Layered with CMHC financing, municipal grants, and development charge exemptions, every $11,000 of LP equity inside FAHF I builds one purpose built rental home. Every $100K builds nine. Every $1M builds ninety. We break the full capital stack down below.
PV, Mit & Jeff
Friday's launch buried the most exciting math. Today we lead with it. Plus where Wellington Towers Tranche 1 stands, and three market signals shaping both funds.
Friday's launch of the Foundation Affordable Housing Fund generated more inbound than any single email we have ever sent. Thank you for that. The replies, the introductions, the questions, all of it. Over the weekend, the same question kept coming up. "What does my dollar actually do inside this fund?"
The honest answer is one we wish we had led with on Friday. $11,000 of LP equity builds one purpose built rental home. Every $100K of commitment translates to roughly nine homes built. Every $1M translates to about ninety. That math is unlocked because the fund is structured around CMHC MLI Select financing at 95% loan to cost. The government does the heavy lifting on debt. Your equity is the multiplier.
That is the number that makes this fund different from any real estate vehicle most investors have ever seen. There is no deadline on FAHF I. We will keep this fund open as long as it takes to do this right, because the homes we are building are designed to stand for generations. Take your time. Read carefully. Bring questions.
Wellington Towers Tranche 1, by contrast, is the lane with a clock on it. Still extended this week at the 24% targeted return. Two open doors, two different reasons to walk through them. Here is how to think about each.
The loan to cost ratio CMHC MLI Select provides on qualifying purpose built rental. That single program is what makes the $11K of LP equity per home math possible. We break down the full capital stack further down in this email.
432 unit purpose built rental in London. Tranche 1 is still open this week at the 24% net annualized targeted return while we finish the subscription paperwork on the investors mid process. After Tranche 1 closes, the next tranche prices at 20% and does not close until late 2027.
This is the lane if you are optimizing for compounding returns over a 4 year hold. $100K minimum, accredited or existing FC investors.
Three classes of capital to match how you invest. Class A targets 18 to 20%. Class B targets 10% with quarterly cash. Class C is 6% PIK for foundations and impact intermediaries. Every $11K of equity, layered with CMHC financing, builds one permanent affordable home for the Canadians the market does not serve.
This is the lane if you want market returns and a permanent affordability outcome on the same dollar. Open for as long as it takes. Accredited investors only.
A purpose built rental unit in southwestern Ontario costs roughly $225,000 in hard construction cost. The fund does not write a $225,000 cheque for each home. It writes $11,000 of LP equity. The rest of the stack is what the fund's structure unlocks.
The $11K of LP equity per home is your contribution. CMHC's MLI Select 95% loan to cost program does the heavy lifting on debt. Municipal grants and NPO unlocked capital deepen the stack further. That is how the fund builds homes at a depth no traditional real estate vehicle can.
The Montreal fund move two weeks ago was not a one off. More Canadian institutional capital is repositioning out of for sale condos and into purpose built rental. The buyer pool we are building toward on Wellington Towers is getting deeper, not thinner. Every quarter that this trend continues makes the exit math at stabilization more durable, not less.
The federal forecast for housing starts has continued to revise down through 2028. Developers are paused, tariffs are biting, and the pipeline of competing supply at our completion date is shrinking. That is good news for any building leasing into 2030. It is great news for one that comes online below market.
For years the 10 to 20 year sunset on CMHC affordability commitments was a footnote. Now it is starting to surface in housing forum conversations across the country. The next wave of policy is going to ask hard questions about permanence. FAHF I was structured to answer them before they were asked.
Subscription completions on Tranche 1 of Wellington Towers, the first wave of NPO and foundation calls on FAHF, and any move from CMHC on the next MLI Select policy refresh. We will recap on Friday.
If you cannot decide which fund fits, or you want to see how a split allocation might work across both, reply to this email with your numbers. We will run the math and walk you through it on a call this week.
Best questions get answered in Thursday's Q&A.
432 Units · 25 Storey Purpose Built Rental · London, ON
$100K Minimum · Cash Only · Accredited / Existing FC Investors
Tranche 1 Extension: 24% Net Annualized Targeted Return
Affordable & supportive rental · Southwestern Ontario
Accredited Investors Only · Three Classes To Match Your Mandate
FCPRET is the $10,000 minimum option, eligible for RRSP, TFSA, RESP, LIRA, and cash. 7% targeted distributions paid monthly, 15% targeted total return. Open continuously.
To your success,
PV, Mit & Jeff
P.S. The most useful thing in your inbox is who you know. If reading this triggered the thought of one person, one organization, one foundation, or one NPO leader who should be in the FAHF conversation, please reply with their name. We will take it from there. The fund stays open as long as it takes. The introductions are the part we cannot manufacture on our own. Reply with FAHF for the affordable housing fund or Wellington for Tranche 1.
