Transforming an historic federal property into housing

Launched in 2018, the Federal Lands Initiative encourages the development of new affordable housing. This is done by transferring surplus federal properties to eligible housing providers at no cost or at a discount. Developers like Ajax, Ontario’s Blackleaf are taking advantage of the program to build housing that is not only affordable, but also accessible and energy efficient.

Project scope and expected outcomes

“The perfect size”

The Roosevelt Properties consist of 3 spacious four-plexes in an older residential part of town. According to Blackleaf President Eric Eberhardt, while the property would likely have been too small for a larger company to take on, it presented an ideal opportunity for a small- to medium-sized developer like him.

“It really was the perfect size for a company like ours,” Eric says. “And with the help of the Federal Lands Initiative, we were able to save an historic property while also building affordable homes for 12 local families.”

Before the launch of the Federal Lands Initiative, the 3 federally owned townhomes at 32, 33 and 36 Roosevelt were in need of substantial renovation. Built to house munitions workers during the Second World War, the two-storey structures were located on a quiet street surrounded by mature trees. But the 80-year-old buildings had definitely seen better days.

Eric had been looking for a project in his hometown of Ajax and came across the listing for the Roosevelt Properties on the Federal Lands Initiative web site. Once his application was approved, CMHC transferred the property to Blackleaf through a $1.369-million forgivable loan plus an initial contribution. CMHC also provided $15,000 in Seed Funding to help cover early development costs. $400,000 in private financing covered the remainder of the project costs.

Construction started in October 2020 and is expected to finish in late 2022.

Energy-efficient, accessible and inclusive

To meet the requirements of the Federal Lands Initiative, Blackleaf needed to make sure that the renovated buildings would be accessible and energy-efficient. The housing would also need to be affordable. This meant creating a plan for the renovation that included:

• reducing energy consumption and greenhouse gas (GHG) emissions by 25 per cent by installing air-source heat pumps in each unit and adding higher R-value insulation
• creating an open and accessible living space, including adding access ramps and making four of the ground-floor units fully accessible
• committing to maintain affordability for three-quarters of the rental units at less than 80 per cent of the median market rental rates for the area, for a minimum of 25 years. 9 units at Roosevelt Properties are at 79 per cent of median market rates and 3 units are rented at market rates.  

An innovative approach to some new challenges

According to Eric, because the Federal Lands Initiative was so new, the financing and development process came with a few unexpected challenges.

“It was brand new to everyone, so the banks and lawyers weren’t quite sure what to make of it,” he says. “Meeting the program requirements also required quite a bit of extra work in the early stages. Plus, COVID made it more difficult to source both skilled tradespeople and building supplies.”

“But we figured it out with the added benefit of some CMHC Seed Funding and by taking out a second mortgage on another property we owned nearby. As a result, we were able to start the renovation in late 2019 and expect to have all 12 homes fully renovated by the end of 2022.”

Making a difference in the community

Eric sees the Federal Lands Initiative as a way to help make a difference in the lives of families and people in his own backyard. The Roosevelt project will provide much-needed affordable housing in his community.

“I know first-hand how important it is to have a safe place to call home,” Eric says. “I’ve also seen the real difference that having a decent place to live can make in someone’s life. This initiative is just a great new way for government and private industry to work together, to give some vulnerable people a chance at a better life.”