Leon’s Furniture plans 4,000 mixed-home development near HQ

Many people in the GTA have bought home furnishings from Leon’s — but would you buy a home from them?

The furniture and home appliance retailer announced Monday that it is planning a 4,000-home development on a 40-acre parcel of land near Highways 401 and 400. Leon’s Furniture Ltd. says it plans to partner with developers to build the project.

The land is currently the site of the company’s headquarters.

Leon’s CEO Mike Walsh said in an interview that the development is part of the company’s plan to monetize its 429-acre real estate portfolio across the country. Leon’s has 303 stores across the country under various banners, including Leon’s and the Brick.

“It’s all about looking at assets and saying ‘how do you get the most out of it,’ ” said Walsh, adding that the company decided not to simply sell the land to developers, partly because it didn’t need to.

Also, he added, selling it off now would mean missing out on further appreciation in the land’s value.

“The reason we didn’t just sell properties to developers and take the cash and run is that the holdings of real estate continue to appreciate, and that unlocks shareholder value,” said Walsh.

Once completed, the new headquarters and retail outlet could eventually end up in a real estate income trust Leon’s is also planning, but Walsh said any final decision on which assets move into the trust would be subject to discussions between Leon’s and the REIT.

“At some point, if the REIT wanted to take those properties into the REIT, then we’d have that conversation. The REIT will happen before this property’s developed,” Walsh said.

Leon’s has already developed two centralized distribution centres in British Columbia and Nova Scotia, and is developing a third in Alberta. In all three cases, the company maintained ownership of the projects, but had a major developer do the work. The company is taking a similar approach with this project, Walsh said.

The company is putting together a two-phase plan for the site, which would still need approval from the City of Toronto.

The plan would see a new corporate headquarters and flagship retail location on the site in the first phase and the second phase would include 4,000 homes, with a mix of townhouses, highrise buildings and midrise buildings.