As the need for purpose-built rental housing has grown in British Columbia, the provincial government has aimed to increase the number of homes and the speed at which they are built through partnerships with private developers, municipalities and nonprofits.
In February, it launched the B.C. Builds program, which is intended to reach these goals by building housing on unused or underused land. The aim is to have the projects completed within 18 months.
B.C. Builds follows other initiatives launched by the province, including measures such as Bill 44. That legislation requires municipalities to reflect housing needs in zoning bylaws, among other measures.
Green Street News spoke to Ravi Kahlon, B.C.’s minister of housing, about the early results of the program and other measures meant to increase rental stock, as well as what is in store down the road.
What does the situation for rental buildings look like on the ground in B.C. right now?
We’ve been leading the country when it comes to purpose-built rentals, and that’s really positive given the challenges B.C. is facing with increased population. I do think that we will see some headwinds with interest rates going up, in particular global inflation, and the pressures when it comes to costs that many of these projects are facing.
“Many of the steps that we’ve taken here in British Columbia, ensuring local governments do their upzoning and plan communities for 20 years of growth in advance, I think that will help to reduce time, which also helps reduce the overall cost of these projects”
It’s possible if the interest rates go up that we may continue to see the projections that we have right now. But I am concerned about interest rates in particular.
I think there were some positive moves being made by the federal government around removing the GST. I think we’ll be beneficiaries of that in British Columbia. Many of the steps that we’ve taken here in British Columbia, ensuring local governments do their upzoning and plan communities for 20 years of growth in advance, I think that will help to reduce time, which also helps reduce the overall cost of these projects.
Are you hearing any concerns from developers about what’s coming up this year?
The main thing I think people want is changes enacted, and we’re in that period right now where we’ve brought the legislation in to reform our process. But local governments have until the end of June to make sure that their zoning and their community plan are aligned with that.
I think that waiting for local governments, to give them clarity about how these rules will be implemented, is one place where certain people in the building and development community are keeping an eye on.
Many people who are building purpose-built rentals say by not having to go to public hearing for their projects they’ve saved a year, a year and a half, on their projects.
B.C. Builds was launched in February. Can you give me a bit of a snapshot on how the response to it has been?
It’s been going fantastic so far. Having the federal government come in with $2bn in financing on top of our $2bn means we can do a lot of projects. What we had projected when we started B.C. Builds was that, given interest rates, we may see a bit of a slowdown in some of the private sector projects.
“Having the federal government come in with $2bn in financing on top of our $2bn means we can do a lot of projects”
To be able to pick up that capacity in the system to continue to have the units being built but having them built on government land I think ended up being the right step for us. We’ve got eight sites that are up for private sector partners to come forward and essentially build and hand us the keys. It keeps their workforce working while they’re waiting for interest rates to come down.
Does that mean there will be expansion of the program?
There definitely will be expansion of the program. We’ve got right now, I believe, nine sites. We could easily be doubling that by the end of the year.
We’ve got communities coming forward saying, “We were going to build a community centre, we were going to build a firehall, now we’re just doing that but with housing on top. Can this program be flexible enough to work and accommodate that?” And the answer is yes.
The point of this program was to be nimble.
Is there a potential for more funding being put toward it?
At this point we’ve got our $2bn and we’ve got the federal government’s $2bn. So, we’ve got the dollars we need at this stage, and if it continues to be a success, that is, of course, something we’ll have to consider.
The amazing thing for us and B.C. Builds is its financing. So when projects are complete, we can take those dollars and put them in future projects. So we do think that revolving line will help us continue this program well into the future.
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