Groupe HD and Fondaction have finalized a joint venture for the acquisition and development of a near-five-acre property in Montreal's Mercier–Hochelaga-Maisonneuve borough where they plan to deliver 1,200 homes through a multi-phased project.

The site comprises over 210,000 square feet and is located at 5600 Sherbrooke St. E. Much of the property, which is also bordered by Chauveau Street, is currently vacant land.

The two Montreal-based firms have not released financial details of their venture, but did say the development represents a total investment of over $425 million. Groupe HD will be the developer and Fondaction is the financial partner.

"This acquisition marks one of the most significant and promising transactions to date for our organization. We are deeply grateful to our partner Fondaction for their trust and support in making large-scale projects like the Sherbrooke Street development tangible and concrete," Thomas Dufour, co-president of Groupe HD, said in Monday’s announcement.

Other members of the development group

Others involved in the development are lender Desjardins - Real Estate Financing Group, general contractor Construction Praxis, architects NEUF Arthitectes and landscape designer BC2.

The partners say the project is aligned with the City of Montréal's Assomption Nord Urban Planning Program. Although few other details are yet available, Groupe HD and Fondaction say the development will include diverse housing types to densify the area, as well as green spaces.

More than 15 per cent of the units - approximately 180 homes - are to be affordable housing, and the development will pursue LEED Gold certification for its environmental sustainability.

The project is to unfold in two main phases and will be executed by Construction Praxis, Groupe HD's construction division.

"Fondaction is proud to partner with Groupe HD to advance the revitalization and densification of this strategic area in the East of Montreal. Anchored in a sustainable mobility network, this flagship project promotes inclusive residential diversity and aims for LEED Gold environmental certification. It aligns fully with our real estate investment strategy focused on sustainability," Chad Ruel, senior director, real estate investments at Fondaction, said in the release.

This is not the first partnership for Groupe HD and Fondaction. Their relationship also includes another recently announced redevelopment, a 72,000-square-foot former auto dealership in LaSalle, where they plan a 155-unit purpose-built rental apartment development.

The LaSalle property at 1855 Dollard Ave., near the intersection of Newman Boulevard, was acquired for $5.5 million from a private seller in an off-market deal announced in August 2024. The dealership had moved to a new location.

About Groupe HD and Fondaction

Groupe HD is a Quebec-based company specializing in real estate investment, development, construction and management. The firm specializes in designing and delivering large-scale housing-based projects. 

To date, the Groupe HD has been, or is, involved in over 20 projects, totalling more than 7,000 residential units, including condominiums, rental buildings and private seniors' residences. 

With its team of 60 professionals, the company manages over $3 billion in assets.

Fondaction is a labour-sponsored fund created at the initiative of Quebec's Confederation des syndicats nationaux (CSN), representing tens of thousands of individuals and hundreds of companies focused on helping Quebec progress. 

Founded over 25 years ago, Fondaction manages more than $3.99 billion in net assets, as at Nov. 30. It is invested largely in hundreds of businesses and on financial markets.