Avenue Living Investment Management has agreed to a funding arrangement with a major Canadian bank to finance a $28 million revitalization of a mixed-use residential building in Alberta's capital.
Avenue Living said it partnered with Bank of Montreal to finance plans to reposition the Capital Tower building at 10609 101st St. NW in Edmonton.
The project would add 179 new units to the Edmonton market, which Canada Mortgage and Housing Corp. said has a 2.4% vacancy rate and is facing affordability challenges.
Average rental rates in Edmonton have grown 16% in the past year, according to Rentals.ca, which said asking rates reached $1,507 in March for all property types.
The project, Avenue Living said, should prompt other developers to follow suit. Avenue Living of Calgary was founded in 2006.
"The renovation of this building is expected to inspire more projects like it in the downtown area, which will bring in more investment and create a fresh, lively atmosphere in the neighbourhood," Daniel Veniot, Avenue Living's associate vice president of debt capital markets, said in a statement. "By investing in this asset, we are introducing new units in Edmonton to support a targeted demographic of essential workers, young professionals, and students, while ensuring that we're doing it in an environmentally friendly way."
In January, the Bank of Montreal or BMO, partnered with the Canada Infrastructure Bank, a federal Crown Corporation, to help clients finance energy retrofits of older buildings.
The Edmonton site built in 1984, according to CoStar data, will get energy retrofits and sustainability upgrades under BMO's short-term retrofit financing program that are expected to reduce the building's greenhouse gas emissions by up to 64%,
"BMO is committed to being our clients' lead partner in the transition to a net-zero world," said Jeffrey Shell, head of alternatives, commercial ESG and innovation, of BMO Global Asset Management, in a statement. "Greenhouse gas emissions from buildings make up a large proportion of Canada's total emissions profile, requiring extensive energy retrofits to get to net zero."