A Transformative Year with Strategic Divestiture and Significant Progress on Student Housing Developments
Fiscal 2025 was a transformative year for GECC, marked by pivotal events that strategically positioned the Company for future growth and a strengthened focus on its core business of providing student-centric rental apartments to over 0.5 million potential students.
Key Highlights from Fiscal 2025:
Strategic Divestiture of Sprott Shaw College
On August 8, GECC completed the sale of Sprott Shaw College, receiving net proceeds of approximately $35 million. This transaction significantly strengthens the Company's balance sheet and provides capital to support future growth initiatives. The sale was concluded at an attractive multiple of Sprott Shaw's EBITDA, enabling GECC to sharpen its focus on developing and expanding its student housing portfolio. GECC retained its language colleges, which will continue to serve as a valuable source of student residents for the GEC® properties, complementing the Company's partnerships with over 95 other schools in Metro Vancouver.
Record Performance in Student Housing:
Despite headwinds in the broader conventional real estate market, the student housing sector remains resilient and continues to demonstrate strong performance. As of August 31st, 2025, GECC's student housing portfolio had a near-zero vacancy rate. This high demand is driven by the robust student population in British Columbia, which includes over 500,000 domestic and international students at the college and university levels, as well as a strong market for short-term international students for language studies and summer programs, which are not capped by federal government policies.
Successful Project Financing and Development Progress:
GECC made significant strides in advancing its project pipeline during fiscal 2025. It successfully secured approximately $178.8 million in CMHC-sponsored mortgages in fiscal 2025, including financing for two towers and the construction financing for GEC® Oakridge. CMHC-sponsored financing provides long-term financial stability with favourable, lower interest rates. The Company's overall financing costs declined in the fourth quarter of fiscal 2025 from the third quarter of fiscal 2025, further enhanced by the cash proceeds from the Sprott Shaw College transaction.
Partnerships and Development Updates:
GEC® Oakridge: GECC has partnered with Pomerleau Capital and its subsidiary, ITC Construction Group, to co-develop this 18-storey student housing project. Construction began in February 2025 and is progressing slightly ahead of schedule with a target completion date in early 2027. The total construction budget is $123 million, with financing sponsored by CMHC. The project is projected to generate over $8 million in annual rental income commencing in its first full academic year of operation. See news release here: https://www.costar.com/article/1632015166/one-of-canadas-biggest-student-housing-operators-launches-major-vancouver-project
Education Mega Center® (EMC): In collaboration with Pure Group, GECC is advancing the Surrey EMC project. The project received its Development Permit in June 2025, and an excavation permit application was submitted in July 2025. The total construction budget is estimated at $330 million, with a CMHC financing application contemplated. See news here: https://dailyhive.com/vancouver/gec-education-mega-centre-surrey-student-housing-tower-partnership
GEC® Langara Expansion: This 650-bed location received Urban Design Panel approval to increase the project's density from 10 to 26 storeys. This approval will substantially reduce the cost per buildable square foot by nearly 50% and is projected to increase annual rental income commencing in its first full academic year of operation from an estimated $3.5 million to $11.5 million. CMHC-sponsored financing is also contemplated for this development.
"Fiscal 2025 was a defining year for GECC," commented Toby Chu, Chairman, President and Chief Executive Officer of GECC. "By divesting of Sprott Shaw College, we decreased debts, substantially increased our cash position, and focused our resources on our core strength: developing and operating high-quality student housing communities. The progress we have made on our development pipeline, bolstered by strategic partnerships and favourable CMHC-sponsored financing, underscores our ability to execute on our strategic vision and capitalize on the strong fundamentals of the student housing market in Metro Vancouver."
Demands:
According to BC Government statistics*1, over 0.5 million college and university students reside in British Columbia, comprising both domestic and international students, demonstrating significant market demand for student-centric rental properties.
Supply:
A report published by Bonard Research*2 indicated that all other Canadian student housing providers are heavily concentrated in Ontario or Eastern Canada, leaving GECC with no meaningful competition in BC at this time. Hence, the Company plans to aggressively expand its presence in British Columbia to gain economies of scale and leverage its existing infrastructure and marketing presence to dominate the local market.
Sources:
2* Bonard (July 15, 2025) Student Housing Market in Canada: Room to Grow Amid International Student Cap https://www.bonard.com/insights/canadian-pbsa-a-sector-with-plenty-of-room-for-growth#form
Read the full article here:
https://www.nasdaq.com/press-release/transformative-year-strategic-divestiture-and-significant-progress-student-housing
