The Salvation Army plans to build 21 new townhouses off Mortlake Road as part of a $6.5 million project to help combat Warrnambool's housing crisis.
With the demand for social housing at "an all-time high", the Salvation Army is keen to see the townhouses built as soon as possible.
Built behind its new church and mission centre, the development includes a mix of two and three-bedroom single and double-storey units.
It will also feature a communal garden with an orchard, barbecue area and raised vegetable planters which can be accessed by residents.
Salvation Army national public relations secretary Major Bruce Harmer said it would be a good day for Warrnambool when it was built.
"I think everyone will be a winner," he said.
Major Harmer said when people had a safe and affordable place to live, other things in life started to fall into place.
"We've seen that so many times when things have begun to work out for individuals and families once they have a place to call their own," he said.
Warrnambool's Major Brett Allchin said he was excited for the opportunity to serve the community.
The former tennis centre was recently demolished to make way for the new church building and housing project.
The townhouse development includes four single-storey two-bedroom units, 10 double-storey two-bedroom units and seven double-storey three-bedroom units.
The three-bedroom units will have two-car garages while the rest will have single garages. The planning application submitted to Warrnambool City Council closes on August 25.
"The proposal seeks to contribute to Warrnambool's housing affordability in the form of community housing, enabling those less fortunate to have access to affordable housing - a basic human right," the application says.
Homelessness is a growing issue in Warrnambool with soaring rents putting pressure on lower income earners.
The Warrnambool Social Housing Planning Project 2020 identified how significant homelessness was becoming within the municipality with an estimated 1246 low-income households under rental stress, and another 149 people experiencing homelessness.
By 2036, it was estimated the municipality would need to have a total of 2812 social housing dwellings, the project says.
The Salvation Army's $5 million church building will include a main worship room, a multi-purpose room, youth hall, kitchen and interview rooms.
Additional space would allow residents to use the facility as a drop-in centre.
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