Calgary-based Optima Developments has completed more than 20 'missing middle' housing projects over the past five years, adding hundreds of rental units to established neighbourhoods as the company looks to expand its development model and offer construction management services to other property owners and investors.

Founded by Jeremy Paylor in 2020, Optima has completed about 280 units across approximately 35 buildings, with another 75 units under construction. The company is targeting annual production of 10 to 15 buildings, with Paylor projecting its portfolio will reach about 350 units by the end of 2027.

Optima initially focused on converting underutilized corner lots into eight-unit rental developments, using Calgary's evolving zoning rules to increase density in established communities. Its projects typically combine three-bedroom townhomes with smaller one-bedroom suites, providing rental options in neighbourhoods where detached and semi-detached homes can be financially out of reach for many residents. 

The company has expanded beyond its original eight-unit model, with projects reaching as many as 28 units, according to Nadeem Keshavjee, president and founder of GreenBirch Capital, which has worked with Paylor on financing since 2021.

The 'missing middle' market

The developments address what the industry calls the missing middle: housing that falls between high-density apartment towers and traditional single-family or semi-detached homes. The segment is intended to provide more attainable options for people who want to live in established neighbourhoods and access their existing amenities without taking on the cost of a detached home or moving into a highrise condominium. 

Paylor now plans to provide construction management services to smaller investors and property owners who want to develop similar projects but lack the expertise to navigate construction, financing and project delivery.

"Optima Developments is the company that I started back in 2020," Paylor said. "I'd built several duplexes and fourplexes before that, so I'd gained some experience in the real estate market and construction as well.

"I'd identified a bit of a niche where these corner lots, which were traditionally less desirable for semi-detached homes and duplexes, had untapped potential."

Paylor saw an opportunity to add much needed rental suppy to the city.

“I started with two buildings," he said. "I tried out this model that I thought would work really well, and it was well-received. I completed them, and the tenants really enjoyed them. The feedback was great.”

From there, he assembled a construction team, acquired a number of these corner lots throughout the years of the COVID pandemic and began building.

“One thing I've focused on all along is how I'm building them," Paylor said. "We haven't just been chasing short-term gains by putting cheap products and cheap construction techniques into these buildings, which you often see during a really busy construction period in Calgary."

Projects meet a need in Calgary

Paylor said many houses on the market in Calgary are out of reach for buyers.

While there has been much discussion about densification, many people don’t want to live in highrise condos and they can’t afford a semi-detached or single-family home but they still want to be close to the amenities in the city.

A missing middle rental can be the answer.

“That's why I think the missing middle is satisfying," said Paylor. "The city has put a lot of emphasis on trying to increase supply in that area."

Paylor said Optima projects are generating consistent interest.

“I know some sectors are slowing in Calgary, but I haven't seen that at all in our product," he said. "As we bring one or two buildings onto the market every few months, they're always well-received.”

All of the builder’s projects have had financing from GreenBirch.

Keshavjee said Optima is a strong case study in how missing middle development can add housing supply in Calgary.

These projects demonstrate how quickly this type of housing can be built and how repeating that approach across multiple sites can have a meaningful impact, he said.

“I see a real opportunity in Calgary for a construction manager focused on projects of this size and scale," he said. "This expansion could help more people move their developments forward and bring additional housing to market."