A global real estate firm bets big on distressed Toronto inventory and mortgage professionals should be paying attention
Jesta Group, a Montreal-headquartered real estate firm with four decades of global investment experience, has entered the Toronto residential market with a $30 million bulk condominium acquisition — the opening move in a stated $500 million programme targeting more than 1,000 units over the next 12 months.
The transaction, brokered by Jeff Lever, executive vice president at Cushman & Wakefield, centres on a recently completed building near Toronto Metropolitan University, in one of the city's most transit-connected downtown corridors.
Jesta is targeting developer inventory at $700 to $800 per square foot. That's well below the market average of $1,189 per square foot recorded in the Toronto and Hamilton region in the first quarter of 2026, according to industry group Urbanation Inc.
The firm plans to rent units out at approximately $4.25 per square foot, or roughly $2,125 per month on a 500-square-foot unit.
"Toronto's fundamentals remain strong and the current market environment has created a unique window to deploy capital at scale," said Anthony O'Brien, senior managing director at Jesta Group.
"We are aggressively pursuing opportunities that fit this investment ethos and encourage developers with qualifying inventory to reach out directly."
O'Brien confirmed the federal and provincial harmonized sales tax (HST) rebate was the catalyst that made the first deal viable — without it, he said, the deal could still have closed, but would have required more protracted negotiations with the developer.
Read more: Ontario HST rebate: Will it jolt a stalled housing market?
A market primed for institutional capital
The entry comes against a backdrop of deepening distress in Toronto's condo sector.
Many condo owners who purchased at the 2021–22 market peak have been unable to offload their units at those elevated prices, with listings sitting stagnant as buyer demand dried up.
That prolonged stalemate has left developers holding growing volumes of unsold inventory, precisely the conditions Jesta is now moving to exploit.
Builders and developers are also beginning to pivot toward liveable condos designed for end users rather than investors, a strategic retreat from the high-density micro-unit model that defined the boom years.
That shift has widened the pool of distressed new-construction stock available for bulk acquisition, and firms like Jesta are stepping into the gap.
Read more: More pain could be ahead for Toronto’s micro condo market in 2026
The timing is no accident. Ontario's HST rebate programme, a joint initiative between the provincial and federal governments, removes 13% in combined taxes for buyers of newly built homes intended for rental use, provided construction commenced before March 31, 2026.
Buyers have until March 31, 2027, to complete qualifying purchases before the rebate expires.
Jesta is not alone in eyeing the opportunity. High Art Capital launched earlier this year with $300 million from the province's Building Ontario Fund, with agreements to purchase unsold developer inventory and convert units to rentals, with plans to raise an additional $1 billion in debt and equity.
For mortgage professionals with broker-channel exposure to investment lending, the dynamics are worth tracking closely.
As institutional buyers such as Jesta move to absorb developer stock, traditional investor-purchaser pipelines may narrow, but so too could distress risk for lenders already holding construction loans or pre-sale mortgages on stalled projects.
Some long-term investors remain bullish on Toronto condos despite the current downturn, including managing partner Joanna Lang of Outline Financial, who has pointed to institutional activity as a signal of underlying confidence in the market's longer-term trajectory.
“I think the mood in general is that clients feel the Toronto condo market is going to turn around. I’m not saying this year or next year,” she told Canadian Mortgage Professional.
“Long term, end users want to close on the deals if they can afford to carry the property, which is a little bit of a challenge considering that rents have come down as well.
“But they generally will figure out the way to make it work because they believe that long-term, the values will rebound.”
Jesta Group is a family-owned, Canadian-based real estate investment firm headquartered in Montreal with operations spanning North America and Europe, including New York, London, Paris, Miami, and the Mediterranean.
The firm has invested across residential, office, industrial, and hospitality assets, and notably transformed Gare Viger — a heritage property built in 1898 — into a mixed-use complex in Montreal that includes hotel, residential, retail, and office components.
Its global portfolio includes over 1,200 hotel keys and development projects in Berlin and London.
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