Vanguard Realty Brokerage Corp. has brokered its biggest deal ever by representing both sides in Pure Industrial’s $136-million sale of a 471,051-square-foot building at 2777 Langstaff Rd. in Vaughan, Ont. to Franline Investments Inc., a Canadian manufacturer of aluminum products.

“We worked on the deal for several months before it became a reality,” Vanguard chief executive officer and partner Paul Miceli told RENX of the deal that closed on March 24.

The 30-foot clear height industrial space also features 72,542 square feet of office space over three floors. It has 92 truck-level doors and one drive-in door. The building sits on a 24.65-acre site north of Toronto with 550 parking spaces and 70 trailer stalls and it has a bus stop at its front entrance.

The building was constructed specifically for Toys “R” Us Canada’s head office and warehouse and was acquired in a sale-leaseback deal by PIRET in 2017. PIRET became Pure after Blackstone acquired it in May 2018 in an all-cash transaction valued at $3.8 billion, including debt. 

Ancaster, Ont.-based Putman Investments bought Toys “R” Us from Fairfax Financial Holdings Limited in 2021 and the toy retailer filed for creditor protection in February. It has closed more than 50 stores over the past two years and faces lawsuits from unpaid suppliers and landlords that are owed more than $150 million.

Toys “R” Us vacated 2777 Langstaff in January.

New owner will occupy the building in phases

Miceli said warehouses typically have about five per cent of their space allocated to office uses, so the large amount of office space at 2777 Langstaff presented leasing challenges. However, it offered everything Franline needed as it will be consolidating four smaller locations into one.

“They feel that having everything under one roof is going to be a lot more efficient,” Miceli explained. “To these guys, Vaughan is centre ice and they think it’s a centre ice building.”

Miceli estimates it could take up to three years for the consolidation to be completed, as the new owner will do it in phases and have to invest significant capital. 

“They're going to start with the office, finish the office, get everybody moved over, and then start with the plants,” Miceli said. “They’re bringing in additional power to run all of the equipment. 

“With the equipment they're ordering, most of it's made in Europe. There are a lot of working and moving parts here. But they believe that, although the market isn't the busiest at the moment, they'll be geared up exceptionally well for the next takeoff in the Canadian economy.”

Vanguard has a niche

Vaughan-based Vanguard was founded by Miceli in 2008 and is involved with the marketing, leasing and sales of homes, investment-commercial-industrial and new construction properties in and around the Greater Toronto Area — much of it north of Highway 401.

“We've been a really good alternative to some of the bigger brands because we can work on the corporate side and also hook up with individuals that often get overlooked by the big brands,” Miceli said. “We've built a little niche market.”

Vanguard has a long-standing relationship with Franline, while Pure is the company’s largest client. Pure has a portfolio of more than 360 properties totalling more than 42 million square feet across Canada.

Miceli said it’s rare for a company of Vanguard’s size to represent both parties in such a big transaction. 

“I wish every company that we dealt with had the professionalism and the class of these two companies,” Miceli said.