104: Empowering Communities by Revolutionizing Middle Housing Development with mddl's Alkarim Devani

Taylor Atkinson: Welcome back to the Kelowna Real Estate podcast. I'm your mortgage broker host, Taylor Atkinson.

Matt Glen: And I'm your real estate agent host, Matt Glen. It's afternoon to say Taylor. Well

Taylor Atkinson: You know, Bank of Canada announcement came out July thirtieth? Yes. Pretty boring, you know, as predicted. Yeah. You know, I think six months ago, we spoke to Brandon Oglinson.
Things were much more optimistic for rate cuts. But, obviously, tariffs have been a huge topic of a conversation. When those tariffs come in, we see inflation, core inflation, that obviously has to put, you know, Bank of Canada on pause. So that trade uncertainty, and then just like our economy in general, like, we have some pretty weak growth signals. So where we're at with that?
In September, there's now a thirteen percent chance for a twenty five basis point cut. And then in October, there's a twenty four percent chance. Of the same cut. And then moving on from that, like, by the end of the year, there's a fifty percent chance. It's not like it's adding up collectively.
It's just point two five percent. It's Yep. Going to likely happen closer to some of the year. Yeah. So it

Matt Glen: would likely get a point two five cut by the end of the year.

Taylor Atkinson: Yeah. And, I mean, that obviously changes weekly when, you know, information comes out about

Matt Glen: Yep.

Taylor Atkinson: Job growth and inflating

Matt Glen: next tariffs. Yeah.

Taylor Atkinson: Yeah. Exactly. So it's been hard to predict. It's been, you know, evolving. Yeah.
I think what I take away from that is, you know, if you take tariffs out of the picture and you take, like, the media out of that, we, as economy, still need a little bit of debt.

Matt Glen: So it,

Taylor Atkinson: you know, it means we are, yeah, at the lower part of our rate cycle. But it doesn't mean, like, we've hit it and we're going back up.

Matt Glen: Right? I'm still optimistic on that. So right before we went on, you said something super interesting about mortgages. Yeah.

Taylor Atkinson: So what I've been doing a lot with clients right now over the last six to twelve months you know, most people are very stressed about the decision whether they go variable or fixed or a three year fixed or a five year fixed. Right now, everything's pretty balanced like most of the rates are neck and neck. So in terms of being qualified, most people have the option to choose whatever they want. But what most people get fixated on is they have to choose one or the other. Yeah.
You don't have to. You can blend the two products together.

Matt Glen: That is so I did not know that. That's Chris.

Taylor Atkinson: Specific to just a couple lenders. So if you want, you know, say you have a five hundred thousand dollar mortgage, you can put two hundred thousand on a variable, two hundred thousand on a five year fix, and a hundred thousand on a three year fix.

Matt Glen: What? You can do three like that crazy.

Taylor Atkinson: Yeah. You can do up to five. You can really, like, pick and choose what you want. It allows people just to, like, you know, hedge their bets a little bit. If they think there are some rate cuts, they can do that.
If they think fixed rates are gonna drop, you know, they can put a little more on the variable side, and then they can lock that in in the future. There's lots of flexibility there. I guess, what I preference to clients usually is, like, you know, hey, when people set this up, they have good intentions to then go, I'm gonna watch this like a hawk and as soon as rates drop, and I'm gonna lock this in and switch that. You know, let's be honest, most people don't. It's usually like a set up and forget it.
But, yeah, it's something that I think is not well known about or people just don't talk about. Yeah. I didn't know that. So if you're out there and you're kinda torn between fixed, variable, five year fixed, three year fixed, whatever. Yeah.
Reach out. We can

Matt Glen: That's why we have you on the pod. The one and only reason.

Alkarim Devani: Yeah. Yeah. No other reason than that. Yeah.

Matt Glen: We waited for three years to get this audio. Yeah. Exactly. That's great info, obviously, Taylor. Yeah.
People are gonna use that. Yeah.

Taylor Atkinson: So anyways, we'll we'll keep you updated on this stuff, obviously. But Yeah. At this point, pretty boring stuff, not a lot's changing. We'll just kinda watch inflation and see what happens with tariffs. But

Matt Glen: Yeah. Yeah. Nice.

Taylor Atkinson: And then, yeah, today's show is awesome, man. We've been trying to connect with Al from Middle Hell's Inn for, like, six months. I went to one of their events in Kelowna. And, yeah, they're doing some really cool stuff, primarily, like, I see it as mostly education based for people that wanna learn about it.

Matt Glen: That's what he says too great.

Taylor Atkinson: Yeah. Like, he's obviously done a ton of developments himself. And now he's kind of stepped away from that, and it's just primarily focusing on educating people. And, like, very affordable education courses. You know?
I'm like, you can go to one of their one day events for, like, a hundred and fifty bucks. And I think most of that is because they're getting subsidized or, you know, being given grants federally or from municipalities to come and help people because this is such an obvious solution.

Alkarim Devani: Like,

Matt Glen: yeah, he's helping people within Phil Housing, down there in the house, building three units, or care house, or whatever, building more houses. And, yeah, it seems like they're using Kelowna as a testing graph for a lot of this stuff, which is super cool too.

Taylor Atkinson: Yeah. Well, I mean, I think everyone knows Kelowna's been very evolved in this space. They're really, like, leading in a municipality. And it doesn't just mean, like, they're focusing on investors how to, like, tear down a single family house and get a floorplex Like, it could be a generational health where you wanna bring in a family member and have some rental revenue. Yep.
Like, they focus nationally. So I think on the investment front, it's probably a little more lucrative in, like, Alberta where the cost of land is a little bit cheaper. Just pencils them a bit better. Yeah. But really cool technology too.
Like, when we were going over, like, realstore dot c a and how they're meshing that together, and you can just look at active listings and what you can put on those sites like a four plexer.

Matt Glen: And then you can buy a design from the fast track program. Yeah. Crazy.

Taylor Atkinson: Like, super super cool stuff. Yeah. Like, five years ago, this would have never been Yeah. Something we spoke about. But, yeah, they've got some awesome stuff.
So sign up for their newsletter, come to some of their events. I think Al said, you know, likely they'll do another event in the fall,

Matt Glen: but we'll keep his one day course Middle School. This is a very interesting episode. He has a lot of good things to say.

Taylor Atkinson: Yeah. We could guy.

Matt Glen: Alright, guys. This episode, like every other episode, sponsored by Century twenty one Insurance Realty, Best Brokerage in Kelowna, and North Okanagan, South Okanagan. All around the interior BC. If you're an agent looking for a switch or if you're a buyer or someone looking for an agent, give us a call. We'd love to talk to you.
Enjoy the episode, guys.

Taylor Atkinson: Alright, Al. So great to have you on the show, man. I met you about eight months ago at one of your presentations and thought you were doing some great work. So we've been trying to get you on the show for ages now, so appreciate you making time for us.

Alkarim Devani: Yeah. No. I really appreciate you guys asking me to come through. This is great.

Taylor Atkinson: So maybe we can just start, like, quick high level elevator pitch of of yourself and middle, the company you guys are expanding quite rapidly through Canada.

Alkarim Devani: So, I guess, we met at our first annual middle school here in the city of Kalana. We've now done middle school. In seven different cities. I think we're up to over a thousand attendees across the country. And historically, like, I was a real estate agent.
I graduated from the University of Cadbury, but I decided to get my real estate license, like, when I was eighteen. So right on a high school, So when got my real estate license, I decided I still wanted to go to university because not in my family had a university degree. And I was like, I'm gonna be the first. I went and was kinda yeah. Was it business school?
And it was tough because, like, my family is all entrepreneurs. My brothers were doing stuff. My brother is the reason why I got my real estate life since I basically, like, sat open houses the entire time that I was in university and basically got paid, like, cash because no realtors wanted to sit open houses, but they wanted their clients to know they had open houses and so I basically, like, have science in the back of my car that were, like, the stockbrokers side and would settle open houses in, like, every community, and I would get to study. Because, you know, back then, like, no one was buying from open house. And we get, like, five people out.
But the cool thing for me is I just, like, learned a bunch about communities, fabrics. I would go literally anywhere in the entire city of Calgary if if I was gonna get paid this at the open hour. I never sold the single house university, but I I set a lot of open houses. And so it was like a crazy thing, but I learned a ton and you learned a lot about communities what was happening, transformation, new builds, like, new growth communities. I just really got an understanding of, like, what was happening in the city.
And so when I graduated, I, like, immediately saw it. Okay. Well, I need to pay for my degree when I gotta downtown. I gotta shoot a briefcase. I'm, like, for, like, three weeks I went through my training program, and I was, like, I'm not doing this.
And so I quit. And I remember the guy being, like, you know, it's crappy that you decided three weeks after rather than a week because, I guess, like, the training program, they say costs thirty thousand dollars. I was like, oh, I'm so sorry. Like like, I didn't learn anything from you to go execute. It's just like, really good for me to realize, like, I don't belong here.

Matt Glen: And so Yeah.

Alkarim Devani: I asked my brother if he would start an inner city building company with me because I saw the market was shifting, and I thought there was a need for things happening in the redevelopment. And so that was kind of my journey of getting into development. So I've been in real estate for a very long time. I was building infill houses, primarily, like, semi detached, turned down older know, wartime bungalow is building duplexes. But then in twenty fifteen, we saw this kind of, like, inflection points that had been doing it since, like, two thousand seven and fifteen prices, like, had doubled, tripled.
The biggest house we've built was, like, a three point two million dollars family and triple cartilage home in, like, in a really beautiful area to see. And I think, like, the marketing calendar was always so booming and blessed. There was tons of volatility. But in twenty fifteen, my mom had passed away with my dad and was living in the suburbs and we had thought, okay. Well, it's kinda crappy for my dad to me by himself in twenty, thirty minutes away.
Let's bring him into the inner city. At the time, like, the only project that seemed to make sense for us to build was a duplex, which is way too big for my dad. And so we were kinda like, should we go and see if we could build four units because there was four units across the street? Everyone I talked to was like, can't do that, doesn't work like that. You could do whatever you want, but you're not gonna get approved.
And I was like, yeah. But it just doesn't make sense. Like, why can't you build townhomes on a site that right across the street? On all four corners, there's townhomes, but, like, for some reason, this street, you can't build the townhomes, like, three corners, had townhomes. So hired a guy who was, like, willing to do with us.
We got rejected. Like, the city said no. We went through a process called Calvary Planning Commission. They also said no. And they're, like, there's no point for you to go to cancel.
You got two out of three rejections. You're just gonna get a third rejection. I thought, well, pock committed at this point might as well go. And we went and counsel debated for, like, seven hours for us to go from what was allowed to be two units to try to get to four units. And we ended up losing because a new counselor just got elected, got scared last minute, voted no eight seven.
And so that was, like, a huge inflection point. Like, it was crappy that that happened, but it also, like, I got calls from the chief urban planner. I don't even know there was a role on the chief urban planner at the time. I got to know what urban planning was. They basically pulled me in to be like, so what were you trying to do?
I'm like, it's pretty simple. We thought that we could try to do more than two units on these lots because you could still build townhomes just like you already allow in certain neighborhoods in certain very remote pockets. City agreed, created a new zoning district, brought us in on the engagement. We knew it was gonna happen, So in twenty fifteen, we went out, bought, like, thirty of these lots, raised the capital fund to go out and basically execute on middle housing now and move our entire infill. What was a side by side, you know, program to saying, let's do four units.
And so we went on to do, like, I think, from twenty fifteen until, I don't know. We were, like, ninety five percent of the city's applications on that zoning code because no one had really caught on that it was working. I think we probably had built a hundred and fifty units in that kind of row house. And then you know, twenty twenty COVID pandemic happens. We had so many of these townhomes for sale.
We are competing with each other because there's no other products. So people would go to two of our houses in different neighborhoods. And so we just realized that we had, like, really, probably produced too many too fast But then, you know, there was this big push for rental housing and MLI Select at the time was called flex. There was almost like a loophole. Like, you stumbled into this thing backwards where when they wrote the row house district, they had permitted you to actually have secondary suites.
Which no one really understood that it was a market or a coworker, was a viable option. And so we kind of, like, had this project. We'd sat on it for two years paying, like, a mezz lending was, like, loan. We had approved BP, but we just didn't wanna put four more townhomes. Of, like, six hundred fifty grand, seven hundred into a market that wasn't moving.
So we held it. And, like, lost money every single month. I'm talking, like, five grand a month in mortgage parents, and I was saying, held it for, like, over two years. K? And then we were just, like, what if we just, like, scrap that project and added secondary suites and built this thing as a rental.
And then we figured out that if we did a construction loan, we could do a select takeout. And then from that point, again, like another huge inflection point for our development company because we learned that there was a huge demand for rental at the time because not everyone could get qualified for purchasing. And then, you know, Round Square was a company that we had built this whole time. It's really transitioned into this purpose built rental model. We have, you know, a hundred and sixty active units that we're building in the townhome space.
But I would say, the thing about the townhome stuff is, like, when you start to pioneer and do things really well, you get pulled into so many different directions. And so we went on to do, like, a two hundred and twenty unit heritage restoration, seven store building in Winnipeg. We did a medical center in Calgary. We've done a rooftop garden building with, like, twenty units and so we went on and did a bunch of things all the way from commercial to mixed use heritage restoration, seven stories, six story buildings. And I would say all of that to realize, like, you know, the thing that we were doing that we were pioneering on, that we recognized was this kind of gentle density.
Like, there are the REITs and pension funds and really well capitalized folks that do, you know, six story, seven story, twelve, fifteen, really well. We learned real quick. You have to have a lot of money. You have to compete at a high level. There's really no room for errors because the budgets are so massive.
The complexities are extensive. It's not as easy as everyone thinks. And so we went back and, you know, I think just after the pandemic basically said, we're not gonna do any more kind of turnaround park aid structures, high rise, mid rise. We're gonna double down on middle housing. And so we launched another fund that Brown Square was actively doing a hundred and sixty units.
And at that time, still very involved in the city and and very involved in advocacy and moving things along, but the city of Cadbury had voted to make it as of rights. And so, you know, when that happened, everything changed just for, like, I think there was, like, three thousand applications for this housing form, you know, within a given year. So you can see the uptake was massive. And so it was great. Another inflection point for myself was, like, My brother doesn't really need me in the development company proper anymore because it's really a system.
It's a process. Land usage in place. There's not a lot of, like, change in pioneering and things happening. And I met my partner, Darlene, who I've worked with before. She was a planning consultant, urban planner.
She was the vice president of base camp developments. It had tons of experience in development. And I said, Dar, I think there was, like, this missing ecosystem that exists of people understanding what the opportunity is in middle housing. And we basically just ask ourselves a question of, like, what would it actually require to scale this across Canada? It's difficult for any one company to scale, which is also why it's really awesome because, you know, a pension fund to read a large development company.
It's hard for them to go out and acquire, you know, fifty homeowners' homes and then assemble building teams that wanna build at these small scales, there hits this point where if you start to produce too many units, you lose the ability to actually do this housing form well, which makes it really beautiful because it's not like craft beer. Right? As soon as you go into distribution, you change it. But when you're a local taproom servicing a market, you can do really well. As soon as you go into distribution, it changes.
And that's the thing about middle housing. It's like, what was successful? Was a bunch of us small folks in community that were doing really well? The challenge was is there was no playbook. There was no understanding of how to do it.
And the biggest thing that we realized was that the person that is most equipped to do middle housing really well is the homeowner because they have the land and the land basis that none of us could acquire it for. And so we kinda just tried to reengineer the system to say, what if we put them at the center of the solution? And so much of the work we do at middle is working with municipalities, working with government, working with homeowners, to not only build, like, the foundational information education, but to, like, unite the ecosystem and figure out how to get homeowners to be a part of this solution. And folks will always be like, oh, you're never gonna get everybody to redevelop their home. And it's like, well, that's really not point.
The point is to make sure they understand what the potential and opportunities are, but also the ecosystem and folks around them in the industry have the ability to support that homeowner or embark on doing that as well. And so that's the journey we've been on, and it's been cool, man. Like, we've been embraced by so many different groups, I would say, across the country. Not only cities, like building groups, ULI, like, different groups who've been really strongly supportive of the work that we're doing and trying achieve. And so we see ourselves as like capacity builders.
We're working on, you know, innovative policy here in Kelowna. We help launch the first version of the Fast Track. They're launching phase two, which gets you building permit within, you know, ten business days. We use CIS mapping technology to identify which one of those sites basically met the requirements for those preapproved lines. And so again, reducing the barriers, providing consistency around cost, architecture, who can build it for what?
What can I build on my house? So just really trying to simplify those things. And I know the GIS tool, like, for us, is really cool because you now type in an address and it'll tell you whether or not you could develop on your home and what you could develop. So what used to take us like, waiting for an architect to do a site client task, pulling the address, trying to check the zoning constraints. We've now reduced that friction to, like, it takes a minute to identify at a high level whether or not that place makes sense.
We're launching a realtor integration now too. So with realtor dot c type in the address, and it'll tell you whether or not that site is actively listed. But we've also done a scrape so you can look at a city and say, okay. These are all the active listings that meet the requirement for a middle housing project. And so Whoa.

Matt Glen: That's really cool. Yeah.

Alkarim Devani: It's a lot. Sorry. I know I just ranted there, but to give everyone a bit of, like, level sets of all the different things we're working on.

Taylor Atkinson: Yeah. That's awesome. With that software, is that specifically through your guys' the website or how do people access it.

Alkarim Devani: If you go to our website, we have a community and within that community, there's what's called the middle GIS tool. We also have a pro form a tool. But the middle GIS tool is currently beta in Calgary, Colorado. And so you can type in your address and tested. In Calgary, currently, there is no preapproved plans, but our goal is working with every municipality to have a site that has a preapproved plan.
And our future state is like, okay, well, we know these preapproved plans. We know that the land that they sit on. We understand the risks. What we envision in the future is, like, we have contractors that know how to build these or modular developers that know how to build them. Can we then, like, have someone run their pro form a, fill out a finance tool and basically get them all their components that they need to basically say, okay, I do have a viable project now and I can move forward with it.
And so that's exactly what we're trying to do is take all the things that we've learned empowered by technology to give people that leg up on their ability to deliver on their projects.

Matt Glen: Okay. So just to bring it back to Kelowna. So your website, if you want the GIS tool, you can type in your address that will tell you what you can do and then there you can pick a preapproved plan there.

Alkarim Devani: Correct. Yeah. Yeah. Exactly. So currently, Kelowna has three approved plans since they're launching another number of them.
And so the idea is, like, we would have all the preapproved plans listed. We haven't quite gotten to the point where we started to put all of the contractors and architects on the website, but that's the future state. We're still early days with the tool. And, honestly, we're taking a bunch of feedback and getting people to kind of tell us what works, what doesn't. And again, like so, you know, Taylor and I met at middle school.
That was a full day. We actually are launching a program. It's called middle you. It's in partnership with the University of Calgary. It's gonna be all online.
And the idea is, like, do we actually get people through scenario modeling, through the emotional roller coasters of building, you know, a place? And so that is a certified course through the University of Calgary. And our hope is that, you know, we bring people through a certificate of middle housing that they've taken this course. They have strong fundamentals. It's a hundred hours of instructional delivery.
And then we tie that in the future to hopefully a funding mechanism and a tool that can help you actually deliver on your project. And so, you know, in a high level, we see ourselves as like a venture fund a venture scale for middle housing? How do we scale fun? And depending on the level of support you might need or might not need. Some people just like they need to go right to different levels, and we're just trying to basically be that support tool for those levels that they're at.

Matt Glen: That's awesome. So in Kelowna's, like, a test spot for you guys to get it all started.

Alkarim Devani: Yeah. So Kelowna's, like, one of the most progressive, I would say, like, infill policies in Canada, like, you know, very, very progressive administrative board that wants to see things happen from a city per perspective. And I think they've been exploring different tools, and they've been on kind of the the cutting edge of a lot of this. I would say that the challenges in Kelowna are unique, you know, to the city of, like, your guys' real estate market, which you probably know better than I do is, like, do we actually get things to pencil today based on the market that we find ourselves in? And so I think that's what we're continuing to to run up against is, like, we can do a bunch of things, but there's some macro level environment things that have to change in order for us to see project viability.
And this is where I go back to the very first thing I said to you. If you're a homeowner, you're better positioned than any other developer in the industry to deliver on your home because you purchased your land ten, twenty, fifteen years ago. And so we know that there's viability of homeowners can be a part of this solution. They're not gonna be able to do it by themselves. There's gonna be developers and builders that partner with them.
What we're trying to do is create the infrastructure to allow for those things to happen. For homeowners to feel like they're educated, they know what they need to get done, provide a bit of a facilitation support to bring the industry together, and make sure the right policy, and there's innovative tools to help them move through that journey,

Taylor Atkinson: and you're not competing now. Right? Like, you're not an in field developer. Like, you are simply on the education side, basically.

Alkarim Devani: A hundred percent. Like, I know a lot of folks are, like, nervous to kinda share with us at times when we get in the industry, but it's like, no. Our goal is not to be the delivery mechanism. It's to take homeowners and pair them with delivery mechanisms. It's to help delivery folks developers find the right pieces of land so that they could do the right things and design high functioning places.
That makes sense for the community and people are happy. And so we see ourselves as capacity builders. We're trying to support you on your goals and delivery. And most importantly, I would say the thing that we realized is that if we don't include homeowners, you'll never get to scale what you wanna do because they'll always be pushed back. And because politicians and administration and cities will always feel like if homeowners aren't a part of this solution or not a part of the equation, then we'll continue to struggle to deliver within these established communities.
Because they were there, we need to figure out how to include them. And so that's the way that we see it. We're trying to basically say, we're simplifying the process so that an everyday citizen can do this. And if we do that, it's only gonna help developers because their processes are gonna be more predictable, more efficient to move through the system.

Taylor Atkinson: Amazing. Can we do like a shared screen and you can walk through briefly on, like, a real life scenario, whether it's Kelowna or Calgary or anywhere. But just how the numbers work? You know, maybe touch on Yeah. On financing and land acquisition and stuff?

Alkarim Devani: Like, I don't have any pull up at the moment, but I can walk you through, like, what we're seeing in work in certain neighborhoods and cities. I guess, I'll start by saying in Calgary and Edmonton, again, two of the most progressive cities when you talk about infill and middle housing specifically. So in the city of Calgary, this is not advice to go buy something and then say, hey, yeah, listen to your podcast, and you said it'd be fine anyway, if call me before you buy anything, but for the vast majority of this city within the established neighborhoods, most lots here are allowed to do eight units as of right. So on a standard fifty, buy one twenty, six thousand square foot lot, you can deliver up to eight units for the units. Yeah.
So four primary units and four secondary suites. And so the most common forms that you would see getting delivered would be a four by four. So you'd have on a corner lot, four a row houses with four secondary suites. And then on a mid block lot, you'd kinda have this cottage court of a duplex in the front, a duplex in the back, and both duplexes would have secondary suites. Most of Alberta has laneways, so everything's parked off the lane, which I know is not necessarily the case in Kelowna.
And so that's been the thing that's really drove in the system, I'd say, the last three years. And most of the people that are building those, when we started back in fifteen, it was all sale. There was a transition after a pandemic where a lot of this went rental. And the reason why it went rental is because a lot of folks were using the CMHC MOI Select program Yeah. Which I'm sure it's the hottest thing on the market now because everyone says, you could own this place for five percent down, and I think it's just like a hot tag line, I would say it's not that easy and we tell everyone that.
And if you have five percent down and you're trying to do a three million dollar project, you can't do it. You don't just need a hundred and fifty grand. It's significantly more complex in Nuance, and it's only gotten more difficult to deliver. And so I would say we're starting to see the pendulum maybe shift back to where folks are now considering to do more sale, not just rental.

Matt Glen: Have you had any pushback from neighbors about like eight units under formerly one house lot.

Alkarim Devani: A hundred percent. Like, this is the thing that Edmonton and Calgary and every city across North America is facing is, like, we were traditionally single family homes, and now we're putting in, you know, eight units as of Bright. And so it definitely has been controversial. There's, like, a fine balance. So we've seen really great examples where a unit's kind of seamlessly integrated into these communities.
You don't realize, like, people think the context of these communities are wartime bunglers, but they're not because they've always been evolving. There's semi detached homes. There's, like, huge single family homes that are three stories that look like they could be eight units. And so Yeah. We've seen some really interesting, like, context where they fit and they fit in a way that has made sense.
I would just say to you that, like, the reason why Mill, like, has really taken this solution that we have to be homeowner centricness because we understand that, like, there's homeowners in community that feel like this is happening to them, not for them, or with them. Like, as a developer, I realized that that was the case, because it's not like I was sitting here overly concerned about what was happening in their community because you have a million other things that you're concerned about. Like Yeah. Are you gonna be able to build on cost, on time, on budget? What is the cost implications if you don't or you miss.
And so I would just say, like, all of those things are really, really critical, and it's not as simple as just saying, like, oh, we're just concerned about the community engagement piece. So yeah. It is no question a challenge. And this is, like, a really good example for folks who get, you know, really concerned about, like, what does this look like? So from the street, this looks like, you know, a duplex and next to, you know, a single family home and infill, but it's actually six units because it's got two secondary suites and it's got two laneways.
And so this is six units on app. What what's typically a single family home?

Matt Glen: What size lot is that? Is that like a one twenty right?

Alkarim Devani: Yeah. Fifty fifty foot frontage. Yeah. So six thousand square feet with a lane loaded kind of backyard. That is one of the preapproved plants that we're working on right now with the city, city of Calgary, city of Edmonton to kind of make it so those things could get built as of right.
Community concerns are valid in our mind and there's a lot of things we can do to help mitigate them. And I think one of the biggest challenges for having is that when examples don't land strong like, when you have examples that are landing poorly in community, it's really challenging. And so how do we figure out a way to create better built forms, that land and community? And one of the ways we think we can do that is by working with, you know, the city, the community. And, honestly, at times, even higher caliber designers and architects, who can't make it feasible to work on one fifty by one twenty, but can potentially make it work to work on one that could be replicated in many different communities.
I'm gonna pull up the GIS tool too even though it's in beta just for you guys to take a peek at here as well. So this is the map. This is in Calgary. You type in an address. It'll tell you kind of a bunch of details about the actual, you know, address that you see.
And then obviously, you know, you can look at the context of what's around there. And so Here's an example of, like, you're on a corner site. One of the best use cases on a corner site is what we call four by four. So you see the rendering. This is done by an architect group called Fast.
And so, you know, it shows you what it could look like. And then you know, maybe not as conducive for a mid block configuration, but this is what a mid block configuration. And I would say, like, a lot of these are nodes, but they could be s's. I just wanted to kinda show you high level what the site is kinda looking like and how we're doing it. That's

Matt Glen: pretty cool. It just says this will work. These two won't. That's pretty cool. That was very cool.

Alkarim Devani: What normally would happen here is, like, you would have realtor dot c a linked, and so now it would highlight whatever ones that were listed in that community now would be on here, and it would tell you whether or not it was a green or red, and you could click on that.

Taylor Atkinson: That's awesome. So I guess, basically, like, once this is up and running, is it primarily built for investors then to look for active listings and then what's a possibility to build on that?

Alkarim Devani: I would say it's built for, like, all three if you think about, like, the three customers that we and interface a lot with this, like, government municipalities? Like, what do they know is possible on the lands that they have? How do they create better systems and processes so that everyone in community knows what's possible? Because one of the challenges we have is, like, when you have someone that's unsophisticated doing this for the first time submitting applications and then getting kicked back and kicked back and delayed. It's problematic for everybody.
Cities don't make more money when you have that applicants. Right? Because they pay the same price. It's not like you pay less if you're a shitty applicant. And you have to resubmit your clients fourteen times and you have to talk to the planner thirty times.
Like, that's actually cumbersome for the municipalities. And so how do we streamline processes for municipalities and get to better outcomes? The citizen often don't know what they can do and neither does a realtor quite frankly at times because they're not development experts.

Matt Glen: So that's hard.

Alkarim Devani: Yeah. No. Like, I mean, it's not a bad thing, but it's a good thing. It's like, how do we get the realtor? We see realtors coming to all of our programming, and I love, like, having conversations because They recognize that not only is this important for them to understand their markets, it's important for their clients.
So we've had real estate now that send their clients to us before they decide whether or not they wanna sell, buy, develop, because I think the thing that I love most of our relatives now is, like, a lot of them are not short sighted. They're not just looking for a one time commission. They recognize, like, that referral, that word about that maybe this guy will go on to buy three or this one will go on to buy two or four or they'll become a developer, and I'll be the person that sells those products or help them buy them. So they have this, like, desire to learn more. And I think, like, that is the gap that we're filling.
It's, like, I didn't know where we would've went back in the day when we did this. We just learned by mistakes. And I think we have so much information and we have a process and now we're leveraging technology to make it easier for more people to understand what the opportunities are.

Taylor Atkinson: Specific to Kelowna, I mean, obviously, I feel this works better in Alberta, and you can correct me if I'm wrong, that Kelowna land prices are pretty expensive. Right? If someone wants to go and buy a eight hundred, nine hundred thousand dollar house to tear it down and do infill, do the numbers still work here as an investment? Or is this primarily like, hey, I'm a current homeowner. I've owned this house for ten years.
However, I wanna make it more of like a generational living. You know, I wanna bring my parents in or somewhere for my kids to live. I wanna separate dwelling plus some rental income. Like, are you seeing more opportunity on homeowners wanting to build units to have a little bit of revenue income and provide housing for family as well? Or, like, where does this fit best, Kelowna specific?

Alkarim Devani: Yeah. You know what's funny? It's like so two things. I would say, like, Kelowna is in, like, a bit of a real state. It feels like a bit of a low here, like, in terms of sales and volumes and historically compared to where you typically have been.
I think there's some lows that have been, but then it seems to kind of swing. Like, you kind of have these years from us that come by and it's high again. And so I think no question the homeowner centric model makes a ton of sense. There's liability in it and how do we bring more homeowners through the process. From an investor standpoint on the purpose built rental side, it's tough.
Right? Because you're right. The land prices are a million to try to build six units, and then there's an affordability requirement that two of those six has to be at the, you know, thirty percent of the median. If you're gonna go after the rental model with CMHC unit. There are use cases right now, though, where we've seen people make the numbers, make sense and work through it.
So, like, there's a part of the folks that are active right now that are delivering these. What I would say is, like, the city is actively working on reducing some of the barriers and costs, whether it be DCC fees, off-site improvements, fortis improvements, and also, like, funding potential models that exist that make this more viable. I also think, like, the sale numbers can make sense in Kelowna, like, maybe not so much a rental market, but this idea of, like, okay, if I was to build these units sell them? How would they perform? I think there's probably more use cases for sale than there is rental.
And I think rental can work, but your expectations would have to be tempered. We tell everyone that CMHC, like everyone thinks they're gonna get rich quick. It's not like that. It's a fifty year amortization with a ten year requirement on the affordable piece. And so if you're doing this to make a ton of money in a short amount of time, it's not the tool for you.
What I think is interesting about Colorado is the type of product technology that's missing. So this idea of three bedroom family aren't into the home. I think there's a lot of room for I think if you're building, you know, stuff that's gonna compete with a fairly robust condo market, rental market in the apartment side, it's gonna be tough. And so there's room for sure, but it's gotta be in the housing diversity, you know, options that you're building.

Matt Glen: So you mentioned earlier about modular. So is the modular solution for some of this?

Alkarim Devani: Yeah. Yeah. So a few of the preapproved plans that have were designed were actually modular ready, and so they were fully designed so that you could deliver modularly. What I would say is, like, again, the same complexities and limitations. Right?
Like, there's not a lot of people that have done modular, especially at the infill scale, but then also, like, what are the complexities that come along with it? But then what are the limitations? So you get outside of, like, there's not a lot of customization that can happen in these things. And so you get this huge efficiency in terms of timeline. You get some cost efficiencies.
Sometimes it's even at par. But the challenge today is, like, there's this gap for modular where if you're gonna provide modular construction, who funds, like, the building of those? Generally speaking, when you're doing construction draws, you get draws based on how far you've gotten on-site. Yep. Traditionally, banks don't fund mods that are being built in a factory until they arrive at site.
But factories need a hundred percent payment once those things leave factory. There's a huge funding gap that hasn't quite been solved about who deals with that portion of

Matt Glen: the five six.

Alkarim Devani: Yeah. I haven't

Matt Glen: heard that. That's interesting to a good point.

Alkarim Devani: When you

Matt Glen: hear about modular and you hear about this, to me, it just makes so much sense, and I just don't understand why we don't see it. At all. I guess that answers a bit why.

Alkarim Devani: Modular factories are good at producing modular homes. They're not necessarily good at the last mile logistics of on-site construction delivery and place man. And so if you're a modular factory and you're staying in your own lane, you can produce these homes, someone's got to deal with the transportation, trucking, and logistics, and then someone also has to deal with the onsites. And so if you go to a general GC and say, a general contractor. I need to do all my service hookups, landscaping, you know, foundations.
But that's it. You're taking away, like, seventy percent of their scope. Why would you see wanna only do that part of the scope and not the rest? And so what we're finding is, like, there isn't enough people who are just experts in delivery of modular because it's never really caught on at scale. And so part of what I think we need to see is a bit of an upscaling of what that last module logistics looks like.

Matt Glen: Opportunity. Yeah. Anyone listening? Yeah.

Taylor Atkinson: You know, it's funny. We did have Ryan Smith on from City of Kelowna. Yeah. A few episodes ago. And we were kinda speaking about some of this as well, but to stay on, like, the funding point that there's that bit of a gap there.
It's similar to, you know, if a homeowner owns their home, but they can't qualify for, like, the equity takeout to start this process It seems like you guys are way ahead of the curve on everything else and kind of you're working with the government as well. Do you see anything coming down the pipeline that would help facilitate? Like a homeowner has their property, they have a bunch of equity, but, you know, they have no income, so they can't conventionally qualify for a mortgage. Are there any programs that are coming down the pipe to help them do some of these infill projects? Like, if that's the barrier for them right now?

Alkarim Devani: I think there's been a lot of conversation around this idea of being CashCore, but how us rich. Right? Like, if you think about our boomers are historically the one who bought

Matt Glen: it, you're the one of people like that. Yes.

Alkarim Devani: Yeah. Yeah. And so we've done a lot of, like, networking exercises. We've done, like, surveys and intakes to understand is that capital stack barrier that we need to get them to a project? And then even once you get them to the project, what is the approval requirements to actually proceed for with the development?
I think there's a model there. No question. I think the question is is, how do you shore up the risk. Right? Because there's an equity stack risk that needs to be shore up for whoever funds that initial equity stack.
But also, like, this is the thing that I think is gonna take time and it's not gonna happen overnight. A homeowner who lives in the community for them to, like, think that a boomer is gonna become a developer. It's a hard thing. Right? Like, you're gonna take on a three million dollar construction project when you've never done any of this before and you gotta go live somewhere for, let's call it, twelve months.

Matt Glen: And you're retired.

Taylor Atkinson: Yeah.

Alkarim Devani: So what I would say to you is, like, that person is showing up with us in small amounts, but when they do show up, it's generally with their kids. Yeah. Like their kids are young professionals who need homes who are renting and who are, like, understanding that this is an opportunity for them now. And so you kinda need that community, like, it takes a village. And I would say the financing piece is one part, but then the cultural risk aversion piece is just a whole another layer that we're trying to unpack.
And so part of it is like they don't know what they don't know. And so if we don't have a foundation of education or information or understanding the process, if we don't have good examples of people who have moved through the system, that can be those early adopters who have successfully done it. None of this matters. And so I would say those first viewing community are gonna be absolutely critical, not only to do well for those people who embark on this, but to land well. And the people that can do it right now are the developers.
Right, are the realtor, are the investors, are the folks who are savvy. And what we need to do a better job at is I think making sure those projects are landing well in community so that we can work with homeowners eventually in communities, the citizens, and cities to actually allow for the staff happen on a more robust scalable way.

Taylor Atkinson: Yeah. Totally. Totally. And I guess if someone is interested, what does it look like to work with you guys? Like, what's the cost?
I know you're talking about, like, you know, the hundred hour course you put on some of these daily things, I think. Some of the cost is potentially subsidized by the city, which is great. But, yeah, can you walk us through what it looks like if someone wants to work

Alkarim Devani: with you? Yeah. So we kind of have a suite of product tools that we built as a way to kind of help folks through navigate through the system. So our middle school depending on the municipality if we have a partnership or not anywhere from, like, a hundred to three hundred and fifty, five hundred bucks for the full day. And so that you spend a full day.
We bring in experts from every field to come in and chat we have a networking event, oftentimes we'll have a walk you tour depending on the community that we're in. But it's essentially, like, giving you as much information as we can in kind of a boot camp style one day event. And then after that, you know, we've launched Middle U, which will launch in the fall. That program is gonna be, you know, kind of in that three thousand dollars range for a hundred hours and instructional hours with the certification at the end. Again, there'll be some opportunities we're hoping where that subsidized and funded depending on where you're coming from or the groups that we get to fund that program.
But after that, like, let's say you're moving through and you have a real live project and you wanna move. We launched two programs in earnest as a response to the education. One of them was called our accelerator. So we have over seventy experts from across Canada, and have all worked in the middle housing space, developers, accounts, lawyers, surveyors, like just builders, anyone you could think of who have basically said they're willing to donate their time and sit down with people for an hour to learn and give them information and feedback on their project. It's an hourly rate we pay those folks That's a program where we're still retooling, but we think is incredibly powerful.
So the accelerator is a great way for someone to say, I wanna talk to this person about financing because I need to know if I can do this. Or I wanna talk to this person about building within this specific jurisdiction. That's a tool that we have on our website. The next one that we have is kind of our master's program. And I would say that is when we're refining two levels of master.
One is, like, we meet with you once a month. You bring anything you wanna go over. We go over that on your project. It's kind of an opportunity for you to have another set of eyes to ask questions because after it's lonely. Like, you don't know who has your best interest.
You have an architect, you have a builder, but everyone's getting paid to do something and deliver for you. And oftentimes, you don't know if that's the best thing. And so that I remember, you know, in my journey, that would happen all the time. Contractors said he could build something. Designer said that it was feasible, and then you get to go do it.
And they're like, oh, yeah. No. No. We didn't know that it would be that much. And it's like it's triple the price that you both told me I could deliver this for.
And so we try to add as, like, another set of eyes oftentimes on larger projects. Like, folks will hire what's called, like, an owner's rep, and that's, like, for folks to have someone on the ground on large projects to basically represent their interest We're trying to do this in a little bit of an augmented way on smaller scale projects to bring all the expertise. And so that's kind of like a coaching, a one hour session that we do monthly with folks. And we've launched another program, which is basically like a tool that we're currently building where it's an augmented development management tool where we build this interface. And the hope of that interface is to basically work with you on a more consistent weekly basis where you're still gonna need a builder, probably maybe a developer, you're still gonna need all those pieces.
But we're building a framework tool that allows you to interface with us, track your developments. We're trying to, like, outline every single step that needs to be done. Almost give you, like, a digital dashboard where, you know, it's gonna be as valuable as you make it based on the information that you put in. Again, this is something that we've been contemplating. We have two customers right now that are kind of in that more advanced program.
We've also funded a few demonstration projects based on what you just talked to at Taylor and this idea if we were to fund that capital stack portion on a few projects, would that unlock a few projects? And so we're funding a first time homeowner right now who had a capital stack gap to help them get over the finish line.

Taylor Atkinson: Cool. That is pretty awesome. We had Stephen Jaeger from Adi come on as well. I know he was I don't know if he was working with you guys or not, but he did start one of the first fast track programs in Kelowna to try and facilitate some of this. So it'd be interesting to see if they get into funding some of these as well, like, some crowd funding.

Alkarim Devani: Yeah. Yeah. We launched one of our projects on Adi as a crowdfunding project. We raised, I think it was a hundred and fifty thousand through Adi on a demonstration project. I love what those guys are after.
I think there's a lot of room in that idea of, like, you know, for community by community if you could kinda get a bunch of people behind the program. What I would say about Adi is, like, it's still so complex in Nuance and there's so much money that needs to be paid before you even know whether or not you're gonna have a successful project in So for me, it's like we have to find a better way to move through that system because, you know, we're pretty sophisticated in terms of our development, our understanding of legal contracts, you know, what's required. And I would say, like, if we have a tough time navigating that process, you can imagine and citizens even gonna have a tougher time. And I would say, let alone the complexity. Even if you get through the complexities in navigating that process, why would you ever fund someone who's never done this before?
Like, in a market right now where people are fairly nervous about what's happening. Like, you want me to fund John who's never built anything ever before in his life to do his first project. And so that's where I think we can play a huge role because it's, like, no. Don't worry. John's not gonna be by himself.
He's powered by middle. So he'll have, you know, the full resources and power of our team behind him to make sure he actually gets through the project.

Taylor Atkinson: Yeah. Well, it was interesting to me when we first started speaking. Was like, yeah, like, middle housing, you're focused on infill. Like, that was what I thought, you know, the company was. But, you know, after the presentation and speaking to you afterwards, finding out that, you know, you guys were supported financially by federal grants is how you're making it so affordable and accessible to people.
To me, it's not like, oh, you you guys have built a company to help with middle housing as you built a company to help with that middle education, middle consulting piece. Right? Like, it's a huge endeavor, and it's, like, pretty scary for people to, like, go in and tear down a house and try and build a fourplex. But if you're able to, like, consult on a, like, small fee because the government is encouraging you guys and supporting you guys to help with that, It's like, go with the flow. Right?
Go with the government policy of if this is what they're supporting. So, obviously, what they want. So, you know, after speaking with you for a while, it's like, it's not an expensive bill because the government wants to facilitate this. Right? So, yeah, I appreciate what you guys are doing in that space.

Alkarim Devani: Yeah. No. And I mean, like, I'm an entrepreneur, and I I understand we're not an entrepreneur, and we're building, you know, different tools that we're able to be profitable on. But I think none of it matters, like, when you think about the funnel, it's not gonna matter if people don't feel like they have the foundations of education and understanding of what it takes to move through it. So we could build every suite of tool.
We could build a fund. We could be a development manager. You could do a bunch of different things. But none of that matters if people just don't know what they don't know. And so I think, like, when we went to the government for when we worked with the housing supply challenge was, you know, they wanted to see actual movement and housing starts, and we said that's really tough to do if we don't understand what the knowledge policy barrier gaps are.
And so we kind of identified what we thought those gaps were and started to provide solutions for those gaps. And so like I said, we think we're finding the right ingredients. It's unique depending on the municipality and the framework in which it works working with. Like, we're working with Regina and Saskatoon, and we've had conversations with even smaller municipalities, Aratana, Red Deer, Lethbridge, like very, very small places that are also very keen to figure out what it can look like for them to get more of this housing form built. I would just say, Taylor, like, we've landed on the fact that there's consensus that this housing forum matters.
It can be incredibly beneficial to communities and cities all across the country. How do we prepare them with the right tool sets, education, and foundation to deliver on those things? And, you know, like, we were lucky enough to be a part of the housing supply challenges, which we're talking about with the federal government where, you know, we are one of four finalists across the country. There's two hundred and sixteen applications, and we advances the finalists through the year in a competition. Which made a huge difference and kinda gave us that boost to be able to keep going.
But the cool part about it is we're seeing people come out the other end now. Right? Like, that are developing, that are on their journey, that are doing it. And I think the other thing about us that's been really interesting is, like, whatever you need in order to actually deliver is what we wanna give you. I know there's people on our community page that, like, are alerting, that are active members that are watching, and they'll see them too much down the road, and they'll say, man, I'm so glad that guy posted that message because I had no idea that they were doing that.
And I basically went back to my project and refined it and change this. And it's like, perfect. Like, that's exactly what what we wanna do is we wanna be a resource for where you are at your journey and make sure if that's interfacing with us on our socials, on our digitals, come into the courses, come into the networking programs that we're throwing. That's what we're trying to do.

Taylor Atkinson: Yeah. Maybe we'll finish off with that. With the last question is when's the next event in Kelowna?

Alkarim Devani: Yeah. So we don't have a date yet booked for the Kelowna region at the moment. I would say, like, we're working on with the city right now on the second phase. I guess it'd be like the third phase of their fast track. So I think it's that the new plans launch and give a bit of diversity because they know there was some feedback on the first set of plans that launched.
I think we'll see more interest, but we have plans to host middle school through the fall. And then also in the fall, the launch of Middle EU, which would be open to folks all across Canada. As I said, because it'd be done mostly online, a great opportunity for folks to kind of get in and learn the foundations, and then also run through some use case modeling.

Taylor Atkinson: Awesome. Alright. Well Yeah. We'll see you in the fall then. Definitely.
Hey. Thank you so much for coming on, and

Matt Glen: oh, that was awesome. Yeah. You're doing some crazy things.

Alkarim Devani: Yeah. I really appreciate you guys having Your

Matt Glen: vision board must just look insane.

Alkarim Devani: It is. And I think, like, it's funny because we talk about that all the time. Like, most entrepreneurs don't die from starvation. They die from, like, you know, indigestion. And so we're just, like, trying to be mindful and stay focused on our niche and what we do well.
And I think a bit of it is, like, what is the thing that we think is gonna make the most meaningful difference and and that's what we're after.

Matt Glen: So whenever you're after keep it up doing the right things too.

Alkarim Devani: Thanks, man.