Alternative Investments: A Strategic Portfolio Inclusion


Grant Alexander Wilson, Ph.D., Assistant Professor, Faculty of Business Administration, University of Regina

Jason Jogia, MBA, M.Fin., Chief Investment Officer, Avenue Living

Author Bios

Dr. Wilson is an Assistant Professor at the Hill and Levene School of Business, University of Regina. His research focuses on marketing, strategy, and innovation. He has published over 20 peer-reviewed articles in top management journals including Journal of Small Business ManagementResearch-Technology Management, and Journal of Business Strategy. His research has been featured in the National Post and by the World Economic Forum. Dr. Wilson is also a research consultant and contributor to Avenue Living Asset Management.

Mr. Jogia is the Chief Investment Officer at Avenue Living and has over 15 years of experience in real estate capital markets, originating over $10 billion in real estate loans and $1 billion in equity. He has extensive experience in real estate investment analysis and capital structure across various real estate classes. In addition to holding 2 Masters’ degrees in Finance, Mr. Jogia is pursuing his Doctorate of Business Administration and currently serves as an instructor at the University of Calgary, specializing in real estate finance.


According to the Bank of Montreal (2020), 77% of Canadians have investments. Of these investments, Canadians are “nearly split when it comes to investing their savings (53%) or keeping them as cash (47%)” (Bank of Montreal, 2020). The data further suggests that most of these positions are in conventional investments. Conventional investment “categories include stocks, bonds, and cash” (Chen, 2021). Paraphrasing Rose (2019), the average investor believes that the key to personal wealth is throwing money into the stock or bond market. In contrast, a study by Fidelity Investments found that wealthy individuals were likely to accumulate it through real estate investments (Sightings, 2018). Alternative investments such as real estate are “all the rage as advisors and clients search for fresh income” during the COVID-19 pandemic (Burton, 2020). Currently, the conventional portfolio is no longer adequate, as fixed-income investments (e.g. bonds) are offering nominal returns and equity markets (e.g. stocks) are more volatile due to market uncertainty (Bank of Canada, 2021; Yahoo Finance, 2021a). As such, participation in alternative investments is growing among savvy investors (Burton, 2020).


Alternative investments do not fall into conventional investment categories (e.g. stocks, bonds, or cash). Examples of alternative investments include private equity, hedge funds, managed futures, commodities, derivative contracts, and real estate (Chen, 2021). Traditionally, mostly accredited or institutional investors hold alternative investments (Chen, 2021). In Canada, an accredited investor is defined most commonly as an individual that has net assets of more than $5,000,000 or earns over $200,000 per year (The Ontario Securities Commission, 2009). “An institutional investor is a company or organization that invests money on behalf of other people” (Chen, 2020). According to Chen (2020), collectively, institutional investors are the “largest force behind supply and demand in securities markets.” Due to their size, institutional investors have opportunities not typically available to retail investors. “A retail investor is an individual or non-professional investor who buys and sells securities through brokerage firms or savings accounts” (Palmer, 2019). Today, accredited and institutional investors are actively participating in alternative investments due to their advantages over conventional investments and increasing accessibility. Specifically, alternative investments are becoming more feasible for retail investors via real estate investment trusts (REITs) and other securitized assets.


Alternative investments have numerous advantages over conventional investments. These advantages include counterweight to conventional assets, portfolio diversification, and inflation hedge. A counterweight investment is one that often responds inversely to another investment. For example, when stocks fall, bond prices often rise (Leonhardt, 2019). As such, alternative investments can act as counterweights to conventional investments, reducing the overall risk profile of an investment portfolio. Similar to counterweight investments, diversification reduces risk. “Diversification is a risk management strategy that mixes a wide variety of investments within a portfolio. A diversified portfolio contains a mix of distinct asset types and investment vehicles in an attempt at limiting exposure to any single asset or risk” (Segal, 2021). Due to the loss of purchasing power resulting from inflation, Milton Freidman describes it as “taxation without legislation” (Shaw, 2009). Accordingly, prudent investors have explored ways to hedge against inflation. “An inflation hedge involves investment in an asset that is expected to maintain or appreciate in an inflationary period” (Wilson, 2021). Historically, alternative investments such as Canadian residential real estate and farmland have served as inflationary hedges (Wilson, 2021). The greatest benefit of alternative investments is the potential return. Despite the articulated benefits, alternative investments have drawbacks.


Shortcomings of alternative investments include valuation complexity, low liquidity, lack of regulation, and riskiness (Chen, 2021). Alternative investments are often difficult to value due to their non-public nature. Data collection and analysis are therefore problematic, as market prices are not widely available and the uniqueness of certain asset classes lack adequate comparables. A typically argued disadvantage of alternative investments is low liquidity (Chen, 2021). As compared to equities, most alternative investments are more difficult to sell. However, this argument is susceptible to a strong counterargument. The liquidity of any asset is dependent on the participation of buyers and sellers. Therefore, equities that are depreciating or not actively traded do not have such liquidity benefits, raising concerns related to the argument’s generalizability over alternative investments. “Alternative investments are often subject to a less clear legal structure than conventional investments” (Chen, 2021). In Canada, alternative investments themselves are not typically required to be licensed, authorized, or regulated (The Legal 500, 2021). Therefore, due diligence is paramount when participating in alternative investing. As with other investments, higher returns are most often accompanied by higher risks. However, this trait is not universal, as many alternative investments are more volatile than a conventional investment in the stock market.


To compare the historical performance of conventional and alternative investments in Canada, a series of analyses were performed utilizing publicly available data from some of the most common asset categories. Conventional investments included Canadian stocks, bonds, and interest on cash deposits. The Toronto Stock Exchange (TSX) is Canada’s primary stock exchange. Accordingly, the TSX Composite index was used to assess stock market performance. As the 10-year bond it is the most common fixed-income asset in Canada, it was used to assess the bond market. Canada’s cash deposit interest rate was used to evaluate cash market positions. Since alternative investments vary and publicly available information is limited, Canadian residential real estate, farmland, and commodities were selected for investigation. Canadian real estate was assessed by residential and agricultural properties. Canadian residential real estate was based on changes to existing home values and new home values. Farmland values were used to assess agricultural real estate performance. The performance of the commodity market performance was assessed based on the Bank of Canada’s (2021b) commodity price index (BCPI) because it includes 26 of the most important commodities produced in Canada and sold globally.

The 10-year appreciation of Canadian residential real estate supports Chen’s (2021) argument that alternative investments may generate stronger returns. Exploring changes to new and existing home values showed consistent annual appreciations totaling 21.50% and 11.18%, respectively (Statistics Canada, 2021; Global Property Guide, 2021) (Figure 1).

The appreciation of farmland was even more significant than residential real estate, as the average annual increase was 10.86% with a total appreciation of 119.50% (Farm Credit Canada, 2019; Farm Credit Canada, 2020) (Figure 2).

While Canadian alternative investments including residential and agricultural real estate markets showed consistent appreciations from 2010 to 2020, the same cannot be said for commodities. The BCPI’s 10-year average value change was -0.59% per year, totaling -6.53% (Bank of Canada, 2021b). Moreover, the examination of the annual changes to the commodity market relative to new home values and farmland explicates its volatility (Bank of Canada, 2021b) (Figure 3). Annual BCPI changes were extremely inconsistent ranging from gains of 21.37% to losses of 36.15%. Based on these comparisons in this timeframe, it can be concluded that Canadian real estate is advantaged over the commodities market. Furthermore, among the Canadian real estate investments analyzed, farmland investments were superior to residential real estate investments based on the 10-year appreciation.

Using new home values and farmland as comparables, they were analyzed with interest on cash deposits as well as 10-year bond yields and the TSX. Deposit interest in Canada fluctuated only moderately, averaging 1.00% from 2010 to 2020 (Trading Economics, 2021). Similar to cash deposits, 10-year Canadian Government bonds are characterized by low returns. From 2010 to 2020, with the exception of 2018, yields of newly issued bonds have consistently declined (Bank of Canada, 2021a). Unlike interest on cash deposits and the bond market, the TSX has shown annual gains of as much as 19.14% (Yahoo Finance, 2021a). A comparison of annual changes to new home values, land values, bond yields, and the TSX shows that real estate offers consistent appreciation and low volatility (Figure 4). Although annual appreciations of the TSX rival farmland values and exceed new home values, annual depreciation of similar magnitude are not uncommon. While the 10-year Canadian Government bond offers consistency, new bond values are low and continue to decline. It is apparent that in the Canadian context, positions in alternative investments such as real estate are more favorable than the considered conventional investments.

Inferences based on this investigation are not without limitations, as the analysis was performed with select Canadian investments. However, broadening the investigative context to include similar U.S. assets produced congruent results.

In addition to the previously analyzed Canadian assets, the New York Stock Exchange (Stock Market B), 10-year U.S. Government bond (Bond B), and S&P Goldman Sachs Commodity Index (Commodity Market B) were included in a reward and risk analysis (Table 1). Reward was measured using the 10-year average annual change of the asset value and risk was the standard deviation of the mean score. Standard deviation is the amount of variance among a set of values. If the values are “further from the mean there is a higher deviation within the data set” and there is greater variance (Hargrave, 2021). Therefore, risk was assessed based on the standard deviation of the asset value change. The reward and risk comparison showed that alternative investments in real estate had moderate to high rewards and low to moderate risks. In contrast, the stock markets presented high rewards and high risks. Inversely, the bond market showed low rewards and low risks. Although the commodity markets differed, both presented high risks. Although the data set was expanded to include U.S. assets, it is recognized that the analysis remains limited in scope. However, it was apparent that alternative investments such as real estate had benefits over conventional assets.


Today, investors are finding that conventional investment categories such as stocks and bonds are simply not adequate to preserve or generate wealth. As the global pandemic endures, there is an acute awareness of the benefits related to alternative investments among savvy investors. And rightfully so, as the analysis of select Canadian and U.S. conventional and alternative investments showed that residential and agricultural real estate balanced potentially appealing rewards with potentially lower risk. As stock and bond markets present extreme volatility, Warren Buffett’s first rule to “never lose money” and second rule to “never forget rule number one” are proving more difficult. Simply, investors need to have a clear strategy to include alternative investments in their portfolio for growth and risk management purposes (Pricewaterhouse Coopers, 2018).


Bank of Canada. (2021a). Commodity price index.

Bank of Canada. (2021b). Selected bond yields.

Bank of Montreal. (2020). Majority of Canadians are investing, but many still prefer cash savings. BMO Financial Group.

Burton, J. (2020). Rise of alternative assets part of ‘another revolution.’ Wealth Professional.

Chen, J. (2020). Institutional investor. Investopedia.

Chen, J. (2021). Alternative investments. Investopedia.

Farm Credit Canada. (2019). 1985-2018 historic FCC farmland values report.

Farm Credit Canada. (2020). 2019 farmland values report.

Global Property Guide. (2021). House prices in Canada.

Google. (2021). S&P GSCI.

Hargrave, M. (2021). Standard deviation. Investopedia.

Palmer, B. (2019). Institutional vs. retail investors: What’s the difference? Investopedia.

Pricewaterhouse Coopers. (2018). Rediscovering alternative assets in changing times.

Rose, J. (2019). 5 things wealthy people invest their money into. Forbes.

Segal, T. (2021). Diversification. Investopedia.

Shaw, G.A. (2009). Taxation without legislation. Wall Street Journal.

Sightings, T. (2018). 7 myths about millionaires. U.S. News.

Statistics Canada. (2021). New housing price index, monthly.

The Legal 500. (2021). Canada: Alternative investment funds.

The Ontario Securities Commission. (2009). National Instrument 45-106.

Trading Economics. (2021). Deposit interest rate in Canada.

Wilson, G.A., & Jogia, J. (2021). Canadian real estate & farmland: A hedge against inflation. Avenue Living Asset Management.

World Government Bonds. United States Government Bonds – Yields Curve.

Yahoo Finance. (2021a). TSX Composite index.

Yahoo Finance. (2021b). NYSE Composite index.

This commentary and the information contained herein are for educational and informational purposes only and do not constitute an offer to sell, or a solicitation of an offer to buy, any securities or related financial instruments. This article may contain forward-looking statements. Readers should refer to information contained on our website at for additional information regarding forward-looking statements and certain risks associated with them.

How Technology Helps Us Elevate the Resident Experience

Anyone who has managed a property knows there are a lot of moving parts. Managing multiple properties across diverse geographical locations can increase those complexities manifold. Throw in a global pandemic and things become even more complicated. Suddenly public health orders limit site visits, viewings, and document signings. And technology becomes a vital tool for keeping residents and employees safe and cared for. 

Avenue Living has used Yardi and other property management technologies since before the pandemic, as part of our commitment to running a paperless organization, improving efficiency, and customer service. So, we were prepared to adapt to new public health measures when they came into effect in March 2020. Our existing infrastructure made the transition to virtual viewings and digital lease signing easy, but we were also able to carry on our day-to-day operations smoothly because we had tools in place to manage them virtually.  


Building-Level Accuracy 

Avenue Living owns and operates properties across the Prairies, covering a broad geographical area. While we have teams in every market dedicated to in-person management, property management software gives us a big-picture view of all our buildings, but it also allows us a more granular view of each building.  

This view is especially valuable now, when public health measures have kept in-person visits to a minimum in order to ensure resident and employee safety. Clear communication is key when we’re trying to minimize how many people need to be on-site, and when. Yardi allows us to create work orders for our teams in the field and attach photos to ensure the information we capture is accurate, both about the job and its resolution. 


Increased Efficiency 

For many management companies with large portfolios, like Avenue Living, technology allows us to keep a close eye on how we fulfill work orders, address resident concerns, and communicate between teams. Our properties are spread out across several provinces, and technology like Yardi ensures all our teams are operating with up-to-date information. 

We’ve also integrated our listing services with our website, which helps ensure our listings are always up to date. In the past, our leasing specialists would have had to handle these updates manually but automating them frees them up to focus on finding the right matches for prospective residents — a task that’s much easier when they know they’re dealing with up-to-date information. 


Informed Decision Making 

“Property management is cyclical,” says Jeff Konechny, Avenue Living’s manager of enterprise applications. “Which means we can collect past data and use it to anticipate future results.” When we can analyze monthly and quarterly patterns, we can see how to improve our processes — for example, how we complete work orders or suite turns, or how our rental rate fits into the market. “We can also use the data we collect to look at the issues residents have raised with us and make informed decisions about what needs to be replaced or repaired, for instance,” says Jeff.  


Better Customer Service 

We operate from what we call a “single source of truth.” The information our call centre takes in reaches our Regional Vice Presidents and Regional Portfolio Managers, who make sure the right people are aware of and addressing the resident concern. The team in the field can generate work orders, upload photos, and add their notes to that same file. In the past, these might have been on paper or sent via email — there may have been documents stored in disparate locations. Now, everything is in one central, easy-to-access place. “Anyone can look at a file and see a lease addendum or a parking agreement or a concern when they need to, without relying on someone in an office to find, scan, and send it to them,” says Jeff. 


Future Possibilities 

We’re always working on ways to make our resident experience better. Our future vision involves technology, as we examine ways to create an experience that gives our residents the ability to do more online. “We really want to make Avenue Living the type of property manager that’s easier to connect with than any other property manager,” says Jeff.  

While we’re still developing these solutions, we’re using the suite of tools we have now to make that experience as seamless as possible, from the moment they contact us for the first time onward.  



This commentary and the information contained herein are for educational and informational purposes only and do not constitute an offer to sell, or a solicitation of an offer to buy, any securities or related financial instruments. This article may contain forward-looking statements. Readers should refer to information contained on our website at for additional information regarding forward-looking statements and certain risks associated with them. 

How Housing Affordability Impacts Communities

It’s no secret that securing homeownership is becoming more and more difficult in Canada. With increasing costs, rising interest rates, tightening mortgage rules, record levels of debt and plateaued incomes, the barriers — for many — seem unsurpassable.

According to the Canadian Mortgage and Housing Corporation (CMHC) (2018), “housing is considered affordable if it costs less than 30 per cent of a household’s before-tax income.” Based on this statistic, 17 per cent of Canadians own homes are just within their budget. And although homeownership in Canada is considered strong, one in every four Canadian households spends 30 per cent or more of their pre-tax income on mortgage payments (Statistics Canada, 2019).

40 per cent of the Canadian workforce is made up of essential workers, such as police officers, firemen, teachers, nurses and medical personnel, who fulfill our basic needs and keep our communities safe. Some are well compensated, but despite being gainfully employed, the essential worker’s average wage, excluding healthcare workers, is almost 20 per cent lower than employees in other industries (McQuarrie 2020). According to Statistics Canada (2020a), many essential workers rent long-term as homeownership is simply not a financial reality.

Housing affordability impacts other demographics, too. For example, seniors and students both often struggle to find comfortable housing within their economic reach. Restaurant workers, delivery drivers, and even office workers earning a moderate income also struggle to find homes they can afford.

In a 2019 Globe and Mail interview, Chief Executive Officer of the CMHC Evan Siddall said, “We need to stop taxing density and call out the glorification of home ownership for the regressive canard that it is. Overpromotion of home ownership is counterproductive, increasing the division between rich and poor.” Housing experts are calling for creative solutions to increase density to make current land usage more effective, by turning residential single-family dwellings into ‘plexes,’ townhouses and low- to mid-rise buildings, accepting that long-term rentals are part of the solution.

This demand for affordable, attainable dwellings and walkable communities continues to grow, but city zoning regulations and market regularities promote urban sprawl, making this more and more difficult to meet without intervention. As the demand for this housing category increases, prices rise and communities begin to experience gentrification, increasing the gap between classes and fuelling our nation-wide housing crisis. Without affordably priced dwellings, communities risk instability in children’s education, community populations and individual health as lower and moderate income families make difficult trade-offs to make ends meet (Enterprise, 2014).

These obstacles barring working Canadians from owning homes creates immediacy for housing affordability. Residents shouldn’t have to depend on their government to supply affordable options for them; they need access to safe, comfortable housing options at a rate appropriate for their income.

We recognize this rising need for quality rentals and aim to serve Canadians across the Prairies. Everyone deserves access to quality housing, whatever income bracket they may fall under. That’s why we invest in multi-family units and bring focus to providing housing affordability to the Canadian workforce, the backbone of our society.

We proudly provide housing to accommodate those who are gainfully employed but fall short of homeownership. These individuals often earn an insufficient income to live in close proximity to work, but want to live nearby. The buildings we invest in are class B and C apartments, typically low-rise, older inventory with affordable rent because they are purchased, upgraded, and then rented at a rate that is much more attainable than a new build.

Compared to other asset classes, class B and C housing presents several advantages, including locations, unit sizes, vacancy rates, rental prices and growth opportunities. Affordably priced dwellings benefit not only its residents, but the community as a whole.

Benefits of Affordably Priced Housing:

Creates a stable community. The growing need for housing that is affordable to the everyday Canadian means that this type of property will always be in demand. Upgraded, affordable rentals support a growing and stable population while encouraging economic investment from those residing in and giving back to the local community.

Builds the local workforce. Affordable multi-family dwellings in a neighbourhood means continual community growth and livelihood. With more essential workers, seniors, and students in the community, services and offerings grow and helps maintain the local economy.

Encourages economic stability. Essential workers tend to be dependable renters and have steady incomes. In times of economic downturn, essential workers often experience income increases as they are needed more than ever, thriving financially while they keep us afloat.

Increases disposable income. Paying less for rent means residents will have the choice of how to spend their money. With lower debt levels and more disposable income, residents can put more money back into their local community, thus fuelling the economy.

Allows for walkability. By increasing density in neighbourhoods, we provide ‘neighbourhood living’ over ‘city living,’ allowing residents to easily explore their community on foot. This actively supports small businesses, promotes physical exercise and encourages individuals to get involved in their neighbourhood.

Lowers our carbon footprint. By providing housing near places of employment, we help to lower our residents’ carbon footprint by shortening commutes, giving time and convenience back to these individuals. In addition, we seek out existing buildings and reposition them through strategic capital improvements, a carbon-friendly alternative to building new.

Revitalizes our communities. In addition to lowering our carbon footprint, investing in vintage properties and repositioning them benefits the community, making it a more attractive home for future residents while maintaining an affordable rate.

The bottom line is simple:

For many people, there’s a trade-off between convenience and affordability.  But it doesn’t have to be that way. Properties that charge affordable rent benefit individuals and the community at large by increasing neighbourhood quality and stability, providing economic security and allowing Canadians to live in safe and comfortable homes.

This commentary and the information contained herein are for educational and informational purposes only and do not constitute an offer to sell, or a solicitation of an offer to buy, any securities or related financial instruments. This article may contain forward-looking statements. Readers should refer to information contained on our website at for additional information regarding forward-looking statements and certain risks associated with them.

How Avenue Living’s Legal Team Is A Strategic Partner

From our very first deal, Avenue Living Asset Management has relied on our legal professionals to help make sure things go smoothly. In fact, Shelley Allchurch was one of our very first full-time team members, joining us as general counsel in 2010.

“We’ve been so lucky to have Shelley on our team right from the beginning,” says Avenue Living Founder and CEO, Anthony Giuffre. “She’s built an incredible team over the years. It has really evolved as Avenue Living has grown and she and her team have become an essential part of our platform.”

Today, our legal team includes 17 professionals — lawyers who are experts in real-estate law, securities law, corporate law, and risk management, as well as paralegals, in addition to an insurance risk expert and a contract management specialist.

“We’ve really expanded and adapted to meet the demands of the business,” says Shelley. As Avenue Living has evolved, we’ve called on the legal team to handle everything from typical tenancy issues and employment contracts, all the way to complex legal matters, such as multi-jurisdictional real estate acquisitions, M&A transactions, restructurings, fund formation and the negotiation and drafting of sophisticated commercial agreements. The legal team ensures the decisions we make and the actions we take are in line with local regulations and mitigate risk for our many stakeholders, including investors, residents, employees, and the communities in which we operate.

“Legal teams can often be seen as the naysayers,” says Shelley. “But that’s not our role. We’re here to support and facilitate Avenue Living in reaching our business goals. We do this by looking at the business through a legal lens and bringing a unique perspective to decision-making.”

While Avenue Living started out in 2006 as an owner/operator of multi-family residential properties, we’ve since grown to include a thriving group of companies that invests in the everyday, from self-storage to technology. These companies all have their own unique needs, and our legal team does a great job at managing most of these needs in-house.

The members of the legal team are partners in the organization. Legal touches every aspect of Avenue Living’s business. Their specialized knowledge and expertise serve us in so many ways — in large ways, such as mergers and acquisitions, and in smaller, everyday ways, like vetting our communications (including this blog post). They help us ensure we adhere to our organizational pillars, which guide our decisions every day.

“It’s vital that we understand the business strategy and objectives,” says Trevor Korsrud, Associate General Counsel to the organization, “so we can align with business units throughout Avenue Living and provide them with the guidance they need.”

Being part of an in-house team has meant stretching the legal team’s knowledge and abilities in ways not possible in private practice. The Avenue Living team touches many different aspects of law in their day-to-day duties, whether they’re providing counsel themselves or consulting and working with specialized experts outside the organization.

And like so many groups within this organization, our legal team regularly learns from each other, sharing insights and experiences as we take on new challenges, together.

“I’m so proud of the team we’ve built,” says Shelley. “It’s challenging, motivating, and validating work.”

This commentary and the information contained herein are for educational and informational purposes only and do not constitute an offer to sell, or a solicitation of an offer to buy, any securities or related financial instruments. This article may contain forward-looking statements. Readers should refer to information contained on our website at for additional information regarding forward-looking statements and certain risks associated with them.