Having reached a conclusion that it needs to make money to spend money, the District of Tofino will sell an apartment it owns to help pay for its controversial affordable housing project.
The town’s municipal council voted unanimously to put a one-bedroom apartment, located at the Gateway Development on Gibson Street, up for sale at $195,000 as a price-restricted and resident-restricted unit with the sale proceeds going to the Tofino Housing Corporation.
That $195,000 price tag represents a roughly 25 per cent discount to the 490 sq. ft. apartment’s assessed value of $260,500 and the sale will include an agreement ensuring it cannot be flipped for market value.
Tofino will then hand the proceeds over to the THC to be put towards a roughly $535,000 bill for a new road and servicing at District Lot 114, which has been earmarked for an 84-unit affordable housing project.
The land, which includes five lots, was rezoned following a recently concluded, though lengthy and heated, public engagement process and is set to become three duplex lots and two apartment lots.
During their Aug. 25 regular meeting, council authorized its staff to transfer the land over to the Tofino Housing Corporation, which will then lease it to Catalyst Community Developments, it’s partner on the 84-unit project.
The THC’s executive director Ian Scott explained during the meeting that council needed to sign off on the planned sale and agree to transfer the land in order for a funding application to be sent to BC Housing.
Immediately after becoming the owner of the land, the THC plans to then lease it to Catalyst, which will then finance the development of the project, which is laid out in stages. The first phase is a 35-unit apartment building and the second phase is a 37 unit apartment building. The apartments, which will range from one to three bedrooms, will be rented at below market value determined by a pending housing agreement.
“They’re taking on the substantial debts required to build those buildings,” Scott said of Catalyst.
He said the lease would run for 60 years, though the THC would monitor Catalyst’s operations and the district has the option of purchasing the apartment buildings from Catalyst after seven years.
While the two apartment buildings will take up two of the five lots, one duplex lot will be sold and the remaining two lots will be developed with matching townhouse style duplexes, each with a secondary suite attached. Those two duplexes would then be sold with the proceeds going towards the costs of the two apartment buildings.
“We’re selling one lot as a market sale and that’s to help us pay back our loans for that road and servicing construction,” Scott said.
The district’s manager of community sustainability Aaron Rodgers told the Westerly News that Tofino obtained the apartment unit as a community amenity from the developer of the Gateway project in 2010. Rodgers said the apartment has housed several district staff members as well as Reserve RCMP members.
READ MORE: Tofino housing project clears zoning hurdle