November 20 2020
Solving the Affordable Housing Crisis: New Construction Housing (Part 1)
In this third article in our affordable housing series (the first two articles are here and here, respectively) we explore how new construction can bring more affordable housing to the market along the housing continuum.
Our exploration will be done in two parts. In this first look, we’re exploring housing for our most vulnerable communities, from emergency shelters to social housing. We’ll share some of the projects we’re currently working on and provide an overview of current policy related to funding for more of these projects in the future.
Defining Affordable Housing
According to the Canada Mortgage and Housing Corporation, housing is affordable if it costs less than 30% of a household’s pre-tax income. Not everyone has the means to compete in the marketplace, however, and the marketplace can’t always meet the needs of those seeking housing.
So, affordable housing can be built by governments, community organizations, non-profits and the private sector. It can be temporary or permanent, rented or owned.
Bringing Affordable Housing to Market: Our Work
Our teams are hard at work on a number of affordable housing projects across our markets.
Varsity Multi Service Redevelopment
This project is a joint venture by the City of Calgary and the Calgary Housing Corporation and is one of the first projects in the City under the Integrated Civic Facility Program.
Entuitive is providing Structural and Building Envelope services and are working with the Mark Boutin Architectural Collaborative on this project, which is 90% complete with the Construction Documents stage.
With the envelope, our goal is to provide a 35-year service life and an envelope that is 16% better than Code. We want to provide the most energy efficient envelope possible, which adds to the affordability of the units, since residents pay for their own utilities.
David Leonard, who is leading the Envelope Consulting for this project has a passion for affordable housing. He is a volunteer at the Better Housing Lab, a collaborative effort among professionals across our industry. They’ve come together to focus on solutions toward creating better affordable housing. “We as an industry need to be focused on the challenges and opportunities that we face on any project to understand where we can avoid unnecessary redundancies and find efficiencies,” says David.
On the structural side, one of the key challenges, according to Greg Riewe, was marrying the conventional and economic wood-framed housing block with the post-disaster requirements of a fire hall, ensuring both can be fully operational in an emergency. “This type of challenge is synonymous with integrated and mixed-use facilities. Some critical and creative thinking is needed to deliver on the requirements these different uses have,” says Greg.
Lower Similkameen Community Services Society
Another affordable housing project we’re providing both Structural and Envelope Consulting services on is the Lower Similkameen Community Services affordable housing project in Keremeos, British Columbia. This project is provincially funded and follows BC Housing requirements but is owned and operated by a local community services organization.
This wood-framed structure is three storeys and will bring 43 units to market, ranging from studios to three bedrooms, with most being one- or two-bedroom units.
The structure, including walls and floors, will be panelized and built off-site in a controlled plant environment. These elements will be assembled onsite to facilitate a rapid erection and reduction of the construction schedule.
In terms of the envelope, we’re providing a cost-efficient envelope with a 30-year service life with exterior walls that are exterior insulated for better thermal continuity and commercial-style roofing that will extend the lifespan of the asset..
104 Avenue Affordable Housing
This BC Housing affordable housing project, located in Surrey, British Columbia, is nearly completely modular in terms of its construction. It’s a six-storey supportive housing building, geared to providing housing for those with a high risk of homelessness or other personal challenges.
We’re providing Building Envelope and Energy Modelling Services on this project and, it being a modular project with the parts produced by Atco Structures in Calgary, has meant some unique challenges for our design team.
According to Mike Lembke, the lead on the project, “Modular projects are unique in comparison to conventional construction and require responsive design solutions that are conducive and effective through off-site construction, transportation, and on-site stacking. For this project we were also able to leverage our One Company culture by heading up the design and field services in Vancouver, while manufacturing plant visits were handled by our Calgary team. This worked well for us and ATCO Structures.”
A Closer Look at Current Policy
Aside from what we’re currently working on, there’s hope that much more affordable housing stock will be brought to bear in the next several years. Recent announcements by leaders of all government levels internationally have allocated funds for new build affordable housing, and we’re also seeing increased appetite for inclusionary zoning that helps bring additional units to market.Entuitive operates in seven offices across three countries, and we’re continuously examining how current policy impacts the construction of new transitional and social housing.
Building for a better world is core to our purpose, and with the COVID-19 pandemic, we’ve felt even more called to do our part in ensuring everyone has a warm, safe place to call home.
Below, a closer look at the current policy climate in these markets.
Canada – Vancouver, Calgary, Edmonton, and Toronto
Recently the Canadian government announced $500 million geared towards the construction of 3,000 affordable housing units to be used for rapid housing in 15 Canadian cities. This includes $203 million for Toronto (and $10.8 million for nearby Hamilton), $51.5 million for Vancouver, and $24.6 million for Calgary. Another $500 million will be dedicated to projects with a longer timeline, as the former must be completed by March 2021.
Canada also has the National Housing Strategy which, within 10 years, aims to cut chronic homelessness in half, remove 530,000 families from housing need, and will invest in the construction of up to 125,000 new affordable homes with funding of $55+ billion.
At the provincial level, Alberta has invested $1.2 billion to build and update 4,100 affordable housing units across the province, and Calgary has a Corporate Affordable Housing Strategy that is planned to 2025.
Edmonton has a 2019-2022 Affordable Housing Investment Plan, which plans to create 2,500 new units with an investment of $132 million by the City and leveraging $477 million of combined financing from other levels of government.
Vancouver’s mayor has pledged $30 million for emergency housing to homeless people and has a robust suite of housing policies related to affordability. Housing Vancouver also has a ten-year plan (2017-2027) that aims to improve housing affordability across the housing continuum. Building 12,000 social and supportive units is the focus of the plan. This plan includes “inclusionary zoning” where the City allows for additional density for projects that provide a certain percentage of new residential development as social housing.
Toronto is home to the HousingTO 2020-2030 Action Plan, which aims to create 40,000 new affordable rental homes, improving affordability for 40,000 households through benefits, improving conditions for 74,800 households through restoration and repairs, creating 4,000 new affordable non-profit home ownership opportunities, and assisting 150,000 first-time home buyers through the MLTT Rebate.
In Toronto, too, it seems inclusionary zoning and affordable rents are up for debate – this will be examined in more depth in a future article.
United States – New York City
Recently, Mayor Bill de Blasio announced $466 million would be shifted into the 2021 fiscal year budget to focus on urgent affordable housing needs. With the shift, the City has invested $1.4 billion in affordable housing in 2020 with 30,023 homes being financed in the last fiscal year. Forty-four percent of these homes serve low- and very-low income families. It also keeps the Housing New York project on track to create and preserve 300,000 affordable homes by 2026.
Some speculation on how vacant Manhattan offices (CBRE found that just 10% of workers had returned to the office as of Sep. 18) could be a site for affordable housing, but this would require zoning approval through the difficult ULURP process, as well as additional financing.
NYC also has a mandatory inclusionary housing policy that was instituted in 2016. This is a key initiative of Mayor de Blasio’s Housing New York Plan, the goal of which is to bring more affordable housing to New York over 10 years. This includes building new affordable housing in all five boroughs and promoting homeless, senior, supportive, and accessible housing.
The United Kingdom – London and Edinburgh
In the UK, in August 2020, Prime Minister Johnson announced a Planning for the Future White Paper that announced that the Covid-19 recovery would be focused on building better, greener, and faster. An interesting aspect of their plan is that all new homes will be “zero carbon ready” in accordance with the UK’s plans to be net zero by 2050.
In the UK, the national rent policy for Social Rent or Affordable Rent is 20% below local market rents, with provision made for it to remain at an affordable price for future households or for the subsidy to be recycled for alternative affordable housing provision. There are also provisions for starter homes and discounted market sales housing, which will be expanded on in the next article.
In the New London Plan, Mayor Sadiq Khan has indicated a strategic target where half of new homes should be affordable. Under the plan, proposals that provide 35% affordable housing and 50% on public or industrial land, and that meet tenure, affordability, and other relevant requirements, can follow the fast track route.
In Edinburgh, a guiding principle for affordable housing is that a residential development consisting of 12 or more units should include a provision for affordable housing amounting to 25% of the total number of units provided. There are various tenure types with “Social Rent” being the highest priority.
Stay tuned for the next article in our series, which will focus on the other half of the housing continuum, looking at affordable market rental and ownership housing.
If you’d like to learn more about Entuitive’s approach to affordable housing, reach out to the lead of this article series, Mike Hillcoat.