How a non-profit is tackling the housing crisis in this Toronto neighbourhood

The Parkdale Neighbourhood Land Trust aims to buy old buildings and keep rents affordable — with the help of a new bank program
By Josh Sherman - Published on Dec 02, 2020
Members of the Parkdale Neighbourhood Land Trust in front of its first building, purchased as part of the Rooming House Preservation Pilot Project, in May 2019. (Courtesy of Joshua Barndt)



Joshua Barndt didn’t think a bank would be much help to the Parkdale Neighbourhood Land Trust.

As the executive director of the non-profit organization, which aims to acquire buildings for affordable housing in Toronto’s west end, he’d found that big financial institutions often had overly rigid mortgage-lending policies. “Trying to develop affordable housing and do community work like the land trust does, we often perceive that banks and executives and the finance world isn’t accessible to us, that it’s an uphill battle,” he says. “They’re on one level, and we’re on another.”

But, at a conference in 2019, Barndt ran into an employee of Vancity Community Investment Bank, with which the trust had worked on a previous project: the purchase and renovation of a rooming house (VCIB provided the mortgage). The two got to talking about how a system could be created that would allow the trust to purchase more old buildings with cheap rents — and keep them affordable. After a year of collaboration, the Preserve and Protect Guarantee Program launched last month. “Our perception [of banks] has been shattered,” Barndt says.

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The program relies on VCIB — an Ontario-based, federally chartered bank and subsidiary of BC credit union Vancity — which, in exchange for deposits, offers investors interest-yielding guaranteed-investment certificates. The money from those deposits will then be loaned to the Neighbourhood Land Trust, PNLT’s charitable arm, so that it can be used to purchase apartments, as well as to cover related renovation costs and interest payments. Some $4 million has been raised.

Advocates say the money allows the non-profit organization — which is governed by a board and holds donated funds in a trust, with the goal of buying land for community uses, such as urban agriculture and housing — to be competitive. On the open market in Toronto, bidding wars can put properties out of reach for non-profits; even if organizations qualify for financing, the carrying costs can make it difficult to keep rents truly affordable.

The program is an example of what VCIB CEO Jay-Ann Gilfoy calls “values-based banking,” and some say it could be a solution to a lack of affordable housing in markets across the country. “Values-based banking is a movement of a number of financial institutions around the globe to really make sure that money is going to serve communities and to serve some of the big challenges that we face in the world,” Gilfoy says, adding that such banks are profit-driven but choose to invest in specific causes, such as clean energy or affordable housing. (On November 20, the Canada Mortgage and Housing Corporation announced that VCIB was committing as much as $100 million through a private-public partnership to finance affordable-housing construction.) 

Barndt and Gilfoy suggest that the Parkdale program addresses a gap in affordable-housing funding. For instance, the application timeline for the National Housing Co-Investment Fund, which provides capital and financing, varies but is generally upwards of a year — too long, they say, for an organization that is trying to acquire buildings before they fall into the hands of private investors or speculators. “We’re seeing doubling and tripling of rents,” notes Barndt, who adds that the type of buildings the trust is trying to purchase would otherwise likely be converted into higher-end housing.

And the kind of building that the trust is interested in acquiring wouldn’t qualify for the Canada Mortgage and Housing Corporation’s recently announced Rapid Housing Initiative, which considers only applications that propose creating new units — for example, by converting a motel into permanent housing. “Really, the investors are providing us gap financing to be able to act very quickly and responsibly to be able to save affordable housing before it’s lost,” Barndt says. After a 36-month period, the property will be refinanced and investors paid back. Before the repayment deadline, the trust hopes to raise more money to purchase other properties.

Adam Vaughan, Liberal MP for Spadina–Fort York, suggests there might be future funding for the type of projects that the Parkdale Neighbourhood Land Trust wants to undertake. “There will be another instalment in the Rapid Housing Initiative, and the learnings from the first billion [dollars] will inform how we spend the next envelope, and so looking at stabilization [like the Parkdale Neighbourhood Land Trust is doing] is also part of it,” says Vaughan, who is also the parliamentary secretary to the Minister of Families, Children and Social Development. “But, right now, we’ve got to get people out of parks and out of shelters.”

Protecting existing affordable rental apartments is crucial, Barndt says: “I want to be very clear that we can secure affordable housing through acquisition for one-third to 50 per cent less of the cost of developing new affordable housing, and we can do it much faster —  where a construction project may take two to four years to complete, we can acquire existing buildings within a very short timeline.” Renovations, he estimates, could take between several months and a year.

Once the Parkdale Neighbourhood Land Trust has its next property in a good state of repair, the plan is to work with a charitable organization to handle day-to-day operations, as it did in the case of the rooming house purchased a year ago. Supportive-housing services, such as advice on budgeting and mental-health and addiction assistance, will be offered to tenants who request them. “We know that in these buildings we’ll have tenants … who really would benefit from additional support from staff,” Barndt explains. “People’s housing stability can be put at risk due to many reasons.”

The trust has already made offers on properties, and Barndt hopes to close a deal before the end of the year. “We believe that it’s a model that could be used in other jurisdictions,” he says. “Our goal is to bring housing into community ownership.”

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