The City of Vancouver has purchased a new market rental housing project for $38.5 million.

The six-storey project is located on the northwest corner of East 41st Avenue and Main Street.

This marks the first time that the municipality has bought a new rental housing project, the city told Postmedia.

Since construction is not quite complete, the building’s 46 apartments remain unoccupied. Once they are finished, a property management will select the tenants, the city told Postmedia. The ground floor includes a liquor store leased to a private owner.

“The purchase of this new building will create long-term benefits to the city and will be a part of a portfolio that will generate revenue that can reduce property taxes and help build needed infrastructure,” Coun. Mike Klassen wrote on LinkedIn.

The city’s new Vancouver Housing Development Office bought the project through the Property Endowment Fund. According to Postmedia, councillors approved the purchase at a closed-door meeting in accordance with usual city property-acquisition practices. (Such private council meetings are known as in camera sessions.)

Council created and approved the VHDO in 2023. The office’s mandate is to create and deliver middle-income housing on city-owned land held within and outside of the Vancouver Affordable Housing Fund portfolio. Initially, the VHDO’s responsibilities were limited to the the affordable housing portfolio; however, council later expanded them to include other city-owned properties.

The little known PEF was created in the 1970s. It holds numerous real estate assets that are not immediately required for city services but are held instead for other purposes, including investment and future civic uses, according to a city 2018 internal audit summary report on the fund.

Previous local owner Rendition developed the newly acquired multi-family rental property.

Rendering: Rendition Developments