Affordable Housing

Michael Stanley, Executive Director of Community Involvement Legacy Homes, was sitting in his MBA Finance class at Cape Breton University when he first learned about Community Bonds. “I thought to myself, wow, this is amazing and why am I only learning about it now?!’’ Michael tells us enthusiastically as we meet them for the first time over a Zoom call. 

Community Involvement Legacy Homes (CILH) was founded in 2007 and currently owns and operates nine single-family homes for adults with intellectual disabilities. Michael shares that they have been quietly operating in the community for many years but they are looking to rise to the occasion, and be an active partner in expanding affordable living options for all people, but in particular community members with intellectual disabilities. “We want a deeper tie and to share our history with the community. We are envisioning a community imagined, community-driven, and community-owned initiative for people to live well in our neighbourhood,” he shared.

CILH has a new project in the works to build and operate an affordable co-housing development in the Leeds and Grenville region. The project will be a three-way partnership with a nearby township that will provide the parcel of land, and a developer of prefabricated cabins.

“We need to think about the price of the unit, the rent for the tenants, but also about the carrying costs to the tenant and to us as the property manager,” says Michael. “These cabins are amazing because they are extremely energy efficient, low maintenance and even come equipped with rooftop solar installations.” The organization has also been in conversations with a local renewable energy co-operative to expand the solar energy production possible on the site.  

Financially, the organization is in a very stable position. With all nine properties nearing the end of their mortgage terms, there is sizable equity that can be leveraged for future projects. Despite having carried debt on multiple properties for many years, Michael shares that the Board of Directors still has trepidations about taking on the risk and opportunity of such an investment. “I think it all comes down to this being very new, and it seems sort of out of left field when compared to our current model.” 

“There are some areas where we would definitely need help,” shares Michael, “I think particularly on the marketing and community outreach piece, we would need more support.” Michael is the only paid employee of the organization and only works part-time.

We concluded our call on a high note. Michael shared his excitement for doing something new and innovative, and for the potential to introduce the concept of community financing to the Leeds Grenville region. “I think we have the perfect storm here,” says Michael with a smile, “Coming out of COVID, I think we all have a new and deeper appreciation for community. I love the community bond model because it allows us to take direct action rather than wait for the big powers that be to decide if our community deserves funding.”

About this Blog Series

In October 2021, Tapestry was selected to take part in a Canadian Mortgage and Housing Corporation (CMHC) program called the Housing Supply Challenge. This innovative competition encourages residents, interested parties, and experts from across the country to propose creative solutions to housing. The goal: to help meet Canada’s pressing need for safe and affordable homes by breaking down barriers to the creation of new supply.

Tapestry participated in Round 2 of the program, Getting Started, which seeks to find solutions to pre-development challenges, such as community resistance and obtaining financing. The program granted incubation funding to the 29 organizations selected to allow them to further develop and test their solution proposals. 

Through six months of research and consultation, we had the opportunity to speak with over 40 interested parties in the affordable housing sector, from housing providers, to development consultants, to funders and lenders. Each and every individual and organization consulted helped to co-design our solution proposal. 

The “Financing Affordable Housing with the Power of Community” blog series shares the lessons learnt and stories heard from some of the amazing organizations that we have partnered with.

In October 2021, Tapestry was selected to take part in a Canadian Mortgage and Housing Corporation (CMHC) program called the Housing Supply Challenge. This innovative competition encourages residents, interested parties, and experts from across the country to propose creative solutions to housing. The goal: to help meet Canada’s pressing need for safe and affordable homes by breaking down barriers to the creation of new supply.

Tapestry participated in Round 2 of the program, Getting Started, which seeks to find solutions to pre-development challenges, such as community resistance and obtaining financing. The program granted incubation funding to the 29 organizations selected to allow them to further develop and test their solution proposals. 

Through six months of research and consultation, we had the opportunity to speak with over 40 interested parties in the affordable housing sector, from housing providers, to development consultants, to funders and lenders. Each and every individual and organization consulted helped to co-design our solution proposal. 

In this blog series, “Financing Affordable Housing with the Power of Community”, we will be sharing the lessons learnt and stories heard from some of the amazing organizations that we have partnered with, including Kensington Market Community Land Trust, featured in this article.

Kensington Market is under tremendous economic and development pressure.

Renters are being pushed out of their homes, food sellers are losing their stores and diversity and affordability – the very soul of the Market – are under threat. The Kensington Market Community Land Trust (KMCLT) is a grassroots organization actively addressing this crisis. The land trust acquires and provides management of land, in perpetuity, removing properties from the pressures of the commercial real estate market.

We had the pleasure of sitting down with Chiyi Tam, the Executive Director of KMCLT, to learn more about the land trust’s goals and plans for acquiring properties. We got right into it when Chiyi began telling us the story of how KMCLT came to own their first property last year – with only a $75 balance in their bank account at the time and a $6.25 million ticket price on the building. 

“It was truly amazing,” Chiyi shared, “as the story often does, it began with community organizing.” In 2018, tenants living in 54-56 Kensington, a 12-unit residential building, were unfairly threatened with illegal eviction. “It was very clear that the landlord’s intention was to convert the units into short-term rentals, and the only way to prevent this was to keep those tenants in place.” 

The community activated quickly, and with the support of individual neighbours, the Friends of Kensington Market and Kensington-Bellwoods Community Legal Services, all tenants resisted the eviction attempt and remained in their units.

Two years later, the building came up for sale. With leadership from City Councilor Mike Layton, The City of Toronto stepped in with a $3 million forgivable loan, recognizing that if this building was purchased privately it would mean losing affordable housing units; and a down payment was made possible through a neighbour in the market that personally put up $300,000. 

To complete the financing puzzle, KMCLT worked with a number of financial institutions, including Vancity Community Investment Bank, which Chiyi says played a critical role in mentoring them through the process, and Alterna, who came through with the mortgage. They also received a very last-minute 0% vendor take-back (VTB) mortgage for $250,000 to cover the remaining capital costs. “I was concerned about repaying the VTB through fundraising, but within a week of the news getting out, we had collected $12,000 in donations,” shared Chiyi. 

With their first project under their belt, Chiyi shares that they are ready to take on a second project. “Neighbours and community members have been mapping property ownership and building types in our area, helping us identify acquisition targets and buildings at risk of private redevelopment. That’s our shopping list.” Chiyi shares with a smile. 

Chiyi believes Community Bonds could be an important piece of their financing for acquiring new properties, or potentially developing a new mixed-use, mixed-income build in the pipeline. It is clear that what KMCLT is doing is resonating and there is widespread community support, not just in Kensington Market among residents and businesses, but across the entire city. “Everyone benefits from this amazing place and wants to maintain its eclectic, inclusive soul.”

Chiyi shared that there was much discussion among their Board about the direction of their future financing. “They understood the different risks and costs associated with pursuing a traditional charitable approach and taking on investment. I think this comes down to our overall financial literacy as an organization, and our core values about how we are held accountable by our members, donors, and investors.”

A key takeaway from our conversation is the power of connecting with like-minded organizations to learn through their experiences. Chiyi highlighted that the mentorship they received from the Parkdale Neighbourhood Land Trust in acquiring their first property was invaluable. “It was like group therapy for the anxiety of going through a commercial acquisition project,” says Chiyi with a sigh of relief that that chapter has closed. “I don’t think we could have done it without that direct transfer of knowledge and support.”

Chiyi hopes to be able to work with Tapestry and pilot the Community Bond model for other land trusts to be able to replicate in the future.

*Please note the ’Financing affordable housing with the power of community’ project received Incubation Funding under the Housing Supply Challenge – Getting Started Round, however, the views expressed are the personal views of the author and CMHC accepts no responsibility for them.

**Photos provided courtesy of Kensington Market Community Land Trust www.kmclt.ca