On October 16, 2026, the federal government announced $165 million through the Apartment Construction Loan Program (ACLP) to support the construction of 370 rental homes in Toronto. The ACLP, formerly known as the Rental Construction Financing Initiative, provides low-interest repayable loans for the construction of new purpose-built rental housing. Loans are available for projects of five or more units and are structured to be repaid over a 10-year term after construction is complete. Projects must include a minimum share of units at or below median market rent to qualify. The October 2026 Toronto announcement is part of a series of ACLP commitments across Canada that the federal government has been making throughout 2026 as part of its housing supply strategy. For purpose-built rental developers in Toronto, the ACLP sits alongside the city's DC reduction program and the 2023 federal HST new rental rebate as a third cost-relief tool targeting the same segment.
Purpose-built rental in Toronto has been the subject of three major policy interventions since 2023: the federal HST rebate for new rental construction, the City of Toronto's development charge reduction program, and now a third $165 million commitment through the Apartment Construction Loan Program announced October 16, 2026. The latest announcement funds 370 new rental homes in the city through low-interest federal loans.
| Element | Detail |
|---|---|
| Program | Apartment Construction Loan Program (ACLP), formerly Rental Construction Financing Initiative (RCFI) |
| Instrument | Low-interest repayable federal loans, not grants |
| Minimum project size | 5 or more units |
| Repayment structure | 10-year term after construction completion |
| Affordability condition | Minimum share of units at or below median market rent |
| October 2026 Toronto commitment | $165 million, 370 rental homes |
The ACLP is a loan program, not a subsidy. The federal government provides capital at below-market rates for construction, and the developer repays over a term that begins once the building is complete and leased. The interest-rate advantage is the value: in a market where construction financing is running at 7 to 8 percent, an ACLP loan at a materially lower rate changes the financing cost line on a rental pro forma meaningfully.
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Each program has its own eligibility criteria, timing requirements, and application process. The HST rebate is accessed at tax filing, the DC reduction at building permit, and the ACLP requires a separate application and approval by CMHC before the loan is committed. Confirm eligibility for each independently.
ACLP loans are available to a broad range of rental housing developers, including private builders, non-profits, co-operatives, municipalities, and Indigenous housing organizations. Projects must be purpose-built rental, meaning the units will be rented rather than sold as condominiums. The affordability condition requires a minimum share of units priced at or below the area median market rent; the exact share is negotiated with CMHC as part of the application.
Projects with 50 or more units are prioritized, though smaller projects above the five-unit minimum can qualify. Construction must not have started before the loan is committed, which means developers need to apply before breaking ground, not after.
The Apartment Construction Loan Program (ACLP) is a federal program administered by CMHC that provides low-interest repayable loans for the construction of new purpose-built rental housing. On October 16, 2026, the federal government announced $165 million through the ACLP to support 370 rental homes in Toronto.
ACLP provides below-market-rate construction loans for eligible purpose-built rental projects of 5 or more units. Loans are repaid over a 10-year term beginning after construction is complete and the building is occupied. Projects must include a share of units at or below area median market rent. Developers must apply before breaking ground, as the loan must be committed before construction starts.
ACLP is available to private developers, non-profit housing organizations, co-operatives, municipalities, and Indigenous housing organizations building purpose-built rental housing in Toronto. Projects of 5 or more units are eligible, with priority given to projects of 50 or more units.
Yes. The ACLP loan and Toronto's DC reduction program are separate and can be combined on the same project. The DC reduction applies at building permit, while the ACLP loan is committed through a separate CMHC application before construction starts. The 2023 federal HST new rental rebate can also apply to the same project, subject to each program's individual eligibility conditions.
The federal government announced $165 million through the Apartment Construction Loan Program for Toronto on October 16, 2026, to support the construction of 370 new purpose-built rental homes.
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