Case Study: Vendor-Take-Back Sale of 8-Unit Apartment Building

1121 37 Street SW, Calgary, AB

Exterior view of the 8-unit apartment building at 1121 37 Street SW, Calgary, AB

Property Overview

The subject of this case study is an 8-unit apartment building located at 1121 37 Street SW, Calgary, AB. The building, positioned in a desirable residential neighborhood, close to downtown and with access to various amenities and transit, presented an excellent investment opportunity due to its potential for value-add through renovations and rent stabilization.

Sale Structure

The transaction was executed as a Vendor-Take-Back (VTB) deal, where the seller offered financing to the buyer. This strategic move allowed the vendor to secure a higher sale price while earning interest on the financed amount. This arrangement was beneficial for both parties, particularly in a market where traditional financing options may have been less favorable.

Vendor’s Perspective

From the vendor’s standpoint, the VTB deal provided several advantages:

  1. Higher Sale Price: By offering seller financing, the vendor was able to negotiate a sale price significantly higher than what might have been achievable through a conventional sale.
  2. Interest Income: The seller earned interest on the financed portion of the sale, increasing the overall financial return from the transaction.
  3. Quicker Sale: The VTB arrangement made the property more attractive to potential buyers, potentially reducing the time on the market.

Buyer’s Perspective

The buyer also realized substantial benefits from this deal structure:

  1. Easier Financing: The VTB deal offered more accessible financing terms compared to traditional lenders, which might have imposed stricter requirements.
  2. Renovation and Stabilization Period: The buyer was given 12 months to renovate the units and stabilize the rents. This grace period was crucial for repositioning the property to maximize rental income.
  3. Flexible Leases: All units were on month-to-month leases, providing the buyer with the flexibility to negotiate new leases post-renovation without the constraints of long-term tenant agreements.

Transaction Details

  • Sale Price: The final sale price was significantly above the market average due to the inclusion of seller financing.
  • Financing Terms: The VTB financing included an interest rate that provided the vendor with a steady income stream over the financing period.
  • Renovation Timeline: The buyer was allocated a 12-month period to complete renovations and stabilize the property’s rental income.

Renovation and Stabilization Plan

During the 12-month term of the VTB, the buyer will undertake the following actions:

  • Unit Renovations: Plans are made to renovate all eight units. These renovations aim to enhance the overall appeal and quality of the living spaces, including modern kitchens, updated bathrooms, and new flooring.
  • Increased Rents: The goal is to attract higher rents post-renovation, significantly boosting the property’s income potential.
  • Stabilized Occupancy: The buyer intends to transition from month-to-month leases to longer-term agreements, ensuring a stable tenant base and consistent rental income.


By the end of the 12-month period, the following results are anticipated:

  • Completed Renovations: All units are expected to be fully renovated, meeting modern standards and increasing the property’s market value.
  • Higher Rental Income: The upgraded units are projected to command higher rents, enhancing the overall revenue of the property.
  • Stable Tenancy: The conversion of month-to-month leases to long-term leases aims to provide a steady and reliable rental income stream.


The VTB sale of the 8-unit apartment building at 1121 37 Street SW, Calgary, AB, stands as a prime example of how creative financing can benefit both sellers and buyers in the current real estate market. The vendor achieved a higher sale price and interest income, while the buyer benefited from flexible financing and the opportunity to add value through renovations. This case underscores the potential of vendor-take-back deals to create win-win scenarios in property transactions.

For more details on this sale contact Joy Daklala