Skyrocketing building costs delay critical housing projects in Nunavut

Thirty-six public housing units will not be built in Nunavut this summer because of high construction costs due to COVID-19. 'Every housing unit we postpone represents a great burden for a family that might otherwise have a place to call home,' says the minister responsible.

36 public housing units were unable to go ahead this year

This housing complex is under construction in Iqaluit's downtown core. Tenders for housing projects this summer came back up to 40 per cent over budget, forcing them them to be delayed. (Beth Brown/CBC)

Thirty-six public housing units will not be built in Nunavut this summer because of high construction costs due to COVID-19. 

Delayed builds dominated discussion during the spring sitting of the legislature that ended June 9. 

The minister in charge of the Nunavut Housing Corporation, Margaret Nakashuk, said the price of building material has increased 40 to 50 per cent from last year. 

"Every housing unit we postpone represents a great burden for a family that might otherwise have a place to call home," said Nakashuk during her opening statement while taking questions from the standing committee on legislation.

"It saddens me greatly to do this. However, cost overruns leave us with no other choice."

Nakashuk said the tenders for these projects were 30 to 40 per cent over budget — a budget calculated when the price of building materials was lower. 

Similar concerns are being raised in the Northwest Territories. That territory's housing corporation recently said the cost to address its ongoing housing crisis has now doubled

Minister for the Nunavut Housing Corporation, Margaret Nakashuk, took question from the Standing Committee on Legislation about what the housing corporation is doing about numerous delayed projects. (Beth Brown/CBC)

To build 16 public housing units in Iqaluit, the lowest bid was $15 million, said Terry Audla, president of the Nunavut Housing Corporation. These units were to be four public housing four-plexes. 

Two public housing five-plexes were postponed because the contractor was unable to secure insurance in Taloyoak. One public housing five-plex was postponed in Rankin Inlet, but, Nakashuk said this project will go ahead when the land is developed.

In Pangnirtung, one staff housing five-plex was postponed and will be reviewed.

These projects will need to go out for tender at a later date. 

"I want to stress that the public housing projects are not cancelled," said Nakashuk. "They are postponed until next year." 

Sanikiluaq hamlet office delayed 

Public housing units aren't the only projects not going ahead for the time being. 

The construction of a new hamlet office in Sanikiluaq has been cancelled for this year. Its tender came back above the $7 million budget, according to Community and Government Services Minister Jeannie Ehaloak. 

The hamlet office was destroyed in a storm in September, leaving municipal staff scrambling for a space to work.

A new request for proposals will be issued this month for the design of the building, but the tender for the construction will not go out until next year. 

The hamlet office in Sanikiluaq after a storm in September ripped the roof off. The construction of a new office has been delayed. (Submitted by Alison Drummond)

Housing corporation hopes market will stabilize 

Audla said the corporation is hoping the projects will move forward as planned next year.

"We are hoping that things will start to stabilize," said Audla. "As the minister had also said in her answer; this is a Canada-wide, North America-wide if not worldwide issue." 

MLA for Iqaluit-Manirajak, Adam Arreak Lightstone, said public housing units are often over-designed and asked if the housing corporation could look at ways to make them cheaper. 

Audla said that often public housing units are built "up to code or better" to mitigate future costs of repairs. 

President of the Nunavut Housing Corporation, Terry Audla. (Sima Sahar Zerehi/CBC)

In the past, Audla said altering the public housing complexes' design — such as removing a second door from the buildings, which saved the territory about $100,000 a piece — but after a fire at one complex, the second door was returned for safety reasons. 

Many members asked about other considerations for cutting down costs such as labour. 

Audla said they are speaking with other Nunavut government departments about training more local labourers. 

"In an ideal situation if we can … bring about an increased labour pool within Nunavut that would be the right direction to go, but that's a long-term initiative," said Audla. 

There will be 70 public housing units and four staff housing units built this year, according to Nakashuk. These will be in Coral Harbour, Rankin Inlet, Naujaat, Kugaaruk, Sanirajak, Pond Inlet and Sanikiluaq.


Jackie McKay


Jackie McKay is a Métis journalist working for CBC in Nunavut. She has worked as a reporter in Thunder Bay, Yellowknife, Whitehorse and Iqaluit. Jackie also worked on CBC Radio One shows including The Current, Metro Morning, after graduating from Ryerson University in 2017. Follow her on Twitter @mckayjacqueline.


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