A Montreal-based real estate firm is making a major bet on Toronto’s challenged condominium market by acquiring a bulk portfolio of units at steep discounts and committing to invest up to $500 million over the next year.
Jesta Group, a family-owned investment company with four decades of experience across Montreal, New York, London, Paris, Miami and the Mediterranean, has completed its first residential transaction in Toronto: a bulk condo acquisition valued at $30 million.
This transaction is among the first of its kind in the city and launches a program aimed at acquiring more than 1,000 condo units within the next 12 months.
The market Jesta is targeting is under significant strain. An analysis by Urbanation found that sales fell to a 35-year low in the first quarter of 2026, and for the first time in decades no new condo projects launched in the Greater Toronto and Hamilton Area.
As of Q1, a record 4,295 new condos were completed and unsold—more than double the unsold inventory from a year earlier and five times higher than in 2024.
Jesta’s strategy assumes this oversupply is temporary and that the same forces currently depressing the market will eventually push prices back up.
“There’s obviously an oversupply in Toronto,” said Anthony O’Brien, senior managing director at Jesta Group. “Our theory is that oversupply is going to be absorbed over the next few years, and because construction costs are so high and because there’s so much condo inventory sitting vacant, there are no new planned condo projects in the foreseeable future.”
O’Brien expects a shortage of new supply to emerge sooner than many anticipate. “What’s likely going to happen is as this inventory gets absorbed, there won’t be new inventory hitting for another few years after. It looks like 2028 to 2030, there’s almost no new projects being delivered.”
Buying at a discount, renting until prices return
Jesta’s initial purchase consists of studio to three-bedroom units in a single downtown Toronto building delivered in 2025 as unsold developer inventory. The company declined to disclose the address or the number of units due to confidentiality agreements. The building is located steps from Toronto Metropolitan University and is within walking distance of transit, shopping and recreational amenities.
O’Brien said Jesta can acquire units at a meaningful discount to market prices, providing relief to developers. The firm is targeting high-quality buildings developed by established builders, avoiding “shoebox” units and focusing on transactions with at least 30 units.
The plan is to rent the units, use rental income to service debt, and sell when the market recovers.
“We’re buying today at a discount because of the oversupply in the marketplace,” O’Brien said. “As the market improves with less supply, pricing should increase, and that’s when we’ll sell and exit.”
He expects to begin selling within three to five years, with a full exit by year five.
O’Brien also noted that current rents make the strategy viable. “Even though pricing has dropped somewhat in the past three years, it’s still very, very strong compared to other areas of the country. The rent will cover the debt, until we turn around and sell them.”
An added catalyst
O’Brien pointed to a temporary HST rebate on new residential construction as a timely incentive for the program. The rebate, available for a 12-month window starting April 1, represents a 13 percent saving on purchases and creates urgency to complete transactions within the year.
To deliver the program, Jesta is partnering with family offices and institutional investors. The firm is pursuing additional bulk acquisitions across downtown Toronto, with Cushman & Wakefield sourcing opportunities.
O’Brien said the team has been evaluating opportunities for the past six months, and several projects remain under review.
The biggest risk
O’Brien identified a prolonged slowdown in immigration as the principal risk to the plan. “Population growth is important,” he said. A sustained federal pause or reduction in immigration could slow absorption of existing inventory and delay any market recovery.