The Westwinds team is proud of the Drake Towns affordable housing complex that opened to new tenants earlier this year. The development marked an important milestone in our ongoing efforts to provide affordable housing solutions for our community.
But our journey with this development presented many unexpected costs, resulting mostly from our efforts to secure the Canada Mortgage & Housing Corporation’s (CMHC) reduced interest rates, and $227K in grant funding from the provincial government.
To secure the best interest rates and grant funding, Westwinds was required to develop two accessible units and upgrade the energy efficiency beyond the developer’s green technology. While our team was pleased to provide these units and increase energy efficiency, the incremental costs piled up quickly.
Between supplementary consultant fees, architectural changes, and specialized features like wheelchair ramps, accessible kitchens and baths, and energy upgrades, we spent an additional $194,000 on the project. Over the lifetime of the project, financing will bring the associated costs to $449,000.
This represents a 7.9% increase in the total project cost, which is enough for us to build more than one additional unit. We have learned a lesson with this development – the additional money spent on securing government grants and financing has a tradeoff which means fewer homes overall.
This lesson highlights how challenging affordable housing development can be for not for profit organizations. Meeting funding requirements, like those from the Canada Mortgage and Housing Corporation (CMHC), added layers of complexity and thousands in additional legal fees. While we appreciate the opportunity to access the benefits provided, it’s clear there’s room to better meet the needs of the community.
Even with the lessons learned, we’re incredibly proud of the development. The accessible units reflect our commitment to inclusion and future readiness, the energy efficiency we achieved is reflected in lower operating expenses for Westwinds and our tenants.
As we look ahead to potential future developments, we continue to focus on finding the best ways to stretch every dollar and creating the homes our community needs.