Real estate investment manager Cameron Stephens is taking an expanded role in developing The Towns of Lambton Mills in Toronto, a townhome community which is now under construction and represents its first equity development investment.

Called a “new chapter” for the Toronto-based company in a LinkedIn post, Cameron Stephens announced this week the groundbreaking for Phase 1 of the 58-unit project, located in Etobicoke. It is planned as a community of three- and four-bedroom units, with prices starting from just under $1 million.

Traditionally focused on lending to the commercial real estate sector, Cameron Stephens also operates in the residential space. An example is the $146.15-million mortgage construction loan it provided for the development of a three-building condominium project in Oakville.

Cameron Stephens understands the housing sector “very well,” its executive vice-president and managing director of equity capital Sean Fleming said in an interview with RENX Homes. Thus, taking a more active role in the development process is a logical next step.

The moment is ripe for a community like Lambton Mills, he said, calling it a “great time to be looking at projects” because the Toronto-area housing market needs an injection of capital “more than ever” to address the shortage of housing.

‘Nice sized, brand-new’ townhomes

A company that manages $3.6 billion in assets under administration, Cameron Stephens started the work to develop Lambton Mills in 2020. The land used to host an industrial property, and was rezoned for a residential project.

Lambton Mills will consist of back-to-back townhome units, with sizes ranging from 1,825 to 3,000 square feet. All but two of the units will have three bedrooms, Fleming said. Prices still start from $999,000 to $1.4 million.

“This is a nice sized, brand-new townhouse at a very affordable price,” he said. “It is comparable to what you would pay for a resale unit, but you’re getting it quite a lot larger and brand new.”

Pre-sales have been "slow" but “steady” with 19 units purchased to date. Many of the buyers have been locals who are searching for a larger home to accommodate a growing family or to move out of a rental dwelling, Fleming said.

The community will be within walking distance of several grocery stores, the Lambton Arena and the Pan Am Path, part of a wider system of multi-use trails across the Greater Toronto Area. The Lambton Golf & Country Club, the Kingsway Mills Shopping Centre, Sheridan Mall, restaurants, schools, a library and Jane subway station are a short drive from the neighbourhood.

Construction on Phase 1 of Lambton Mills is expected to take 18 months, building 27 homes at the site. The remaining 31 towns will be built in Phase 2.

Cameron Stephens expects to have all the construction finished within the next two years, Fleming said.

Cameron Stephens partners with TFC on development

To develop Lambton Mills, Cameron Stephens has partnered with Richmond Hill-based TFC Developments, and will focus on supplying the equity capital and underwriting.

Cameron Stephens had partnered with TFC’s founder Gary Tiz, a notable developer, on financing in the past, Fleming said. As Cameron Stephens’ first venture into equity investing, it “made sense” to partner with TFC, he continued.

“It was just a logical extension of the business that we were doing on the loan side.”

Cameron Stephens is taking the opportunity to learn about low-rise development from TFC, Fleming said, noting TFC’s experience on the construction aspects of housing development.

How Stephen Cameron aims to sell units competitively

Though there is opportunity in the market, Fleming acknowledged the housing sector has hit a rut.

"There's a gap between what people want to pay and what we need to charge to have a project be successful," Fleming said. "The trend right now is everyone’s looking at lowering their price,” which means finding ways to lower costs during the development and construction process.

Mindful of the environment, Cameron Stephens has focused on selling units “at a price that worked,” Fleming said. The website for the project states the price per square foot at Lambton Mills is less than half of a pre-construction condo.

Fleming also attributed the competitiveness to Cameron Stephens’ ability “to buy the land well” and gain approval for a “good amount of units on the site so we can sell for less than some of our competitors.”

He hopes the upcoming federal budget will extend an additional helping hand to developers. The Canadian government has proposed steps to resuscitate the industry, including halving municipal development charges.

Developers also have to be more creative, Fleming said, arguing that many current models are no longer viable.

Fleming does not expect Cameron Stephens will stop with Lambton Mills. The company has more capital to deploy toward housing projects and is actively looking for opportunities, he said.

“We want to be the capital partner, we want to partner with operators.”