OPINION | Looking for a way out of Calgary's affordable housing crisis
We need a plan to build affordable housing on a scale that has never been seen before, says city manager
This column is an opinion from Richard White, who has written extensively on Calgary's urban development.
Bruce Irvine, the manager of affordable housing for the city of Calgary, recently told me that to keep up with current demand, Calgary needs about 2,000 new affordable homes every year.
He added that, "since 2011, we have only built an average of 300 per year, from both city and other agencies, a deficit of about 1,700 per year."
That is a huge deficit and a crisis in the making, if it isn't one already.
Given the average affordable housing project contains about 50 homes, this means we need to complete 40 affordable housing projects in this city every year.
Is that even possible?
In 2016, after conducting extensive research, the city of Calgary produced the "Foundations for Home" report, which became the city's affordable housing strategy looking ahead to 2025.
A $3B investment
The research estimated the city's affordable housing deficiency at 15,000 homes. With the current cost-per-door at about $200,000, that means clearing up the shortfall would require a $3 billion investment. And that doesn't include the annual costs to manage and operate the homes.
It will soon be 2025 and Calgary is nowhere near addressing its affordable housing crisis.
I began to wonder, even if Calgary had more than $3 billion to invest in affordable housing, could the various players find the land, obtain the approvals and build the estimated 40 new projects every year?
One way to look at the possibilities of the future is to examine what's been done in the past.
Irvine thinks one of Calgary's biggest successes to date was the sale of city land to groups willing to build affordable housing.
In 2018, five lots were sold — three to HomeSpace, one to Habitat for Humanity and one to the Homes for Heroes project. In total, these five projects (four are completed and one is under construction) will create 166 new homes for about 500 Calgarians.
This doesn't seem like such a big success to me. It represents 83 homes per year, which works out to about four per cent of the annual demand.
The city is currently in the process of selling another six sites in 2020, with a projected completion date of 2023 and 300-plus homes.
This is great, but again, the city's land sale initiative is creating only a small fraction of the affordable housing needed.
Lawrence Braul, the CEO of Trinity Place Foundation of Alberta, which has built three new affordable housing projects over the past 20 years, estimates it takes about six years to go from securing the funds and site, to developing the design, conducting community engagement, tendering and, finally, building the project.
Based on this timeline, Calgary needs to have 240 affordable housing projects at various stages of development at any given time to complete the 40 projects needed every year to add 2,000 new affordable homes to the city's inventory.
How realistic is that?
Collaboration is key
Irvine says, "The way to address the affordable housing crisis is for the city, province and federal governments to not only make affordable housing their number one priority, but to collaborate with various not-for-profits, corporations and housing developers on a scale that has never been seen before."
Martina Jileckova, the CEO of Horizon Housing and the co-chair of the Calgary Housing Affordability Council (CHAC), agrees partnership and collaboration is important.
She notes that the RESOLVE fundraising campaign was a huge success, with governments, non-profits and the private sector coming together to raise funds to build affordable housing in Calgary.
However, by the end of the campaign in March 2018, only $74 million of the $120 million goal was realized. That's not a small number, but it will build only about 4,000 new homes, or two years worth of supply.
Yes, the 40-member CHAC is working collaboratively to increase the number of new affordable housing units completed each year, but are they succeeding?
One of the more ambitious CHAC members, HomeSpace, has completed 11 projects since 2016 and currently has four buildings at various stages of development.
Bernadette Majdell, the CEO of HomeSpace, says they have developed a successful model that can leverage funding from various sources and engage major Calgary home builders to manage the actual construction.
To date, they have worked with 11 different home builders in various communities across the city.
However, one of the biggest obstacles Majdell faces is the NIMBY attitude of a few individuals who don't want affordable housing in their community.
A lack of understanding
She laments the public's "lack of understanding of the economic benefits of providing affordable, adequate and safe housing."
She says that, since Calgarians who are properly housed require fewer social and medical services, affordable housing results in an estimated cost savings of $35,000 per year per person.
The task of addressing Calgary's affordable housing crisis is complex and costly, and while all of the affordable housing champions I spoke to were optimistic, I couldn't help but wonder how building a few hundred new homes every year is going to properly address the problem.
I found it very strange that the city doesn't have a list of affordable housing projects currently under construction, recently completed, or in the planning stages. I was told one is in the works.
And while Irvine estimates that an average of 300 new affordable homes have been completed each year over the past decade, nobody knows if that number will increase significantly in the future.
I would not be optimistic if I was a member of the Calgary Housing Affordability Council.
To reiterate what Irvine said: We need a plan to build affordable housing on a scale that has never been seen before.
And I would add we also need the funding and the capacity to implement it.
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