{"id":41696,"date":"2026-05-12T09:45:06","date_gmt":"2026-05-12T09:45:06","guid":{"rendered":"https:\/\/www.europesays.com\/canada\/41696\/"},"modified":"2026-05-12T09:45:06","modified_gmt":"2026-05-12T09:45:06","slug":"real-estate-developer-jesta-plans-to-buy-500-million-of-unsold-toronto-condo-stock","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/canada\/41696\/","title":{"rendered":"Real estate developer Jesta plans to buy $500-million of unsold Toronto condo stock"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

Condo towers in Toronto in September, 2022. Jesta has been trying to expand into Toronto\u2019s residential rental market for some time.Christopher Katsarov\/The Globe and Mail<\/p>\n

Real estate<\/a> company Jesta Group plans to spend $500-million to buy more than 1,000 newly built Toronto condos and turn them into rentals, taking advantage of the recently announced Harmonized Sales Tax rebate to make its foray into the city.<\/p>\n

In its first purchase under the program, the Montreal-based company paid $30-million to buy nearly all of the unsold units in a recently completed condo building near Toronto Metropolitan University in the downtown core.<\/p>\n

\u201cWe\u2019re approaching developers saying, \u2018Would you like to sell all of your inventory?\u2019 \u201d said Anthony O\u2019Brien, Jesta\u2019s senior managing director. Mr. O\u2019Brien would not provide the exact number of units purchased in the initial deal or the name of the building or developer.<\/p>\n

Jesta is entering the market as other corporate entities are also looking to make bulk purchases of unsold inventory. That includes the $1.3-billion government-backed High Art Capital, which recently formed to buy 2,200 condo units and turn them into rentals, some of which will be rented at affordable rates.<\/p>\n

Opinion: No, aging baby boomers will not trigger a glut of suburban homes for young families<\/a><\/p>\n

Jesta, which manages rental apartments and other commercial property in Montreal, Europe, the United States and Britain, has been trying to expand into Toronto\u2019s residential rental market for some time.<\/p>\n

In 2017, the developer bought a hotel in Toronto and planned to turn it into rentals. Instead, it capitalized on the boom in commercial land and sold the property a year later. <\/p>\n

Today\u2019s real estate climate has prompted Jesta to act. <\/p>\n

It\u2019s not just because there are deals to be had with developers that are sitting on heaps of unsold condo inventory.<\/p>\n

The housing industry<\/a> is predicting that by 2030 there will be a shortage of new homes coming to the market since there are very few condo projects breaking ground today. That, along with forecasts that the country\u2019s population will grow, means there will eventually be more demand for housing in Toronto.<\/p>\n

\u201cIt\u2019s a very good economic opportunity,\u201d said Mr. O\u2019Brien, adding that he could buy newly built condos at a cheaper price than it would take to develop and deliver a condo project over the next three to five years.<\/p>\n

\u201cIt\u2019ll cost us more to build brand new and deliver in three years than to buy brand new finished product ready to lease tomorrow,\u201d he said.<\/p>\n

Editorial: Ottawa builds its housing plan on shifting sands<\/a><\/p>\n

In five years \u2013 when immigration is expected to boost demand for housing and the supply of new homes is expected to drop \u2013 Mr. O\u2019Brien said Jesta expects to start selling its Toronto condo units. <\/p>\n

\u201cWe feel demand will increase at that time. That will have upward pressure on pricing, and that will be a good window to exit on the strategy,\u201d he said.<\/p>\n

High Art Capital also expects to sell its condo rental units after holding them for a minimum of five years. <\/p>\n

Jesta\u2019s $500-million program is made up of $100-million in equity and $400-million in debt. The developer will make the decisions on purchases, property management and sales, and will use $20-million of its own capital and raise $80-million in equity from four to five other investors, according to Mr. O\u2019Brien. <\/p>\n

Jesta\u2019s criteria is that the building must be in the downtown core and must have a minimum of 30 unsold units to buy. It has no interest in relatively cheaper areas such as Vaughan Metropolitan Centre, which has a surfeit of unsold condos and is at the northern end of one of Toronto\u2019s main subway lines.<\/p>\n

Jesta will also not purchase any unit with an interior bedroom with a glass wall that looks into the rest of the unit. \u201cWe just don\u2019t see that as livable,\u201d Mr. O\u2019Brien said.<\/p>\n

The developer will, however, buy units as small as 350 square feet. On average, it expects to spend less than $500,000 a unit, which Mr. O\u2019Brien said is feasible given that it is looking at studios and one-bedrooms. <\/p>\n

Jesta said the building must be either delivered in the past year or about to be completed within a year. That meets one of the requirements for the HST rebate, as construction had to have started prior to March 31, 2026, for investors who plan to turn condos into rentals.<\/p>\n

Mr. O\u2019Brien said the HST rebate was the catalyst to make the first deal work. He said Jesta could have made its purchase without the tax break, but it would have required more negotiations with the developer. <\/p>\n

The asking price for unsold inventory averaged $1,189 a square foot in the Toronto and Hamilton region in the first quarter of this year, according to industry group Urbanation Inc. <\/p>\n

That is much pricier than the resale market and higher than Jesta\u2019s price range of $700 to $800 a square foot. The developer aims to rent the units out at about $4.25 a square foot. On a 500-square foot unit, that works out to a price tag of $400,000 and a monthly rental rate of $2,125.<\/p>\n

Although there has been other investor interest in buying condos in bulk, Mr. O\u2019Brien said he did not think his company faced much competition on its first deal. <\/p>\n

\u201cI know there\u2019s a lot of people out sniffing, but I\u2019m not hearing about a lot of deals closing, at least at this scale,\u201d he said. <\/p>\n

He said Jesta is looking at about 20 buildings in downtown Toronto <\/p>\n

As of the end of the first quarter, there were a record number of 4,295 units that were completed and not sold, according to Urbanation. That does not include the estimated thousands of units that developers had to take back because buyers defaulted on their purchases. <\/p>\n

The tax rebate was designed to clear up the thousands of condo units that have been recently built but are unsold and sitting empty. <\/p>\n

Buyers have until March 31, 2027, to make the purchases before the HST rebate expires. <\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: Condo towers in Toronto in September, 2022. Jesta has been trying to expand…\n","protected":false},"author":2,"featured_media":41697,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[164,224,238,214,212,239,17,211,230,231,227,213,210,235,171,234,143,222,249,215,216,229,225,226,219,240,220,244,245,247,242,246,94,243,217,142,233,113,232,241,223,236,48,237,228,221,218,248],"class_list":{"0":"post-41696","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-toronto","8":"tag-alberta","9":"tag-arts-news","10":"tag-bc","11":"tag-breaking-news","12":"tag-breaking-news-video","13":"tag-british-columbia","14":"tag-canada","15":"tag-canada-news","16":"tag-canada-sports","17":"tag-canada-sports-news","18":"tag-canada-trafficcanada-weather","19":"tag-canadian-breaking-news","20":"tag-canadian-news","21":"tag-economy","22":"tag-education","23":"tag-environment","24":"tag-federal-government","25":"tag-foreign-news","26":"tag-globe-and-mail","27":"tag-globe-and-mail-breaking-news","28":"tag-globe-and-mail-canada-news","29":"tag-government","30":"tag-life-news","31":"tag-lifestyle","32":"tag-local-news","33":"tag-manitoba","34":"tag-national-news","35":"tag-new-brunswick","36":"tag-newfoundland-and-labrador","37":"tag-northwest-territories","38":"tag-nova-scotia","39":"tag-nunavut","40":"tag-ontario","41":"tag-pei","42":"tag-photos","43":"tag-political-news","44":"tag-political-opinion","45":"tag-politics","46":"tag-politics-news","47":"tag-quebec","48":"tag-sports-news","49":"tag-technology","50":"tag-toronto","51":"tag-travel","52":"tag-trudeau","53":"tag-us-news","54":"tag-world-news","55":"tag-yukon"},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts\/41696","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/comments?post=41696"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts\/41696\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/media\/41697"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/media?parent=41696"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/categories?post=41696"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/tags?post=41696"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}