Armco Capital

Developing Communities

If you live in Atlantic Canada, you have probably heard of Armco Capital.  That’s because the company owns 40 per cent of the residential market, developing 600 to 700 lots per year. Over the past 27 years, Armco has brought more than 10,000 home sites to 35 subdivisions—including single-family executive homes, semi-detached homes and townhouses.

Armco understands the importance of commu­nity, which is why the company carefully selects homesites—and just as carefully selects the best builders to partner with. Armco pays attention to the way the homesites fit into their environment, mindful of each site’s integration with other hous­es, nearby amenities, green space, playgrounds and walking trails. Nothing is overlooked in an Armco community.

Located in Halifax, Armco was founded in 1982 by two members of the Armoyan family. Originally, the company was a small, residential real estate developer run almost entirely by two brothers. Through the years, however, the Armoy­ans grew the company into a very dynamic group of companies. In recent years, Armco has diversi­fied nationally and internationally.

“We are one of the biggest organizations of our kind in our region,” says Kathleen O’Donovan, Sales and Marketing Manager. “Armco has been recognized 15 times by Progress Media Group as one of the top 101 companies in Atlantic Canada.”

Armco owes a lot of its success to the team’s ability to plan ahead and its willingness to jump on a good opportunity when they see one. “We accept more risk than our competitors and thrive in economic disasters,” explains O’Donovan.  “Armco watches the market and understands it is cyclical in nature.  The company anticipated the recent economic downturn and, so, spent the last two or three years strengthening its balance sheet to be in a position to take advantage of resulting opportunities.”

“Our business model is ‘value creation’ through indentifying and acquiring underval­ued assets,” adds O’Donovan.  “We create oth­erwise unrealized value through restructuring, redevelopment or repositioning the asset, and, ultimately, we realize the created value through sales, operations or leveraging.” Armco is actively monitoring those areas hardest affected by the subprime mortgage crisis and is closely exploring opportunities that will enable the company to acquire projects at discounted prices. In the last year, Armco acquired two condominium projects in Miami and Tampa, Florida at well below their estimated original values.  

Residential development is just one piece of the Armco pie. Over the years, the company has expanded to include industrial, commercial and institutional development divisions, as well as as­set management.  

P3 Ventures

While residential development is still well un­derway, Armco’s most significant undertaking to date is the $150-million Public-Private Partnership (P3) school project. In 1998, Armco’s sister com­pany, Scotia Learning Centres (SLC), was chosen to design, construct and operate 13 of 31 facilities leased to the Province over a twenty-year term. “We were chosen as the Province of Nova Scotia’s preferred partner for the P3 school project and completed construction of all 13 schools within 18 months,” explains O’Donovan.

In 2004, the portfolio of schools was expanded with the purchase of the Leo Hayes High School in Fredericton, NB.  Just recently, the company was also awarded two new P3 schools in New Bruns­wick.  Construction has already begun and both schools are slated to be finished before the end of 2010.

New Brunswick Premier Shawn Graham says both P3 schools will save taxpayers approximately $12 million, as private companies tend to build schools quickly and more cost effectively than the government. “For the people of this community, where in the past some of their schools become dilapidated over time, this is good news,” Graham says. “They’re going to have a state-of-the-art building for the next 30 years.”

In addition to the schools, Armco owns several commercial and industrial properties in the Hali­fax Regional Municipality, including Bayers Lake Tower 1, The Willow Tree Tower, Halifax Chrysler Dodge, and 612 Windmill Road, which is home to Sleeman Maritimes Ltd and Brewdebaker’s res­taurant. In total, Armco maintains over 1.5 million square feet of commercial, industrial and institu­tional space.

Giving back

Not only does Armco develop communities, it also gives back to them. “Armco puts Corporate Social Responsibility at the centre of its business decision-making and strives to produce an overall positive impact on society,” says O’Donovan. “Our belief is that our organization should actively be involved in and contribute to the welfare of its communities.”

Over the years, Armco has been a supporter of many organizations, including Habitat for Humanity and The IWK Foundation. Habitat for Humanity is a not-for-profit organization that works to build affordable housing and promotes homeownership as a means to break the cycle of poverty. Although Armco was honoured to par­ticipate in the Adopt-a-Day Challenge and spon­sor the Annual Habitat for Humanity Dinner, the company was looking for a greater way to help this organization. 

Armco understands that acquiring affordable land has been one of Habitat’s greatest challeng­es and therefore has offered to assist the organi­zation.  The company has offered to reserve two building lots in each phase of its Governor’s Brook subdivision at a significant discount for Habitat for Humanity.  “The first homeowners will move into their new homes in Governor’s Brook this fall,” says O’Donovan.

Armco Capital has also pledged to give $750,000 to the IWK Health Centre Foundation. These funds will be used for the 7th Floor Pedi­atric Medical Unit (Inpatient), as part of the Chil­dren’s Site Redevelopment project set to open in the spring. Funds will be donated in relation to the sale of lots in the Governor’s Brook Subdivi­sion.

Covering all grounds

Armco Capital has done well riding out the economic downturn. The company remained prof­itable and continued to diversify and expand its operations. Diversity is essential to Armco’s goal to be an industry leader for the long haul. “We have distinguished ourselves as a leader in real estate development by understanding the im­portance of community,” concludes O’Donovan. “Community encompasses many elements—not just your home.  It is where you live, work, play and go to school. It is this understanding that makes us different.”