Crombie REIT (CRR-UN-T) is forming a series of joint ventures with Toronto-based Montez Corporation in relation to three of its development projects - the under-construction The Marlstone apartments in Halifax and two other proposed redevelopment properties.

The partnership with New Glasgow, N.S.-based Crombie has two elements. First, Montez will invest $32.2 million into a 50/50 venture to complete the development of The Marlstone, a mixed-use project at Duke and Albemarle streets which will include 291 apartments and offer a direct connection to a major downtown commercial and retail complex.

Crombie and Montez have also created separate “entitlement partnerships” for the proposed Barrington Street and Brunswick Place developments, which are also in Halifax.

"These partnerships represent a significant milestone in Crombie's value creation roadmap," Mark Holly, president and CEO of Crombie, said in the announcement. "The partnerships provide immediate stabilized cash flow through predictable management fee income, while maintaining flexibility on how and when to proceed as each property advances through entitlement approvals. 

“Importantly, the balance sheet capacity freed up by these arrangements enables us to continue our strategic investments in our core necessity-based retail portfolio, further enhancing the growth profile of our portfolio and creating long-term value for unitholders."

The Marlstone in Halifax

Montez is financing the Marlstone acquisition via a $19.2-million payment to Crombie, and the assumption of $13 million in construction financing debt.

Crombie will act as development, construction, leasing, and asset manager for the project, earning development and management service fees.

The Marlstone will stand 19 storeys when it is completed, which is scheduled for the first half of 2026, and contain approximately 188,000 square feet of space. The transit-oriented development will offer a direct link to the adjacent Scotia Square, which contains retail, commercial, office and hotel space.

"We're proud to be entering into a long-term strategic partnership with Crombie, fully supported by institutional capital, to deliver this best-in-class residential development and unlock future opportunities that will benefit the Halifax region," Montez president and CEO Manfred Lau said in the announcement.

The Barrington Street and Brunswick Place ventures 

The partnerships for Barrington Street and Brunswick Place involve two proposed future development sites in Halifax. 

Crombie and Montez plan to work together to advance the entitlement and design process for each site. The two firms will share all costs equally.

Crombie will manage all aspects of the partnerships and earn development and management service fees. 

Both properties “will remain wholly owned by Crombie throughout the entitlement period. Once entitlement is achieved, both parties will align on the optimal path forward, including timing and participation,” the announcement by Crombie states.

They are part of a multibillion-dollar development pipeline under Crombie’s control. According to a Q4 2024 investor presentation, that includes 26 properties, the potential for up to 10.6 million square feet and 11,291 residential units.

About Crombie and Montez

Crombie REIT is an owner, operator and developer of commercial and residential real estate assets. Its portfolio primarily includes grocery-anchored retail, retail-related industrial, and mixed-use residential properties. The REIT has a longstanding relationship with Empire Company, the Canadian owner and operator of Sobeys and other grocery and retail banners, whose stores anchor many of its retail properties.

As at Dec. 31, 2024, Crombie’s portfolio contained 304 properties comprising approximately 19.1 million square feet, inclusive of joint ventures at Crombie's share, and its pipeline of future development projects.

Montez was founded in 2002. The privately held firm actively manages, develops and transacts large-scale real estate investments for clients including government pension funds, Crown agencies, Crown corporations, insurance funds, institutional investment firms, corporate pension plans, universities and colleges.

Montez manages over 25 million square feet and $7 billion of real estate across thematic investment funds and segregated accounts. The portfolio includes 10 million square feet of active development assets.

Montez has raised over $3.25 billion of equity for its income, growth, urban and development strategies.