KV Capital invests in Nelson Lumber to boost real estate development

Partnership aims to enhance building material supply chain amidst housing slowdown

KV Capital invests in Nelson Lumber to boost real estate development

Canadian investment firm KV Capital is expanding its portfolio into the building products sector, announcing a strategic partnership with Alberta-based Nelson Lumber Company and Nelson Homes.

KV Capital has joined forces with Nelson Lumber, a provider of commercial and residential building supplies for renovations and new home construction, and its sister company, Nelson Homes, a manufacturer of ready-to-move and prefabricated homes.

The alternative investment firm said the move marks its entry into the building products sector and supports its mission to enhance real estate development in its operating markets.

The announcement comes as housing construction in Canada continues to decline. The Canada Mortgage and Housing Corporation (CMHC) reported a 1% decrease in housing starts in April.

CMHC chief economist Bob Dugan said the downward pressure is unlikely to improve any time soon due to “challenging borrowing conditions.”

The partnership involves ATB Private Equity, BDC Capital, and the current shareholders of Nelson Lumber.

"Nelson Lumber is set to play an increasingly significant role in Alberta's housing industry, especially during this period of exciting provincial growth," Tabreez Lila, managing director of growth and transition capital, Prairies at BDC Capital, said in a media release.

"We're eager to partner with firms that share our vision for the future as it relates to building supply sales, manufactured building components, building packages, and premanufactured home production,” Nelson Lumber president Jason Pehl said. “Together, we will continue to improve our customer's experience, boost the efficiency of our operations, and expand into new markets and offerings."

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"Nelson Lumber's reputation, culture, and proven track record make it an ideal inaugural investment for KV Private Equity Fund III," added Aleem Virani, CEO of KV Capital. "We invest in companies with significant potential, and we're excited by how this partnership will drive success for Nelson Lumber, KV Capital, and our stakeholders-particularly our ability to better serve our customers and investors."

"ATB Private Equity is thrilled to partner with KV Capital, BDC Capital, and the current shareholders of Nelson Lumber, united in our vision to expand the Nelson Lumber platform,” said Terry Freeman, head of investments at ATB Private Equity. “We are eager to work with Nelson Lumber's management team to accelerate growth and further enhance their industry-leading reputation established over the past 75 years."

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