Leon’s Furniture Ltd. announced on Monday that it is closer to developing a master-planned community that includes 4,000 residential units in Toronto.

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The furniture retailer received rezoning approval from the Ontario provincial government in December 2023 for the 40 acres of land it plans to develop for mixed-use including residential, commercial and retail elements. This follows an earlier approval it got from the City of Toronto in July 2022.

“By establishing more density as part of a multi-year, multi-phase development, we will be helping to meet the overwhelming demand for additional housing within the city, while generating substantial value for LFL shareholders,” chief executive Michael Walsh said in a press release.

The land is bordered by Highway 401 to the north, Highway 400 to the west/southwest and Jane Street to the east, municipally addressed as 45 and 88‐100 Gordon Mackay Road, and 11 and 35 Suntract Road.

The company’s home office has been located on this parcel since the company went public on the TSX in 1969.

In an interview with the Financial Post, Walsh said the company currently owns 429 acres of land across the country, which it develops on its own for its stores, warehouses and distribution centres.

The company’s retail banners include Leon’s, The Brick, Brick Outlet and The Brick Mattress Store, which have a combined 303 stores across Canada.

Walsh said that while Leon’s remains focused on retail “because that’s the engine behind this company,” he sees great value in its real estate portfolio.

“Unlocking the value of our real estate is massive,” he said. The company’s land and buildings, which are all unencumbered, are valued at $236 million on its balance sheet, and the shares do not reflect that value, he said.

The company said it expects to complete a secondary plan with the City of Toronto for the 40 acres of land in mid 2025. The first phase of development will focus on construction of a new flagship retail store and corporate headquarters on the site and subsequent phases will focus on 4,000 homes including townhouses, mid- and high-rise buildings and community spaces.

“With this particular site … we believe that we can build 4.6 million square feet of gross floor area,” Walsh said. “And so how you maximize that is through residential, high-rise, low-rise, rental units, townhomes. And so each property is different, but when you want to optimize and intensify land, it’s a mix of a whole bunch of different things.”

Walsh said the company is looking forward to commencing public consultation for the land development after receiving government approval.

In May last year, Leon’s announced its intention to create a real estate investment trust (REIT) for its wholly-owned real estate portfolio, subject to prevailing market conditions and receipt of required regulatory approvals, including approval to list the units on the Toronto Stock Exchange.

• Email: dpaglinawan@postmedia.com

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