PROJECT OSBORNE
FULL CASE STUDY
INTRODUCTION
Project Osborne was not a broken deal — it was a deal that worked, but not optimally. The property had been acquired as a fourplex and performed as expected under conventional financing. However, the owner recognized that while the investment was stable, it was not maximizing its full financial potential.
Arete was retained after acquisition to evaluate the building and develop a strategy to improve performance, increase value, and reposition the asset for long-term optimization. What followed was a targeted plan to convert the building from a fourplex to a fiveplex — a change that would fundamentally transform both the financing structure and the overall economics of the investment.
PROBLEM
As a four-unit property, the building was subject to conventional financing limitations. While it performed adequately, the structure of the debt restricted its potential.
Typical constraints included shorter amortization periods, higher down payment requirements, limited loan-to-value ratios, and higher monthly debt obligations.
DISCOVERY
Through our assessment, we identified a key opportunity: the building could be converted from a fourplex to a five-unit property through proper variances and approvals.
STRATEGY
Arete developed a focused strategy to convert the building, secure approvals, and position the asset for CMHC refinancing.
EXECUTION
We led the variance and approval process with the City, securing all approvals with zero appeals and successfully converting the building.
RESULTS
The building qualified for CMHC financing, unlocking extended amortization, higher leverage, and allowing the investor to recapture their original capital.
CLOSING
Project Osborne demonstrates how strategic repositioning can unlock significant value.