Turbulence on a flight is never enjoyable, no matter how many times you have flown. However, for the most part, our reactions tend to far outweigh the severity of the moment. Similarly, increasing interest rates in an already volatile market can feel very uncomfortable, but for many people the anticipation and associated fear usually outweigh the actual impact of the change.
We are six months into 2022 and Cameron Stephens, like the rest of the world, continues to push through the turbulence and navigate the murky and unknown waters. The volatility and uncertainty in the markets have certainly caused us to pause and be cautious and reflective. However, we tend to be cautiously optimistic as business continues to be strong.
The key factor for our optimism is the unsustainable nature of the growth we were seeing. The combination of what some were calling “free money” (record low interest rates) and the 30%+ increase year-over-year in real estate prices in the GTA was irresponsible and unsustainable. Inflation needed to be addressed, and the plateau we are experiencing, for many reasons, was needed and good for our local real estate economy in the long run.
Turbulence aside, Cameron Stephens Mortgage Capital is having a record year with over $1.2B in YTD commitments. To provide some context on the level of growth we are seeing, in the first half of 2022, we achieved almost the same level of commitments as we did from the entirety of 2021. This strong start provides a good buffer as we tread cautiously into Q3 and Q4.
The Cameron Stephens Equity Capital business is also off to a great start. We closed our third acquisition in February, and our fourth joint venture will be closing on July 13th, 2022. With these deals, we are now managing four projects and over $53M of capital committed to a development portfolio that represents over 1.2M square feet of residential and commercial space and over $1.2B of development value at completion. Given how relatively new we are to the scene, we take great pride in this accomplishment.
RESIDENTIAL & COMMERCIAL PORTFOLIO
DEVELOPMENT VALUE AT COMPLETION
In June of 2022, CSMC held an investor appreciation event at the CN Tower for all of our institutional, private, and retail investors. Aside from the stunning views, good conversation, delicious canapes, and libations, we welcomed economist Brett House as our guest speaker. Brett was optimistic on the state of the Canadian Market, and I wanted to share a few of his key points as to why Canadians should remain positive and trust that the turbulence is only temporary.
Brett left us with three key take-aways:
Read the full presentation by downloading it below
All in all, we continue to grow and reach new heights as an organization. The combination of our incredible staff, strong borrowers, and reliable investors holds us in good stead as we embark on the second half of 2022.
Executive Vice President
Watch our latest DealTalk featuring 131 King Street, a contemporary 31-storey residential building in London, Ontario. Developed by York Developments and designed by Zedd Architecture, the 266 unit purpose-built rental building with ground floor retail space is a welcome addition to this vibrant location across Covent Garden Market in downtown London. Our creative end-to-end financing solutions through multiple phases of this project included a $3.75M land loan, and $84M for construction financing, which facilitated in bringing this new rental community to life.
On June 8, we brought special guests together with Cameron Stephens employees for our inaugural Investor Appreciation Event at the CN Tower. The highlight of this special occasion – a presentation on today’s economic climate from accomplished macro-economist Brett House. Currently a Principal at Tesseract Advisors, Brett has held many notable roles over the past few decades, most recently, Vice-President and Deputy Chief Economist at Scotiabank. A Rhodes Scholar, he holds degrees in economics from the University of Oxford and Queen’s University, has taught and conducted research at five universities, and has received several industry awards and acknowledgements. Needless to say, Brett’s insights were well received by all.
On June 2, the Cameron Stephens team invited a few guests to the Eagles Nest Golf Club in Maple where we hosted a golf tournament and welcomed a special appearance by Canadian hockey icon Wendel Clark.
Cameron Stephens Mortgage Trust (CSMT) offers a unique opportunity for accredited high net worth investors to participate in primarily first position residential and commercial mortgages on high profile development and construction projects across Canada.
Attractive Target Return of 8%* Annualized, Net of Fees
Opportunity to Co-Invest in Equal Priority with CSMC’s Other Investment Vehicles for High Net Worth Investors
Low Correlation with Public Markets (CSMT is a Private Fund with a Unit Price that is Intended to Remain Fixed at $10)
Provides Portfolio Diversification Due to Real Estate Being an Alternative Asset Class
Benefit from CSMC’s Proven Track Record in Originating, Underwriting and Managing Mortgages
Registered Plan Eligible
* This is a target return. The actual return cannot be guaranteed.
In November 2021, CSMC arranged and funded the first advance of a $23,500,000 1st mortgage servicing and construction loan for a new low-rise community in Picton, ON. The subject loan represents CSMC’s second transaction with this local developer/builder. After selling out the first two phases of this five-phase development, CSMC was able to provide its client with a low-cash equity option to complete the servicing of 88 lots and construction of 29 singles, 2 semis, and 16 townhouses.
CSMC funded a competitively priced 2nd mortgage construction loan for an existing client in an increasing cost environment in order to cap their equity contribution. A 12-storey condominium consisting of 363 units as well as 915 SF of ground floor commercial space with a total GFA and NSA of 302,412 SF and 244,082 SF, respectively. The building will include three levels of underground parking over 192,136 SF and will offer 400 total parking stalls (334 residential, 55 visitor, 1 commercial, 7 EV, and 3 car share), 357 storage lockers, and 356 stacked bicycle stalls.
EP. 34: TORONTO UNDER CONSTRUCTION WITH with Carlo Timpano from Capital Developments
In this Episode of Toronto Under Construction, we are excited to welcome Carlo Timpano, President at Capital Developments. We start this episode learning more about Carlo and how he got started in the real estate development industry. Carlo shares details of his time at Oxford Properties and consulting at the Boston Consulting Group.