An investment group led by Immo Alliances has acquired  a multi-residential portfolio of 25 buildings with 248 units, as well as two redevelopment sites following a fire at 2012-2022 Westmore Ave., in Montreal’s Notre-Dame-de-Grâce neighbourhood.

The portfolio was acquired for $41.25 million from Lacopar Inc., a family group that built the apartments decades ago and has owned them through multiple generations ever since. The deal was brokered by RBC Capital Markets Real Estate Group.

Other investors include Developlex, OREA Real Estate Holding and Jean Sebastien Bergeron Gagne. 

The portfolio was 98 per cent occupied as of last October and is comprised of: 

• 48 one-, 90 two- and 46 three-bedroom units on Patricia and Westmore Avenues;
• 23 studio and three bachelor units at 7375 Sherbrooke St.;
• and 38 studio units at 7320 Harley Ave.

Below market rents

All of the units are renting for well below market rents.

“We wanted to balance our portfolio with good-sized units that are in great shape at reasonable rents,” Immo Alliances director of acquisitions and real estate development strategist Denis Gallico told RENX. “I call it an anti-recession portfolio.”

There are plans to develop approximately 50 new residential units where the older buildings were destroyed by fire.

“Our objective is not short-term speculation,” said Gallico. “We believe in creating sustainable value, preserving existing rental housing and investing in improvements that allow residents to enjoy quality housing at rents that remain affordable relative to market conditions.”

Deal built on relationships

There was a lot of investor interest in the portfolio, but one of the reasons the Immo Alliances-led group was successful in its bid was that it included a couple of partners that had developed a strong working relationship with a member of the ownership group.

“At a time when conversations in real estate often revolve around interest rates, valuations and financial structures, this transaction serves as a reminder of a fundamental truth,” said Gallico.

“Behind every building are families, stories and human relationships. When trust is present, extraordinary outcomes become possible.”

Similarly, Gallico credits Westmount Capital Mortgage Corporation, which Immo Alliances has worked with in the past, for its innovation in financing the acquisition.

“Against a backdrop of elevated financing costs, economic uncertainty and a difficult rental housing environment, success required creativity, flexibility and exceptional collaboration among multiple stakeholders,” said Gallico, who's also the founder of 5am Capital, a personal coaching and investment company.

Past and future acquisitions

Montreal-headquartered Immo Alliances has been active in converting local office spaces into residential units in locations within a 10-minute walk of a Metro station and close to downtown and universities. 

This includes the $11.15-million acquisition of a five-storey, 44,511-square-foot office building at 1434 Sainte-Catherine St. W. from Gestion SIDEV in 2024. The site was on a primary retail artery in close proximity to Concordia and McGill universities, two Metro stations, the Réseau express métropolitain automated light rail system and three bus routes.

These newly acquired apartment buildings are a bit farther from a Metro station but close to Concordia. Plans are to put a focus on student housing with appropriate amenities at the Sherbrooke Street and Harley Avenue buildings with the studios.

Immo Alliances is pursuing multiple acquisition and development opportunities, with the ambitious goal of growing its apartment portfolio by 1,500 to 2,000 units over the next two years. It’s also continuing to invest in other companies and asset classes.

“Our core structure is so lean that we can really compete against the big players,” said Gallico. “We have the resources to deliver big projects, so right now we're bidding on 500,000-square-foot and more offices and commercial spaces to either convert or keep commercial.

“We’re talking about $50 million transactions and more. We're bidding on apartment portfolios in Montreal or in specific markets in Ontario, New Brunswick and Florida.”