A new $2.35 million housing manufacturing hub will be established in the south-west creating 50 new jobs.
The state government chipped in $800,000 towards the project on Thursday and is expected to be up and running at the Portland Airport by April next year.
Minister for regional development Harriet Shing said investment from the government had come from the Portland diversification fund.
Geelong-based manufacturer FormFlow will transform the unused Portland airport hangar into a housing manufacturing hub.
The hub will be capable of producing up to 200 relocatable houses a year not just for the Glenelg Shire but the surrounding regions.
The project will create 50 full time jobs and an estimated 150 indirect jobs, and once complete will establish a new industry for the Portland district.
The hub will have the capacity to manufacture housing for key workers and seasonal workers, as well as housing for National Disability Insurance Scheme participants, and for emergency responses.
The manufacturing hub is one of a range of initiatives the government is investing in to address workforce shortages and housing availability across south west Victoria.
This investment is drawn from the $1 million allocated from the $7.5 million Portland Diversification Fund to fast-track projects that create more housing for workers.
The Fund forms part of the $17.4 million Portland Economic Diversification Plan which supports investment to create sustainable long-term jobs growth and better opportunities for locals.
Ms Shing said housing availability was a major factor in social and economic growth across rural and regional communities. "This manufacturing hub is part of the solution," she said.
"We're delivering more homes where they're needed most and attracting more workers to Portland, to ensure the area is economically strong now and into the future."
FormFlow managing director Matthew Dingle said he might even put some of his own temporary housing near the airport to house workers for the new business.
He said the hub would manufacture one, two, three and four bedroom homes.
Dr Dingle said the houses would be built to last and were value for money.
The smallest home would be about $130,000 and a three-bedroom would be about $400,000.
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