The units, on the ground floor of the Loan and Mercantile warehouse behind Dunedin’s railway station, are expected to open within the year and will join 30 existing social housing flats in the building.
They are being built in partnership between Dunedin developer Russell Lund and the Salvation Army, funded by the Ministry of Housing and Urban Development.
Salvation Army social housing director Greg Foster said the new units would be life-changing for many of the tenants.
Throughout New Zealand, the Salvation Army was building 400 units, either in partnership with developers or independently, he said.
"It’s fantastic. It’s life-changing for many of our tenants."
Mr Lund said, through their partnership, he and the Salvation Army were able to build at "a fraction of the cost" of the government.
"It’s something we think we need to do," he said.
The planned units were similar to the existing 30 units on the first floor, most of which were 50sqm; an office for support workers, bike sheds and a pool table were also envisaged.
Mr Lund, who is running for the Dunedin City Council, said space remained in the building for the possible development of a further 30 units, in addition to the 13 high-class apartments in the building.
