Canada Infrastructure Bank unveils financing program to spur construction
The Canada Infrastructure Bank (CIB) has unveiled a new lending product that aims to tackle infrastructure bottlenecks limiting new housing construction.
The CIB's new lending program, Infrastructure for Housing Initiative (IHI), provides targeted financing options for municipalities and Indigenous communities seeking to build infrastructure that directly supports increased housing supply.
The IHI also offers municipalities and Indigenous communities a unique repayment structure that mitigates risk. Repayments are linked to the number of new housing units built, allowing borrowers to invest in critical infrastructure now while aligning payments with future growth.
“The housing challenge in Canada requires innovative thinking, new partnerships, and various financing supports to make progress,” said Canada Infrastructure Bank CEO Ehren Cory. “We are pleased to have already advanced financing to a number of projects which will spur new housing such as district energy expansion, transit lines, broadband networks and water treatment facilities.”
According to the bank’s news release, the product offers several benefits including faster infrastructure development without large upfront tax increases, as well as access to competitive interest rates for smaller municipalities that may lack traditional capital market financing.
Municipally-owned corporations could also qualify for the program. CIB is looking to partner on eligible projects, prioritizing large-scale infrastructure projects, including water systems, roads, transit, and clean power.
The initiative complements existing federal housing programs as part of a broader approach to tackle the housing shortage. The CIB's previous investments are already impacting housing, including commitments of up to $140 million for water projects in Manitoba, which are expected to unlock up to 15,000 housing units.
“With the CIB's new Infrastructure for Housing Initiative, communities across the country will have access to financing that will help build the infrastructure needed to increase housing supply,” said Sean Fraser, Minister of Housing, Infrastructure and Communities. “This is a significant lever communities can now access to enable local investments in critical infrastructure from roads to public transit and water treatment systems.
“The CIB's innovative approach to addressing the housing challenge will help municipalities and Indigenous communities develop complete, inclusive, and sustainable communities with affordable and accessible housing.”
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