Montreal’s largest real estate developers are taking an unusual step to address the city’s growing housing crisis, proposing a $100 million initiative to construct 2,500 affordable housing units specifically for people experiencing homelessness. Groupe mach, Cogir Immobilier, and Groupe Devimco plan to transfer ownership of the completed project to the Société d’habitation du Québec, ensuring long-term affordability-a move experts say reflects both market conditions and a shifting responsibility from public to private sector solutions.The proposal, first reported by La Presse in November, is raising questions about government inaction and the role of the private sector in addressing social needs.
Three of Montreal’s largest real estate developers are proposing a significant initiative to address the city’s housing crisis: the construction of 2,500 units specifically for people experiencing homelessness. Groupe Mach, Cogir Immobilier, and Groupe Devimco plan to build the housing at no profit and then transfer ownership to the Société d’habitation du Québec to ensure the units remain permanently affordable.
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The proposal, first reported in November by La Presse, is just one of a growing number of private sector initiatives stepping into the realm of social housing. Other projects include Toit à moi, which aims to purchase and offer 1,500 affordable condominiums to individuals 55 and over experiencing homelessness by 2035, and Mission Unitaînés, slated to complete delivery of 17 buildings with 100 affordable units for seniors across Quebec by 2027. UTILE, a non-profit organization, also focuses on student housing.
Maintaining Workforces
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The involvement of the three major developers is particularly noteworthy because it deviates from the typical non-profit model and isn’t driven by profit. Anne Cormier, a specialist in social housing at the University of Montreal’s School of Architecture, believes the developers may be responding to a saturated market where demand for luxury condos and homes has declined. “They’ve overbuilt, the market is completely saturated, and they’re likely looking for work,” she said. “The goal, in this case, is to avoid dismantling the teams they’ve spent time building.”
PHOTO ÉDOUARD DESROCHES, ARCHIVES LA PRESSE
Experts say the initiative will allow companies to keep their workforce employed.
Hélène Bélanger, a professor in urban and tourism studies at UQAM and a social housing specialist, echoed this sentiment. “There may not be a profit margin like in a private for-profit construction project, but their company is running, their workforce is working, so it allows the machine to keep running.”
Addressing Homelessness Concerns
Another motivation, according to experts, stems from concerns about the impact of homelessness on the business community. Louis Gaudreau, also a social housing expert at UQAM’s School of Social Work, explained, “It’s very clear that the business community views homelessness as an obstacle to economic growth, or at least to the smooth functioning of business.”
Bélanger went further, noting that “homelessness is becoming increasingly visible, but it’s also becoming more acute, with more severe cases that we didn’t see as frequently until recently. This creates a negative image for business.” She believes the business community has long tolerated the issue, “but now the problem is too big. We can no longer simply ignore it or push it to a few street corners. There are homelessness issues everywhere now, in the suburbs, in the regions, and the business community has a vested interest in solving the problem.”
PHOTO CHARLES WILLIAM PELLETIER, ARCHIVES COLLABORATION SPÉCIALE
A camp of people experiencing homelessness.
These large developers participated in a way in the housing crisis with the construction of large condo projects, whether for rent or for sale, that are inaccessible to most households. And now, there’s a niche that hasn’t been occupied yet, since the government is abandoning the construction of social housing, so there’s a glaring need and they want to fill that void in the construction of social housing.
Hélène Bélanger, professor in the Department of Urban and Tourism Studies at UQAM
Government Inaction
The rise of private initiatives is directly linked to what some see as a lack of government engagement, according to Véronique Laflamme, spokesperson for the Front d’action populaire en réaménagement urbain (FRAPRU), an organization that has advocated for the construction of social housing for decades. “It feels like governments, particularly the Quebec government, are abandoning their role as project leaders. The Quebec government doesn’t have a clear vision or quantifiable objectives for development and is lagging behind the private sector.”
Georgia Cardosi, an assistant professor in the Faculty of Architecture’s School of Architecture at the University of Montreal, agrees, stating that the growing involvement of the private sector “is much more than a rebuke of the government. What we’re experiencing is a general failure of the state’s presence in the main issue of housing. Many citizens can no longer afford their rent, but we’ve seen this coming for a long time. There’s therefore an inefficiency, an inaction on the part of the state.”
PHOTO EDOUARD PLANTE-FRÉCHETTE, ARCHIVES LA PRESSE
François Legault and the President of the Treasury Board, France-Élaine Duranceau, who also served as Minister Responsible for Housing.
We are not simply in a housing crisis, but rather in a fairly important crisis of values, where the state is increasingly absent in issues at the heart of civic life.
Georgia Cardosi, assistant professor in the Faculty of Architecture’s School of Architecture at the University of Montreal
Hélène Bélanger draws a similar conclusion that extends beyond housing. “The disengagement of the current government is clear for several years and we see it in several areas, not just housing. The current government relies heavily on the private sector to take over social programs and some community initiatives. This disengagement is visible on several levels.”
Private Development, Public Funds
Public authorities aren’t entirely absent. These projects can be built at low cost, in part because municipalities often provide the land. And the government does contribute financially, according to Louis Gaudreau. “These philanthropists are proposing something that doesn’t bear the name of social housing, but has almost all the characteristics. We’re talking about building housing that will become the property of the state, municipal housing offices, and in which tenants will pay rent proportional to their income. And that’s the definition of public housing, subsidized housing. And what’s ironic about that is that the official policies of the Quebec government don’t even propose that.”
What Quebec is doing, he says, is providing funding on a case-by-case basis. “Rather than creating programs or incorporating projects into programs, they fund them individually.” He cites Unitaînés as an example, where funds were granted by decree to the non-profit organization Mission Unitaînés, founded by the owner of Groupe Maurice, Luc Maurice, to carry out the projects submitted by the organization. In addition, the land was provided by the 17 municipalities involved.
No public funding has yet been allocated to the three developers, but they don’t hide their desire to obtain long-term mortgage financing from Quebec.
That’s why, according to Georgia Cardosi, these projects will need to be closely monitored. “We need to ensure the long-term sustainability of public resources that will be allocated to this, even when the private sector is in charge. There are always public resources, land, grants, loans that are contributed. We need to ensure that these public resources will lead to housing that will permanently remain a collective asset.”
The Most Vulnerable Left Behind
The decision to allow the private sector to take the lead in social housing has consequences. “What worries me most is that these developers are used to building for people without particular issues,” says Anne Cormier. “If we think about the most visible people, there are still many who have organizational problems and need support to return to more comfortable lifestyles.”
She notes that the three major developers are talking about building buildings of 200 to 300 units. However, she recalls, “there are many people who need support to reintegrate into society and 300 people is too many for a building, for this clientele. I find it a bit worrying that such companies are launching into housing intended for a different population, without necessarily knowing the issues that this presents. In general, for people who have certain adaptation difficulties, we are more in the maximum of 50 units.”
PHOTO PATRICK SANFAÇON, ARCHIVES LA PRESSE
Vincent Chiara, president of Groupe Mach.
In other words, these developers could cater to a specific clientele – the new cohort swelling the ranks of homelessness because they are unable to find housing they can afford. As reported in La Presse on November 24, Groupe Mach President Vincent Chiara openly acknowledged that real estate players were largely responsible for pushing these people out of their homes.
Loss of Trust
Beyond these immediate considerations, Georgia Cardosi expresses concerns about the long-term consequences of this transfer of responsibility from the public to the private sector. “This is absolutely negative because it removes a lot of meaning from the presence of the state, the government, and public actions that must be put in place. It undermines the trust that citizens have in public authorities and could trigger a series of other problems that we may not see at this time, that is, open the door to other types of solutions that are not necessarily desired, either by governments or by citizens.”
Most experts point out that some European countries have addressed the housing problem through the massive construction of social housing, but “there is no political will here to be an actor, promoter, developer of housing to ensure that people are housed,” laments Hélène Bélanger. “That’s what makes private actors try to take over because there’s room to do so. And I think the government, this is a bit what it wants because we can continue to disengage by saying we have great developers who are willing to not make a profit to build these social units.”
“So, the equation works well here, we are for all-private. The private sector is there to meet the needs, but it would be very surprising if it were present to meet the needs of the most vulnerable and the most complex cases.”
Note to readers: In a text published on December 31, The Canadian Press incorrectly stated to Louis Gaudreau that the money had been given by decree to the Maurice group, when it was given to the non-profit organization Mission Unitaînés, founded by the owner of Groupe Maurice, Luc Maurice.
