Shovels are in the ground at 726 Clement Avenue as construction begins on two, six-storey residential buildings.
The BC Government has partnered with developer PC Urban to build a pair of apartment buildings on Clement Avenue, with the province providing $39 million in interim construction financing.
The goal is to offer housing that is convenient and affordable for middle-income earners.
"It's because years of inaction that we find that too many people just can't find the kind of housing that meets their needs" said Minister of Municipal Affairs and Housing Selina Robinson.
The two buildings will host 157 units of rental housing with commercial storefronts at ground level. Rent for a one bedroom will start at $1,300 per month.
"We'd like to see as much growth as possible in our coming years in our town centres and our urban core but that's also where the land is most expensive." said Kelowna Mayor Colin Basran.
"To have projects like this… which will allow middle-income earners to be able to live in parts of town that maybe they wouldn't have otherwise been able to afford, just means that we're going to have more inclusive and diverse neighbourhoods and that's a good thing."
It's expected the project will be completed by late 2020.