A real estate development company has purchased a ‘white elephant’ building along the busy Saint Denis Street in Montreal with plans to revitalize it into unique retail and housing space to go along with the renewal of a street which had fallen into decay in recent years.
“One white elephant was the southwest corner of Rachel and Saint Denis Street. Originally a bank in the 1920s, it was Mexx’s flagship store for 17 years before its demise. The building has been fully vacant and vandalized for five years now and has been in many Montreal newspapers as the ugly face of the retail apocalypse and Montreal’s abnormally high retail vacancy rate,” said Spatzner.
He said the company purchased the building in October and plans are to redevelop the site, which had decayed, to 5,500 square feet of retail on the main floor with the second floor turning into an AirBnB hospitality asset.
“The building is really a symbol of Saint Denis’ fall and hopefully rebirth,” said Spatzner.
MTRPL was founded in 2016 as a real estate company concentrating on retail centric mixed-use urban development. It specializes in the investment, development, and management of mixed-use assets.
“Our investment philosophy begins with transit-oriented development along retail corridors in urban areas. We search for assets in high density neighbourhoods, with abundant foot traffic and an authentic sense of place,” says MTRPL on its website.
Spatzner is an architect turned developer who after spending time studying in the United States returned home to Montreal. After stints working with large national developers, he founded MTRPL.
“We buy distressed assets, vacant buildings, buildings that are under leased, poorly managed and we try to give them a new lease on life through sort of creative, highest and best use, through enlarging buildings, through finding if there’s excess land on the property if we could infill it somehow,” he said.
“Saint Denis is our most recent project. We started four years ago. Saint Denis is our 10th project. We look for assets on commercial arteries, retail corridors in the downtown Montreal area often with an eye towards transit-oriented development, which here in Montreal essentially means near a Metro station or one of the new REM (light metro rapid transit) stops. We love what we do.
“We’ve got the best intentions of the city at heart and really take placemaking as our passion and are very lucky to love what we do.”
He said Saint Denis has hit some pretty tough times over the last few years for a number of reasons including construction, “exorbitant” taxes, and the natural flow of the city.
“This building in particular has a lot of history to it. Essentially this beautiful, heritage property on a prominent corner of Saint Denis and Rachel Streets has been vacant for the last five years. In addition to that there was a fire in the building in that time frame. It’s just the type of property we look for, warts and all,” said Spatzner. “We see tremendous upside. It’s a landmark property. Everybody knows that corner and it’s honestly become the white elephant on Saint Denis and the face of Montreal’s retail woes.
“We’re super excited being involved in bringing it back to form. What’s nice about this building there’s a fully finished basement from the time it was a bank with washrooms. The ground floor is not reinventing the wheel but fixing up the space, renovating after the fire, bringing it back to the beautiful building it could be and leasing the ground floor. The second floor we have the zoning for AirBnB. Previously it was a 5,000-square-foot single apartment that the inheritors of the building had been living in. When the fire gutted that upstairs apartment, it’s essentially been uninhabited for the last few years. Montreal’s AirBnB legislation permits short-term rentals on certain commercial arteries of which this tranche of Saint Denis is included. And so part of our redevelopment plan is to redevelop the second floor and reposition it into 10 short-term rental suites.”
He said the building is a premium retail location kitty corner to Rachelle Béry.
“We feel it’s a very prominent corner with real flagship potential for a future retailer,” added Spatzner.
He said Saint Denis, along with Saint Laurent and Mont-Royal, is a main retail corridor in the Plateau district of Montreal.
“The Plateau is Montreal’s densest and arguably, after old Montreal, most famous neighbourhood. So for our company that really looks for retail corridors and commercial arteries, it was kind of a no-brainer. We have other projects in the Plateau on Mont-Royal and projects in the sudwest on Notre Dame, on Wellington Street and Verdun. So it really fits nicely into our sort of investment thesis and portfolio profile,” said Spatzner.
“I think Denis probably hit rock bottom a year or two ago. As of late there’s actually been quite a lot of movement in properties being purchased, changing hands, and I would say young developers coming onto the street, onto the corners and really trying to turn it around.”