Deal reached to bring more affordable rental units to London

In the SoHo neighbourhood, new affordable rental units are both figuratively and literally on the horizon.

A high-rise residential development at 391 South St. has received a massive low-interest loan from the federal government in exchange for making about a fifth of the units affordable housing.

Peter Fragiskatos, Parliamentary Secretary to the Minister of Housing, Infrastructure, and Communities and M.P. for London North Centre announced that a $142.8 million low-cost loan has been awarded to Medallion Corporation from the federal government’s Rental Construction Financing Initiative.

The terms of the deal include at least 129 of the building’s 588 units (21.9 per cent) will rent at or below 30 per cent of London’s median household income.

“The housing crisis that we have in front of us is fundamentally a supply crisis, so the more we build, the greater the likelihood, in fact the certainty, that we bring down the cost of housing,” Fragiskatos told CTV News.

London is in the midst of a commitment by council to create 3,000 new affordable housing units by 2026.

Those units typically include a rental rate at least 20 per cent less than the average market rent in the London-St. Thomas region.

However in this case, the affordability will be based on the median household income.

Located across from the Vision SoHo project, Fragiskatos sees an opportunity for people to transition from some of the deeply discounted housing units into the newly announced affordable units.

“They leave there and open up a space in a rent geared to income situation. This is how a focus on rent actually has the opportunity to lift all boats,” he says. “That’s why we’ve decided to focus the investment in this particular manner.”

The residential building is scheduled for completion in summer 2024.