Institutional investors are gradually entering Canada’s “missing middle” housing segment as financial conditions for midrise development show signs of improvement and confidence in the high-rise condo market remains weak. BGO is one of the early movers, assembling a portfolio of four- to six-storey apartment buildings across key markets such as the Greater Golden Horseshoe, Greater Vancouver, Calgary, Ottawa, and Montréal. According to Chetan Baweja, head of Canadian value-added and separately managed accounts, midrise housing offers faster construction timelines, fewer zoning hurdles, and greater potential to address middle-income housing needs. BGO’s approach blends acquisitions of existing assets with new development, enabling the firm to deliver the product at a scale attractive to institutional partners.
Yet despite rising interest, the market continues to face structural challenges. Stakeholders note that municipalities, provinces, and the federal government must remove barriers to accelerate approvals and improve project feasibility. Lenders and institutions remain cautious after a condo-market downturn left them holding illiquid inventory, causing uncertainty around exit strategies for new projects. Developers emphasize the need for more risk capital to unlock supply, with improved policy and lower land costs creating a more favourable environment—but not enough to fully overcome equity hesitancy. As a result, institutional capital is increasing slowly, but many believe stronger participation will be essential to meeting Canada’s acute shortage of medium-density housing solutions.