Councillors approve developer’s request to cut number of affordable units in new West Broadway apartment block

City councillors have approved a developer’s request to reduce the number of affordable housing units that will be included in the construction of a new Sherbrook Street apartment complex.

Local developer Paragon Design Build originally agreed to include 38 affordable suites in the seven-storey, 102-unit building at 130 Sherbrook St., but the number was cut to 18 Monday at a city centre community committee meeting.

Construction is expected to begin in the spring. There are also six ground-floor commercial spaces in the design.

The city’s urban planning and design division recommended council approve the change, citing the density bonus pilot program implemented by council in December 2023.

The program dictates that housing units of up to 360 square feet are not required to be affordable. If, however, units in a building are larger, half of them must be categorized as affordable and be rented at a rate determined by a formula.

Before the program was put in place, Paragon had received a variance from the city that allowed construction of a greater number of smaller units than typically approved, with the condition that 38 of them would be deemed affordable.

Under the new guidelines, considering the developers want to build 102 units, 66 would be at the base 360-square-foot size and not required to be affordable. Half of the remaining 36 units must be, arriving at the 18 number.

“While it is unfortunate that the number of affordable dwelling units is being significantly reduced from what was first proposed, it would be unreasonable to require the applicant to provide a higher proportion of affordable dwelling units than other projects are required to per the city’s density bonus pilot program,” the report included in Monday’s council meeting agenda reads.

Units are deemed “affordable” under the Canada Mortgage and Housing Corp. guidelines — calculated based on the median income of Manitoba renters — if it costs less than 30 per cent of a household’s before-tax income.

Changes to federal funding also impacted the change, said Brennan Johnson, a planner with Landmark Planning and Design Inc., which is involved in the project.

Johnson, who said he was speaking on behalf of Paragon, said developers planned to use Canada Mortgage and Housing Corp.’s financing forthe planned 38 affordable units, but that funding has since dried up.

“We don’t control those programs — when the funding is allotted, when the programs are cancelled — and those things do require us to come back to committee,” he said.

“We do understand with the density bonus pilot program, that requires that level of affordability be accommodated.”

The development will access financing from the CMHC for insurance coverage through a program that requires the project to deliver 11 affordable units.

The building will go above and beyond that requirement, Johnson said, by providing 18.

Six will be studio units rented at about $774 per month, and 12 will be one-bedroom apartments priced at $1,100 per month, with utilities included in the cost.

Area councillor Sherri Rollins said the situation was an example of the program doing its job; even after the developers lost access to federal funding, there will still be new affordable housing.

“What I hear isn’t a density bonus program, what I hear is a private developer wanting to do affordable,” said Rollins (Fort Rouge-East Fort Garry).

She said she wants to see the approval process for the density pilot project expedited to ensure much-needed housing — both affordable and at market rates — is built faster.

Community groups previously expressed concern with the rental costs of the units. According to 2020 city census data, the average employment income in West Broadway was $45,100, more than $20,000 below the citywide average. Half of the surveyed population made less than $40,000 that year.

Yutaka Dirks of the Right to Housing Coalition said the situation raises questions as to whether the density bonus pilot is successful in creating the kind of affordability Winnipeg renters need.

“When the city comes up with a policy like the density bonus pilot that extensively is about creating incentives to create new affordable housing, it’s disappointing to see that as a policy ends up, when it’s implemented, producing less than the negotiation with the developer had prior to the implementation of the policy,” he said.

He said he’d like to see the policy improved. For example, it could require “deeply affordable” units or units where rent is geared to income.

“I think if we’re willing to give away density and sort of make a variance on our rules as a city to allow for greater density, which is, I think a good thing, then I think we want the developers to to do a bit more in order to get that benefit.”

malak.abas@freepress.mb.ca