More than 300 aging, but affordable townhomes have been added to the Ottawa Community Housing stock thanks to a multi-million dollar deal between OCH and Minto.
In the deal announced Tuesday, OCH has acquired 122 three-bedroom townhomes in Tanglewood plus 154 three-bedroom and 35 four-bedroom townhomes in Chesterton from Minto Apartments REIT. Both neighbourhoods are in Nepean near Merivale Road and Viewmount Drive.
The units, most of which are already occupied, have a range of rents, but are all significantly below current market rates, said Cliff Youdale, chief development officer for OCH. The deal is the first of its kind for OCH buying private-market housing that is already renting at affordable rates.
“This is definitely new. It’s a byproduct of the economic conditions,” Youdale said in an interview Tuesday. “It’s been really hard for us to acquire units in the past because it was such a competitive marketplace. But, with some of the adjustments in the market, it’s a cost-effective way of adding units to our portfolio that are currently affordable.”
Existing tenants will be allowed to stay, and OCH will be able to keep their rents low. When units do turn over, having OCH as the owner will prevent rents from climbing out of reach.
Multi-bedroom units suitable for large families like the ones in the Minto deal are particularly hard to find, Youdale said. Some tenants have lived there for 20 years or more.
OCH purchased the properties at about $270,000 per unit, he said.
The Tanglewood complex was built in 1975 and the Chesterton homes date back to 1969, but all have been well maintained by Minto and are the same age as many of OCH’s existing 15,000 units, he said.
Negotiations began in the fall, and Youdale said he hoped OCH could acquire other properties like these in the future to help ease Ottawa’s affordable housing crunch. The wait list for affordable housing is currently about 12,000 names long.
“We really think it’s important that we protect that private market affordable,” Youdale said. “And I think private-market players would also agree. It’s an opportunity for them to move some stock that may not be part of their future visions.”
Minto described the deal as beneficial for both the city and the company.
“This transaction is truly a win-win,” Jonathan Li, president and CEO of Minto Apartment REIT, said in a statement.
“It helps maintain affordability in the assets, and, at the same time, the proceeds generated from the transaction strengthen the REIT’s position to further increase housing supply across the country as we invest in our existing portfolio and new purpose-built rental developments.”
The deal is scheduled to close Feb. 15.
Share this article in your social network