ARIA, a 286-unit apartment complex in Calgary’s University District, has been acquired by a Harrison Street fund. (Courtesy Harrison Street)

Harrison Street has made its second acquisition with its Canada Alternative Real Estate Fund, a 286-unit apartment in Calgary’s University District.

ARIA, a six-storey building completed earlier this year, was purchased for an undisclosed price from Gracorp Properties.

“What attracted us to it was being part of what we believe will be one of the premier communities in the entire Calgary market, where the university is starting from scratch to build it,” Harrison Street managing director and head of Canadian transactions Jonathan Turnbull told RENX.

“The folks at Gracorp are outstanding developers that build great assets and we had a relationship with them.”

What ARIA offers

ARIA offers one-, two- and three-bedroom units, underground parking and indoor amenities that include a gym, a yoga studio, a lounge, a games room, a large group kitchen, a dining area, event and storage space.

Outside, a 20,000-square-foot inner courtyard features barbecue areas, a pickleball court, a bocce court, a stage, a fire pit, a sitting area, a fountain and a fenced-in pet play area and washing facility.

ARIA was built in two phases. The first opened in September 2020 and the second followed earlier this year, according to Turnbull, who said the apartment is more than 90 per cent occupied.

“It leased up very quickly by any market’s standards, which speaks to the quality of the location and the quality of the development itself.”

The ground-level retail at the property is owned by University District Trust and includes a grocery store, a liquor store, a bank branch and a coffee shop.

Calgary’s University District

ARIA is the first rental property purpose-built for young professionals and students in the 200-acre University District, where University of Calgary Properties Group is overseeing ongoing development to optimize the return on the land for the benefit of the university’s academic mission.

ARIA is within easy walking distance of the University of Calgary and adjacent to Alberta Children’s Hospital, quick-service restaurants, personal service providers and a movie theatre.

University of Calgary Properties Group’s long-term plan for University District is to create a diversified community with a mix of multiresidential, seniors housing, office, entertainment and commercial projects on the university-owned land west of the campus.

University District is the first community in Alberta to achieve LEED ND Platinum status.

“It’s an area that we’ll continue to look at and focus on to see if there are additional deals because you can’t beat the partnership with the University of Calgary and what they’re trying to build there,” said Turnbull.

Other residential developers in University District

Homes By Avi, Brookfield Residential and Truman are involved with condominium projects in University District, while The Brenda Strafford Foundation is leasing units in an assisted seniors living facility that opened last year.

Homes By Avi’s condos are: Argyle, which has 151 studio, one-, two- and three-bedroom units above almost 30,000 square feet of ground-level retail space; and August, which has 107 one- and two-bedroom units.

Brookfield Residential’s Capella offers 140 units, while Ivy has 127 townhome units.

Truman’s Esquire will have 185 one-, two- and three-bedroom units while Maple’s 95 one-and two-bedroom units will offer independent living to those 55 and up. Truman’s Noble townhomes and condo units have all been sold.

The Brenda Strafford Foundation’s Cambridge Manor has 240 units and offers independent and assisted living as well as enhanced care and memory care services.

Canada Alternative Real Estate Fund’s first investment

Harrison Street’s recently launched Canada Alternative Real Estate Fund completed its first closing in August with capacity to invest more than $550 million in senior living, student housing, medical office, life sciences, storage and digital assets throughout Canada.

Turnbull said the open-ended fund has continued to raise capital and attract new investors since then and he expects to announce another major investment soon.

The fund targets stabilized, cash-flow-producing assets and can invest up to 35 per cent of equity in value-add strategies.

The fund can also be used for development projects such as its first investment, a 152-unit seniors living project that has broken ground at 412 Sparks St. in Ottawa and is slated to open in 2024.

It’s a partnership with Signature Retirement Living, which has seven current properties operating in Ontario and two more in Calgary. The value of Harrison Street’s investment in the Ottawa project hasn’t been disclosed.

“We think it will be the premier seniors housing property in the Ottawa market,” said Turnbull.

“It’s in the classic Signature configuration and format, where it’s mainly ISL (independent supportive living) with a little bit of AL (assisted living) embedded within it. It’s a higher-end product.”

Harrison Street and Gracorp

Harrison Street was founded in 2005 and is exclusively focused on alternative real assets. The investment management firm is headquartered in Chicago and has offices in San Francisco, London and Toronto.

Harrison Street has more than 200 employees and approximately $39 billion US in assets under management. The senior leadership team has an ownership stake in the firm, while Colliers owns 75 per cent.

Gracorp is the real estate development subsidiary of Graham Group. Its portfolio stretches across mixed-use, multiresidential, office, industrial and retail developments in Alberta, British Columbia and Washington.