The 8-door build: a fourplex plus legal suites, explained
Why the Alberta product is four units over four suites, how suite income carries the coverage test, and what has to be true for it to work.
The Alberta product that keeps appearing in CMHC-financed new construction is a fourplex with four legal basement suites on a single infill lot. Eight independent rental units, one title, one build.
It looks like a compromise between a house and an apartment building. It is not. It is a specific answer to a specific financing test, and understanding why it takes that shape tells you more about whether it fits you than any pro forma will.
Eight units, one building, one title
Each of the four main units is a self-contained dwelling. Each has a legal secondary suite below it, also self-contained: its own kitchen, its own bathroom, its own living area, its own entrance.
That last detail is not architectural preference. It is what makes each suite a residential unit rather than part of the unit above, and unit count is what the financing and the tax treatment both turn on.
CMHC's MLI Select is a multi-unit product. A single-family house with a suite is not in scope. Eight units comfortably is.
On the tax side, the federal purpose-built rental housing rebate requires the building to be a multiple unit residential complex with at least four residential units, each having a private kitchen, a private bathroom and a private living area. CRA has addressed a building on one title containing two main-floor units and two self-contained basement units with separate entrances, and treated it as a multiple unit residential complex rather than a duplex. The basement location does not disqualify a unit. Sharing a kitchen with the unit above would.
Why eight and not four
Four units would still be a multi-unit building. The reason to build eight is debt coverage.
CMHC states a minimum debt service coverage ratio of 1.1 on MLI Select: net operating income has to exceed annual debt service by ten percent. That test, not the down payment, is what most files fail.
Adding four suites raises gross income substantially without buying more land, without a second foundation, and without a second roof. The incremental cost of finishing a basement as a legal suite is far below the cost of the unit above it, while the rent it produces is a meaningful fraction. That asymmetry is the entire economic argument, and it is what pushes a building over the coverage line at maximum program leverage.
Put plainly: the suites are not extra income on top of a deal that already worked. They are frequently what makes the deal work at all.
What has to be true
The suites have to be legal. Not "suite-ready", not roughed in, not a basement with a kitchenette. Legal, permitted, and inspected. Income from a non-conforming suite is not income a lender will underwrite, and a building financed on the assumption that four suites count is a building financed on a number that does not exist.
The design has to come first. MLI Select scores affordability, energy efficiency and accessibility, and the tier reached determines amortization and recourse. Those points are designed into a building. They are not added to a finished one. An investor who finds a project after the drawings are fixed has already lost access to the tiers that make the arithmetic work.
The affordability commitment has to be modelled as a constraint. Committing rents for longer earns more points. Those commitments are obligations registered against the building, not intentions. They belong in your exit model, not in a footnote.
The construction start date matters for the rebate. The federal purpose-built rental rebate applies where construction began after 13 September 2023 and before 2031, with substantial completion before 2036. A project that started outside that window does not qualify no matter how well it is built.
What the shape costs you
It is worth being even-handed about the trade.
Eight units on one lot means eight tenancies, eight turnovers, and eight sets of maintenance calls against one building envelope. That is more management than a fourplex and more than most investors expect from something that looks like a house.
Basement suites also rent to a different tenant profile than the units above, at different rents, with different vacancy behaviour. Modelling all eight units at a blended rate is the most common error in an 8-door pro forma, and it always flatters the result.
And the affordability commitment that earns the points is a real restriction on what you can charge, for years, enforced against the property rather than against you personally.
None of that makes the product worse. It makes it a specific instrument with specific obligations, which is different from a generically good investment.
What this does not tell you
This describes why the structure exists and what it has to satisfy. It is not advice, not an assessment of any building, and not an offer. Program parameters are set by CMHC and approved lenders and vary by file. Rebate eligibility is determined by the Canada Revenue Agency on the facts of the specific project.
Specific projects are presented by licensed representatives, not by this platform.