More than 25 years after founding RealNet Canada, George Carras is still finding new ways to bring innovation to commercial and residential real estate.
“The road ahead is about innovation and there’s venture investing and there’s venture-building,” said Carras, R-LABS’ founder and chief executive officer. “R-LABS is the latter. We ingest problems and use technology-enabled business models to solve those problems through the creation of new companies.”
Carras founded RealNet in 1995 to provide real estate investment and development market information to stakeholders. He sold RealNet in 2014 to Altus Group and founded RealStrategies Inc. in 2015 as a vehicle to expand real estate opportunities.
The R-LABS concept grew out of that. Carras created it in 2018 as an alternative to more conventional venture investing.
“Structured company building, or studios or venture building, only represents about five per cent of new company formations,” said Carras. “But in stand-alone ventures, 80 to 90 per cent of those companies fail.
“In structured company building, one out of two fail. So you have a much bigger probability of success in structured company building, and that’s the path that we chose.”
R-LABS operates out of a 9,000-square-foot space on Front Street West across from Union Station in downtown Toronto, though it’s not being used at the moment due to COVID-19 restrictions and precautions.
Teranet delivers land and commercial registry services and markets property intelligence and data solutions to customers in the real estate, financial services, government, utilities and legal markets.
Carras said Teranet can contribute to R-LABS through its relationships with land registry offices and by adding innovation and information infrastructure.
Teranet joins these existing R-LABS limited partners:
– real estate development and investment firm Dorsay;
– pension fund firm OMERS;
– development company Empire Communities Corp.;
– and investment, development and property management company Oxford Properties Group.
“R-LABS can partner with entrepreneurs and allow them to be their best selves,” said Carras.
“As a company builder, we bring in all of the capabilities that entrepreneurs would often struggle with, such as technology, finances, accounting and human resources.”
All R-LABS partners invest skills and capital. Carras said they provide expertise and operate within an open innovation program with a mix of people, ideas, technologies and money to try to solve existing problems in housing or commercial real estate.
“We’re about two bottom lines,” said Carras. “You’re not in business only to make a profit, as there’s the problem you’re solving and the impact you’re making, but you need a profit to be in business.”
All R-LABS partners become co-founders and have a stake in all of the companies built through this process.
“We are the only venture builder that’s dedicated to housing and real estate anywhere in the world, and we’re the only platform that operates open innovation anywhere in the world in real estate,” said Carras.
R-LABS has co-created two companies since its formation.
OneClose has created a solution that enables new condominium buyers in Ontario to obtain a mortgage before final closing and avoid unnecessary interim occupancy interest payments before a building is registered.
“OneClose has created a very innovative new model that’s technology-enabled and allows a consumer to get a permanent mortgage at the time of occupancy, as opposed to waiting an average of 10 months,” said Carras.
R-LABS claims OneClose will collectively save new condo buyers in the Greater Toronto Area more than $1 billion in coming years through its work with developers and lenders.
R-Hauz builds prefabricated laneway suites and mass timber townhomes, and its offerings can be adaptable for other uses. Its customized products are pre-designed, pre-approved and manufactured off-site.
It uses materials that minimize heat loss and increase air quality to reduce costs and the size of the carbon footprint while exceeding building code standards for energy efficiency.
Materials are delivered to the property so construction can be completed within a fixed time frame at a fixed price. R-Hauz manages everything from approvals, permits and utility connections to on-site construction warranty and service work.