Mit spent 45 minutes yesterday walking through the entire Foundation Capital universe. FCPRET, all three development funds, the affordable housing fund, and where each one sits right now. Replay + the five highlights that matter most, inside.
PV, Mit & Jeff
The rental market has split in two. The FC strategy has quietly evolved. Approvals are hitting. And Fund III has a Friday deadline for a subscription bonus.
Yesterday Mit ran a live 45 minute update covering every vehicle inside Foundation Capital: FCPRET, Development Fund I, Development Fund II, Development Fund III, and the Affordable Housing Fund. If you missed it live, the full replay is right here.
FCPRET, all three development funds, and the affordable housing side in one sitting. Market split, strategy pivot, approval status, Fund III mechanics.
For the five minutes of your morning, here are the highlights.
The top of the market broke. National asking rents down 4% year over year, 22 straight months of decline. Condo rents down 6.3%. Studio condos down 9.6%. CMHC reports the highest vacancy in the country sits inside buildings completed after 2020, and landlords in that tier are giving away months of free rent and gift cards just to fill it.
The bottom did the opposite. CMHC's own turnover data shows the cheapest quartile in Toronto turns over at 7.9%, the most expensive turns at 12.1%. The tenants who are moving are the ones chasing incentives at the top. The affordable tenants are staying put. That is the market FC actually owns.
For years the value creation lever in FCPRET was turnover based renovation. When a unit came back voluntarily, we would upgrade it and lift the rent to market. That worked because sitting tenants had somewhere cheaper to move to. In London, the bottom rent used to be $600 to $800. Now it is $1,200 to $1,500 plus. Nowhere cheaper to go. Turnover slowed for everyone, and every peer in the industry is quietly feeling it.
FC's response was to stop depending on turnover as the driver and start creating new units instead. File zoning bylaw and site plan amendments to add units inside the existing building envelope. 11 units become 20. 12 units become 21. 42 units become 70. In 2026 alone the OLT has approved or is pending on 86 net new units across the private and REIT portfolios. Each added unit lifts appraised value by roughly $160,000 to $200,000. Longer horizon than a single unit renovation (six to eight months of approvals, six to eight months of construction), but a much bigger percentage of the building gets improved, sitting tenants stay in place, and you unlock municipal and provincial grants that a straight reno never qualifies for.
Here is the single most important slide in Mit's deck. FC builds new affordable supply on the Bus Rapid Transit corridor using CMHC MLI Select (95% loan to cost, 50 year amortization) plus stackable grants. The lowest rent tenants in FC's older buildings get offered a brand new unit in the brand new building. A genuine upgrade for them. That frees the older building for a deep renovation and full intensification. Repeat.
Net result: no inventory lost to the market. New supply added. Tenants housed better. FC captures the lift on both sides of the trade. This is the loop Fund III is designed to close.
On June 22 the province announced Doorways to Dreams at 763-2773 Dundas in London. 247 units. 40% affordable. Sponsored by a not-for-profit. The province committed $2.4M in OHFI capital for 50 affordable units, the City added a $1.1M loan and waived roughly $4.5M in development charges. That is roughly $90,000 per door of stacked public capital. On a $220K-$250K per unit build cost. Not a modelled scenario. A funded, comparable deal executed by another sponsor.
London has drawn $132M in federal Affordable Housing Fund money plus a further $90M tranche, a $74M Housing Accelerator Fund agreement, a $7.3M outperformance top-up, and two consecutive Building Faster Fund awards of $11.9M and $11.2M. Chatham holds over $10M in housing money and took another $3.7M for 50 modular units. None of that is committed to Foundation Capital. But it establishes that the capital exists, the model is funded, and comparable sponsors have already closed on it. That is exactly what Fund III is built to draw down against.
Fund III is 600 units across 76 to 84 High Street, adjacent to Dev Fund II and diagonal to Dev Fund I on the Wellington land assembly. Currently raising the $1.5 million Tranche 1, targeted 20% compounded annually, 4 year hold, $100K minimum, accredited or existing FC investors.
The first property in the assembly closes this Friday. If you sign the sub-docs and fund before Friday, there is an additional subscription bonus incentive on top of the target return, because your capital directly closes the first property instead of FC drawing on its own capital. Ask us on the call for the specifics.
600 Units · 76-84 High St · Wellington BRT Corridor
Targeted: 20% compounded annually (4 year hold)
$100K minimum · $1.5M Tranche 1 · Additional subscription bonus for anyone in before Friday's property close · Accredited or existing FC investors only.
$10K Minimum · RRSP / TFSA / RESP / LIRA Eligible · Also Cash
Targeted: 15% Annualized (7% cash monthly + 8% appreciation)
8 buildings across Southern Ontario. 100% London occupancy. Next NAV per share review expected September following pending OLT and council decisions.
Talk soon,
PV, Mit & Jeff
P.S. Watch the full 45 minute replay above. If any of it lands, book a Fund III call. If you can move by Friday, ask about the subscription bonus.
