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British Columbia is experiencing an unprecedented housing crisis. While addressing various aspects of the housing supply chain is essential, no single approach can fully solve the challenges we face in scaling housing production. So, what's the blueprint for growth?
In November 2023, DIGITAL — Canada's Global Innovation Cluster for digital technologies — launched its Housing Growth Innovation Program with support from the Province of British Columbia through the Ministry of Housing and Municipal Affairs. The program brings together collaborative teams of industry leaders to accelerate technology-driven approaches that are driving real, tangible growth for British Columbia's housing production sector.
Amy Vilis, Director of Housing Growth Innovation at DIGITAL, chats with innovators doing groundbreaking work within DIGITAL's Housing Growth Innovation Program to develop and implement technology-based solutions within British Columbia's housing sector across the full scale of end-to-end production. These conversations showcase how ideas are making it into the real world where they can become comprehensive, viable and, best of all, achievable solutions to accelerate housing production for British Columbians.
Amy Villis (00:13)
For a long time now, we've heard about the housing crisis that exists everywhere. We need to build tons of new homes to keep pace with demand. We've heard the problems, the seemingly insurmountable challenges of creating good, accessible housing quickly, and for many. But what are the solutions? My name is Amy Villis and I'm the Director of Housing Growth Innovation at Digital, which is Canada's global innovation cluster for digital technologies. Before I got here, I used to work for the City of Vancouver developing affordable housing.
In particular, I helped begin the process of harnessing the power of digitizations so that we could produce faster, smarter, more sustainable housing solutions. Since 2018, the company Digital, as the name would suggest, is all about figuring out how to help industries accelerate growth using the best tools that tech has to offer. We've dabbled in many sectors like healthcare, natural resources, workforce development, and now, housing. To address these housing challenges, Digital launched the Housing Growth Innovation Program.
made possible with the financial support of the province of British Columbia through the Ministry of Housing and Municipal Affairs. It includes the Housing Growth Innovation Lab and Network for collaboration, co-investing in mission-driven projects targeting key housing issues, and workshops and events to foster partnerships and solutions. By bringing together diverse stakeholders and leveraging technology, we aim to accelerate housing production and position BC as a leader in housing innovation. In this series, we're going to talk to those that actually have boots on the ground,
the interesting projects they're working on and how their tech innovations are creating unprecedented opportunities in moving the needle in housing production. We're going to look at all that through the lens of the first five phases of the end-to-end housing production lifecycle. So that's market demand, due diligence, design engineering, pre-construction, procurement and construction. We've made this podcast for anyone who's passionate about solving Canada's housing challenges. Whether you're an industry professional, policymaker,
tech enthusiasts are just curious about the future of housing. And shouldn't that be all of us? Housing is an essential human need and in a sea of challenges and bad news stories, here we offer solutions. Like I said up top, I'm your host, Amy Villis, and welcome to Blueprint for Growth, Innovation and Housing, a podcast exploring cutting edge solutions, transforming Canada's housing landscape. My guests for this episode are Helen Goodland and Scott Complanis.
Helen Goodland is the principal and head of research and innovation for Sias Advisory, which is a data consulting and general support team for the real estate and construction industry. While this podcast focuses on solutions in the future of housing in Canada, let's start by acknowledging the challenges in British Columbia, particularly the need to meet that established market demand. With soaring demand, limited supply and rising costs, the sector faces significant hurdles. Addressing these issues require innovation,
collaboration and new technologies to accelerate housing production and improve affordability. So let's start with Helen.
Helen Goodland (03:15)
Well, on the demand side, Amy, we just have this absolutely pressing crisis of providing housing now for a full spectrum of need right across Canada. And it's not just Canada, it's a global problem that there is this huge urbanization trend happening where we really need to provide housing for people everywhere. And it just...
We're running up against all of these problems. We have problems of not enough people, not enough materials, not enough equipment, not enough money in some cases, but it's just such a wicked problem. And it's not something that we should be surprised about. This has been a long time coming. We've got decades of this building.
Amy Villis (04:04)
Scott Kaplanis is the founding managing partner of Brown Break Ventures, a Toronto-based venture capital firm focused on funding property technology and home innovation ideas.
Scott Kaplanis (04:15)
I'm sure that your viewers or listeners will have had some information previously, but we have the most acute housing crisis in Canada in the entire G20 at the moment by most metrics. And so, you know, we're starting with this very severe, very deep and very fundamental issue to people. And just for a stat that shocked me, between 1980 and 2020, the average price of a home in Canada increased by almost 750%.
Over that same time frame, the median household income increased by just under 300%. So the cost of housing has outpaced real incomes on a household level by about two and a half times.
Amy Villis (05:00)
So how open is the development and construction industry to adopting new tech and innovation? Are we actually seeing things like mass timber, digital tools and new building methods take off?
Helen Goodland (05:12)
Good question, Amy. I would say, you like every industry, have, you know, there's the sort of the innovation adoption curve. You've got your innovators right at the beginning of, two and a half percent of your market. And then you've got like 15 % of the sort of early adopters, and then you've got everybody else following along. And construction's no different. We've got in British Columbia, some of the world-class engineering firms, design teams.
who are doing amazing things at the leading edge. Just think about how fast mass timber has come into the marketplace in BC. mean, still British Columbia has more mass timber buildings than the rest of the country put together. And we have, you know, it may only be a handful of firms, but they are, you know, global leaders in, you know, innovative timber technology.
Amy Villis (05:59)
The construction sector has been slow to innovate, with companies investing only about 1 % of their revenue into R &D compared to other industries like healthcare. Public initiatives like digital's housing growth innovation program and the work you're doing with CMHC are helping to de-risk this investment. How can public-private partnerships drive innovation in construction and the kind of impact that we can have on long-term R &D investment?
Helen Goodland (06:22)
Yeah, it's a really good question. We're working with an industry that is very unfamiliar with the way R &D works and certainly the way R &D works for all of the other big industries that are benefiting from innovation. What I think is interesting about construction is that it is very much a project-based industry. So it learns by doing and historically it has always expensed its learning on projects.
And so there's a culture, a deeply rooted culture of really not investing in R&D outside of a project. So these companies, construction companies, and you have to understand that construction in Canada and it's pretty much the same in all of the developed world. They're very small businesses, as you say at the beginning, very slim margins, but they don't see the value of investing in R&D outside of that project environment.
So they're expensing their learning onto the client. They're not investing it in their business as a means to stay competitive, productive, and healthy corporately through to the future. So in that cultural environment, it's been very hard for companies like us to make the case for innovation. And we find ourselves helping to involve them through project support and through on the ground handholding.
So that I think is the context, first of all. So where the Housing Growth Innovation Fund is so great and really quite novel, to be honest, is that it's starting to see the value of collaborating on projects. As soon as you do that, the construction industry understands where you're coming from and it can see what the value is because it's going to help do those particular projects better. By that output, it will be able to actually learn
Bring those learnings back into the business. Do a little bit better the next time.
Amy Villis (08:25)
I've seen firsthand how government-funded initiatives like the Housing Growth Innovation Program can really help move the needle. With housing affordability now a top political priority, what type of programs, incentives, and investments are creating real opportunities for change? How has the government's alignment around housing innovation evolved in the past years to help drive meaningful impact in the sector?
Scott Kaplanis (08:47)
And this is the most exciting part for me. And I think you might touch on this at a point, but it's really government alignment. You know, over the last 12 months or so, I think the interest in housing innovation, housing affordability has changed dramatically as it's become the number one political issue pretty much across all levels of government and across, and cutting across all parties. And as a result of that, the
Various governments have been putting forth all types of different programming to address this, dozens and dozens of programming. We probably have more things going on behind the scenes in terms of rebates, credits, funding programs, et cetera, than any other place in probably the G20. And to me, that means we are creating a sandbox, a true sandbox of opportunity for our best and brightest, our technically competent people here.
to build stuff because where there's activity, there's innovation, there's progress, and there's company creation and formation that will lead to step function change. So oddly, or maybe not surprisingly, because we have such an acute problem, because it's been recognized, and because we're doing stuff about it right now, we have the opportunity to really gain a significant advantage relative to the rest of the world in going through these problems and creating solutions.
Amy Villis (10:13)
Concept of sandboxes in housing innovation is indeed exciting and holds tremendous potential. These government-created environments for experimentation and innovation are proving to be a powerful catalyst for progress in the housing sector. This sandbox environment is more than just a testing ground. It's a launch pad for the next generation of housing solutions. By fostering innovation in this way, we're not only addressing our immediate housing needs, but also building a foundation for long-term growth and leadership in the sector.
However, it sounds like there's still a significant gap when it comes to private sector involvement, especially in the terms of funding an early stage company that are looking to scale up in the housing innovation space. So my question would be, how can we better incentivize private sector investment in housing innovation, particularly for early stage and scaling companies?
Scott Kaplanis (11:02)
So I think it does definitely start right now, given the acute phase of the crisis that we're going through with different forms of public capital. Whether again, whether that's a tax break or development charge break, or it's a credit for something that just creates the activity portion. But what's been nice to see is in addition to the dollars and cents aspect, we are seeing new programming being rolled out at various forms and taking different shapes.
as it relates to embracing innovation as part of the solution. I think everyone kind of realizes that sure, we can do more of the same. Sure, we can throw more money at the problem, but we need a step function change in productivity in order to get there. And so there are unique programs. I referenced the CMHC Housing Supply Challenge. That's a $300 million program to support innovation across the housing ecosystem. So everything from permitting and planning all the way to modular construction. But then ultimately,
the private sector has to pick up the ball and run with it. And we're seeing some signs of interest there. But I'll be very candid, there is not a lot of funding for the work that we do sort of on the early stage of a company's development and definitely not a lot of capital for companies that are scaling in this space to make a meaningful difference in housing supply and productivity.
The government has now stepped up across a bunch of functionality to get the ball going. Now we need the private sector to take the lead.
CLIP
Amy Villis (12:48)
Hey, Helen, I hear you're working on something really exciting, the DASH initiative. DASH, that stands for digitally accelerated and standardized housing. It's a great example of how partnerships can drive innovation and housing. It's uniting BC Housing, architects, BIM teams, and prefabrication companies to tackle housing affordability and supply challenges. This initiative is creating an ecosystem for innovation, offering a safe space to test new ideas in an industry that's often risk averse. Can you tell me more about it?
Helen Goodland (13:18)
Thank you. Love to talk about this. So this is DASH, the digitally accelerated standardized housing initiative. So this is a big hairy project that is trying to put its arms around the entire housing pipeline. We have BC Housing, which is British Columbia's largest non-market housing developer, but also wears the hat of the licensor of builders, has to train them, provide continuing professional development opportunities. And it
aims to develop a kit apart solution for mid-rise housing, so everything from three stories up. It has a full digital delivery foundation to it. So everything is within the BIM environment, building information modeling for those who don't know. And it brings together architects developing these standard blueprint design kits. It brings together the BIM teams.
and advice, it brings together the prefabrication companies that can make all of the components in BC so that we have a structure and envelope system that is flexible, generic enough that you can sort of customize your kit parts. And it's underpinned. This is the cool bit, the technology bit. It's underpinned by generative design configurators, both for the E-compliance piece so that you know that from the very beginning, your design
is going to be permissible in the community that you're planning to build. And that it also has a prefab configurator that allows you to take your design into this environment where you know that the inventory of products and the components that you want to make into your building, those are available, manufacturable, and you can even, down the road, will be able to get costing information from it. So we've got industry, we've got BC Housing,
And a strategic partner in all of this is Metro Vancouver, who is the regional government for the 22 municipalities in the lower mainland of BC. They wear their regulatory hat, convening a group of 11 local governments who have developed a model bylaw to make zoning pre-review and pre-approval feasible for prefabricated buildings. And it also is on the hook to deliver few thousand units of its own housing, so it's got a developer hat too. So having those governments and government agencies, municipal and regional and provincial, with federal dollars, working together with the industry, I think we're finally able to see that full spectrum of players. And we are trying to bring everybody together in a constructive collaborative way.
Amy Villis (16:15)
To address housing challenges and position Canada as a global leader in construction, leveraging technology and innovation is key. Education and workforce development will play a crucial role in supporting this shift. How can we combine innovation, workforce development, and education to drive this transformation and elevate Canada's role in the global construction market?
Scott Kaplanis (16:35)
So this is things like building information, modeling, BIM, Autodesk, Procore, robotics, even AI functionality. We need a place to educate those people, those workers. And we need a place where industry wants to come to engage with those workers and future workers and attract them. Because that talent is so incredibly important, but it also creates an atmosphere of excitement. And I think we're missing that right now in this country. We're sort of...
down in terms of this is a serious problem, but there's an opportunity here and that opportunity set is exportable. As odd as it seems, like we've talked to representatives from California and the government. We've talked to senior officials from the UK. They're all looking to Canada right now asking like, you guys are doing a lot of stuff there, what's going on? So we have an opportunity to lead here and I'd just love for us to be able to take it.
Amy Villis (17:31)
Given the recent developments and government support for innovation in the housing sector, it's clear that the landscape of housing construction in BC is set for significant evolution, particularly with the rise of digital technologies and prefabrication. Government alignment and initiatives like the Digital Transformation Roadmap are likely to play a key role in mainstreaming these innovations. How do you see housing construction landscape and BC evolving over the next five to 10 years, especially in terms of digital technology and prefabrication?
Helen Goodland (17:59)
With the innovation that we're looking at now in the next five to 10 years on the digital side and the prefab side, pushing the way we've been pushing, I think it's going to be mainstream. And if I can lead you with one last thing to bear in mind is BC has been blessed with the provincial, regional, local governments and federal governments all pulling in the same direction when it comes to housing. When I go across the country, that's quite unusual. I look at the struggles that some of the other regions have been having trying to align disparate.
know, political priorities and it makes it so hard. So we've got that the province has also launched its digital transformation roadmap for the housing development industry. The minister has a digital construction council, which I know digital is part of. You know, these are all incredibly important signals to the industry too, that there is significant government support and horsepower behind making these changes. So in the, you know, I
I'm very confident that BIM is going to be a part of the mainstream way of doing business 10 years from now. think prefab is going to be where we've seen the incremental housing requirements fulfilled. The units that we need, they're all the incremental ones are going to come from that prefab side of the marketplace. So I think I'm really positive. I think this has been such a big change over the last probably just two years.
Amy Villis (19:26)
I'd to thank my guests, Helen and Scott, for their time and their insights. As we wrap up this inaugural episode, it's clear that we're at a pivotal moment in the housing industry. The challenges we face are significant, but so are the opportunities for innovation and growth. We see how collaboration between government, industry, and technology sectors is really driving change. Join us next time as we explore the due diligence phase of housing development.
We'll explore how AI and digital tools are revolutionizing planning, improving feasibility studies, and transforming investment models. Thank you for your time, and especially for being interested. This podcast is just one way digital and folks you hear in these episodes are working together to accelerate housing production and position British Columbia as a leader in housing innovation. But there is so much more that we're doing. Digital's Housing Growth Innovation Program invests in mission-driven projects targeting key housing issues.
as well as encouraging collaboration and information sharing through workshops, events, and more. We'd love to hear from you. Reach out through our website at housing.digitalsupercluster.ca for more information. This podcast and Digital's Housing Growth Innovation Program are made possible with the financial support of the province of British Columbia through the Ministry of Housing and Municipal Affairs.