Kevric Real Estate hopes to build a close-to-700,000-square-foot residential and mixed-use development in the Studio District east of downtown Toronto.
The Montreal-based company plans to apply to the City of Toronto to add residential and other uses on a five-acre brownfield site it owns at its 65 Heward St. and Eastern Ave. site, which houses the Six5 movie studios it co-owns with Montez Corp.
The new development will densify the site, with the studio facilities remaining in operation on the property.
The area, about two blocks from Cadillac Fairview’s huge East Harbour mixed-use development, is “getting a massive transit infrastructure” with construction of the new Ontario Line subway extension and will be close to two subway stations, including East Harbour, Kevric’s new president Sébastien Hylands said.
“We believe that site is a prime residential site. However, the current zoning doesn’t necessarily allow it,” Kevric founder Richard Hylands told RENX. But with the construction of the subway line, “it’s only logical to densify around those future stations.”
Kevric hopes to able to go forward with the project in the next 24 months, Sébastien Hylands said in the same interview.
New leadership, new divisions at Kevric
The proposed development comes as Richard Hylands takes a step back from the company he founded in the 1990s and becomes its board co-chair.
Kevric has also created two new divisions – Kevric Investments and Kevric Management, which will be led by Sébastien Hylands. All property management activities have been transferred to Kevric Management, which will also seek third-party management mandates, a new avenue for the company.
The company also hopes to announce a “surprising” change in the coming months to the 315,000-square-foot exhibition hall in its enormous Place Bonaventure complex in downtown Montreal, which was the world’s largest building when it was completed in 1967. Kevric, Westcliff and Goldman Sachs acquired Place Bonaventure in 1998.
Closed in 2020 during COVID, the exhibition hall which features a 28-foot ceiling, has become interesting for alternate uses, Richard Hylands says.
Sébastien Hylands added that the summer 2023 opening of the first phase of the REM light-rail system has been driving foot traffic into the building. (The REM’s Gare Centrale terminus is connected to Place Bonaventure.)
As a result, interest is growing from retailers “who had been less active in the downtown core but are starting to drift back,” Sébastien Hylands said. The lease-up of a retail redevelopment that began in 2017 was “delayed by COVID but now we’re definitely starting to see some results.”
1100 Atwater and 600 de la Gauchetiere W.
Kevric is also aiming to densify excess land on the western portion of its 1100 Atwater development in Westmount, a 175,500-square-foot, seven storey loft-style office building at Atwater Ave. and Tupper St. that it owns in a JV with Blackstone.
1100 Atwater is currently leased in the “high 90s” per cent, Richard Hylands said, with tenants that include the Microsoft-owned gaming company Compulsion Games.
Plans are to build up to 20 high-end townhouses at the site. The area is currently under a zoning review by the City of Westmount.
Kevric is about halfway through the transformation of its over-725,000-square-foot 600 De La Gauchetière West, which will be CN’s new headquarters in Montreal for at least the next 20 years, starting in 2026.
The building is at 83 per cent occupancy, and “we’re getting a pretty good pipeline of interest from (potential) occupants” for the top five floors that remain available in the 28-storey building, Sébastien Hylands said.
Transitioning to new leadership
Richard Hylands formed Kevric in the mid-1990s but partnered with Westcliff for about 10 years. He took Kevric – a name that stems from his full name Kevin Richard – on its own in 2005.
The pandemic, a time of slowdown for the company, allowed Sébastien Hylands to take over Kevric’s ongoing projects, Richard Hylands explained.
“I’ve been in the business for 44 years and if I’m going to do a transition over a few years, now’s the time. We have a lot of young talent in the company and it’s an opportunity for this young talent to start assuming the responsibilities of taking things forward. I’ll be more of an investor than the one leading the parade.”
New president Sébastien Hylands joined Kevric in 2015 and was previously vice-president of development, responsible for several development and redevelopment projects.
Kevric’s expertise is in major transformations of assets that were not operating at their full potential, Sébastien Hylands said, and the company sees potential in repositioning the underperforming portfolios of institutional and potential partners.
But while Kevric will be chasing third-party mandates, “it doesn’t mean that the partnership model and investment model is necessarily something that we’re going to be letting go. It’s just that we’re going to be working on both,” he said.
Kevric’s other properties include the Atlantic Complex at 99 Atlantic and 40 Hanna Avenues in Toronto’s Liberty Village and the Air Canada Tower at 525 Viger in Montreal’s Quartier International district. The properties are owned in joint ventures with Blackstone.
The Air Canada tower is fully leased, with tenants that include Air Canada, Shopify and Plus Company which owns Cossette Advertising.
“Our vacancy situation is very much under control,” Richard Hylands said.
