Developer urges government bonds to pay for affordable housing

Sponsors of incoming Syrians are scrambling to find affordable places for the refugees in one of the most expensive cities in the world.

But Toronto's affordable housing crisis is several decades old. There are almost 100,000 families in Toronto already on the waiting list for affordable housing.  

Now one of the biggest developers in the country wants the government to sell bonds to help raise money to build affordable rental housing across the country.

Cary Green, the chair of Greenwin Inc and executive vice-president of Verdiroc Development Corporation, said the government should sell 35-year bonds at an interest rate of 2.5 per cent. He called them Federal Development Bonds.

The money from the sale of the bonds — which he estimates would be $6 billion — should be used for the construction of affordable rental housing.

"In the 1950s and 60s, there was also a lot of immigration,and we had almost no rental options. So developers built a lot of rental towers, many of them in the inner suburbs," he told Metro Morning. "We sold bonds then to raise capital for developers to build rental towers — all middle- to low-income rental housing."

Green said it costs about $150,000 per unit to build housing. He said that price tag is why the government can't afford to build affordable housing very often.

"I've been to hundreds of seminars on affordable housing and it's always the same conclusion," he said. 

Toronto is expected to grow by 30,000 people a year over the next five years, Green said, with about a third of those being renters.

"Just to meet the new demand, we need to build about 3,000 units of affordable housing every year in Toronto alone," he said.

Of course, his proposal directly benefits developers like himself. But he said there is a larger gain for society.

"If we raise $6 billion over the next three to five years, we could create 28,5000 jobs and generate 65,000 full time jobs," he said.

There is some urgency to Green's plan. Part of it hinges on taking advantage of the low interest rates in Canada — which will not stay low forever.

He called rental housing "the safest, long-term investment for which you can sell bonds".

In terms of accomplishing this, Green said he needs political will. He said the premier of Ontario and the mayor of Toronto are already on board, but he needs the recently elected Liberals to join the cause. He thinks it's an easy decision, considering the options.

"It would save the new federal government millions in transfer payments for subsidized housing because the cost of not having housing is even more than the cost of housing," he said.

"Right now, the government's housing plan to 2020 is to spend $60 million a year over 30 years to build only 8,000 units and generate 10,000 full time jobs. Selling $6-billion dollars worth of bonds allows us to build four times as many units and generate six times as many jobs."