The meetings happened across town on different days, but they could have been different worlds. Joe Deschênes Smith, Founder & Principal of Trillium Housing, spent years standing in both rooms and noticing how rarely they spoke to each other.
“We’ve got the non-profit housing sector, which needs to navigate many roadblocks before getting a project off the ground, and then we’ve got a development industry building tens of thousands of units a year,” he says.
Joe and his partners set out to link the two worlds and deliver affordability without asking developers to change their process or pricing. Their solution was simple by design: a non-profit raises impact capital at a set return and partners with developers building entry-level homes. It co-invests in the project and uses the difference between its funding cost and the project’s returns to offer shared-equity Trillium Mortgages to buyers who would otherwise be priced out.
From the street, the affordability is invisible: no separate entrance, no downgraded finishes, just well-located, entry-level homes.
“We need to move away from the same old bucket of tools for dealing with affordability,” says Joe. “Rental housing is needed and it’s the right fit for many people, but there are also many families with young children that dream of owning a home and want to set roots in their neighborhoods and communities.”
With Vancity Community Investment Bank (VCIB) as a construction-financing partner on early projects, Trillium has now completed four townhouse communities in Toronto, Pickering, and Hamilton, bringing approximately 400 homes to market.
For the families living there, the model has made a big difference. Because the Trillium Mortgage is regular-payment-free while the home is owner-occupied, families save over $500 a month on housing costs. This gives them welcome breathing room and a chance to build equity as homeowners.
“Very few families earning $80,000 to $100,000 can afford to buy a 2- or 3-bedroom townhouse in Toronto,” adds Joe. “But with these mortgages, we can change their lives.”
Looking ahead with purpose
As projects wrapped, Trillium faced a new question: how to steward cash prudently while staying aligned with its mission. The organization chose VCIB’s Affordable Housing High Interest Savings Account (HISA) available only to non-profit affordable housing providers, including land trusts and co-ops.
“VCIB stepped up and gave us construction financing for our first projects at very competitive rates,” says Joe. “I want to do the same. When we place funds into VCIB’s HISA they will be used to support someone else’s affordable housing project.”
The Affordable Housing HISA offers a strong interest rate, no monthly fees, and the assurance that 100% of deposits help finance projects that strengthen affordable and sustainable communities across Canada.
“With this product, affordable housing providers’ reserves and project proceeds can earn a competitive rate between milestones and be easily deployed when the next build is ready, all while driving positive impact” says Flora Lo, Associate, Impact Investments at VCIB.
Alongside stewarding cash through VCIB’s HISA, Trillium is preparing a Trillium Housing Fund. The intent is to offer medium- to long-term investments that channel capital directly into Trillium Mortgages, reducing development-side risk for investors and creating a clearer line between each dollar invested and the families supported.
“We have shown this model can deliver affordability while turning a profit,” Joe says. “With the right partners and support from senior governments, we can scale this so more working households can afford to buy a home.”
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Learn more about VCIB’s Affordable Housing HISA here, or get in touch to discuss financing for your next build.
