Vancouver office market receiving a post-COVID boost

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Western Investor

Tech, life sciences tenants are showing interest in downtown space

 B6, set to completed in 2023, is 47 per cent preleased as tenant demand roars back with the return of in-person work.Musson Cattell Mackey Partnership/BentallGreenOak

Demand for space as companies return to in-person work arrangements will continue to be influenced by the COVID-19 pandemic, in some cases in unexpected ways.

Speakers at the April 21 meeting of commercial real estate association NAIOP said demand for space has bounced back, and some new drivers are in the offing. The panel discussion focused on the investment market, and the fundamentals for office investment are strong.

“[Demand] has snapped back really quickly, and we do have some appetite for some of that Class A office product in Vancouver,” said Jaclyn O’Neill, principal, investments with BentallGreenOak.

Preleasing at B6, a 32-storey tower with 534,000 square feet set to complete next year, is an example. It’s seen several inquiries after not a single offer during the pandemic, she said. Preleasing now stands at 47 per cent.

While BentallGreenOak has sold some smaller office assets in B.C., this constituted adjustments to its portfolio rather than a shift away from office.

“Going into COVID, we found ourselves really over-allocated to office compared to other asset classes,” O’Neill said. “So over the past year and a half we did sell some of our smaller office assets in BC, more right-sizing our allocations to office and knowing that we had B6 under construction.”

Now that the market is emerging from the pandemic, she sees demand buoyed by the tech sector but also life sciences thanks to greater interest in firms that defend health – not only in workplace protocols, but in their actual work.

“I think there could be some fundamental shifts in the demand drivers of the office market,” she said. “We’ve seen it on the tech, I think we’re going to continue to see some of that, but also maybe some growth on the life-sciences side, some of those tail-winds that we’re seeing coming out of COVID. People are a little more cognizant of health and safety in that regard.”

Panellist Shaun Blythen, director of acquisitions with Nicola Wealth Real Estate, said the company is focused on office space in Mount Pleasant, where strong demand from the tech sector has made spec building possible.

“It’s one of the strongest office markets in the country,” he said.

Downtown core office vacancies average 7 per cent, according to the latest statistics from commercial brokerage JLL. The firm says the comparable rate for Mount Pleasant, when two buildings awaiting occupancy are factored out, is just 4.2 per cent.

Reliance Properties Inc. president and CEO Jon Stovell is also confident of office demand.

Reliance recently began construction of a 344,000-square-foot office tower at 1166 West Pender in partnership with Hines, and Stovell cited the strength of demand from professional services and tech companies with the decision to move forward.

Reliance also plans to move forward next year with the development of 440,000 square feet at 601 West Pender Street.

But with costs rising across the board, Stovell expects the next 12 months to see a re-indexing to the new price points. Rental rates will be part of the equation as landlords seek returns and tenants pay more for space just as they’ve been paying more for wages, energy and other input costs.

“They have to [rise],” Stovell said of rental rates. “It all comes down to markets re-indexing to support higher rents in all the asset classes.”

Triple-net rents in the downtown core averaged $63.46 a square-foot in the first quarter, JLL reports. This is up from $58.72 a year ago.

 

© 2022 Western Investor

Will Liberals put a tax on primary residence sales?

Corben Grant
Canadian Real Estate Wealth

One thing that all real estate investors are painfully aware of when they plan on owning a property is the capital gains tax. With the rules currently in place, you must pay capital gains taxes on the profits you make from the sale of a home or other real estate. This is applicable mostly to investors because, notably, the tax makes an exemption for a home that is the owner’s primary residence. At least, it does for now.

However, some have been worried that the Liberal government may move to instate a capital gains tax on all home sales, regardless of whether or not it’s a primary residence. Is this new tax on its way, and if so, what would the impact be on Canadian homeowners?

Housing crisis a hot topic in politics

In recent years, there has been much discussion across all sides of the political spectrum on how to help ease pressure in the real estate market and address the housing affordability crisis. Most recently, the Liberal government released their 2022 budget that laid out new programs and taxes that would be used to help cool excessive price growth.

Newly proposed anti-flipping tax to close primary residence loophole

One change aimed to close a loophole that allowed home flippers to utilize the principal residence exemption in order to avoid capital gains on a flipped property. Now, any gains may be made from selling a home within 12 months of purchase will be taxable capital gains beginning early next year. This change is designed to serve as an anti-flipping tax to reduce speculative demand and discourage those who aim to make money only from price growth without adding any value to the housing market, and in doing so, reduce competition for homes.

However, some have noted that the Canada Revenue Agency (CRA) has already been diligent in identifying individuals who mislabel their flip homes as primary residences, meaning the actual impact of this new change may be less than it seems.

Exemptions from the anti flipping tax for extraordinary circumstances

This anti-flipping tax has been noted by some as a form of capital gains tax for a primary residence. What would happen if a buyer purchases a home and then, due to extenuating circumstances such as divorce or death, is forced to sell the home before 12 months? Would they then be charged a hefty tax on top of their already hard times?

Not quite. The government has also expressed plans to make allowances for such circumstances. Though the law has not yet been fully codified, it should help to clear any ambiguities about taxation for house flipping and hopefully protect legitimate primary residence sales when it comes into force.

As of yet, the principal residence exemption for capital gains remains in place. This means homeowners who plan to sell their primary residence in the near future will not be required to pay tax on the profits, provided the home was the principal residence for the entirety of the ownership period.

Why the government should want to avoid a tax on primary residence sales

The logic behind taxing primary residences seems pretty clear: by taxing the sales of homes you make it less appealing to those looking to sell for an inflated amount, thus reducing some of the upward pressure on homes sales. At the same time, the additional tax income could be put towards more housing initiatives. The actual results of such a change would not be so clear-cut.

 

First of all, the Liberal government, like most political parties, is mostly concerned with taking action in ways that will make them more popular with voters. Something like a ban on foreign  purchases is a simple way to appease Canadians and gain political favour. After all, foreigners make up a very small percentage of voters due to the fact that they don’t vote in Canadian elections. So the idea is to make a tax that targets homeowners – one of the largest and most active voting blocs in Canada? Not a very good idea for your political prospects.

And, it wouldn’t just be bad for the Liberal electoral prospects – it would be bad for the millions of Canadians who are relying on the value of their homes to fund part of, or all of, their retirement plans. With inflation skyrocketing and an increasing number of Canadians reaching retirement age, they need as much value as they can get from their savings.

But it doesn’t end there. For those planning to sell under a hypothetical tax, they could just as easily raise their asking price even higher to accommodate, thus pushing prices up even more. Or, they could choose to not sell at all, which wouldn’t help the already low housing stock across the country.

Finally, there are simply other ways the government can help to ease the housing market without targeting regular homeowners. Some other new changes are already underway such as banning blind bidding, creating a new tax-free homes savings account, and assisting in affordable housing development.

Can I say for certain that a capital gains tax on primary residences will not be put in effect? Honestly, no. But hopefully, I have done well enough to explain why the change is unlikely based on the widespread unpopularity, potential damage to Canadians, and range of alternative options to ease the housing crisis.

©2022Canadian RealEstate Wealth 

BoC considering another 50-basis-point hike: Macklem

Fergal McAlinden
other

The governor says the central bank is prepared to act “forcefully” to tackle the inflation crisis

The Bank of Canada is weighing up another oversized rate hike for its next policy rate announcement in June, according to the central bank’s governor Tiff Macklem.

Speaking with the federal finance committee on Monday, Macklem said the Bank was considering a second consecutive 0.5% increase to its trendsetting rate in an effort to tackle runaway inflation, with the annual inflation rate now higher than at any point during the last three decades.

“I expect we’ll be considering a 50-basis-point increase,” said Macklem. “I’m not going to rule out other options, but anything bigger than 50 basis points would be very unusual.”

The governor emphasized the difficult balancing act that lies ahead on rate hikes, saying that the Bank must strive to avoid a recession as it increases borrowing costs in future policy announcements.

“Getting this soft landing is not going to be easy,” he told the committee. “We don’t want to overheat the economy, but we also don’t want to overcool the economy.”

Read next: Bank of Canada announces another rate hike

Still, he said that the central bank was prepared to act “forcefully if needed” to get inflation under control – and acknowledged that it had made some errors in its approach to the crisis so far. “We got a lot of things right, we got some things wrong. We are responding,” he said.

The Bank’s benchmark rate plummeted to 0.25% as the pandemic took hold in Canada in 2020 and remained resolutely low for nearly two years before a quarter-point hike was announced in March.

That was followed by another rate increase, this time by 50 basis points, in the Bank’s April announcement, which also saw it announce a “substantial upward revision” in its inflation outlook.

In that statement, the central bank indicated an increasing risk that elevated inflation in Canada would become “entrenched,” and said that inflation was only likely to return to more normal levels in 2024.

The next Bank of Canada policy rate announcement has been scheduled for June 01.

 

Copyright © 1996-2022 Key Media, Inc.

RBC Economics says odds of Canadian housing market crash are low but “can’t be completely ruled out”

Carlito Pablo
The Georgia Straight

 RBC Economics says home buyers across the country will “feel the pinch of rising rates”.

The Bank of Canada has so far raised its interest-setting rate twice this year, and it’s not yet done.

RBC economist Robert Hogue believes that the central bank will hike rates by one percent more, bringing it to two percent by the end of 2022.

Hogue is convinced that rising interest rates will be a game changer in the Canadian housing market as this will make mortgages more expensive.

To illustrate, a one percent increase in the Bank of Canada rate translates to $526 more in monthly payments for a typical home in Vancouver.

Also, those who qualify for a mortgage will “see higher rates reduce the size of the mortgage they can get—and the price they can pay”.

Citing as example, Hogue noted that Canadian households earning the median income will have their maximum purchase budget reduced by 15 percent.

This will cool down the market that saw red hot activity in 2021 because of low interest rates.

“We now expect home resale activity to slow more quickly than previously anticipated and, perhaps more important, we see prices peaking this spring as market sentiment sours from extreme bullishness,” Hogue wrote in a report released on April 21.

“In this altered landscape,” the economist continued, “local markets could experience a mild price correction, partly reversing outsized gains recorded in the past year.”

Hogue wrote that the most expensive housing markets in Canada will feel the effects of rising rates the most.

“We expect downward price pressure to be more intense in Vancouver, Toronto and other pricey markets,” the economist wrote.

Hogue continued, “This will translate into larger annual price declines in 2023 in British Columbia and Ontario.”

“By comparison,” the RBC economist went on, “we expect activity and prices to be more resilient in Alberta, where local markets have more catching up to do following a prolonged slump before the pandemic.”

Although resale numbers are projected to decline and prices to experience a “modest” correction, prospects for the Canadian housing market are not really grim.

“While it can’t be completely ruled out, we view the odds of a market crash as low,” Hogue wrote.

The economist explained that “solid demographic fundamentals will continue to support Canada’s housing market”.

“Millennials—in their prime home-buying years—will remain a force, and growing immigration will further boost demand for housing. These factors will keep demand from falling into a deep-freeze,” Hogue wrote.

Overall, Hogue believes that rising interest rates are “likely to bring welcome changes to the market—including more sustainable activity, fewer price wars, more balanced conditions, and modest price relief for buyers”.

“After the extreme price increases and heated bidding wars of the last year, this would be a positive shift,” Hogue concluded.

 

© 2022 VANCOUVER FREE PRESS.

Calgary bounces back as CRE sales rise, office vacancy drops

Frank O’Brien
Western Investor

 A combination of higher oil prices, pent-up demand and what are seen as bargain prices for property pushed Calgary’s commercial sales into record territory during the first three months of 2022.

If the previously reported sale of the Bow office tower, which closed on January 25, is counted, the top 20 transactions during the first quarter of this year reached $1.53 billion, according to research firm the Network. This compares with $910 million in the first quarter of 2021, if all 162 transactions at that time are included.

Network president Nathan Gettel suspects that when the final Q1 data is complete, it could reveal a record-setting pace in Calgary, led by the office, industrial and multi-family sectors.

Office sector

Oil prices at a 10-year high as of Q1 2022, have buoyed Calgary’s downtown office market, which has fallen from a nation-leading 30 per cent during most of 2021 to 28.9 per cent.

The overall vacancy has fallen to 25.4 per cent, according to Avison Young, down from 26 per cent at the end of 2021.

Calgary’s downtown Class AA office take up in the first quarter of this year reached 400,000 square feet, pushing the total lease-up or sale of prime space to 13 million square “for the first time in recent history,” Avison Young noted.

As well as the close of the landmark Bow building sale, the first quarter of 2022 also saw the $18.5 million cash purchase of a 50,000 square foot office building on 9th Avenue downtown by Calgary Technologies Inc.

“Activity in the office market is shifting away from shorter term blend-and-extend or stop-gap style deals, and back towards full scale moves as tenants gain more confidence,” Colliers suggested.

Industrial

There were six multi-bay industrial sales in the first quarter, but the purchase of 68.6 acres of industrial land by Vancouver-based Beedie Developments could signal an accelerated move into Calgary by West Coast developers.

Beedie, through Beecal Developments Ltd., a subsidy, purchased the industrial site at 6502 106 Avenue SE, from the City of Calgary on February 24 for $38.2 million, or $557,000 per acre.

As a comparison, a 17-acre vacant industrial site was sold by the City of Burnaby, B.C., in December for $136 million, or $8 million per acre.

Beedie is no stranger to Calgary. It made its first foray into Alberta 11 years ago by buying 220 acres in northeast Airdrie to develop Highland Park Industrial. It has since developed the Glenmore Corporate Centre, a 235,000-square-foot centre in Frontier Business Park and the 93,000-square-foot Ironside Business Centre and, more recently, 170 acres of land in Rocky View County east of the city.

Other Vancouver developers, including Anthem Properties, are also active in Calgary, at least partially due to what is seen as relatively low prices for commercial and industrial land.

But, in its Q1 2022 National Market Snapshot, Colliers Canada noted that low land values are just part of Calgary’s attraction as oil prices push over US$100 per barrel.

“Steadily decreasing vacancy and increased demand for industrial product in Calgary continues to place upward pressure on asking rental rates,” Colliers’ report stated.

Calgary’s industrial vacancy rate is 3.5 per cent, compared to 4.6 per cent in Edmonton and shockingly low 0.4 per cent in Vancouver.  Industrial lease rates now average $9.00 per square foot, up nearly $1 from Q4 2021, but still the second lowest among Western Canadian cities.

More than 1.4 million square feet of new industrial space has completed in Calgary as of the first quarter 2022, and 7.65 million square feet is under construction, much of in speculative lease developments that will open next year.

Multi-family

Calgary-based Mainstreet Equity Corp. one of Canada’s largest landlords, is extremely confident in Alberta’s multi-family market.

Last year Mainstreet posted a 7 per cent growth in rental revenues, and a 5 per cent increase in net operating income.

“Canadian oil production was the highest on record in 2021, and energy companies reaped their largest-ever revenues over the year,’” said Mainstreet founder and president Bob Dhillon, who believes the oil-price surge will increase in-migration to Alberta this year.

Alberta welcomed 16,690 newcomers in the third quarter of 2021, the most in nearly seven years, according to Statistics Canada.

On January 4, Mainstreet paid $38.1 million cash for a 239-unit walk-up apartment complex at 641 Meredith Road in Calgary’s Bridgeland/Riverview area, a price of around $159,400 per door.

Avenue Living, also of Calgary, has also been aggressively buying rental properties in the city.

As reported here last month, Avenue Living purchased 764 apartments in three separate Calgary rental complexes on March 7 for $138 million. Then, on March 31, the company snapped up another 86 units in Calgary’s Setton neighbourhood.

Retail

Calgary is seeing redevelopment of older shopping centres this year and its resilient retail market – Alberta retail sales held steady at an average of $7.6 billion a month all during the pandemic – is attracting investors.

The old Stadium mall site on 6.5-acres near the Foothills Hospital is being redeveloped into a mixed-use project that will retain retail, including an anchor grocery store, in a project by Western Securities.

Northland Village Mall is also being redeveloped into mixed-use residential and retail village.

On February 4, 2022, the 120,250-square-foot London Town Square was bought by a Richmond, B.C.-based investor for $36 million, one of the largest recent retail deals in Calgary.

Hotel market

On March 29, Coast Hotels announced its purchase of the 120-room Regency Suites Hotel in downtown Calgary from SM2 Capital Partners.

It is rare positive sign for the hard-hit Calgary hotel sector, according to CBRE’s just-released Canadian Hotel Industry Outlook. The CBRE forecast is for both Calgary and Edmonton to trail the market this year.

“Calgary and Edmonton are projected to grow revenue per room (RevPar) by more than 50 per cent, but lingering supply impacts and fundamental economic challenges remain. Nevertheless, CBRE expects Calgary to reach $62 in RevPAR for 2022,” according to CBRE Hotels director Nicole Nguyen.

But the rise in oil prices and the opening of travel and in-person conferences could surprise on the upside in 2022.

“The good news is that we anticipate hotels across Canada to be well on their way back to full strength by the end of this year,” said Nguyen. “In fact, depending on how substantially consumer confidence rebounds, and to what degree business travel picks back up, there’s even the possibility that the hotel industry exceeds expectations. That would be welcome news for a change.”

 

© 2022 Western Investor

North Vancouver waterfront industrial site goes to market

Peter Mitham
Western Investor

Port authority intends to exercise its option to purchase the lands

Chemtrade has announced plans for a sale-leaseback transaction of the 40 acres it owns at its 58-acre site in North Vancouver. | North Shore News
Vancouver Fraser Port Authority is the front-runner to purchase a 40-acre industrial site in North Vancouver at 100 Amherst Avenue currently home to the Chemtrade facility.
Toronto-based Chemtrade announced its intention to sell and leaseback the property from its new owners on April 19. The facility produces industrial caustic soda, chlorine and hydrochloric acid for Chemtrade clients across North America.
“We are excited about the financial flexibility that this opportunity could create for Chemtrade,” the company’s CEO, Scott Rook, said in a statement announcing the sale.
The property’s assessed value in 2021 was $204.3 million, according to the BC Assessment Authority. Chemtrade says proceeds from the sale “could provide significant liquidity for investments in organic growth while also helping to reduce debt.”
Chemtrade’s most recent annual report shows the company posted a net loss of $235.2 million on revenues of $1.4 billion in the year ended Dec. 31, 2021. Owners’ equity also declined in the most recent fiscal year as the company faced limited demand for its products during the pandemic and aging infrastructure. The plant in North Vancouver experiences biennial maintenance shutdowns that reduce its annual output by millions of dollars.
However, the sale could also help resolve a running dispute with the port authority over Chemtrade’s lease of an adjacent 18-acre property. The lease expires June 30, 2032.
Together, the two properties give the facility more than 58 acres for its operations, complete with rail service. Chemtrade intends to continue its operations in North Vancouver, but without a deal with the port it will not be able to use the 18 acres of leased land “to receive, manufacture, store, and distribute liquid chlorine.”
“We are assessing alternatives to address this restriction, but not finding a viable alternative could have a material adverse effect on our business,” Chemtrade’s most recent annual report states.
Upping the pressure on Chemtrade is the fact the port has expressed its intention to exercise an option to purchase the portion of the site that Chemtrade owns.
Discussions with the port are ongoing, but a sale-leaseback transaction presents an attractive way to resolve the issue. The deal would allow Chemtrade to keep operating the facility while allowing the port to acquire the site.
Port vice-president, real estate, Tom Corsie was not immediately available to comment on the port’s interest in the property.
The deal would be a small but not insignificant addition to the port’s substantial land holdings across Metro Vancouver.
The port authority controls more than 3,700 acres in the region. Its most recent acquisition was 1443 Dominion Street in North Vancouver, purchased in October 2019. It is a 4,200-square-foot lot adjacent to other port properties, including the Lynnterm Terminal.
The port’s most recent land use plan notes that properties on the north shore of Burrard Inlet handle 22 per cent of all cargo volume through the port. It describes the area as “an integral connection for Canadian exports to overseas markets.”
Colliers International and RBC Capital Markets are charged with managing the sale process, which officially launches at the beginning of May.
Colliers executive vice-president Stuart Morrison declined comment, noting that the process is still in the very early stages.
Chemtrade units (CHE.UN:TSE) closed at $7.80 on April 21, down 1.9% versus a day earlier. Over the past year, units have traded between $6.01 and $8.70.

© 2022 Western Investor

Ottawa housing market to cool in 2022 but prices will rise: CMHC

Josh Pringle
other

New Lanford industrial strata sells out during construction

William Wright Commercial
Western Investor

Agents for the 110,000-square-foot complex pre-sold all 32 strata units in 10 months for a total of $37 million.

William Wright Commercial, Victoria, B.C., for Western Investor

 

Type of property: Industrial strata

Location: West Shore Business Park, 4342 West Shore Parkway, Langford, B.C.

Number of units: 32

Unit sizes: 3,215 square feet to 10,500 square feet

Total strata space: 110,000 square feet (approx).

Completion: Q4 2022

Total price: $37 million

Brokerage: William Wright Commercial, Vancouver

Brokers: Connor Braid, Harry Jones.

 

© 2022 Western Investor

Vancouver housing market faces slower price growth, drop in building starts in 2022

Michelle McNally
Livabl

Vancouver’s housing market could see home prices gradually fall this year while challenges related to housing starts, labour shortages and affordability continue to linger.

The Canada Mortgage and Housing Corporation (CMHC) recently released its Housing Market Outlook report, which outlines forecasts and predictions for Canada’s national housing market and 18 of the country’s largest urban centres, including Vancouver.

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According to the report, the average home price in Vancouver is expected to keep increasing, but the pace of growth is anticipated to slow after Q1-2022 and fall below five per cent year-over-year after 2022.

Higher property prices haven’t prompted a rush in new listings from sellers, so the pace of sales is expected to drop from “an unsustainable high.” The decrease in sales will occur throughout 2022 until the total level of sales is slightly below the average for the past five years, according to CMHC.

Housing starts to drop in 2022

This year, total housing starts are predicted to fall but will rise to levels similar to the past five years in 2023.

In 2022, total housing starts will sit between 22,000 and 26,000 units, lower than 2021’s 27,485 starts. The following year, total housing starts are expected to fall between 18,900 and 30,300 homes.

As single-family detached starts continue on a downward trend as the region’s housing density increases, total starts will be dedicated towards apartments. Ground-oriented housing types will be focused on row and semi-detached product. This year, starts for single-detached units will average between 2,700 and 3,300 homes, much lower than the 19,300 to 22,700 units expected for multiple-home types in Vancouver.

For projects that already have acquired land, price growth over the last two years will give those developments “an incentive to move forward,” but labour shortages and supply chain issues will contribute to higher construction costs.

The prospect of the construction industry pushing total starts to ever-higher annual output seems unlikely,” said the CMHC report. “Absorption of new units will also be uncertain as buyers face affordability challenges.”

Rental demand in Vancouver rebounded in 2021 as students, migration and employment improved, factors that will place more pressure on rental supply, especially as homeownership costs stay high. Current construction levels and long development timelines, however, won’t provide much rental relief over the next three years to raise vacancy rates or stimulate competition among property owners to lower rental prices.

Higher interest rates may reduce buyer spending power

Financial obstacles like rising interest rates could create hurdles for Vancouver homebuyers.

Rising interest rates have historically resulted in fewer sales and slower price growth, creating a “major headwind for prospective buyers.” Monthly mortgage payments will rise while the loan amount offered from lenders will fall, dampening buyer spending power, according to CMHC.

However, trouble in national and global markets might reverse the expected increases to rates. If Vancouver homebuyers were insulated from the negative economic effects that tend to coincide with rate cuts, lower rates could stimulate the market.

“If buyers face greater financial obstacles than what we expect, market activity will slow to a greater degree,” said the report. “Historically, it takes several years for inventories and listings to rise to a point where this market sees downward pressure on prices.”

Vancouver is expected to see a growth in immigration and high-skilled, high-wage jobs, but the old challenge of attracting workers to an expensive housing market is emerging again, CMHC noted.

“Vancouver will emerge from the pandemic with a strong economy,” said Braden Batch, senior analyst of market insights. “Immigration will be a major demand driver over the next few years, but a lack of supply at all levels and tightening credit has worsened affordability.”

 

© 2020 BuzzBuzzHome Corp.

Massive investment in BC housing supply announced

Ephraim Vecina
other

New housing complex provides more than 100 low-cost units

Federal and provincial investments of $5 million and $25 million, respectively, have been announced for a new multi-use housing building in Surrey, British Columbia.

The investment in the new six-storey Foxglove complex, situated at 9810 Foxglove Drive, also came with approximately $3.2 million in annual operating funding for the project. The building provides 66 supportive homes and 30 permanent shelter spaces for people at risk of or experiencing homelessness, along with 34 complex-care beds for vulnerable individuals requiring support.

The building will be operated by RainCity Housing and Support Society.

“Complex care clients will have access to enhanced supports on-site, including nurses, peer workers, social workers, and other health-care professionals, along with access to treatment and other specialized services,” said Canada Mortgage and Housing Corporation.

Read more: Analysis: BC housing at the mercy of inter-provincial migration

The federal funding for this project comes from the first tranche of a $75 million memorandum of understanding with the government of British Columbia. The agreement aims to help build 1,500 units of affordable housing across the province.

“The opening of this building is the next step in providing a real solution to an issue that has gone on for far too long in BC. We’re working to make sure the housing system works better for people with serious mental-health and addiction issues so they aren’t left behind in a cycle of shelters, evictions, emergency rooms and even jail cells,” said David Eby, Attorney General and Minister Responsible for Housing. “This building, and others like it opening across the province, will help people with complex challenges get the care they need, when and where they need it.”

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