Building solutions: how private innovation meets public goals in Canada's housing crisis

Equiton's VP, Development, Alan Dillabough reflects on how Equiton leads with strategic development, capitalizing on government initiatives

Building solutions: how private innovation meets public goals in Canada's housing crisis

This article was produced in partnership with Equiton

Amidst the multitude of factors and stakeholders shaping the current state of the housing market and its future trajectory, private real estate companies are stepping forward, offering innovative solutions.

The government and private sector are increasingly working in tandem to address the pressing housing crisis. In conversation with Alan Dillabough, VP, Development at private real estate investment firm, Equiton, he underscored the importance of private investment in addressing Canada's housing needs.

Government initiatives paving the way for growth

Housing affordability is a nationwide issue, prompted by the lack of housing supply and increasing demand. The National Housing Accord’s recommendation to add two million new affordable and market-rental homes by 2030 has been embraced by the federal government. One announcement made by the feds was the exemption of the construction of purpose-built rentals from the goods and services tax. According to a TD report, this tax relief could spur the creation of an additional 5,000 to 10,000 units annually, showcasing the government's commitment to fostering a conducive environment for multi-residential development.

Dillabough says, “The demand for multi-residential housing has evolved significantly, driven by a supply-demand imbalance exacerbated by population growth. This imbalance is becoming a generational issue.” Equiton's response to this demand, underpinned by strategic government policies, positions the company to make a notable impact on the housing market through the development of multi-residential properties. Dillabough notes, “We are optimistic about the changes in the regulatory environment. These are beneficial steps that should improve the approvals process and incentivize development.”

Another notable initiative is the rezoning effort incentivized by federal measures, urging cities to allow for more multi-unit constructions. This move, as reported by Global News, is a direct response to the acute housing crisis, marking a significant shift in policy to support high-density living spaces.

The construction labour shortage is an additional piece to the puzzle that the government is addressing through a targeted immigration program, expediting the entry of skilled tradespeople. This approach not only tackles immediate workforce needs but also supports the long-term sustainability of housing development projects across Canada.

Equiton's strategic contribution to the housing market

Equiton, an expanding player in Canada's development space, is uniquely positioned to capitalize on regulatory changes and market dynamics. With comprehensive investment offerings that include both income-producing properties and development projects, Equiton is actively contributing to the multi-residential housing segment.

Dillabough explains, “While private developers and real estate investors have always been the primary providers of housing in Canada, the scale of what's necessary to meet all the different needs will always rely on the private sector. We are equipped with the skills and background, making us a significant contributor to the housing solution.”

Despite a slight decrease in multi-unit starts (-1% YoY ‘22’23), the resilience of this property type is evident, with overall housing starts seeing more significant declines. This resilience, coupled with potential for lower construction costs in the coming year, presents a ripe opportunity for Equiton to expand its footprint in the multi-residential space.

Equiton differentiates itself through a comprehensive approach that includes acquisition, planning and approval, and construction. Dillabough adds, “Our strategy involves leveraging our extensive networks, market knowledge, and a hands-on approach to navigate the property development process efficiently, ensuring we exceed community standards and create lasting value.”

Looking ahead

Despite the positive outlook, the sector faces challenges like the slow approvals process and rising construction costs. However, government efforts to address these issues provide a hopeful perspective for a more efficient development landscape. “There are challenges, but there's also a response to these challenges. As an industry, we've made our concerns known, and it seems the government is listening,” Dillabough remarks.

A key example is Equiton’s Sandstones Condo project. This urban condominium development in Toronto will add over 300 much-needed units to the housing supply.

“We believe in the residential development space in Canada and are bullish on its prospects. With the government's supportive policies, we are confident in our ability to contribute significantly to addressing the housing affordability crisis,” concludes Dillabough.