“Apartments Make Money!”: The Financialization of Canadian Multi-Family Housing

After twenty years of disinvestment in multi-family rental housing in Canada, new vehicles for financial investment began to target ageing apartment towers in the 1990s. In 1999, Canadian Apartment Properties Real Estate Investment Trust (CAPREIT) triumphantly proclaimed that “Apartments Make Money!” on cover of their Annual Report, a reversal of the real estate industry’s common wisdom for decades. This paper explores the financialization of multi-family rental housing in Canada – a process initiated jointly by state and industry players – and the role of this process in intensifying gentrification and uneven patterns of urban development. This paper documents the rise of financialized landlords in Canada, and their consolidation of ownership of apartment housing from the 1990s through 2016 – efforts that have intensified in the post-crisis period. Financialization has enabled investors in Canada to overcome former barriers to investment in multi-family housing, posed by the multi-family sector itself and by the country’s diverse regional geography. Financialized landlords have, in fact, capitalized on these barriers to preserve a competitive advantage, from remote Northern communities, to resource boom-towns in the Alberta tar sands, to trailer parks in the Maritimes. This shift in multi-family ownership, and the novel treatment of multi-family homes as pure financial assets has led to property management strategies that are putting new pressures on tenants, via rent increases, new fees, harassment, and renovations to attract higher-income renters. The practices of financialized landlords also intensify existing patterns urban socio-spatial polarization both within and between communities, exacerbating gentrification pressures, and squeezing revenues from low-income tenants living in marginally located properties. This paper also touches on efforts to contest these pressures, led by tenants in Toronto’s Parkdale community, who have fought back against financialized landlords via city-wide organizing, rent strikes, media engagement, and legal battles.