Forgestone's Big Plans
After only a year of active investing, Forgestone Capital Management is well on its way toward securing $600M worth of deals. (On the flip side of that, it took us a year to choose a toothpaste we were comfortable with.) We caught up with founders Trevor Blakely and Keith Jameson at their Yonge Street HQ to hear what's next.
CEO Trevor and COO Keith—who've worked together for 25 years, most recently at BMO's real estate capital markets group—launched the private equity real estate fund with Canderel Group's Jonathan Wener. They tell us the fund is focused on repositioning and redeveloping commercial, retail, and mixed-use assets, with an emphasis on urban intensification projects. By year's end, many of the $600M in deals will have been made off-market. The fund's flexibility is its competitive advantage, says Keith; it's about finding the right properties, not necessarily in a particular geographic market. "We go across the country looking for aberrations," Trevor says. (Have fund, will travel.)
Case in point: The fund's first major deal—the one Trevor says "put us on the map"—is a 1.7M SF office park in Montreal, the NEXUS 40-13 International Business Center. Institutional investors include HOOPP and Canderel, which will manage the park's operations and leasing. The site comprises 27 buildings on 31 acres, with tenants such as Telus, Canon, Xerox, and Siemens. "We'd never be able to do that deal in Toronto," Trevor says, pointing to the office park's large number of vacancies. "Plus we would have been outbid here."
They would gladly pursue more opportunities in the GTA, Trevor says, but at the moment, "We're just finding better deals elsewhere." And the fund's investors appreciate its managers "not being myopic in our focus." He certainly wasn't myopic when he bought a cottage on Lake Joseph 15 years ago; now it's his family's favourite vacation spot (and one heckuva an over-performing asset in no need of repositioning). Keith is off to Europe later this summer, where he plans to explore Italy from north to south. "I want to get it all in so I can find another country next year."
