Disposal of surplus federal properties for affordable housing
Context
The Federal Lands Initiative (FLI) makes suitable properties available to selected proponents at a discounted cost so that they can provide affordable housing that is energy efficient, accessible and socially inclusive.
In accordance with its National Office Portfolio Plan, Public Services and Procurement Canada (PSPC) will dispose of underperforming and underutilized properties. In doing so, these properties will be made available for the FLI as a contribution to enhancing the affordable housing stock.
Suggested responses
- The government is committed to increasing the supply of affordable housing, including by making surplus federal properties available through the Federal Lands Initiative
- We launched this initiative in 2018 with a target of 4,000 new or renovated housing units that would be energy efficient, accessible and socially inclusive
- The Federal Lands Initiative will facilitate subsidies of up to $200 million for the transfer of federal lands to affordable housing providers
- We will continue to support and encourage the development of sustainable, accessible, mixed-income, mixed-use developments and communities
Background
The FLI was launched in 2018 with a target of making 4,000 suitable properties available to selected proponents over a ten year period.
Over the next ten years, the FLI will facilitate subsidies of up to $200 million for the transfer of federal lands to housing providers to encourage the development of sustainable, accessible, mixed-income, mixed-use developments and communities. Surplus federal properties across Canada will be made available through the new program to partners that repurpose them to provide housing at less-than-market rates. The partners will receive the federal properties at a value somewhere between market value and $1. The difference between market value and transfer value represents the government’s contribution towards the provision of affordable housing.
Each housing project must meet the following NHS requirements:
- Affordability: 30% of units must have rents at less than 80% of local median market rents
- Energy efficiency: a minimum 25% reduction in energy consumption and greenhouse gas emissions compared to either national building codes or past performance
- Accessibility: 20% of units must meet accessibility standards
After the transfer of a property to a housing provider, a restrictive covenant will be placed against the property for a fixed timeframe of at least 25 years to ensure compliance with these requirements by the private sector partner.
The FLI is being led by the Canada Mortgage and Housing Corporation (CMHC) and is a component of the government’s larger National Housing Strategy. Along with CMHC, partners in the FLI include PSPC, Canada Lands Company Limited, and Employment and Social Development Canada. CMHC is responsible for managing the program’s budget, selecting the proponents, and reporting on performance.
PSPC’s role is to assess its portfolio to identify properties that are surplus to its requirements (usually those assets that are underperforming and/or underutilized together with those sites that have redevelopment potential). PSPC also provides disposal related services that facilitates the transfer of the property to the affordable housing proponents.
As of September 2019, 283 units had been committed through the program. PSPC has contributed 38 properties to the FLI to be assessed by CMHC for suitability for affordable housing.
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