadians over the age of 65 and, by 2030, all of the baby boom generation will be over 65,” ViveRE chief executive officer Mike Anaka told RENX. “They have financial capacity and are looking for flexibility and convenience in their choice of residence.

“While properties catering to the needs and wants of this demographic exist in bedroom communities across Canada, to our knowledge no one was consolidating or cultivating the growth of these properties into retirement communities.

“Our plan to launch a real estate company focused upon this emerging niche of 55-plus renters was well-researched and tested with asset managers and pension funds. The consensus was that it could become a new sector of senior housing.”

A team of investors with real estate and capital markets knowledge as both managers and developers was assembled when the company decided to move into real estate.

The Halifax-based company also took skill sets and geography into consideration when compiling its board of directors, whose membership has representation from St. John’s to Vancouver.

“Every board member is an investor, as is management,” said Anaka, who previously had a 35-year career with PwC and has experience in financial reporting, transactions, corporate finance and companies ranging from startups to multinationals.

What ViveRE is looking for

ViveRE is focused on acquiring clusters of low- and mid-rise mid-market properties with elevators, community rooms, gyms, workshops and gardens in secondary markets. The plan is to create what it calls “naturally occurring retirement communities” or “NORCs”.

These buildings should have condominium-quality finishes and be close to health-care facilities, shopping and public transit. The resident base should already have a significant 55-plus cohort.

“Our residents are renters by choice and our buildings are their homes,” said Anaka. “They treat the buildings with care and respect, developing community friendships and staying for extended terms.

“In the same way they chose the homes and neighbourhoods where they raised their families, they are looking for smaller, more personal building environments with social activities, physical fitness facilities and the opportunity to continue with hobbies and gardening.

“To meet their desire for choice and convenience, ViveRE will offer a menu of services covering ICT (information and communications technology), homecare and healthcare. The services purchased will be at the choice of the resident and not one-size-fits-all.”

Properties in Saint John, Moncton

ViveRE’s first acquisition was a 31-unit building at 41 Noel Ave. in Saint John, N.B., purchased in 2017 for $4.9 million. It followed that in April this year with the acquisition of an adjacent 42-unit property at 50 Noel Ave. for $7.9 million.

The company has purchase options for two more apartment buildings on the same street, one of which is under construction and expected to be completed in the spring.

“The Noel Avenue properties have all of the features we were looking for,” said Anaka. “They are very close to Saint John Regional Hospital, on public transit and newly built.”

ViveRE also recently closed on two properties at 542 and 550 Ryan St. in Moncton, which have a combined 46 units, for $5.49 million.

The Ryan Oak Estates have been fully occupied since they were completed in 2012, with rents well under market and room for growth. The average age of residents is 71.

“Both Noel and Ryan Street have the finishes and amenities that appeal to the demographic ViveRE is looking to attract,” said Anaka. “We are currently working on implementing services in these NORCs.”

Finally, ViveRE announced on Dec. 3 it has an agreement to acquire a newly constructed 20-unit building at 75 Emma St. in Oshawa, from Emma and Albert Development Inc.

It is comprised of one two-bedroom, and 19 three-bedroom apartments, a community room, fitness centre and a library.

Located within walking distance of the Oshawa city centre, the Emma property is near health facilities, recreation and shopping. ViveRE is purchasing the property for $7,300,000, with a cap rate of 5.25 per cent.

Monthly rents are projected to range from $1,850 to $2,450.

ViveRE’s growth plans

Anaka envisions ViveRE’s acquisition size and pace picking up as it develops critical mass. The short-term target is to reach 500 units by the third quarter of 2020 and to add at least 500 additional units in each of the following two fiscal years.

“We see purpose-built development as a component of our growth strategy, best executed with developer partners, not directly by ViveRE,” said Anaka.

ViveRE uses third-party building management, either keeping existing building managers in place or using partner Novacorp Properties Limited wherever possible.

Anaka said ViveRE is leveraging strategic partner Trimaven Capital Advisors’ real estate, structure and capital markets knowledge, while iQ Commercial Mortgage Strategy is working with the company on its debt requirements.

ViveRE has traded at between seven and 25 cents per share over the past year and has a market cap of $8.64 million.

Anaka said ViveRE has a dedicated and growing number of investors, with early institutional and family office investment.

“Transaction volumes to date have been relatively light. However, we are satisfied with the growing interest and performance.”

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Toronto suburbs boast the most overvalued real estate in all of Canada – blogTO



While people in and around Toronto have just had to accept (albeit begrudgingly) the region’s outrageous home prices for what they are, it’s downright maddening to look at what you could buy in other parts of the world for the amount it costs for even a tiny condo here.

It’s not just the downtown core, either, with peripheral markets in the province continuing to see prices skyrocket to unseen levels, and homes in even small-town Ontario now on par with L.A. and other larger and far more desirable cities.

Though it’s obvious the region’s real estate is not actually worth as much as it’s going for these days, the extent to which it is overvalued at this point is quite shocking.

New figures from BMO (via Better Dwelling) show that while Canadian homes in general are about 38 per cent overvalued, the issue is the worst in Ontario, where home prices are about 55.4 per cent overvalued as of the first few months of this year.

What’s most interesting is that in Toronto specifically, this number is lower than the province as a whole — at 41 per cent — while in the surrounding suburbs, it’s far higher.

Cottage country areas like Muskoka, the Kawarthas, and Haliburton are approximately 64 per cent overvalued, the bank says, while the suburbs just outside of the GTA have the highest levels of overvaluation.

Properties in “exurb” areas like London, Barrie, Niagara, Guelph and Kitchener-Waterloo — that is, not the suburbs directly around the city, but just beyond — are now around 74 per cent more expensive than what they’re worth.

Given how fast home prices have climbed in Toronto and, as a result, around the city, experts say we have been on the verge of bubble conditions for some time now; the city was actually just ranked the second-biggest housing bubble in the world at the end of last year due to its severe overvaluation.

This will, stakeholders seem to agree, eventually lead to a swift downtown and market correction, likely later this year due to a number of factors, even without the government intervention that so many have been demanding to quell out-of-control price acceleration.

While B.C., Quebec and Atlantic Canada all join Ontario in having substantially overvalued housing markets, prospective Canadian buyers can still get some bang for their buck if they’re willing to move to Alberta or Saskatchewan, which are considered undervalued.

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Real Estate Has Bucked the Deglobalization Trend – MSCI



Real Estate Has Bucked the Deglobalization Trend

  • Deglobalization has had profound implications for portfolio construction in listed assets. Conversely, with real estate, there are indications that the asset class has become more global in recent years.
  • Return dispersion across national markets has decreased, while property type has become a more important return driver across all markets, suggesting stronger international alignment, as cross-border transaction volumes have remained stable.
  • Institutional real estate investors could still face challenges from deglobalization, but a historical preference for more transparent and stable markets may help counterbalance some of them.

Real estate has historically exhibited a strong home bias, with investors favoring their local markets. Where investors have sought offshore exposure, they have typically favored markets that offer higher levels of transparency, better governance and stability. This is not to say that investors have not allocated to markets that are less transparent than their home markets. Nor that they have not pursued strategies higher up the risk curve when they invested in foreign markets. But in aggregate markets with higher transparency and government ESG scores have tended to attract more real estate capital.

Globalized real estate drivers in a deglobalizing world

The demand for international real estate is driven by the world’s largest institutional investors, many of whom have explicit global real estate investment mandates. Surveys of investor intentions show continued strong demand for cross-border investments among this group.1 Despite this sentiment, the share of the volume of cross-border transactions, as tracked by MSCI Real Capital Analytics, has remained relatively stable over the last decade, ranging between 19% and 26% of total quarterly transaction volumes.2

Even with relatively stable flows across borders, there is evidence that real estate may have become more global based on return behavior. There has been a notable decline of total-return dispersion across national markets in the MSCI Global Annual Property Index since 2008. At the same time, the spread of returns across property types has increased across all markets as technology changes (like the rise of e-commerce) and the pandemic have disrupted real estate markets, causing headwinds for sectors like retail and office but boosting other sectors like industrial. These trends point to potentially stronger international alignment in the asset class: Unlike in much of the previous two decades, since 2019 there was a greater opportunity for outperformance from allocation decisions based on property type, rather than country.

Return dispersion decreased across national markets but increased across property types

Source: MSCI Global Annual Property Index

Could deglobalization affect real estate?

Political populism, the COVID-19 pandemic and increased geopolitical tensions have all contributed to concerns about deglobalization. Business cycles may become desynchronized, leading to wider variations in the performance of equity and bond markets across countries, lower correlations and higher volatilities. The investment impact of this trend emerged in recent years: In equities, correlations between countries and regional blocs have declined.

Going forward, global investors in bonds and equities may respond by taking a more nuanced approach to asset allocation — for example, by considering new, more focused country allocations for broad allocation decisions (geopolitical blocs, energy importers versus exporters or autocracies versus democracies) and placing greater emphasis on risk factors exposed by the war in Ukraine, such as sanctions risk, reputational considerations and currency convertibility. While it is possible that similar deglobalization headwinds may emerge for real estate investors, there are several factors that could mitigate this.

One example is that, as mentioned earlier, transparency, governance and stability have always been important considerations for global real estate investors, as it is an opaque and illiquid asset class, where asset-investment life cycles are typically measured in years (the median holding period for assets in the MSCI Global Annual Property Index has been six years). The result is that markets with higher transparency, better governance scores and stronger institutions represent the lion’s share of the opportunity set and transaction volumes.

Transparency, governance and stability have mattered in real estate

Where available, market-size estimates are sourced from MSCI’s Real Estate Market Size Report 20/21. For the remaining countries, market size is assumed to be 10% of GDP. Source: JLL, Our World in Data, MSCI

Institutional real estate investors may therefore have less exposure to countries significantly exposed to decoupling risk due to deglobalization. Of the approximately USD 2.3 trillion of assets that MSCI tracks in the MSCI Global Annual Property Index and MSCI Asia Annual Property Index, over 91% of the capital value was invested in liberal democracies with real estate markets rated as transparent or highly transparent by JLL.

Nevertheless, deglobalization could have knock-on effects that impact real estate. For instance, increased political polarization and pandemic-induced supply-chain disruption could drive “nearshoring” and changes to international trade patterns.3 These changes could in turn affect the volume, nature and location of real estate demand. For example, a move from just-in-time to just-in-case logistics could increase demand for industrial-warehouse space and see some of that demand shift away from markets that are further afield and more vulnerable to potential trade disruption.

While deglobalization could result in profound consequences in asset allocation and portfolio construction, different asset classes may be affected in different ways. The distinct features of the real estate investment process, as opposed to that for listed equities and bonds, as well as the nature of the opportunity set typically available to global real estate investors, may mean that real estate could be less directly exposed to the effects of this investment megatrend.

The authors thank Alexis Maltin for her contributions to this post.

1For example, see: “2021 Institutional Real Estate Allocations Monitor.” Hodes Weill & Associates and Cornell Baker Program in Real Estate, Nov. 10, 2021.

2It should be noted that purchases made by third-party managers on behalf of offshore investors will count toward domestic volumes rather than cross-border volumes and thus may underestimate total cross-border capital flows.

3Nearshoring is the practice of transferring a business operation to a nearby country, especially in preference to a more distant one.

Further Reading

Did Deglobalization Add to Inflation Woes?

The Erosion of The Real Estate Home Bias

Real Estate’s Income Risk in an Inflationary World

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With housing top-of-mind for Ontarians as election looms — Windsor's real estate market cools –



With the Ontario election less than one week away and interest rates rising, the real estate market in Windsor-Essex is experiencing a cool down.

However, the price of a home is still significant, leaving many constituents feeling left out of the market, yet hopeful that the election might bring with it some improvements.

“Optimism and hope is always there because that’s all we have, right?” said Shanike Gordon, a single mom with two kids renting an apartment in Windsor.

Gordon hopes to get into the housing market soon. 

“That’s the goal at the end of the day — you have somewhere for you and your kids to be able to call home,” she said.

The latest numbers indicate a shift in the local real estate climate, with buyers taking a more conservative approach, and sellers not seeing as much competition for their houses as before, according to Windsor realtor Abe Alhakim.

“We’ve noticed a slowdown in the market over the past few months,” explained Alhakim, who works with LC Platinum Realty. 

“We’ve noticed buyers have put their plans on hold, especially with the increase in interest rates from the Bank of Canada, which has already had one interest rate increase and more is planned over the next few months. And also there’s an Ontario election coming up, so people want to kind of see how things work out over the next few months.”

After months of prices climbing, the average price of a home in Windsor-Essex dipped to $692,759 in April. It was the first decline in the average sale price of a home since September 2021. At its peak, the average price of a home reached $723,739 in March.

The number of sales also dipped by 16 per cent in April compared to the month prior. Sales also dropped by nearly 19 per cent compared to April 2021.

Alhakim describes it as a “mixed market” where some homes are still selling significantly over asking price with multiple offers and bidding wars, while other houses aren’t seeing the same kind of demand. 

Realtor Abe Alhakim says the real estate market in Windsor-Essex is experiencing a slow down. (Katerina Georgieva/CBC)

As for what’s anticipated for the coming months, Alhakim noted, “that’s the golden question.”

“I anticipate the market will stay stabilized and balanced over the next few months, but it remains to be seen how expected interest rate increases are going to affect the market — and also the Ontario elections.”

He noted that the decline has some feeling “fearful” while others are jumping at the opportunity to buy a home at a cheaper price point.

Housing key election issue

Housing costs are a key issue for voters across Ontario, with bidding wars and low supply having driven prices up in recent years. To address the issue, the PC Party, NDP and Liberal Party leaders have all pledged to build 1.5 million homes if elected.

For Leamington’s Terry Maiuri, it’s particularly concerning as he considers the impact the soaring prices are having on his son. 

“It’s just getting ridiculous for the younger generation, I’d say, to afford housing,” Maiuri said.

Terry Maiuri, left, Lisa Lum, centre, and Shanike Gordon, right have affordability of housing on their minds during this provincial election. (CBC)

His 20-year-old son is close to completing his university studies, and Maiuri is concerned about what comes next.

“I told my wife the other day, with the price of houses, I said, ‘My God, he’s going to be living with us until he’s 40.’ Like, how does someone starting out as an adult afford housing, let alone apartment rentals?” he asked. 

“It just seems a little ridiculous.”

He added that while politicians say they realize there’s a problem, he doesn’t think any party is doing enough to address the issue.

Shanike Gordon on housing

7 hours ago

Duration 0:48

Single mom Shanike Gordon shares her hope of buying a home one day.

Windsor voter Lisa Lum says affordable housing is key for her this election. She said, after living in her Walkerville home for eight years, she was recently evicted after her landlord sold the duplex she was renting. 

Now, she’s in a new home in the same neighbourhood, but it’s significantly smaller, paying $500 more in rent. 

As for whether she might want to buy down the road, she doesn’t believe that to be realistic given the state of the market. 

“I wouldn’t be able to with the bidding wars that are here,” she said.

“I mean, how do you even get the down payment when homes that were bought, you know, five years ago for $120,000, and now they’re going for five and $600,000?”

While she’s optimistic more can be done by political leaders to address rent control, she doesn’t have confidence much will change when it comes to real estate.

As for Gordon, she’s not sure she’ll be voting at all in the provincial election, but explained stronger action on housing could sway her.

“Anything that caters for housing, families, single families especially, I’m all for it,” she said. 

Meanwhile, Alhakim continues to monitor the market, adding that he doesn’t expect a major correction in the market, but envisions the market settling into a plateau this year.

The housing market in Windsor-Essex is experiencing a cool down, with a dip in the average price of a home and fewer offers on some homes, according to realtor Abe Alhakim. (Katerina Georgieva/CBC)

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