Thank you, Mr. Chair.
I would like to thank the Committee members for inviting me to appear today.
My name is Dan Dixon, and I'm the senior vice-president of project finance for the Minto Group and Minto Apartment REIT.
I'm here today to represent Canada's five largest publicly traded real estate investment trusts that focus on apartment rentals in Canada and on policy matters relating to housing affordability. For convenience, I will refer to these REITs as the REIT group.
The REIT group members have a multi-decade history as housing providers. We play an important role in housing Canadians, and we are proud of what we do. We provide homes to approximately 120,000 families and households across Canada. Our average rent is $1,394 per month. While we offer apartments at a range of prices to satisfy the housing needs of all Canadian renters, 53% of our homes are affordable at rental rates that are less than 30% of a renter's median income, the standard set by CMHC for affordability.
Although we run large, visible organizations, we make up a small part of the rental stock in Canada. With approximately five million renter households in Canada, the REIT group's 120,000 suites represent fewer than 2.5% of all rental suites in Canada.
The REIT group believes in the progressive realization of the right to adequate housing as set out in the National Housing Strategy Act. We have proactively met with the federal housing advocate to ensure and improve our understanding of the rights, duties and obligations of all participants in the housing sector.
In this regard, the UN framework referenced in the National Housing Strategy Act is helpful and clear. Governments are accountable to their citizens for the realization of the right to adequate housing. Governments are also responsible for putting frameworks in place to ensure a functioning housing market and that businesses in the private sector are important players. In Canada, the private sector delivers over 96% of all housing.
As businesses, our strategy is to meet the needs of our residents while taking care of our employees and the environment. REITs are required to pay out 100% of their taxable income to their unit holders as distributions, where that income is taxed in their hands. The distribution of that income currently provides our unit holders with a yield on their investment of approximately 3%.
As we go about operating our businesses, we recognize that our apartments are homes that provide comfort, safety, convenience, pride and a sense of community. We regularly survey our residents and take their feedback seriously. We compete with each other and with the other 4.9 million rental apartments in Canada for tenants to choose our buildings.
We support CMHC's call to build 5.8 million new homes by 2030 to restore affordability. The private sector will provide the vast majority of these homes. The total REIT sector in Canada, including apartment REITs and diversified REITs, has over 230,000 homes in its development pipeline. That is the equivalent of one full year of housing starts in Canada at a time when we desperately need housing supply.
To develop these homes, we need access to the capital markets. That requires a stable and predictable regulatory environment. We agree with many of you on this committee that the government should focus its support on those one in 10 Canadians in core housing need through a mix of social, supportive, co-operative and subsidized housing. There are tools the government could use to encourage more of that.
The most affordable housing is existing housing. That's why we support a national acquisition fund to acquire existing, affordable rentals and keep them affordable in perpetuity. There are a number of buildings in our portfolios that would be good candidates for this fund.
Among the housing rights itemized by the UN is the right to choose one's residence, to determine where to live and the freedom of movement. Fulfilling that right requires a robust and functioning private housing market. Public real estate investment trusts are a vital tool in the tool box for providing choice and value in housing for Canadians.
Thank you for your time. I look forward to taking your questions.