Blatchford 90-Unit Townhome BTR
Tranche 1 of a 750-unit purpose-built rental programme on Canada’s most ambitious city-owned masterplan. CMHC MLI Select financing at 95% LTC, 50-year amortisation, sub-5% fixed rate. Edmonton is Canada’s fastest-growing city. This is the entry point.
Build new rental homes in Canada’s fastest-growing city, financed at 95% by the federal government, and earn 15%+ IRR on C$4.3M equity.
The deal in 30 seconds: 90 purpose-built rental townhomes on a city-owned masterplan in Edmonton, Alberta. The federal CMHC MLI Select programme finances up to 95% of cost at a fixed rate below 5% with 50-year amortisation — converting a moderate rental yield into a 15.6% levered IRR and 3.28× equity multiple over 10 years. Edmonton is Canada’s fastest-growing metro (+3.0%), the only Canadian city where CRE investment increased in 2025 (C$3.3B), and one of the last affordable major markets. Tranche 1 is a 90-unit proof of concept; the programme scales to 750 units across four tranches.
Verdict: Conditional Positive
Why this works: the thesis rests on four pillars. (1) Canada has a 3.5-million-unit housing deficit and one federal programme — CMHC MLI Select — actively subsidising new institutional rental supply. (2) Blatchford is a city-controlled, carbon-neutral masterplan whose built-in ESG infrastructure naturally qualifies for MLI Select points. (3) The sponsor has assembled proven local execution partners: Encore Master Builder (2,000+ homes, 39 years in Alberta) and GreenBirch Capital (350+ CMHC transactions). (4) The programme structure offers optionality — prove the concept on 90 units before committing to 750.
What needs work: Year 1 DSCR of 0.95× requires an interest reserve to cover the initial deficit. The sponsor has not previously executed ground-up BTR at this scale — prior track record is Ontario value-add. The 4% annual rent growth assumed in the model exceeds recent Edmonton rental growth and should be stress-tested to 2.5%. The CMHC commitment is described as “sizing complete” but the distinction between sizing and binding commitment requires confirmation.
Canada's Housing Crisis Meets Federal Policy
Canada has a structural housing deficit. The CMHC estimates the country needs 3.5 million additional housing units by 2030 to restore affordability. At the same time, interprovincial and international migration have overwhelmed supply in every major metro. Edmonton, uniquely, has land and political will. The city decommissioned its downtown airport in 2013 and designated the 217-hectare site -- renamed Blatchford -- as one of the most ambitious urban infill projects in North America: a walkable, net-zero-carbon neighbourhood for 30,000 residents.
The federal government, through CMHC's MLI Select programme, has created the financing mechanism that makes institutional BTR viable. By offering insurance-backed mortgages at up to 95% loan-to-cost, 50-year amortisation, and fixed rates below 5%, MLI Select converts thin development margins into institutional-grade levered returns. The programme awards points for energy efficiency, accessibility, and affordability -- all features that Blatchford's district energy system and sustainability standards naturally deliver.
MBI Group has assembled the local team and the first 90 units are priced at C$325K per unit all-in -- a per-unit cost supported by transaction comps in the C$235K-331K range for stabilised Edmonton product. The programme structure offers a disciplined entry: prove the concept on 90 units, then scale to 750 across four tranches. For an institutional investor, this is a rare combination: federal policy tailwind, structural supply deficit, a city that controls its own land release, and a scalable programme format.
90-Unit Purpose-Built Rental Townhomes
Unit Mix (5 Types)
| Type | Configuration | Description |
|---|---|---|
| A | 3BR Townhome | Interior unit, main + upper floors |
| B | 2BR Lower Suite | Interior unit, lower level |
| C | 3BR Townhome | End unit, main + upper floors |
| D | 1BR Lower Suite | End unit, lower level |
| E | 2BR Garage Suite | Above-garage unit |
Average rent: C$2,080-2,163/mo. Premium to Edmonton metro average of C$1,628/mo reflects new-build townhome product with private entries, in-unit laundry, and access to Blatchford district amenities.
Edmonton, Alberta — Canada’s Fastest-Growing Metropolitan Area
Where Is Edmonton?
Edmonton is the capital of Alberta, in western Canada — 300 km north of Calgary, roughly the latitude of Manchester. Alberta is Canada’s energy and agriculture heartland: the province generates C$72,000 GDP per capita, the highest of any Canadian province — up to C$23,000 more than Ontario or Quebec. Edmonton (metro population 1.69 million) is Alberta’s largest city and the northernmost major metro in North America.
Between July 2024 and July 2025, the Edmonton CMA grew by +3.0% — the fastest growth of any census metropolitan area in Canada, overtaking Calgary, Toronto, and Vancouver. For the first time in a decade, Edmonton attracted more interprovincial migrants than any other Canadian city (+11,742 net). The province’s real GDP is forecast to grow 2.6% in 2026, more than double the national average (0.8%), and Alberta’s employment growth of 3.3% leads the country.
For a European investor: think of Edmonton as a resource-rich provincial capital undergoing rapid diversification — significant public infrastructure investment (LRT, university campuses, district energy), a young and growing workforce, and no provincial sales tax. Housing affordability remains strong relative to Toronto and Vancouver, where average home prices are 2–3× higher. Edmonton is where the population is moving.
Blatchford: 217-Hectare City-Owned Masterplan
Canada’s First Net-Zero Carbon Neighbourhood
Blatchford is not a conventional subdivision. It is Canada’s most ambitious urban sustainability project — a 217-hectare net-zero carbon community being built on the site of Edmonton’s decommissioned City Centre Airport, 3 km from downtown. The site is named after Mayor Kenneth Blatchford, who in 1927 championed the creation of Edmonton’s “air harbour” — the city’s original municipal airport that operated for over 80 years before closing in 2013.
Critically, the City of Edmonton itself is the land developer. It retains long-term ownership and control of the masterplan, selling parcels to private builders who must meet customised architectural and green building standards. This structure ensures the net-zero vision is enforced through every phase of development — not diluted by speculative builders. The approach also allows the city to “play a key role as Edmonton plans for another million residents in the next few decades.”
The community is designed around five core sustainability principles:
- 100% renewable energy — the Blatchford Renewable Energy Utility (operational since Nov 2019, C$19.4M invested) provides district heating and cooling via geo-exchange and sewer-heat recovery. No gas connections.
- Stormwater as amenity — rain gardens, bioswales, and constructed wetlands manage 100% of stormwater on-site; no runoff to the municipal system.
- Transit-first design — the NAIT/Blatchford Market LRT station (opened Jan 2024) provides a direct 12-minute connection to downtown. Pedestrian and cycling networks prioritised over car infrastructure.
- 30% more green space than a comparable conventional development — tree-lined streets with no front-facing garages, community gardens, and 30+ hectares of parks and open space planned.
- Density done right — a mix of townhomes, mid-rise, and mixed-use buildings targeting 30,000 residents at full buildout (~2042), with schools, retail, and a 10-hectare central park.
Blatchford has won the 2023 CHBA National Award for Best New Community and was shortlisted for the 2026 Emerald Awards (Alberta’s top environmental honour). Builders active on site include Landmark Homes, Streetside Developments, and Stratosphere Living.
More information: blatchfordedmonton.ca
District Energy System
Operational since November 2019. C$19.4M invested by the City of Edmonton. Geo-exchange and sewer-heat recovery provide heating/cooling to all Blatchford developments. This infrastructure directly qualifies for CMHC MLI Select energy-efficiency points.
LRT Connectivity
NAIT/Blatchford Market LRT Station opened January 2024 on the Capital Line. Direct 12-minute connection to downtown Edmonton. Walking distance from the subject site.
Controlled Land Release
The City of Edmonton controls all land disposition at Blatchford. This limits speculative overbuild and supports rental rate stability. Currently ~400 units occupied or under construction; target 30,000 residents at full buildout (~2042).
Neighbourhood Context
Blatchford sits 3km northwest of downtown Edmonton on the 536-acre (217-hectare) site of the former City Centre Airport (decommissioned 2013) — comparable in scale to Edmonton's entire existing downtown core. It is the largest urban infill redevelopment in Canadian history. The masterplan, approved by City Council in 2009, envisions a 100% renewably powered, carbon-neutral community designed for 30,000 residents, built around two LRT stations, 80+ acres of parks, schools, a town centre, and Canada’s most advanced district energy system.
As of November 2025, 57% of the site is constructed, under construction, or in planning. Nearly 400 homes are complete or under construction, with ~780 additional units on land already sold or under builder interest. Stage 6 is underway with 19 new acres and ~200 townhome lots. The first apartment building with ground-floor retail is under construction. NAIT has purchased 13.27 hectares within Blatchford for campus consolidation — an anchor institutional tenant.
Blatchford is entirely natural-gas free — the only major Canadian community with this mandate. All buildings connect to the district energy system. Solar panels are standard on all homes. Energy performance codes require 37% better efficiency than Alberta provincial standards.
🏆 CHBA National Award — Best New Community (2023)
Blatchford won the 2023 Canadian Home Builders’ Association National Award for Best New Community — Canada’s highest recognition for innovative land use, environmental initiative, and amenity design. This is not a planning award; it is an industry jury confirming that the built product delivers on the masterplan vision.
Federal & Municipal Infrastructure Investment
The governments have already committed the capital that de-risks this community:
- 01C$167–232M — City of Edmonton investment in roads, utilities, and land preparation (sunk cost, not future commitment)
- 02C$23.7M federal grant (NRCan, July 2024) for district energy expansion — total energy project cost C$79.2M. New capacity: 13.1 MW heating + 12.3 MW cooling via Sewer Heat Exchange Energy Centre
- 03LRT delivered under budget and a year ahead of schedule — NAIT/Blatchford Market Station opened January 2024. Phase 2 (Blatchford Gate Station) approved and funded
- 04Self-financing — no direct tax levy support. Blatchford’s redevelopment is structured to be self-financing from land sales and energy revenues
Active Builders (Market Validation)
Multiple builders are active in Blatchford, proving market demand across product types:
| Builder | Product | Status |
|---|---|---|
| Stratosphere / Launch | Pilot — 90-unit rental townhomes | Actively leasing (Canada’s first purpose-built rental in a carbon-neutral community) |
| Encore Master Builder | The Brooklyn — 2-storey fee-simple townhomes | Limited units remaining (MBI’s construction partner) |
| StreetSide (Qualico) | Bungalow & condo townhomes | Show homes open |
| Landmark Homes | 2-storey fee-simple townhomes | Limited remaining |
| Carbon Busters | Contemporary townhouses | Active |
| Crimson Cove | 4–6 storey apartment (ground-floor retail) | Coming soon |
| Metis Capital Housing | Pakoshayimooh Village — affordable housing | Active |
MBI Group
Execution Partners
- 01Encore Master Builder — 39 years in Alberta, 2,000+ homes delivered. General contractor for Tranche 1. Provides construction cost certainty and local permitting expertise.
- 02GreenBirch Capital — 350+ CMHC-insured transactions. CMHC underwriting and application specialist. Described as having "completed" the CMHC sizing -- confirm whether this constitutes a binding commitment or preliminary sizing only.
- 03Braden Equities — C$1B+ AUM in Alberta property management. Will manage the rental operations post-completion.
Track Record
MBI's prior experience centres on Ontario value-add multifamily acquisitions achieving 16-19% ROI. The Blatchford programme represents MBI's first ground-up BTR development at scale. This is a meaningful step-change in execution complexity. The quality of the Encore and GreenBirch partnerships partially mitigates this risk, but sponsor DD should verify construction delivery history on comparable scope and timeline.
Edmonton: Canada's Fastest-Growing City
Rental Market
International migration to Alberta falling 72.5% due to federal policy changes (Source: sponsor materials). This is a material risk to the demand assumption if interprovincial migration does not offset the decline.
Transaction Comparables
| Property | Units | Date | Per Unit | Cap Rate |
|---|---|---|---|---|
| Edgemont Estates | 296 | Q4 2024 | C$235K | 4.69% |
| The James | 272 | Q4 2024 | C$235K | 4.97% |
| Secord Landing | 232 | Q4 2024 | C$247K | 4.98% |
| The MacLaren | 240 | Q2 2025 | C$331K | 4.40% |
The MacLaren (highlighted) is the most relevant comp: new-build, institutional buyer, Q2 2025 pricing. At C$331K/unit and 4.40% cap rate, it validates the subject's C$325K/unit cost basis. Older vintage product trades at C$235-247K/unit with cap rates in the 4.69-4.98% range.
Exit Valuation & Cap Rate Analysis
The model's 5.00% exit cap rate is conservative relative to current transaction evidence. The MacLaren traded at 4.40% in Q2 2025 for comparable new-build product. If the Blatchford programme stabilises as planned and Edmonton fundamentals hold, a 4.40-4.60% exit cap is achievable, which would increase the equity multiple and IRR above the base case. This provides embedded upside.
Cap Rate Comparison
Sources & Uses
Uses of Funds
| Item | Amount (C$) | % of Total |
|---|---|---|
| Purchase Price | 29,322,540 | 92.6% |
| Closing Costs | 1,689,014 | 5.3% |
| Acquisition Fee | 586,451 | 1.9% |
| Operating Reserves | 447,500 | 1.4% |
| Total Uses | ~31,600,000 | 100% |
Sources of Funds
| Source | Amount (C$) | % of Total |
|---|---|---|
| 1st Mortgage (CMHC MLI Select) | 26,390,286 | 83.5% |
| CMHC Insurance Premium | 1,320,834 | 4.2% |
| Member Equity | 4,334,385 | 13.7% |
| Total Sources | ~31,600,000 | 100% |
CMHC MLI Select Financing
Debt Service Coverage
Year 1 DSCR of 0.95x is below breakeven. The model assumes an interest reserve to cover the deficit during lease-up. Confirm whether the interest reserve is funded from equity or rolled into the CMHC loan. This is a standard feature for BTR lease-up but must be explicitly structured.
Attach / Detach Analysis
The attach/detach framework quantifies where equity capital sits in the loss waterfall relative to the CMHC-insured senior debt.
| Metric | Value | Note |
|---|---|---|
| Equity Attachment Point | 0.0% | First-loss position — LP equity absorbs all losses before CMHC |
| Equity Detachment Point | 13.5% | C$4.3M equity / C$31.5M total cost = equity absorbs up to 13.5% value decline |
| CMHC Attachment | 13.5% | CMHC loss begins only after equity fully wiped |
| Breakeven Value Decline | -13.5% | At C$325K/unit entry, equity is wiped if stabilised value falls below ~C$281K/unit. MacLaren comp at C$331K/unit and Edgemont at C$235K/unit bound this range. |
| Breakeven Rent (DSCR 1.0x) | ~C$2,190/mo | At 90% LTV / 4.00% rate / 50yr amort, blended monthly rent must exceed ~C$2,190 for debt service to break even. Model underwrites C$2,080–2,163 in Year 1 — hence the sub-1.0x DSCR. Stabilised Year 2 rents of ~C$2,163–2,250 clear the breakeven. |
| Exit Cap Sensitivity | 5.50% → IRR ~12% | If exit cap rate widens 50bps from the 5.00% base case, IRR compresses to ~12% but equity is preserved. At 6.00% exit cap, IRR falls to ~9% and equity multiple to ~2.2x. |
Bottom line: Equity sits in first-loss at a 13.5% cushion against value decline. The CMHC insurance de-risks the senior debt entirely — an investor’s downside is limited to their equity commitment. The risk is concentrated in Year 1 lease-up (DSCR 0.95x) and the exit cap rate assumption. Both are manageable with an interest reserve and conservative exit underwriting at 4.75–5.25%.
Return Profile
Key Model Assumptions
| Assumption | Value | Source |
|---|---|---|
| Average Rent | C$2,080-2,163/mo | Sponsor model |
| Annual Rent Growth | 4.0% | Sponsor model -- AGGRESSIVE |
| Vacancy at Stabilisation | ~5% | Sponsor model |
| Exit Cap Rate | 5.00% | Sponsor model (conservative vs comps) |
| Debt Rate | 4.00% fixed | Sponsor / GreenBirch sizing |
| Amortisation | 50 years | CMHC MLI Select programme terms |
| Sponsor Co-Invest | 10% of equity | Sponsor term sheet |
Sensitivity: Rent Growth Impact on IRR
| Annual Rent Growth | Est. IRR | MOIC (10yr) |
|---|---|---|
| 2.0% | ~11-12% | ~2.4x |
| 2.5% | ~12-13% | ~2.6x |
| 3.0% | ~14-15% | ~2.9x |
| 4.0% (model) | 16.15% | 3.28x |
The 4% annual rent growth is the single most impactful assumption in the model. Edmonton average rent growth has historically been in the 2-4% range. At 2.5% growth, the deal still produces an estimated ~12-13% IRR -- attractive but below the 15% target. The 50-year amortisation provides a floor on cash-on-cash returns even in a low-growth scenario.
Return Mechanics
The return profile is driven primarily by leverage and amortisation rather than yield. At a 4.00% fixed rate with 50-year amortisation, the annual debt service is approximately C$1.18M on a C$26.4M loan. On a stabilised NOI of ~C$1.25M (Year 2), the property produces marginal free cash flow -- the bulk of the return accrues through principal paydown and terminal value appreciation.
Over a 10-year hold, cumulative principal paydown contributes materially to the equity multiple. Combined with modest NOI growth (driving exit value) and a conservative exit cap (5.00% vs market evidence at 4.40-4.60%), the model produces a 3.28x equity multiple. No preferred return is currently structured in the deal. For institutional investors, a 6-8% pref with a promote above a hurdle would be standard and should be negotiated.
Risks & Mitigants
- 01Year 1 DSCR Below 1.0x — At 0.95x, the property cannot service its debt in Year 1 without an interest reserve. This is standard for BTR lease-up but requires explicit structuring. Mitigant: interest reserve funded at closing; Year 2 DSCR stabilises at 1.15x. Risk residual: moderate -- a delayed lease-up extends the shortfall period.
- 02Sponsor First Ground-Up BTR — MBI's track record is Ontario value-add, not ground-up development at scale. This is a meaningful execution risk. Mitigant: construction is contracted to Encore Master Builder (39yr Alberta track record, 2,000+ homes); CMHC underwriting handled by GreenBirch (350+ transactions). The sponsor is assembling rather than self-performing.
- 03Rent Growth Assumption (4%/yr) — The model's 4% annual rent growth is at the upper bound of Edmonton's historical range. If growth moderates to 2.5%, IRR falls to ~12-13%. Mitigant: Alberta is not subject to rent control; Edmonton's population growth (+3.0%) supports demand; the product is premium new-build with limited direct competition in Blatchford. However, Edmonton average rents remain among the lowest of major Canadian cities.
- 04Early-Stage Neighbourhood — Blatchford has ~400 occupied units of a planned 30,000. Amenity build-out is incomplete. Tenants are renting into a construction zone for the foreseeable future. Mitigant: city-controlled land release limits oversupply; district energy and LRT are already operational. Risk is primarily to lease-up velocity and achievable premium.
- 05LTV / LTC Discrepancy — Sponsor materials reference both 90% and 85% LTV in different documents. The capital stack presented here implies ~83.5% senior debt as a percentage of total uses. This must be clarified with GreenBirch and CMHC. Higher leverage improves equity returns but reduces the margin of safety.
- 06No Preferred Return — The current structure does not include a preferred return to LP investors. This is below institutional standard. A 6-8% pref with a promote structure above a hurdle should be negotiated before closing.
- 07International Migration Decline — International migration to Alberta is expected to fall 72.5% due to federal policy changes. While Edmonton's interprovincial migration (+11,742 net) partially offsets this, the combined migration picture weakens the demand thesis. Monitor BoC and immigration policy announcements.
- 08Land Agreements for Tranches 2-4 — The land agreements for tranches 2 through 4 are described as "being renewed." The programme's full 750-unit scale depends on securing these future tranches. Tranche 1 stands alone economically, but the programme premium embedded in the GP's strategy depends on scaling.
Open Items for Investment Committee
| Item | Status | Priority |
|---|---|---|
| CMHC MLI Select commitment vs preliminary sizing | Unconfirmed | Critical |
| Exact unit count per type (A-E split) | Not disclosed | Critical |
| Interest reserve quantum and funding source | Unconfirmed | Critical |
| LTV/LTC discrepancy (90% vs 85%) | Conflicting data | Critical |
| Preferred return / promote structure | Not in current terms | High |
| Land agreements for tranches 2-4 | Being renewed | High |
| Encore Master Builder fixed-price contract | Not confirmed | High |
| SPV structure and liabilities | Not reviewed | Medium |
| Property management agreement terms (Braden) | Not reviewed | Medium |
| Construction timeline and penalty clauses | Not confirmed | Medium |
| Environmental / Phase I for Blatchford lots | Not reviewed | Medium |
| Rent roll / lease-up schedule detail | Not provided | Medium |
SPV structure, guarantor obligations, and intercreditor terms not yet reviewed. These are standard for CMHC-insured transactions but must be confirmed.
750-Unit Scalable Programme
Tranche 1 (Subject)
90 units · C$32M total cost · Blatchford · CMHC MLI Select financing. Proof of concept for the broader programme.
Tranches 2-4
~660 additional units across subsequent phases. Land agreements "being renewed" -- not yet secured. Same structure and financing approach. Scale benefits expected in construction and management costs.
- 2026 Q3Equity close, Tranche 1TARGET
- 2026 Q3CMHC MLI Select commitment finalisedPENDING
- 2026 Q4Construction commencementTARGET
- 2028 Q2Substantial completion (est. 18-month build)EST.
- 2028 Q3Lease-up beginsEST.
- 2029 Q1Stabilisation (Year 1 NOI)EST.
- 2036-38Target exit (7-10 year hold)TARGET
Recommendation: Proceed to Diligence (Conditional)
The Blatchford 90-unit BTR programme presents a structurally sound investment opportunity anchored by CMHC MLI Select financing, which provides the leverage and amortisation profile necessary to convert a moderate-yield rental asset into a 15%+ IRR equity return. The macro thesis -- Canada's fastest-growing city, federal housing policy tailwind, controlled land supply -- is compelling.
However, proceeding to commitment requires resolution of the critical open items identified in Section 10, particularly: (1) confirming the CMHC commitment is binding (not just sizing), (2) obtaining the exact unit mix for rent-roll modelling, (3) clarifying the LTV/LTC discrepancy, and (4) negotiating a preferred return structure appropriate for institutional capital.
The deal's embedded conservatism in the exit cap rate (5.00% vs 4.40% market evidence) provides a margin of safety. The key downside scenario is a combination of slower rent growth (2.5% vs 4.0%) and delayed lease-up, which would reduce returns to the low-12% range -- still positive but below the target hurdle. The 50-year CMHC amortisation provides structural protection against debt service stress even in the downside case.
Dry Capital's role is advisor and capital arranger. We are not a principal in this transaction.
Sources: MBI Group investor presentation and Build Form (2026); GreenBirch Capital CMHC sizing summary; CMHC MLI Select programme guidelines; Statistics Canada population estimates (2025-2026 CMA); JLL Edmonton Capital Markets Report Q4 2025; Bank of Canada interest rate announcements (June 2026); City of Edmonton Blatchford Development prospectus and district energy reports; Edmonton Real Estate Board rental market statistics; RealNet / CoStar transaction data for Edmonton multifamily (Q4 2024-Q2 2025).
This document has been prepared by Dry Capital for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities. All projections are forward-looking and based on assumptions that may not materialise. Yellow-highlighted items denote assumptions sourced from sponsor materials or Dry Capital estimates -- they are not verified facts. Investors should conduct their own independent due diligence before making any investment decision. Past performance is not indicative of future results. Dry Capital acts as advisor and capital arranger in this transaction and is not a principal.