Auckland City Mission will get a $27 million boost from the government to help it build and run a new social housing complex, the Prime Minister has announced.
Construction on the 80-unit complex, which will be on the mission's existing central city site, is due to start next year.
It is expected to be completed by mid-2020.
The project will provide permanent accommodation for rough sleepers and vulnerable Aucklanders, as well as other support services.
Auckland City Mission's Chris Farrelly said the need was critical.
"This year, through Housing First, we've housed 30 of our most chronic, long-term homeless people who are sleeping on Auckland streets. There's another couple of hundred [but] we just don't have the housing supply. That's the problem, we do not have these units available, so it is critical, thus the speed."
Mr English said it would be one of the biggest social housing projects outside of Housing New Zealand.
"The whole aim of this is the City Mission will have a substantial asset, it will be a sustainable organisation, and it will have the capacity to innovate and to try out its own ways of dealing with the tenants in a way that is going to change their lives."
The government-backed Housing First programme, which helps more rough sleepers off the streets, will also be expanded to include Christchurch, Tauranga, and Wellington.
The programme started in Hamilton and has been operating in Auckland for almost six months.
As well as dealing with the immediate need for housing, the programme also provided wraparound services to tackle issues around mental health and addiction that could lead to homelessness.
Social Housing Minister Amy Adams said the government set aside $16.5 million in this year's budget to grow the scheme.
In addition to the new locations, there will also be more 100 more places available in Auckland.
But Labour leader Jacinda Ardern said the government's announcements had come too late.
While the extra beds were welcome, the government had plenty of time to act before now, she said.
"I would have had more appreciation if they'd done this earlier, we're three weeks out from an election, those people who are rough sleeping, those people who are at Te Puea Marae or living in a motel, they needed a house years ago."