A Dawson City company hopes to help ease the town's chronic housing shortage with a proposed 14-unit apartment project.

The Chief Isaac Group of Companies wants to build the complex on the site of an existing, but dilapidated, two-storey building in Dawson's downtown near the intersection of 2nd Ave. and Queen Street.

Lynn Hutton, CEO of the Chief Isaac Group, said that while the company wants a return on its investment, it also wants to help boost the amount of affordable housing available in the area.

"We see a lot of lower income people in Dawson because it's a tourist town, so only half the year a lot of these people are working," she said. "We want to give everyone in this town an opportunity to have their own home."

The need for more rental housing in Dawson is severe: a market survey by the Yukon Housing Corporation showed the town had a rental vacancy rate of zero.

Dawson City Queen Street.jpg

The new building would take the place of the grey, two-storey building on the right side of this photo. (Chris Windeyer/CBC)

Hutton and Whitehorse architect Jack Kobayashi gave town council its first look at the project Wednesday. It would include six affordable studio apartments, six two-bedroom apartments, a single one-bedroom unit, and a "live/work space" that could double as a storefront.

But the company is grappling with high construction costs and Hutton said it's a challenge to make the economics work. The project's capital cost is estimated at $3.2 million.

"The difficult part...has been trying to figure out a way to make it work financially, because it's expensive to build in Dawson," Kobayashi said.

That figure doesn't include $400,000 to build a foundation on the marshy lot, $100,000 to clean up hazardous materials in the existing building and $42,000 in penalties for foregoing parking spaces.

Fees to go car-free

Town rules require one parking space for each unit, or a $3,000 fee instead. But Kobayashi said the lot is too small to fit that many parking spaces. And Hutton said many people can live easily in Dawson without driving, and prospective tenants wouldn't necessarily need a vehicle.

Hutton hopes the town will waive the parking fees, which may count as an in-kind contribution and allow Chief Isaac to access $42,000 in funding from the Yukon Government under a matching program designed to encourage the construction of rental housing.

Wednesday's presentation was meant only to inform council about the project, which has yet to receive any permits or approvals. Hutton said she hopes construction starts by spring or summer.