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Equiton targets real estate for private equity investments

Equiton might have a relatively low profile, but the private equity firm’s leaders have continual...

IMAGE: The Markham apartment building was recently purchased by Equiton. (Courtesy Equiton)

This Markham apartment building at 65 Times Ave. was recently purchased by Equiton. (Courtesy Equiton)

Equiton might have a relatively low profile, but the private equity firm’s leaders have continually expanded its holdings since its inception five years ago.

Equiton’s Residential Income Fund most recently completed the SVN Rock Advisors Inc., Brokerage-brokered $21-million purchase of a 64-unit apartment building in Markham from KingSett Capital in March. Chief executive officer Jason Roque said the property, its first in the suburban city north of Toronto, fits Equiton’s profile as a site containing unrealized value.

“We became interested in the Markham property because we saw an opportunity to acquire a property in a prime location that had a lot of upside potential,” Roque told RENX in an interview.

The building at 65 Times Ave. is located just off Highway 7, minutes from shopping, restaurants and amenities. It’s also close to Highways 407 and 404 as well as public transportation, including a GO Transit station that provides access to downtown Toronto.

“Not only were we able to purchase the property below market, but we also see an opportunity to increase its value by making a few changes in how the property operates. We’re able to do this without having to spend money on capital improvements, as most of the changes are operational.”

It’s the 12th property for Equiton’s Residential Income Fund, which also owns and manages four properties in Brantford, three in Kingston and two each in Chatham and Stratford, Ont.

Equiton’s management and strategy

The Burlington, Ont.-based Equiton management team — which includes chief financial officer Helen Hurlbut, chief operating officer Clifford Fraser and chief investment officer Greg Placidi — has more than 100 years of combined real estate, investing and management experience, Roque says.

The team has overseen the acquisition and management of more than $10 billion in real estate, developed more than 100 million square feet, and managed more than 10,000 apartments in Canada and the United States.

“We have significant experience in all aspects of the real estate business, including acquisitions and dispositions, finance and administration, property management, construction and renovation, and marketing and sales,” says Roque, who spent seven years as CEO of a private real estate company before setting out with Equiton.

“These skills permit Equiton to see what others don’t and capitalize on opportunities which are not obvious to other inexperienced real estate investors. Not only that, but this experience was gained over numerous economic cycles — both good and bad.”

Rounding out his experience, Roque spent five years working with Landmart Homes, also in Burlington, following his graduation from the University of Toronto with a degree in economics.

“Additionally, Equiton puts its money where its mouth is and invests alongside the clients with our own money,” said Roque.

Equiton Residential Income Fund

Equiton’s Residential Income Fund launched in March 2016. The private real estate investment trust (REIT) specializes in residential income properties, including apartments and student housing in Canada. It requires a minimum initial investment of $10,000.

The fund focuses on adding value by purchasing existing apartment buildings for below their intrinsic value through Equiton’s proprietary PropertyTrak acquisition system and the due diligence process, and then actively managing properties to extract value.

“Apartments have a history of positive performance and excellent risk-adjusted returns,” said Roque. “We also see that there is a lot of inventory with upside potential if we were to employ our active management process.

“Population growth, the high cost of home ownership, limited land for new development, rising construction costs and legislative barriers have also created a situation where demand for places to live is outpacing supply.

“These trends should have a positive impact on apartment investments over time.”

Equiton Balanced Real Estate Fund

Equiton’s Balanced Real Estate Fund launched last May. The private REIT specializes in investing in a mix of real estate assets, including income properties, development and construction projects, and lending and financing, throughout North America.

It requires a minimum initial investment of $5,000.

“Our latest product is multi-faceted, and its development component will be adding value through property development and building something that can be held for income or sold for profit,” said Roque.

Equiton also launched an equity financing product for qualified residential and commercial developers across Canada in April 2016.

The firm considers projects of varying sizes and in a variety of asset classes from the time of land acquisition, but prefers zoning, site plan approvals or pre-leasing to be in place.

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