It was just under a year ago that a brand new building focused on affordable housing opened in Mount Brydges, but this week it was very evident at Strathroy-Caradoc Council that the Caradoc Housing Corporation is grappling with severe financial challenges, highlighting the urgent need for municipal support to sustain its operations at the almost one year old Caradoc Place in Mount Brydges.
According to the Corporation’s Treasurer Greg Willsie, Caradoc Place is dealing with a monthly projected $30,000–$50,000 loss, driven by higher-than-expected operating costs, maintenance, and unforeseen expenses. Capital improvements at the Corporation’s other site on Queen Street in Mount Brydges and escalating costs for Caradoc Place have left the organization unable to balance its 2025 budget. The Corporation estimates $500,000 in annual municipal funding over the next 7–10 years is needed to break even, and that’s what it was asking for this week in chambers.
According to the Corporation’s constitution, it was established for the “exclusive purpose of providing affordable housing to residents located in the Municipality of Strathroy-Caradoc.”
The Board of the Strathroy-Caradoc Housing Corporation acknowledged to Council this week that it has since 2022 been financially supported by the Municipality of Strathroy-Caradoc. That it has an outstanding $2 million loan from the municipality, and an additional outstanding $1.1 million loan from the municipality. It also acknowledged that after reviewing its financial position, that it is unable to repay any part of the monies loaned back to the municipality totaling $3.1 million for the foreseeable future.
Further complicating matters, the organization is locked into a 10-year mortgage with a $3 million penalty for early repayment. A change in ownership or board structure could trigger repayment of a $2.5 million CMHC grant, bringing the total penalty to $5.5 million.
The Corporation’s Queen Street facility, while profitable with a $20,000–$30,000 annual surplus, cannot offset Caradoc Place’s deficits. Despite some rent increases, current revenues remain insufficient to cover expenses, with operating costs exceeding rent by 50–70%.
Council discussions resulted in two key approved motions: explore all financial and operational options, including appraisals of both buildings, and allocate a $500,000 placeholder in the 2025 municipal budget.
Willsie stressed the need for immediate action, noting the Corporation will potentially run out of funds by May 2025 without municipal intervention.
Written by: C. Soares