Community Housing Portfolio Review - Issue Report

Report To:                         Manitoulin-Sudbury District Services Board

From:                                     Lori Clark, Director of Integrated Human Services
                                                    Sherry Frost, Integrated Human Services Manager

Date:                                       May 21, 2026

Re:                                           Community Housing Portfolio Review - Issue Report

Strategic Plan Goal:  3. Grow with Purpose and Resilience
Objective:                          3.2 Invest in renewing caprial assets and infrastructure across all service areas

Purpose

The purpose of this report is to inform the Board of the operating performance and capital requirements of the Manitoulin-Sudbury District Services Board (DSB) Community Housing portfolio. The report provides a review of operating expenses and revenues over the past five years, as well as projected capital expenditure over the next five years. This information is intended to support informed decision-making regarding the long-term sustainability of the portfolio and potential adjustments to funding levels.

Background

A Housing Needs Assessment (HNA) was completed earlier this year to better understand the housing needs and challenges faced by residents throughout the service area in relation to suitable and affordable housing. The HNA identified that an aging population, increasing housing instability, and evolving community needs are driving greater demand for accessible, appropriately sized, and supportive housing options.

At the same time, the supply of affordable housing remains constrained, slow to expand, and in many cases not aligned with current demand trends. Community housing continues to play a critical role within the local housing system; however, a significant portion of the DSB’s housing stock is aging and requires ongoing repair, renewal, and reinvestment to preserve existing supply and maintain safe and functional living environments.

Given these factors, it is important to assess both the operational and capital sustainability of the current housing portfolio while considering alignment with present and projected demand.

Financial assessment

The financial viability of the Community Housing portfolio is a critical factor in evaluating the long-term sustainability of the DSB’s housing assets. Operating costs have continued to increase due to inflationary pressures, rising utility and insurance costs, increased maintenance requirements, and the growing complexity associated with maintaining aging buildings.

In 2025, a Building Condition Assessment (BCA) was completed for each Community Housing property. The assessment identified the projected capital requirements necessary to repair or replace major building components over time, including roofing, mechanical systems, windows, building envelopes, accessibility upgrades, and other lifecycle replacements.

This information was presented to the Board in March, with direction provided to review projected project costs across the full Community Housing portfolio. Table 1 in the Appendix provides a summary of operating revenues and expenditures over the past five years, together with projected capital expenditures over the next five years.

Preliminary analysis outlined in the Community Housing Portfolio Finance Summary in the Appendix indicated that projected capital requirements significantly exceed current reserve contributions. Without additional investment, there is an increasing risk that deferred maintenance will continue to grow, resulting in higher future costs, service disruptions, and potential reductions in usable housing stock.

In addition to capital pressures, several properties continue to experience operational challenges due to rising expenditures outpacing rental revenue growth. While the portfolio remains a critical community asset, maintaining the current inventory in a safe and sustainable condition will require ongoing strategic investment and prioritization.

Current Portfolio

The current DSB Community Housing portfolio outlined in Table 2 in the Appendix provides a tabulated list of the number of current Community Housing units and what the demand is based on unit size (number of bedrooms). Demand for some unit sizes is less accurate in communities that don’t have all the apartment options. The data is based on the DSB waitlist.

Conclusion

Demand for affordable housing continues to exceed available supply in many communities, particularly for one-bedroom and family-sized units. The combination of increasing demand and growing capital pressures highlights the importance of proactive long-term planning to preserve existing housing stock while positioning the portfolio to respond to future community needs.

Recommendation

Staff are recommending that the Board support a comprehensive review of operating expenses across the Community Housing portfolio to better understand current cost drivers, operational pressures, and the long-term financial sustainability of existing assets.

Staff are also recommending that the Finance Committee consider future funding adjustments during the 2027 budget process. Staff will continue to advocate at all levels of government to support the preservation, repair, and modernization of community housing assets throughout the service area to maintain safe, sustainable, and affordable housing for residents.