Uptimo has invested $42 million to acquire 825 Beauregard, a complex of 232 multi-family units in the Quebec City suburb of Sainte-Foy. It is also the company’s biggest acquisition to date.

The acquisition of the two 13-storey buildings next to Université Laval, between Sainte-Foy and Quatre-Bourgeois roads, marks the Sherbrooke, Que.-based real estate investment and property management company’s entry into the provincial capital in a big way.

Uptimo acquired 825 Beauregard from members of the Bombardier family. The companies have a previous relationship, as Uptimo has managed other Bombardier family properties. 

The company got its start in 2016 in Sherbrooke, but “we always kept an eye on Quebec City,” says Uptimo partner and CEO Marc-Antoine Vézina. He believes Quebec City will see the kind of value appreciation in the next decide that Uptimo has experienced in Sherbrooke.

Uptimo currently manages 2,000 apartment units, mostly in the Eastern Townships city about 50 kilometres east of Montreal, and owns about 400 of those units. 825 Beauregard is by far Uptimo’s largest property – the next biggest building it manages has 56 units.

Room to expand 825 Beauregard

Built in 1980, 825 Beauregard has “major growth potential,” as an additional 100 to 200 units could be built on what is now an exterior parking lot, Vézina says.

He’s had discussions about the site with other developers “because we’re not developers. We’re owners, promoters but we’re not builders.” However, a site densification may not come for another five to 10 years. “We’re not rushing it.” 

Students, professionals and seniors make up the tenant mix of 825 Beauregard. Sixty per cent of units are studios and one-bedrooms and the remaining 40 per cent are two- and three-bedrooms.

Apartments will be renovated when tenants leave but Vézina insists there will be no renovictions: “It’s not our mentality. We don’t do that.” 

The two buildings are “in very good condition, but we’re at the point where we need to reinvest,” he says. “In the next five years we’re going to do doors and windows, common areas and increase tenant services.” Work is also planned on the underground parking lot and balconies.  

Uptimo, which has received CMHC financing for improvements in energy efficiency, has a $6 million capex plan over the next five years for 825 Beauregard.

“We’re long-term investors,” Vézina says. "That building has huge potential for us over the long-term. It’s not a flip. It’s not a buy for sell. We believe in that asset. We buy it, work on it, and we improve the quality of the asset over time.”

Uptimo has focused on Sherbrooke

Vezina is based in Montreal and hails from Quebec City, but he and his partners began to invest in Sherbrooke when they formed Uptimo because of that city’s lower-cost housing. The Uptimo name combines the words optimization, up and immobilier (real estate).

“We are doing value creation through renovation, revitalization and operational efficiencies." 

The strategy in Sherbrooke was “to invest on the properties that would bring us money and improve the cash flow and some day the value creation would come. That was a good decision.”

Uptimo has been in acquisition mode over the past five years “but we’re very precise on what we want. We’re looking for properties between the 1980s to early 2000s, 2010, that we can create value. And we take our time.”

Uptimo has a 40-employee team “which enables us to look at acquisitions in other markets,” he says. “When we look at other markets, we need to have a sizeable acquisition. You cannot buy a 16-unit, it’s not big enough to justify your operations in a new city.”

The company has one other small property in Quebec City and is a strong believer in the city, Vézina says. “We believe that units are way more affordable in Quebec City than in other cities, which should bring immigration toward the city.”

Several major construction projects are planned for Quebec City in the coming years, including a tramway system.

While it’s currently putting its focus on Quebec City, Uptimo also plans to enter other markets in the next three years, he says.