About the property

Built in 1974 and most recently renovated in 2021, East York Apartments is a 15-story high-rise apartment building, providing 253 residential units, including 16 townhomes. The building is located in Toronto’s East York borough, overlooking Taylor Massey Creek, and enjoys easy access to Toronto downtown and financial core via the Bloor-Danforth subway line and the Don Valley Parkway. The neighbourhood is amenity rich and close to retail stores and restaurants, as well as local schools and community parks.

Investment rationale

The property is also in excellent physical condition having been institutionally managed by one of Canada’s largest rental housing providers for two decades and occupancy currently stands at 96%. The Canadian value-add investments team believes that East York Apartments offers strong income growth potential through programed suite renovations on apartment turnover. In-place rents across the asset are significantly below current market rents.

About the development

Fulton & Fifth is a high-quality residential-led development located in the Wembley area of London, one of the largest regeneration areas in Europe and is less than 15-minutes from Central London via public transport. The project consists of five buildings ranging from 14 to 23 stories, with 846 residential units (of which 35% are affordable housing) as well as industrial and retail space. Amenities will include a gym and yoga studio, swimming pool, gardens, golf simulator, cinema room and lounges, far exceeding the offering in other local projects.

In addition to the significant component of affordable housing, the project includes a range of other environmental and social initiatives, including sustainable building materials and renewable energy provision and is targeting a score of BREEAM “Excellent” for the commercial element.

There is also an on-site training academy, set up alongside Building Heroes, a charity which provides skills training to military veterans and supports them into employment in the building trade.

Investment Rationale

The Project benefits from being located in a well-connected, highly sought-after and gentrifying London location with strong underlying supply/demand dynamics. The Wembley area has relatively low levels of residential units earmarked “for-sale,” with pre-sales achieved by comparable projects demonstrating high demand for new-build product.

The LaSalle value-add investments team has partnered with a best-in-class London developer with a strong track record delivering market-leading projects.

The deal was structured as a “preferred equity” investment with meaningful downside protections which partially insulate the investment from sales slowdowns and declines, construction cost increases, and project delays.

About the building

Lacus Quartier is located in a quiet and family-friendly part of the up-and-coming Weißensee district in Berlin-Pankow, in close proximity to the highly sought after Prenzlauer Berg district. Weißensee profits from Prenzlauer Berg’s expansion while offering more affordable rents.

The development is of high quality and with modern fit outs across 230 units with an average apartment size of 73 square meters, perfectly suiting the local demand. The homes have parquet floors and modern kitchens, nearly 90% of units have a balcony or terrace, and the courtyard offers many leisure activities such as a children’s playground, table tennis and more.

Investment rationale

Lacus Quartier is the LaSalle E-REGI Fund’s first investment in the residential sector and contributes to further diversification of the fund. Berlin is one of the most sought-after investment markets in Europe, with strong population growth of over 8% expected through 2030.

More specifically, the asset’s micro location within Berlin is steadily improving due to the expansion of the neighboring district (Prenzlauer Berg) and its reputation for high-quality housing. The fund’s management team expects a continued shift in demand to Weißensee due to further supply shortages in Prenzlauer Berg.

The building should provide long-term stable income as the building is 100% privately owned and therefore not subject to government-imposed rent controls. Existing leases are fully indexed against a consumer price index annually and further increasing rents and growing capital values in Berlin are expected, with continuing population growth and strong demand for residential space in Berlin.

Future plans

LaSalle intends to have Lacus Quartier certified by the German Sustainable Building Council (DGNB) in 2023.

About the building

Rideau & Chapel is a mixed-use, 25-story retail and residential building on the corner of its namesake streets in downtown Ottawa. On completion, it will feature over 600 apartments for rent and 9,000 square feet of retail space. It is located on the eastern edge of the central business district near the Rideau Centre, the University of Ottawa, the Chateau Laurier, the Rideau Canal and Parliament Hill.

Investment rationale

As a mixed-use residential and retail development, Rideau & Chapel will have diversified income streams from the start. The building is located in a prime Ottawa position near local landmarks and within close proximity to the brand-new Rideau LRT Station along the Confederation Line. Construction is progressing on schedule with possession estimated for late 2022.

The LaSalle Canada Property Fund has purchased a 47.5% stake in Rideau & Chapel.

About the property

Pier 8 at The Preserve, is a Class A multifamily property in the Tampa suburb of Odessa, Florida owned by one of LaSalle’s custom accounts clients. Pier 8 at The Preserve features luxury unit finishes including stainless-steel appliances, quartz countertops, in-unit washers and dryers, walk-in closets and programmable thermostats. The community’s amenity package includes a pool, a fitness center, a yoga/wellness lounge, spa lounge, movie theater, wine tasing room and walking trails around the adjacent lake.

Investment rationale

Located in the Tampa suburb of Odessa, Pier 8 at The Preserve provides residents excellent mobility via Highways FL-54 and FL-589, allowing convenient access to the majority of the Tampa MSA. It also provides access to walkable retail amenities such grocery stores and pharmacies, as well as other retail and dining facilities.

LaSalle’s Research and Strategy rates Tampa an “overweight” target market for multifamily due to its excellent rent growth, which exceeded the national average by 5.6% as of March 2021, and its low vacancy of just 4.0% for stabilized multifamily properties. The greater Tampa area’s population and economic growth are projected to remain strong for some time to come.

The investment management team for the custom accounts client believes that the property’s desirable location in a highly sought-after area of a community with strong growth potential, will make it a strong and reliable income-producing asset for many years to come.

About the building

Legacy at Highlands Ranch is a luxury multi-family apartment complex of over 400 units with a strong amenity package including fitness and business centers, a sizeable clubhouse and a pool with grilling and picnic areas. The unit layouts are efficient and feature 9’ ceilings, in-unit washer/dryers, balconies and attached/detached garages in select units.

Investment rationale

Highlands Ranch is an affluent suburb of Denver which has experienced extensive population growth over the last 30 years, expanding from just over 10,000 people in 1990 to over 95,000 people in 2010. Median household incomes are over $100,000, and the community benefits from excellent local amenities and businesses, making it a very desirable place to live.

Built in 1999, the apartments at The Legacy at Highlands Ranch were dated and only attracting submarket rents. The Clubhouse in particular was poorly planned from a space perspective and lacked modern amenities. Unit interiors and common areas remained largely untouched since construction, offering the LaSalle Property Fund the potential to achieve core plus returns through common area and unit renovations.

Improvement works

Once the transaction was complete in late 2017, LaSalle’s Asset Management team took on a series of improvement works, including:

• Renovating units for a contemporary look equivalent to newer builds.
• Reconfiguring the clubhouse to provide for better leasing functionality, a larger gym, events space, game room, and package lockers.
• Painting the exterior and making significant enhancements to the complex’s landscaping.
• Updating the branding and website to match the more contemporary look and feel.
• installing monument sign along a secondary entrance to the property for better curb appeal along Burgundy Street and South Broadway.

What we achieved

Improvement works to The Legacy at Highlands Ranch have had a sustained and positive impact for both residents, who have benefited from the substantial improvements to the complex, and the LaSalle Property Fund. Improvement works have commanded higher rents, and current occupancy levels are over 90%, helping to provide stable and reliable income for the Fund.