The Manitoba government is putting $10 million into a new fund aimed at getting more affordable housing units on the market.
The money is being used to start an investment trust that would work to attract private-sector investors, then build new housing or convert existing buildings into affordable units, the province announced Tuesday.
The building projects could be run by non-profit groups, which could leverage more money from other government programs.
Premier Wab Kinew anticipates non-profit groups will appreciate the help from business interests.
“What we’re saying with this project is … let’s take your expertise and meet you with people who’ve made their careers out of project management and haggling with contractors,” he said.
Bernadette Smith, the provincial minister for housing, addictions and homelessness, said the initiative aims to have three housing projects within the coming year, as a start.
The trust is being developed by the Business Council of Manitoba and is formally called the Collaborative Housing Alliance Real Estate Investment Trust.
Council president Bram Strain says the government would get no return on its investment, and some other big business investors would get little or no return, keeping the cost of new housing down and helping prioritize below-market-rate housing.
“This is about giving back, so it’s not about what’s in it for the business,” Strain said Tuesday.
“This is about taking care of our province, our citizens of our province. It’s to help people.”
Over time, the aim is to have thousands of units built or converted, he said.
Tessa Blaikie Whitecloud, CEO of Siloam Mission — which operates 137 housing units in Winnipeg — said one challenge her organization has encountered in adding to its housing stock is that “you need some funding to get in the door with other funders.”
The new real estate investment trust, or REIT, could provide some of that initial funding, she said.
A 32-unit housing proposal from Siloam Mission is currently on hold because the non-profit didn’t qualify for the first round of funding through the federal housing accelerator program, she says.
A key piece of the real estate investment trust, she said, is that it will help partner the “project management side, that knowledge of housing construction, with the non-profit side of knowing how to best serve the community.”
She also said she’s pleased non-profits will own at least 50 per cent of the housing projects built or renovated through the investment trust.
“We know that despite private investment, this is going to stay social housing for the long haul and stay controlled by the community sector,” said Blaikie Whitecloud.
End Homelessness Winnipeg CEO Jason Whitford expects tens of millions, if not hundreds of millions, will be funnelled into the investment trust in the years to come.
He’s confident there’s interest from members of the private sector, who have talked with End Homelessness about ways to address the lack of housing.
“There’s been a queue of either private developers or organizations that have come to us because of our presence in the community — coming to us with ideas, with business plans, with properties that they wanted to develop,” he said.
“I think we’re going to build upon that knowledge [with the REIT] and actually … hope to have some of these projects come to fruition.”
Community groups will be able to apply for funding through an expression of interest.