A real estate company says it wants to make P.E.I. housing even more affordable through an innovative business model. But some housing advocates are questioning why the province is leaving it to the private sector to address the Island’s housing woes.

Nova-Scotia based Vida Living has bought 20 apartment buildings in Stratford and Charlottetown since September, containing a total of 338 units.

The real estate business runs more than 2,000 units in the rest of the Maritimes and in Manitoba, using what company representatives call a “customer-driven model.”

Hugh Goodday, Vida’s chief growth officer, says the model is a “win, win, win.”

What the company calls “tenant ambassadors” run day-to-day operations in the buildings, while “community contractors” paint and perform light repairs and maintenance — both roles involving cheaper rent as payment.

“We are evolving to a co-stakeholder model, which really means that we’re laser-focused on the relationship with our residents and having them understand how we can collaborate, work together, build trust and keep our costs down,” Goodday said. “[That] in turn helps keep our residents’ rents low.”

Ambassadors are given training in the skills needed to run a building, receiving a reduction in rent based on the number of units they manage. Goodday said the system is designed so that they can maintain full-time employment while running the building on the side.

Goodday said Vida has received some funding from provinces for pilot programs that help keeps costs even lower, which he said has helped them succeed in rent-capped markets like P.E.I. 

In 2024, P.E.I. landlords will be able to raise rents by a maximum of 3 per cent without having to go through the Island Regulatory and Appeals Commission. By doing that, they can argue for a further 3 per cent increase.

“We have a great partnership with CMHC,” Goodday said. “We’re able to have best-in-class financing in these acquisitions, and we have a very conservative approach to our acquisitions, and our growth strategy and targets.”

Calls for public housing

But Vida’s approach has previously drawn criticism from tenant advocacy groups elsewhere in the region, with some saying the company’s selling points may be too good to be true.

Ryan MacRae, an organizer with the P.E.I. Fight for Affordable Housing, said the province shouldn’t be leaving it to private companies to address a lack of cheap housing supply.

“We’re in a housing crisis and there are… potentially thousands of of cheap rental units going on the market,” he said.

“[Government] should be licking their chops at this, you know. But instead they’re going to let the private market consume these units, which is difficult, right? Because once that happens, they’re potentially gone forever,” MacRae said.

He said there is no guarantee the units will remain affordable as long as they’re owned by a private company, and that even if Vida does as promised, it could still sell the buildings to a different real estate investment trust.

He said the only guaranteed form of cheap housing is publicly owned housing.

“At the end of the day, [Vida] is still a landlord looking to pull a profit from tenants,” he said.

“It doesn’t matter if it’s Killam, Capreit or Vida, if they’re not turning a profit, they would not be in the housing market, right? And those profits are coming at the expense of tenants, be it through their rent payments or in the case of Vida, potentially through their manual labour.”

MacRae said the government could potentially be saving money on supports already in place if they owned the buildings outright, including getting some social assistance money back as recipients pay rent.

Housing Minister Rob Lantz has said that the province keeps a close eye on buildings that come onto the market but only considers them if they meet certain needs.  

“It seems that somebody tries to sell me an apartment building once a week,” he told the legislature this week. “We are assessing those opportunities on a case-by-case basis because we know where the housing needs are throughout the province. We have a housing registry and we know where the demand is.”

Killam among those selling to Vida

One of the landlords MacRae mentioned, real estate investment company Killam, has sold off 11 of its buildings in Charlottetown and Stratford recently, including some to Vida.   

Vida confirms it bought Killam complexes at 4 Ducks Landing and 280 Shakespeare Dr. in Stratford, as well as Country Place and 27 Longworth Ave. in Charlottetown.

June Ellis, the executive director of the Residential Rental Association of P.E.I., said provincial regulations are prompting landlords to sell because it’s hard to make a profit. 

“They cannot raise the rent when a new tenant comes in…. And that’s something we really need the government to change,” Ellis said. “I was talking to a landlord that wanted to just raise the rent to try to cover his cost and he couldn’t, so he had to turn it into condos.” 

Speaking to CBC’s Island Morning on Friday, Lantz said letting landlords raise rents when a new tenant moves in is simply not on the table.

“We’re the only province to my knowledge that doesn’t allow that,” he said, adding that his government prides itself on P.E.I.’s “strong tenant protections.”

But he added: “We have to be careful because over-regulation can backfire. It’s a fine balance… We have to watch carefully [to] make sure that we continue to have a a healthy housing market. So I’m not considering that right now, but we’ll keep an eye on how things unfold in the future.”

Despite that regulatory climate, Vida said it may be interested in expanding its rental footprint on the Island even further.

“We love partnering with local entrepreneur-led businesses who can see the value in what we’re doing and help us keep our costs down and grow our business together,” Goodday said.

“If we can do that, if we can build a relationship with the provincial government — we’ve had some very productive conversations… we’ll be in great shape to continue growing on Prince Edward.”