I think many of you saw this fun piece by Ian Young at the South China Morning Post about the interesting doings with two Nelson Street properties, purchased by Bruno and Peter Wall just two years ago and recently sold for $68 million to a new player in town, Gao Shan.
Ian’s style can be very entertaining and swashbuckling — reminds me of the style of William Randolph Hearst’s reporters at the New York Journal in the rambunctious days of early commercial journalism. And kudos to him for getting hold of the new buyer and also interviewing the Walls’ sad-sounding architect about the building design he created for them, which now looks to many as though it was just window-dressing prior to a sale.
But I was hoping that in the Twitter/blog discussion elsewhere that a couple of questions would be answered, but that hasn’t happened, so I’ll put them here.
What really is the role of Suncom in all of this? This is the company that was advertising “crowdfunding” opportunities for both the Molson Brewery site and these Nelson Street sites on social media a few months ago, which various reporters wrote about. Yet the Molson Brewery site ended up in the hands of Concord Pacific and it looks as though it went straight from Molson to Concord with no intermediary, in spite of whatever Suncom was advertising.
With the Nelson Street sites, Julia Lau, who has been with Suncom in the past but it’s unclear what her role is now, also appeared to be soliciting investors, as I wrote in a story a couple of months ago. Some sharp-eyed people got screen grabs of her Facebook posts saying the following.
Julia Lau –
“The new project we just bought is 1065 Nelson St., Vancouver. Located at Burrard Corridor Area “E”. lot size is 17,292sf ( 130 x132 ), two appointments building with 50 units. Net income is $470,000/year. The SFR is 2.75 now but potentially could be up to 24.3. It could built up to 58 floors new apartment building potentially. Whoever want to invest has to prepare the deposit with bank draft tomorrow. The shares will be sold out on Monday.
The previous project we bought with $103 million at 14140 Triangle Road, 14300 Entertainment Blvd, and 14111 Entertainment Blvd Richmond on May 22, 2015, the shares were sold out in one week.
The $30 million projects at 5826 & 5860 Tisdall St Vancouver’s shares were sold out in one day on Feb 21, 2015.”
“The $60 million dollars project at 1065 Nelson St Vancouver’s shares sold out in two hours! Thank you very much.”
So Lau’s posts claimed that the project sold out. But did it? We have no evidence that anyone invested. Lau hasn’t returned calls to anyone in a while and no investor has ever appeared to talk about what a good investment she or he made.
What is that land really worth? There are two apartment buildings, one at 1059 Nelson, the other at 1075 Nelson. The Walls bought the two in February 2014 for $16 million, though the 2015 assessment put the value at only about $14 million for the two. Gao Shan bought for $68 million, which makes it look as though he paid stupid money and the Walls made out like bandits.
However, since the time the Walls bought and now, the city passed the West End plan. That plan envisions much taller towers being allowed in the block next to Burrard, i.e. right where those two apartment buildings are. (Actually, my question 3 is, what did the Walls know when they bought those apartments back in February 2014, before the West End plan was passed.) Note: My mistake. The West End plan was passed in November 2013, as per CityHallWatch note. But I do wonder if the sites were optioned before. Their purchase price seems low, as though the owner didn’t know about potential rezonings.
Developer Bosa recently bought out all the condo owners of a building nearby (1060 Barclay) for double the assessed value on their units, precisely because of the additional density the West End plan will allow. There were 56 units in the building. One unit that I looked up had been bought by Bosa for $608,000 when it was only assessed at $354,000. If you multiply 56 times $608,000, it comes out to around $34 million. And some units may very well have been worth more. Note: David Taylor says Bosa bought 1070 Barclay, next to 1060, for $59 million. Also in the rezoning zone.
So developers are clearly willing to pay extra in that area, based on their expectation that the city is going to allow much high density in that block between Burrard and Thurlow. The Walls had proposed a 60-storey tower in their pre-application open house.
But I don’t know enough about the potential for that site and the buildable square feet that might be allowed to know what that $68 million will work out to on a per-square-foot basis.
The city also does require that 25 per cent of the units on that site be for social housing, which is definitely going to cut into the profits. And, from what I understand, the buyer has already made a couple of clumsy moves at city hall. I can’t imagine this process is going to go smoothly for him.
I look forward to your analysis.
April 21st, 2016 · 1 Comment
A nice visual look at transit use in Vancouver, compliments of a group called the 10 and 3, who sent this to me.
A Heat Map of Public Transit Use in Vancouver
By Arik Motskin and Zack Gallinger
Vancouver was relatively late to the game in Canada when it came to building a modern rapid transit system, opening its first Expo line in 1985, many decades after Canada’s first subway came online under Toronto’s Yonge Street in 1954. And while Vancouver’s efficient SkyTrain system maintains relatively modest ridership numbers compared to its counterparts in Toronto and Montreal, talks of expansion to serve the ever-growing transit needs of this bustling city are continually being put forward.
As with our earlier transit heat map of Toronto, we wanted to take a high level view of the system and examine where residents in Greater Vancouver rely on public transit the most. Using data from the 2011 National Household Survey, we sliced up the Vancouver area into census tracts, and mapped what percentage of employed residents in each area use public transit as their main mode of transport to get between home and work.
Not surprisingly, some of the highest usage areas are along the Expo line, Skytrain’s very first line built for Expo 86. A significant amount of high density housing has been constructed along the line since then, which has translated to a notable reliance on public transit in those areas, including the area around Metrotown Station, which has the city’s highest usage (52.2%).
The Millennium and Canada lines were built far more recently, and the data suggests residents along those routes tend to rely somewhat less on public transit for their daily commutes. A notable exception is in the area near the Lougheed Town Centre, which was built up even before the SkyTrain arrived in the 2000s. Here, upwards of 37% of residents take public transit to work.
As we observed in Toronto, residents of certain wealthy areas tend to rely less on public transit, even when in relatively close proximity to stations. Shaughnessy, which was recently declared the most expensive housing market in the country, exhibits remarkably low usage (11.5%).
Statistics Canada collects public transit usage data for employed residents over the age of 15. Public transit must be a resident’s main mode of transport to travel between home and work to count, as opposed to walking, cycling, driving, etc. Census tracts represent the most granular slicing of a city that Statistics Canada looks at, and typically represents an area with between 2,500 and 8,000 residents.
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The good folks at city hall are probably wishing someone had started the idea of an affordable home-ownership program 10 years ago, when prices were way more reasonable.
At any rate, they’re going to try now by getting units in new development projects through developer community-amenity contributions and then selling them to people at below-market prices, while retaining a share of the equity.
I’ll be counting the seconds until this all unrolls. Very difficult to work out. First, the province has to change legislation. Then, the city has to hold a consultation on how this will work. Who gets first dibs on these units, once people have met the income/residency/job-in-Vancouver requirements? A lottery? Or will some types of employees get bumped up the list?
And then there’s working out the financials and legals with the developer and the buyers.
All this and more is what other cities have gone through so it’s not impossible. The city’s comprehensive report outlines the efforts in places like Calgary, San Francisco, Boston and more.
Local housing experts say the program is worth a try, but will likely only be able to serve a small slice of the city’s anxious residents. They’ll need to make enough money to pay the mortgage on what will be, even with the discount, an expensive condo, but not make enough money to just plunge into the market on their own.
This arrived in an email and I’m passing it on as a PSA
Vancouver, B.C. – The housing crisis leads the headlines, but there’s more to the story than foreign investment from mainland China entering the real estate market. A new independent film series called Crisis in the Greenest City is set to go deeper into the story, engaging communities facing evictions, displacement and destabilization.
Eliot Galan, founder of Collectivista Media, states, “While we recognize that foreign wealth migration has rippling effects in the housing market, we assert that there are bigger factors causing the affordability crisis: a deregulated housing market, disparity between rising rents and stagnant incomes, and gentrification of lower and middle-income neighbourhoods, to name a few. Given that the media has focused almost exclusively on foreign wealth and speculation, our goal is to fill the gap in the story, and shed light on what’s really happening on the frontlines of the housing crisis.”
Collectivista is asking for community members to vote on Storyhive so this film series can become a reality. People can vote at tinyurl.com/crisisfilm once a day until April 24. If successful, the film series will be produced and distributed publicly this summer.
It’s amazing how much interest there has been in Vancouver’s beer factory at the south end of the Burrard Bridge.
Ever since Molson announced it was being sold, there’s been speculation about the buyer and the price and the future.
It’s not the first time Vancouver’s west side has gone through this. For you youngsters, the decision to close the Carling O’Keefe brewery at Arbutus and 12th in the early 1990s resulted in one of the most exhausting brawls in the history of the planning department, as residents resisted any form of development that they thought wouldn’t fit in with the primarily residential neighbourhood.
It’s going to be just as tough this time, as the whole region is focused on trying to preserve industrial land, whatever that means on a piece of land in the middle of one of the more expensive cities on the continent.
Here’s the story about the news that Concord Pacific bought the land, with plans for some kind of “sustainable mixed-use development” and my follow-up on what councillors and urban-land specialists think should or will happen.
It’s more than a full-time job trying to keep up with the way behaviour in the real-estate market is morphing these days.
The latest: Buyers possibly being asked to sign forms saying they understand the dangers of making no-subject offers.
(One of my Twitter commenters already noted that this makes it sound as though it’s the buyers pushing this, when, he said, it’s the realtors. That’s a good point.)
This news release from the city, asking for suggestions for locations for bike-share docks, seems like fertile ground for fun. I do know other cities have had some mini-wars over the location of docks. Personally, I am lobbying for one directly in front of my house. I know others won’t feel the same.
Suggest a station site for public bike share
Anyone who lives, works or plays in and around downtown Vancouver is invited to suggest a station site for Vancouver’s new public bike share system.
“Public bike share will be a big boost for Vancouver’s active transportation system,” said Mayor Gregor Robertson. “This is a great opportunity for people to have their say for where bikes are most needed for short trips and to help us fill the gaps in our existing network.”
The launch of the public bike share system this summer will include 1,000 bicycles and 100 stations. An additional 500 bikes and 50 stations will be added by the end of summer 2016. The initial service area will include the Downtown Peninsula, bounded by Arbutus Street, 16th Avenue and Main Street.
Public bike share stations will be located at popular destinations near where people work, study, shop, dine and play. Stations will be spaced every two to three blocks on streets, sidewalks, plazas, parks and private property within the service area.
“We are actively inviting input from Vancouver residents and commuters on station sites,” said Mia Kohout, General Manager of Vancouver Bike Share Inc, the Vancouver subsidiary of CycleHop. “People can simply go to vancouverbikeshare.ca and pin a location on the map to make their suggestions.”
People can also suggest a public bike share station site using the City’s VanConnect app – look for Cycling in Vancouver/Suggest a Location.
Businesses or property owners wishing to request a station on their property can email CycleHop directly at firstname.lastname@example.org<mailto:email@example.com>.
Vancouver’s public bike share system will be the largest smart bike fleet in North America, featuring ‘a brain on the bike’ that allows users to unlock and activate easily and quickly. This allows for increased flexibility of station configuration and placement; stations can also be easily relocated in response to demand.
The City announced in February that CycleHop, a privately-owned company, had been selected to operate a public bike share system that is expected to roll out in downtown Vancouver starting summer 2016.
Overall, the City has seen a continued year-over-year increase in the use of its bike lanes as more residents adapt to cycling, in part due to infrastructure built for people of all ages and abilities. The majority of trips in Vancouver are now taken by foot, bike, or public transit. To view monthly stats visit: http://vancouver.ca/files/cov/Bike-lane-stats-by-month.pdf.
Vancouver is gearing up this week to deal with Airbnb, with Councillor Geoff Meggs spearheading a motion to have staff get more aggressive about getting information from the company and about getting information on the impacts.
It’s a popular move for many. Landlords, strata councils, neighbours, housing advocates and more are all worried about the impact of having all residential areas turning into scattered hotel sites.
But there are also local Airbnb hosts who are worried about an impending crackdown, saying that what they’re doing doesn’t take away renter housing and that it adds life and a financial benefit to their communities. Those who only rent a spare bedroom or who only rent out their places while they are out of town especially feel strongly that they are providing a benefit that doesn’t take away from the local housing stock.
Their story here.
Vancouver’s Mount Pleasant industrial area is undergoing a profound transformation.
For years, the old steel-plating, gadget-manufacturing, and garment-producing businesses had been leaving slowly.
But that speeded up three years ago when two things happened. Hootsuite, the city’s bigfoot digital company, moved into a building in the area. (It was a building zoned for office use, at 8th and Quebec, across the street from the conventional industrial zone.)
And the city tweaked the zoning to allow some office uses, as long as one floor of a building was retained for industrial.
Tech companies started to flood in and prices went up.
My story last weekend looked at the changes and the struggle going on in the city, and the region, to figure out what industrial actually means these days and how to keep office users looking for cheap space from invading.
In Vancouver, where council is particularly anxious to foster a tech industry, the debate is even more pointed.
So interesting to see how the ground is shifting on this issue of Airbnb.
When I first wrote about the phenomenon in Vancouver four years ago (inspired by rumblings of dissatisfaction I’d been hearing in other cities), there didn’t seem to be a lot of concern.
The bed-and-breakfast people weren’t so happy, but the hotel association was staying out of the fight and it didn’t seem to be on a lot of people’s radar. My main problem with the story was finding an Airbnber to talk to me, I presume since many of them are breaking several kinds of bylaws or strata rules or CRA reporting requirements.
Fast forward, and we get to this week, where council is now pushing hard to get maximum information in order to figure out what to do. The number of listings in Vancouver has increased to almost 5,000.
It’s not just this council that’s worried. Others are too, along with landlords (I talked to an apartment manager in my story whose sign in front of the building specifies “No Airbnb) and strata councils, which have been rapidly moving to create new bylaws that prohibit Airbnb rentals.
At the same time, it’s not a black and white issue. I, like many in this city, have used Airbnb elsewhere because of the chance it gives to feel like you’re living in a real apartment in a regular neighbourhood. I try hard to stay at places that don’t appear to be set up as permanent hotels. I’m not always successful, but I do try. My best experience was a gorgeous place in Lyon I rented from a flight attendant who was in Iceland during our four days there.
I’ve also been contacted, since I wrote the story, about people who say they’re concerned that there will be a crackdown on the kind of Airbnb rentals they do that they believe help provide needed spaces for visitors, but don’t take away long-term housing — people who rent out a spare room or who rent out their whole places if they are away for a few weeks or months on vacation or business.
I understand there’s been divided opinion at the city’s rental advisory committee, because some representatives there say it helps renters if they can have someone stay a few nights a month to help them make the rent.
And a UBC student has also written about the issue of people who are renting out a spare room.
On the other hand, there are indeed whole units being lost to the “hotel” market. I wrote about last year about a couple who said they decided to Airbnb their basement because the tenant was moving out. I later heard from the tenant that she’d been told they were planning to do that, so she decided to leave without a fight.
That’s a problem when, as anyone looking for rentals these days knows, it’s a near-zero vacancy rate and there are 100 applications for any available unit that isn’t a slum.