$1 Billion Hits the Streets to Fund Canadian Modular Rapid Housing Initiative
For the past two years, MBI and our members have been working with the Canadian Mortgage Housing Corporation (CMHC) to open up opportunities for modular social housing projects in Canada. The challenge, according to CMHC, is that “modular does not fit our traditional underwriting and financing profile.”
MBI has been able to work with CMHC to develop new underwriting guidelines specific to modular projects. Based on a late-October call with CMHC, those guidelines are expected to be available and in force by the end of 2020. But the bigger news for the industry is the recent announcement by CMHC about their “Rapid Housing Initiative (RHI).”
The Government of Canada, through CMHC, has launched the RHI as a $1 billion program utilizing only modular construction to help address urgent housing needs of vulnerable Canadians, especially in the context of COVID-19, through the rapid construction of affordable housing. The initiative provides capital contributions (upon signing a funding agreement with CMHC) under two streams to expedite the delivery of affordable housing.
The RHI will:
- Support the creation of up to 3,000 new permanent affordable housing units.
- Cover the construction of modular housing, as well as the acquisition of land, and the conversion/rehabilitation of existing buildings to affordable housing.
- Aim to commit all funds before March 31, 2021, and ensure housing is available within 12 months of agreements.
Applications for projects must be submitted by cities in partnership with a developer/builder by December 31, 2020.
RHI will deliver funding under two streams, each containing $500 million in available funds. Under the first stream, RHI will expedite funds to pre-identified municipalities with the highest level of renters in severe housing need and people experiencing homelessness. For the second stream, an application portal will be open to municipalities, provinces and territories, Indigenous governing bodies and organizations, and non-profit organizations where applications will be prioritized based on the strength of the application.
MBI has put together a directory of Canadian manufacturers for the express purpose of helping decision-makers locate qualified modular companies with whom to partner.
MBI is also reaching out directly to the pre-identified municipalities to offer resources and assistance to help ensure these modular projects are successful. If you are interested in participating in this housing initiative, please visit this page for more details: https://www.cmhc-schl.gc.ca/en/nhs/rapid-housing-initiative
MBI has identified the multifamily, social/affordable housing sector as one of the greatest growth opportunities for the industry. This work with CMHC dovetails with the recently completed work MBI did with Fannie Mae in the development of their Multifamily Modular Construction Toolkit.
Special thanks to MBI member Joseph Kiss of Horizon North for his assistance on this effort.
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