Page 54 - BOMA Manitoba 2021 Commercial Building Directory

INVESTMENT

ANDREW GIRDNER
Assistant Vice President, Real Estate Finance, CMLS Financial

Multifamily development Shines in 2020

s 2020 draws to a close, it is clear in purpose built rental supply, declining Residential construction Financing
that multifamily development ownership affordability, and an increase initiative (RcFi)
Awas the brightest star in the in consumer preference toward rental all A $13.75 Billion program funded
commercial real estate market this year. supported these dynamics. Eventually by the Government of Canada
While other asset classes have struggled developers saw an opportunity to fill this to incentivize affordable rental
with rent deferrals, softening demand supply gap and a few ambitious ones construction through generous
and even bankruptcies, multifamily has attempted purpose-built rental projects. financing terms and low long-term
experienced growth. More than half of the They were met with great success and interest rates. The program prioritizes
housing starts (~1,700 units) in Winnipeg achieved rental rates well beyond what projects with high social impact and
have been rental and presently over 4,000 the market thought was possible. Others provides up to 100% financing.
units are under development (CMHC, followed suit.
2020). This begs the question – why now? Affordable Mortgage Loan insurance
Meanwhile, Canada Mortgage and Also known as ‘Mi-Flex’, this product
Over the past decade Winnipeg Housing Corporation (‘CMHC’) also allows CMHC Approved Lenders to
and many cities in Canada saw acknowledged the need for affordably offer up to 95% of Cost financing
vacancy rates approach zero. Strong priced purpose-built rental housing on new apartment construction,
international immigration, growth in and launched two programs to assist subject to meeting affordability and
empty nester downsizing, limited growth with this: underwriting criteria.

54 Manitoba 2020 Commerical Building Directory