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Mixing offices and condos in downtown business districts

January 26th, 2010 · 7 Comments

Vancouver has been tussling with the issue of condos in its downtown business district for a while.

There’s still a debate going on between the planning department, which is trying to preserve a strong core of office-only space and a substantial inventory of office space throughout the downtown peninsula, and developers, who have developed a lot of expertise in building condos and say that Vancouver’s office market just won’t support a lot of office-only buidlings. So they’re pushing for the right to have more office/tower combos.

Vancouver is not the only city with that issue, though it creates more angst here among those who fear we’re turning into a resort city with no real business base. Others are dealing with it, including, yes, Toronto. I have a story in the Globe’s Property Report section today that looks at the specific question of buildings that mix condos and offices in downtown districts.

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  • Tiktaalik

    I think we need downtown office space. If this keeps up we’ll have some bizarro reverse suburb where everyone downtown has to get in their cars and drive to burnaby to go to work.

    When my company was looking for 20k sq ft of office space in the downtown they were having an incredibly tough time finding it. I recall a conversation where the CEO told me there were only 4 appropriate spaces in the downtown that fit our needs.

    The argument that Vancouver’s market can’t support office space seems silly to me. Is it a build it and they’ll come problem? Vancouver won’t be able to attract companies if they have no where to locate themselves downtown.

  • Chris

    Do the micro-lofts still need to provide a minimum number of parking spots?

  • Tiktaalik, I agree that it seems odd that Vancouver developers cannot build new office space in the downtown that is economically viable. But it is a function of our higher construction costs and lower rents and yes land costs….now, the city is hoping that by eliminating residential development in the CBD and surrounding areas the land cost will drop and new office developments will be economically viable again.

    It would be nice if it was so easy. But so far, I am not aware of any new single purpose office projects coming forward. On the contrary, some of the developers I know, who were contemplating office developments as part of a mixed use project (where the residential development would ‘subsidize’ the commercial component), have essentially shelved their projects for the time being.

    I agree that many mixed use buildings did not work; but mixed use projects did work. They could share parking and other spaces, and the different components complemented one another. Furthermore, they added vitality to the city at different times of the day.

    It was for these reasons that I think we made a mistake changing our zoning, and spoke up at Council. But I am not overly concerned because in a few years I expect the zoning to be changed back! If you don’t believe me, just look at the pattern of zoning changes related to housing in the downtown over the past three decades. It has often changed.

    And count the number of new office buildings coming on stream….I suspect there will be more in Surrey than in Vancouver in the immediate future (which, by the way is something the Metro Regional Growth Strategy supports, but that is another story.)

  • Joe Just Joe

    Well we do have a couple of office proposals that are expected to see the light of day shortly. Bentall will be going ahead with 745 Thurlow later this year, and Aquillini is expected to proceed with it’s tower at GM Place late this year as well. It’s also safe to assume that there will be at least one office tower on the BC Place lands as they have 700,000sqft of commercial space to sell off. I wouldn’t worry too much about the reverse commute anytime soon, Translink stats show that it’s clearly a myth that more people leave downtown then come in.

  • MB

    Perhaps one way to partially address this issue would be to phase construction to better reflect the slow rate of rental / lease.

    Bentall 5 was purposely designed to be built in two phases, the upper five or so storeys coming a few years after the lower 20 (+/-). The top two floors of the first phase were kept vacant to accommodate construction crews and equipment when the market caught up and tenants for the upper floors were found. The lower floors were never closed for business and the contractors worked around them.

    This, of course, doesn’t address the central issue of increasing the proportion of office space (at least not at a quick pace), but it does reflects a rather unique form of adaptation to a slower office market in a building that doesn’t mix uses.

    Regarding mixed office + residential, I really don’t see the negative. It is a mirror of our regional economy which is far more diversified than, say, Calgary’s one horse petroleum paradigm. To force an exclusive single use for offices only into the CBD economic engine seems artifical and may well backfire, or as Michael pointed out, be changed back.

    Further, single uses for offices over wide swaths of a CBD does not make a vibrant community. Calgary may boast a plethora of big corporate head offices, but they still roll up the downtown sidewalks after 6:00 p.m. and on weekends. Only recently have they started a mixed use project on the eastern downtown riverfront, and it’s generating great interest. To think that this waterfront land sat derelict for over 30 years — that would be unheard of here.

  • MPM

    I have never really seen what the problem is with mixed use buildings. As mentioned in the article, they are two types of tenants that live different lives and rarely cross each others paths. What I do think is hurting downtown Vancouver is the loss of office space in variable prices.
    Years ago downtown Vancouver office space was available all around the downtown core – minus the Westend. If you look at all development in the last 10 years, we have lost full streets of office space – Seymour, Richards, Homer, south Howe st, south Hornby st, West Georgia and East Georgia, Melville, West Pender….
    Now by concentrating the downtown core within expensive fancy new office towers you never give small or medium business a chance to be near downtown for a lower rental. Downtown has become the exclusivity of Banks and Lawyers.

    Joe Just Joe: For 5 years a I travelled from the West End to Surrey for work – between 2001 – 2006. In that time I noticed a big increase in the reverse commute. Sure, Translinks stats show that downtown still receives more traffic, obviously, but the numbers for the burbs are increasing.
    I worked on 72nd in Surrey and with in that 5 years there were 6 new business parks with 4 blocks, as well as an increase in the business parks I noticed around Anaccis Island – driving hwy 91.
    I have worked in IT for over 10 years and still have never worked downtown. The business parks are increasing by leaps and bounds and soon the numbers will balance.

  • Agree with MB “CBD does not make a vibrant community”.

    Know of some people staying at hotel on Pender, for business, never walk up to Robson…and could be the same for us on a business trip in SFO, Chicago, could get with a poor impression of the city: dead one!

    mix development is good, but the lost of office space is legitimate and preserve some class A office tower only is probably wise, but what about strike a deal, by allowing redevelopment of some subject to replacement of office space somewhere else in city, like around Granville (especially Pacific # Granville, since it make a poor location for condo) but also in Entertainment district (not mixing well with Condo)

    I could strongly suggest allow mix development in CBD subject to office space replacement in some place in strong need of urban rejuvenation like DTES, or place previously mentioned