Lululemon Athletica founder Chip Wilson’s family real estate company has been rapidly buying up property, primarily in East Vancouver, and plans to have a portfolio worth $1.5 billion within 10 years.
Five-year-old Low Tide Properties (LTP) already owns about $300 million worth of property, about 90% of that in the city of Vancouver, said CEO Andrew Chang, who has been at the 10-employee company for about a year.
Wilson’s Point Grey mansion, which is assessed at $63.8 million and is the most expensive home in B.C., is not part of LTP’s portfolio.
“We go into neighbourhoods where we think there’s significant growth potential,” Chang told Business in Vancouver. “Our investment horizon is always long-term.”
Most of the buying has been in Gastown, Strathcona and Mount Pleasant, although the company also has property at False Creek Flats, in Kitsilano and around Burrard Street and West 7th Avenue.
Future purchases will likely include real estate along Great Northern Way, Chang said.
Rare purchases outside Vancouver have sometimes stemmed from necessity. For example, LTP bought a building on Toronto’s Yonge Street to lease space to the Wilson family’s retail fashion brand Kit and Ace, which has yet to open at the location.
“Diversification is very important in the stock market,” said Real Estate Investment Network founding partner Don Campbell. “But in real estate … there’s so many different levels of diligence and management and the politics that you have to play that having all your eggs in one basket can make sense if you really watch your basket and know it well. You’re then not distracted by that shiny thing over there in Kelowna.”
LTP’s Gastown properties include 151 Water Street, where Kit and Ace operates a store, and adjacent buildings at 157 and 165 Water Street.
The biggest cluster of Strathcona properties is centred in the 800-block of East Hastings, between Hawks and Campbell avenues.
LTP has several properties between 855 and 895 East Hastings on the north side of the street and 10 lots between 828 and 868 East Hastings on the south side of the street, Chang said.
The City of Vancouver recently rezoned that strip of East Hastings to allow for residential development, but Chang said LTP has no plans to build condos.
“We don’t actually do a lot of development at this point,” he said. “That area lends itself to be more of a village or a commercial neighbourhood.”
Tenants, such as Tim Knight, who plans to open the 12,000-square-foot craft brewery Strathcona Brewery Inc. in one of LTP’s properties on that strip, appreciate that LTP is not going to radically change the area.
“They could have easily demolished everything but I think they’re trying to work with the community and build a neighbourhood,” Knight said. “They’re trying to encourage people to open coffee shops and keep the area mixed-use.”
While LTP has yet to buy any single-family homes or condominiums, it does have rental buildings, Chang said.
It has also diversified into industrial and office properties by buying sites such as Kit and Ace’s head office at the corner of Manitoba Street and West 7th Avenue as well as one at 2450 Ontario Street, where Raven Song Community Health Centre operates.
Other properties nearby are on Main Street near East Broadway.
“We have a really neat older property that we are renovating with retail on the ground floor and rental suites on the upper floors,” said Chang of a building at the corner of Main Street and East 11th Avenue.
“Obviously, over time, we would certainly have to diversify geographically, potentially to cities in the U.S. We’re monitoring that but we are still a young company.”•