Frances Bula header image 2

Vision rental program generates backlash, raises questions about future solutions

April 13th, 2010 · 31 Comments

It was the best kind of theatre, being at council last week when West Enders showed up to voice their concerns about the Vision council’s program to create permanent rentals, the Short Term Incentives for Rental or STIR.

Councillors tried to keep the bemusement out of their voices, but weren’t all that successful as they questioned one person after another along essentially the same lines, which was: If you’re opposed to having new rental towers built, what the heck do you think is the solution to what seem to be cyclical rental crises in the city?

Geoff Meggs was the most persistent, asking whether people think there is no rental crisis any more. (Apparently, there are some who think there is no longer a problem with rentals in the West End, in spite of the screaming for the last several years about same.)

Even Suzanne Anton, who has been critical of the STIR program from day one, pointed out quietly to one speaker — a woman who seemed to think that the solution would be to have the city subsidize rents for all the existing residents but not allow any new developments — in a low-key way that “people like it there and over time that will drive rents up.”

I’ve tried to capture some of the current debate on the STIR program in my Globe story today, but it’s a big topic with many side issues that is too big for this box.

And this council is going to have to find answers, not just for Vancouver, but for all the municipalities out there wondering what to do about what’s been a national problem for 30 years — the lack of purpose-built rental housing.

While some of the opposition was clearly unrealistic (yes! let’s ask Vancouver taxpayers to donate money so that everyone currently living in this extremely attractive area in the middle of one of the world’s most desirable cities, an area that’s walking distance to downtown, can all afford to live there at 1990 rent levels), the backlash to the city’s STIR program does raise an interesting dilemma for other cities contemplating a similar program. That dilemma: Given that the city has control over very few tools to help encourage development of rental buildings, what can they use that people are willing to accept?

They can reduce or even eliminate parking. They can reduce fees. But that’s not enough to make the investment attractive for developers, compared to condos, and all the wishing in the world won’t make it so. The main thing cities can offer is density, i.e. more space to build on a lot than what is normally allowed.

But then neighbours get unhappy about that and, as we’re hearing in the West End, they want both less density and more affordability — two parts of the equation that are at odds with each other. The current towers being proposed in the West End could be required to have defined rents that are affordable to the average renter with $38,000 in income — but the city would have to give developers more density to achieve that.

The solution that I’m hearing Brent Granby from the West End Residents Association propose — if I’ve understood correctly — is to mandate inclusionary zoning, i.e. simply tell developers that they have to build in some affordable market rentals into every project. Don’t give them any density, just make it a condition of rezoning.

But … and this is a complex issue, so I’m sure my educated friends on this blog will be jumping in to add nuance to it … it’s hard to imagine Vancouver being able to do that unless most of the other municipalities did the same. I await the pro-forma numbers to roll in.

On a related topic, people have been commenting in blogs and articles that the Vision council’s aim to create market rental is going to flop because, look, the city built its own market rental apartments over the community centre at 1 Kingsway and they’re sitting empty. Since I live near there, I’ve noticed that too. I called Jerry Evans, the associate director of real-estate services at the city, to find out what’s going on.

He says that at this point, the 98 units are about 65 per cent rented out, which is approximately what they expected at this point. Evans said that, even though the city has had a list of people waiting to get in for years (the centre was supposed to be finished two years ago, but went through incredible construction delays), it always takes about six months for a new rental building to fill up. Even people who want to move in won’t give notice where they are until a building is finished; not every newcomer to the city wants to live in the area and so on. The city started advertising the units in January, when the centre opened.

The building is renting at slightly higher rates than what’s the norm for this area, with its 60s-era walk-ups, but it’s $2 a foot, which apparently is considered reasonable for new construction in Vancouver.

For those who don’t know, this is the only building that the city has built with its own market rental apartments included. The whole concept was the brainchild of former real-estate director Brent Maitland and housing-centre director Cameron Gray, who were desperate for ways to create some market rental in the city — something that private developers abandoned in the 1970s, when the federal government took away several tax advantages connected to rental developments.

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  • Westender

    I’m confused about a couple of aspects of this story. Council was hiding its bemusement? They were bemused that residents would find a 500% increase in density on the site at 1401 Comox Street to be objectionable to neighbours? Really? And what of the references to rental housing demands as part of the 2008 election? I don’t remember calls for more rentals, or promises from Vision about providing them. I remember demands for security of tenure and protection from unreasonable rental increases. Vision offered to eliminate homelessness – not provide new rentals – there is nothing in the 2008 Vision platform that references the creation of new market rentals.

    What the heck do we think the solution is to a rental “crisis”? You mean the crisis evidenced by one of the biggest jumps in vacancies in the last 10 years? I don’t know – is it building market rental towers in Stanley Park? Would Council be surprised if there was an outcry at such a “solution?” I’m pretty sure that STIR with its wildly-varying approaches to incentives, fast-tracking, trampling of community obejctives, and undefined density bonuses is also not the solution.

    Residents, including the more than 2,500 signing the petition delivered to City Council, have not asked that development in the West End be stopped, but that existing zoning and guidelines be respected until a new community plan, or some other interim zoning measure, is in place. This is not unreasonable. Suggesting that residents have in the past been “screaming” about the creation of new rentals is demeaning to the real concerns of residents and does little to encourage respect and communication. The basic concern of most neighbours to the site at 1401 Comox Street relates to the scale and suddeness of the proposed change. The site’s existing zoning (the zoning that was produced as a result of the last community planning process in the West End) allows approximately 26,000 square feet of floor area to be built. The developer, Westbank/Peterson, has applied to increase this to approximately 130,000 square feet – an almost five-fold increase in density resulting in land value per buildable square foot of $33. This increase in density IS unreasonable and this is why neighbours are voicing their concerns. Approving the 1401 Comox project would create a building unlike any other in the West End – a bulky building inconsistent with the character of the community and one bound to degrade liveability. This is not about a 22 storey building, this is about re-establishing some level of predictability in municipal planning and restoring a community’s confidence in their civic administration. Eradicating zoning in the face of an artificial crisis is not the solution to this problem, and a suggestion that residents have somehow “changed their tune” is simply wrong.

  • mezzanine

    FYI there is a good summary of the west end in a link provided by pricetags. The following quote gives perspective on proposed changes in the west-end . plus ça change…

    “The number of building sites doubled from 1955 to 1956. It spawned an explosion of high-rise apartments, fueled by the booming economy, and while the rest of North America burst out into suburbia, the West End experienced a 50% increase in population in the 1960s.

    The new construction was tall, fast and cheap, and quickly recognized as such. Proponents cited the strong lines and clean facades as new heights in architectural design, but few saw the bland, repeated patterns as anything other than pure capitalism. The new zoning regulations affected little control over the whims of private capital, and shrewd developers realized that while the FSR limited a building’s footprint, it could still be constructed narrowly across the width of the site, thus providing and stealing as many ‘views’ as possible. The structures were declared parasites on the community – thiefs of light, air and amenity.”

    http://thedependent.ca/news/vancouverism-a-west-end-story/

  • mezzanine

    @ Westender:

    http://www.straight.com/article-113541/gimme-shelter

    “Veteran housing activist Tom Durning told the Straight that Canada is committing some of the same public-policy blunders that occurred in the United States 20 years ago, which is exacerbating the rental-housing crisis for young people. “It’s like a tsunami we’ve seen coming for 10 or 12 years, and nobody is doing anything about it,” he said.”

  • Frances Bula

    @Westender. So what I am curious about — it was unclear to me in spite of listening for a couple of hours at council and interviewing people — is what people would like the city to do to create rentals? I understand the desire for an overall plan, something that reassures the community that there will be room in the schools and community centres for the new population.

    But what are people willing to accept in exchange for getting some rental housing? From what I heard at the meeting, there are at least some West Enders who don’t think there is a rental problem at all and nothing needs to be done. It doesn’t sound as though you personally feel that way so what do you see as a better solution? Since I’m likely to write more about this, I’d like to know.

    I am not sure that saying people were “screaming” for new rentals before is demeaning. It’s a fact that the newspapers and radios of the past couple of years were filled with story after story of people extremely distressed about what they saw as a kind of attack against renters. In some cases, I have had people literally screaming at me.

    As for councillors being bemused, if you look back at what I wrote, I said they were bemused at the reception the whole program was getting. Re the Comox building — everyone keeps saying it is increasing its density five times from the current zoning. But do you really imagine that, if it had been sold to a condo developer (the likely scenario before the STIR program came along) that it would have remained at only 1.5 FSR? That was an old zoning, one unlikely to have stayed at the same level in a redevelopment. Surely it would have been increased to whatever the zoning is of buildings around there — 3 or 4? Given that, do you think people would have been okay with that — a 3 or 4-FSR condo building? (Again, I honestly don’t know what it is that people are seeing as the acceptable maximum for the area.)

  • Mark

    I’m a West Ender who has just written to council to support the proposal for 1401 Comox. To get a whole whack of new rental units without displacing/evicting any existing residents is brilliant. It would be great to have more options for rental housing in the neighbourhood – also high end rental housing. The West End’s whole appeal has to do with high densities in combination with the incredible natural setting and proximity to downtown. I keep on hearing this code language that the new building is “out of character” with the neighbourhood. I just think that’s bogus – within 2 blocks of that site there are multiple 20+ storey buildings already (of varying architectural styles), and nobody seems to mind. And all the people living in these buildings enhance our neighbourhood, not detract from it. I don’t get how anyone’s quality of life is any worse with a tower on that site rather than an ugly church, and I can see all sorts of ways in which people could benefit.

  • Shards

    -First, I was at that meeting and don’t recall any speaker asking the city to subsidize rents “for all the existing renters”.
    -Second, I think most tax payers would prefer to see their taxes go to a few low income renters, such as seniors who’ve lived in the WE for 40 years, than to subsidize wealthy developers who forgo DLC’s of $112,000.00 per unit!
    -Third, Bula is operating on the assumption that rentals can ONLY be built in the West End. There is a whole city out there and the WE is only 10 square blocks. And funny, most Westenders LIKE density. That’s why they don’t live in the suburbs. However, too much of a good thing can ruin everything.

  • From Denman to Thurlow there is one building on Comox that rises to 12 stories between Jervis and Bute. Everything else on the street is less than half that.

    It’s fortunate by the way, that there are people with deep pockets at the Shangri-La (same builder as 1401 Comox) who can deal with concerns like faulty elevators, floods, shoddy workmanship and poor finishing for a premium. Any takers?

    Of course, the pockets won’t run so deep on a rental building when say a flood happens, or one of the only two elevators for the 22 story Faux Comox Shangri-La is out of order waiting on a part. Afterall, it’s a rental building, so the owner won’t be making much of a profit or worry much about maintenance.

    No worries, they’ll get around to eventually fixing it. You’ll just have to wait your turn if you stay long enough.

    But if tall building height nearby is all you think that justifies “character” of a structure’s fit in it’s land and surrounding, then I feel sorry for anyone in the West End who thinks Henriquez Partners Architects’ Ghetto Shangri-La Chic on Comox would be a vast improvement from what they rent now.

  • Westender

    Frances, you’ve asked what people would like the city to do to create rentals and what people are willing to exchange for getting some rental housing. I can only speak for myself – not the community. The Planning Department and City Council need to engage the community to determine what is needed and how best to fulfil those needs. One of the questions worth asking is “Does the West End need more rental housing?” Over eighty per cent of the housing in the West End is already rental housing. And the more pressing question for the neighbourhood is how to re-new the aging rental housing stock – particularly those units in 1950’s three-story buildings. We have seen nothing to try to address this issue.

    As I noted in my posting, I think all West End residents recognize the concerns of renters regarding cost of housing and security of tenure, but walking the West End it is clear that availability of rental housing has changed over the last year. Almost every building has a “for rent” sign out in front of it. This change in the market is likely the basis for opinions that there is no rental crisis in the West End.

    What do I personally see as a better solution? I would like to see STIR re-examined to evaluate whether it is working as expected and to provide some reasonable “boundaries.” It doesn’t make sense that a developer on Broadway can build rental housing under the existing zoning with a relaxation of parking and a waiver of DCL’s, while a developer in the West End is requesting a 6.0 boost in density. I recognize the costs and time associated with a community visioning process and I think there is an opportunity for an “interim measure” – a revised zoning schedule or density bonusing system that can meet the objectives of renewing the neighbourhood (including new rental housing), while still allowing equity and some measure of predictability.

    I’m not sure how to post links here, but google: “Market Rental Housing in Vancouver” by the Vancouver City Planning Commission (circa 2008). This proposal included many of the same components as STIR – DCL waiver, parking relaxations – but it included a defined density bonusing system that allowed for some predictability. The current STIR approach is “wild west development” at best, and appears to allow developers to set the density they desire.

    A condition of adoption of the STIR policy was that implementation updates be provided every six months. The first of those was due December 18, 2009 but has never provided.

    You asked whether a condo building of 3 or 4 FSR would be acceptable on the Comox site. I suspect a smaller building (rental, condo, or a mix) would be more palatable to residents than the current large building, but without engaging the community I don’t know how the City can determine an appropriate density target. To date no one has provided a defensible argument for why rental housing at a density below 7.5 FSR is infeasible. The last building built in the area was a non-profit seniors’ rental building at a 2.75 FSR (corner of Broughton and Davie Street) – I suspect the neighbourhood is fine with that project, and it has fit well with the existing mix of buildings and greenspaces. In contrast I’m not aware of any existing building in the West End that approaches a 7.5 FSR.

    Your comment that zoning surely would be increased [for a condo project] to whatever the zoning is of buildings around the site highlights a communication problem the Planning Department seems to be doing little to address. The West End Policy Plan established in 1989 included a revised zoning schedule which set the maximum FSR for the middle of the West End at 1.5. There are some existing surrounding buildings that exceed this 1.5 FSR (that were pre-existing at the time), but most of them comply with the 1.5 maximum. And these buildings will be cast into shadow by the proposed building at 1401 Comox Street. If the plan and zoning are old, then update them – that’s what we pay the Planning Department to do.

    I too don’t know what people are seeing as an acceptable maximum density for the area, nor do I have a magic solution to create rental housing – but I’m pretty sure that trying to determine an acceptable maximum density by throwing random development applications out to the community for consideration is bound to consume a great deal of time and energy. There is an alternative – it’s called “community planning.”

  • Living in the West End

    What about Planners Ethics. A professional Planner’s first duty is to the Public. How did a rezoning application (CD-1) proposing an FSR increase of 500% get accepted at City Hall. This CD-1 application is in the center of the West End in the West End Valley created in 1989 as a family zone. How many other CD-1’s exist in the City where one of the adjacent streets is not a major traffic street. Our Planners are at City Hall to protect the Public from outrageous rezoning applications like this.

  • Ripley

    “If you’re opposed to having new rental towers built, what the heck do you think is the solution to what seem to be cyclical rental crises in the city?”

    This. A thousand times this.

    It always blows my mind that the people who complain most about housing prices in Vancouver are usually the same people who want to artificially limit the housing supply.

  • Keith

    The City could encourage the building of rental buildings by creating special zones for rentals only, not condominiums.
    For example all main streets could be zoned for combined retail and rental apartments.
    These zones would result in lower land prices making it more attractive and affordable to build rental units as well a lowering the cost of retail units.
    The enemy is the condo, which has elevated land prices hurting both rental housing and retail.

  • Joseph Jones

    The headline to your article in the G&M reads:

    Vancouver Council Dumbfounded Over Backlash to Rental Program

    Poor C0uncil. There was quite a flip-flop on 16 June 2009 when Council backed off immediate approval of STIR to hear a few more speakers on 18 June … and then waved the deal on through.

    Here are my opening remarks on June 16, after I forcefully denied that Council could presume that the few individuals gathered meant that they were hearing from the public, as one Councillor was claiming:

    Last night around 10:00 pm it came to my attention that the administrative report on Short Term Incentives for Rental Program would be coming to Council this morning.

    Obviously I cannot be prepared to offer very considered comment on such short notice, or even to be completely sure I have understood matters correctly. Please forgive any misunderstandings.

    If I read the proposals correctly, the City of Vancouver seems to be out to hand our City over to developers in return for some sort of additional rental housing. My only consolation is that the proposed giveaways may come to an end with 2011 in this supposedly time-limited program. And they may not, once developers get used to the new goodies.

    The tsunami has lagged the earthquake.

  • Mick

    This is yet another example of Vancouver’s addiction to discussing process rather than what they’d actually like as an end result.

    I agree there needs to be a community plan in place before making any decision, but what do these people want the ultimate result to be? More density or not?

  • Joe Just Joe

    Keiths idea of making rental zoning isn’t a bad one, you would have to control it somehow though like mentioned along aterials, otherwise if you blanket a whole neighbour there would be the preception of creating a less desirable area where no one is an owner. This isn’t to say that area would become less desirable but it certainly would be viewed as such by some. Another idea to help is to copy the metro core jobs mandate where they made min fsr requirements for commercial space in certain areas of the city, do the same for rentals across the core, say imposed a min 1.0 or 1.5 rental fsr on any new development in d/t.

  • I expect council — and city governments everywhere — will keep trying to figure out a way to generate more permanent rental housing. At a certain point NIMBYism will have to lose out to practical considerations.

    Renters help drive and support the economy of the city. Apartments are housing for skilled, educated newcomers (whether immigrants or migrants from elsewhere in Canada) who come for the jobs; for people who like density and support all the amenities that go with density whether as workers or consumers; as well as for those looking for a cost-effective and lower maintenance alternative to single family house rental.

    Right now, the economics to develop market rental housing don’t work in Vancouver. I know developer/investors who would stretch to create such a product, but just can’t find any way to break even–not lose tons of money–building an apartment complex.

    Rental-only zoning might help on certain sites to keep land costs down, but I suspect it could be too late in many places.

    The city will have to find some creative ways (offer density and/or parking relaxation and/or other assistance) to make it possible for projects to have a chance of breaking even (let alone making a modest profit).

    No private or institutional investors (like pension funds) will set forth to build an apartment building at a loss .

    If we want to keep rental affordable, in a region with a growing population, then adding supply is the only option. And doing that will take creativity and compromises from everyone involved.

  • Joe Just Joe is right that we’d want to be wary of having a large area of “rental only” zoning.

    The mix of tenure is very valuable in that it brings lots of stakeholders to a high density community. While some renters actively participate in their community, and making it better, many are transient and do not.

    Owners will more likely fight back if something is hurting the community as it affects their property values.

    Moreover, mixed tenure density supports a wider range of amenities, which in turn makes the area more walkable and nicer to live in.

    The challenge will be in how to mix up such a zoning without negatively impacting the property value of one owner’s property versus another. That’s why I wonder if it’s too late on the downtown peninsula for this, but perhaps it could still work in other neighbourhoods.

  • There are a lot of very good and thoughtful comments on this thread. But I do think we need to put a few things in perspective. At the moment there are three STIR related proosals in the West End, (one has been approved) for a total of less than 500 units. Throughout the city, there have been enquiries for no more than 2,000 potential units. Few have yet progressed beyond the enquiry stage.

    Three projects are not a lot…however I appreciate that given the relatively slow pace of development in the West End in recent years, these three projects seem like a lot. Moreover, they are coming forward as towers, although as Councillor Jang and others noted at the Planning and Environment meeting, the current West End zoning permits buildings up to 190 or 210 feet, depending on the zone.

    I listened to all the speakers at Thursday’s meeting and while I didn’t agree with those who said there’s no need for more rental housing since there are conversions taking place (Pacific Pallisades) and the vacancy rate has increased over the past year and a half, I did agree with all of the speakers who expressed concern about the high level of fear and uncertainty that the current proposals are creating.

    As one speaker said, is this just the tip of the iceberg? Will there be many more such proposals? Will the West End start to look like Yaletown?

    I think these are legitimate concerns, and it is incumbent on City staff to now organize meetings in the West End to explain what they think might happen in terms of future planning and development, within the context of the current plan, and the likelihood and timing of a new overall community plan.

    Furthermore, staff also need to explain the STIR program, since as a number of people pointed out, it is generally misunderstood by most people, not only in the neighbourhood, but also at City Hall and within the development community.

    I have been advising one of the three applicants (Beach Towers) who decided to respond to the city’s call for new rental housing. I told the owner that I thought there was a need for family rental housing…two and three bedroom units in the West End…and he agreed to include them in the proposal. I also thought it made sense to add rental housing on his large parking lot provided the plans demonstrated architectural excellence….since he was adding apartments to what is generally considered to be an iconic development. To my mind, the appropriate solution was a slender tower, similar to the existing towers on the large, unique property. The submission is now at the enquiry stage and awaiting a response from the city.

    While I have previously noted on this blog that for a while Vancouver’s rental vacancy rate has been really higher than many city officials and politicians believe, I thought it was appropriate for the city to initiate the STIR program since it could encourage a few developers to come forward with rental housing developments, which would not otherwise happen.

    Only a few have come forward, since the concessions are not really sufficient to offset the economics of rental housing and the requirement that the housing remain rental in perpetuity. I know many of you don’t believe this, but my proof is the fact that so few rezoning applications have actually moved forward.

    One of the reasons that my client decided to come forward now is that construction costs are relatively low, compared to the past few years, and that helps a project’s economics.

    Lastly, I have to smile at those people who have told me they oppose the project I am advising on because it will have the effect of increasing vacancies and lowering rents in the West End. That’s right. Some existing apartment owners are opposing the new developments (Councillor Stevenson reported at the meeting that one came to see him) since the new rental units could increase the vacancy rate and dampen rental increases in the future. One neighbourhood resident at the meeting fears that increased vacancies may result in vacant units being upgraded. Hello!

    The rental housing market, like the office market is very cyclical. While there are a lot of rental units in the West End, many are nearing the end of their useful life. The City Housing department has determined that the city needs approximately 1500 new rental units a year to replace aging buildings and accommodate increased demand. Now is a good time for the City to support new, well conceived and designed projects, provided the benefits from the approved density bonus, and any forgiveness of Community Amenity Contributions can be earned.

    Any further approvals will also have to be made within the context of improved information, communications and consultation. This has not been happening.

  • What people don’t understand is that rentals building are not built is because condos sell for more than double rental value.

    the STIR program doesn’t address the Real estate bubble in Vancouver.
    I don’t believe there is shortage of rental too: everyone walking down the street can see rental sign sprouting like mushroom after the rain on the lawns.

    STIR is bad because it subsidizes the big corporation for renting, while the average Joe will still have to pay his condo full price!

    and that is the Vancouver problem: affordability. A professional couple can’t afford to own in Vancouver, and those people have no intention to be life renter. So those productive people will bring their economic contribution elsewhere.

    That will help rent to go down in Vancouver, but at what price?

  • Lewis N. Villegas

    Voony may well be right in seeing a bubble out there. The increasing interest rates may well be the tip of the needle that will burst it, or it may be the beginning of a cycle of inflation. Hope for the former, and stay tuned.

    I am ‘a fish out of water’ here, in a high stakes financial world, but here’s what I will be looking for, Frances:

    1. Tower and Podium delivers gentrification.

    If tower and podium, or just plain tower neighbourhoods fail to deliver rentals, then what we are seeing is gentrification. Big buildings are rental-restricted as a way of managing the property.

    2. Tower and podium are not sustainable

    Toronto had a condo bubble several years ago. I am sure that a history of irrational exuberance would be found in all tower neighbourhoods where moods and fortunes run hot and cold.

    We are also being told that a unit in a tower consumes as much energy as a single family residence in the ‘burbs. Hello!

    3. Plan neighbourhoods as ‘quartiers’ with maximum build out specified in the urban code right from the get-go

    I agree with Mick, “… there needs to be a community plan in place before making any decision, but what do these people want the ultimate result to be?”

    To get my satisfaction, Mick’s statement would read as, “An urban code must be in place showing maximum build out.” The developers will appreciate the “certainty” the urban codes deliver making approvals all but a formality.

    4. Downzone to 2.5 FSR

    We can mix luxury and rental, market and non-market, by making appropriate choices in building type and ownership. Some believe that we had it right in SE False Creek.

    Human-scale, fee-simple building types require no land assembly, providing a break against land speculation. For additional incentive make the buildings self-parking. Allow the market to set parking requirements, because we will…

    5. … Add LRT

    This one’s for voony-and-friends. Take the Hastings Street Streetcar (yes, we will need one of those to turn the DTES around) and loop it from Stanley Park to Denman. Plan LRT “quartiers” as walkable places that are not auto dependant.

    6. Shift the Planning Paradigm

    If it doesn’t work, try something different. On a neighbourhood wide basis, we will build as many units at human-scale 2.5 FSR than at the tower densities. One difference is that the fee-simple product will deliver rental suites where the luxury condos do not.

    One significant difference is that rental suites will be “built-in” as mortgage helpers. Make no mistake, building in the WE will remain expensive because of the limited amount of land. And the amount of available land will remain restricted by natural boundaries that one hopes will not be extended, although we should anticipate the market pressures to do so.

  • Joe Just Joe

    Not sure where the theory that tower podiums don’t provide rentals comes from, I am personally involved with a few of them and they all have rental rates of between 50-70%. Even at the very high end of the scale over 50% of the units are rented out. This isn’t an arguement against fee simple I’m all for it, just wanted to clarify the above information.

  • Westender

    J. Just J., some of this is about security of tenure. Renting a condo provides little security to the tenant. Purpose-built rentals provide more. What’s lacking in the equation is that massive density increases are being considered without a requirement to provide some proportion of the new units as rental tenure. The project at 1304 Hornby Street is an example – it is currently under application for an increase in density from 5.0 to 12.44 FSR (it is unclear why the City is considering this increase – there is no indication on the City’s website). Why not demand that 30% of the bonus density (2.2 FSR) in this case) be in the form of purpose-built, market rental housing? That might be a more “structured” way to address rental housing supply than the current approach.

  • Joe Just Joe

    Westender, I completely agree about the security of tenure and there’s no arguement from me. I just wanted to point out that tower/podium condos do provide rentals, they might not be of the same quality but they are rentals none the less.

  • Keith

    It occured to me that the majority of rental apartments in Vancouver were built on land that was zoned for rental buildings.
    I believe condominiums became a legal entity in 1965 and were allowed to be built on the same land as apartments. There should have been separate zoning created for condominiums so as not to distort the market for rentals.
    It could be condominiums have been illegally built on land that was originally designated for rental apartments.
    I would also like to suggest all rental buildings can only be replaced by another rental building of higher density, not by a condominium.

  • A few quick responses…

    Lewis, I too think you are confusing form and tenure…As others have noted, just over 40% of all new condominium units in the downtown penninsula over the past few years have been purchased by investors and rented out. Whether it’s a tower, or tower and podium form of development is a red herring. While these units add to the rental stock, they do tend to be more expensive and there is no security of tenure.

    Keith, the land to which you refer was never ‘zoned’ for rentals. It was zoned for a particular building form, not tenure. The buildings were generally rental since condominiums had not been invented yet. However, some of the buildings that you might think are rentals are in fact co-ops!

    At the present time, in the West End and most if not all Vancouver neighbourhoods, rental units cannot be demolished to make way for condominiums unless a ‘one for one’ replacement of rental units occurs.

    As for ‘rental zones’ around the city, this has been discussed in the past. However, I would say most planners, myself included, would recommend against this, just as they would recommend against a zone for luxury units over 2,000 sq.ft., or a zone for social housing (although some citizens would like the DTES to be a social housing zone).

    One of the reason that the West End and Kerrisdale and many similar places are successful is the mix of tenures and households. I also believe the mix of building forms contribute to their success.

    But for what it’s worth, the city did introduce a sort of ‘rental zone’ in Coal Harbour in the early 90’s. It was George Puil’s brainchild…inspired in part by the then rental crisis in Kerrisdale. At the last minute, Puil proposed that the staff recommended FSR for Bayshore and the Marathon Lands be reduced, on the understanding that the developers could have the density ‘back’ if it was built out as rental units.

    In the case of Bayshore, the building at the corner of Cardero and Georgia was built, but the other ‘rental site’ remains vacant to this day.

    Now, as for the proposed rezoning at 1304 Hornby, I can tell you what Brent Toderian told Council on Thursday (referring to rezonings in general, not to this particular site). If the rezoning results in additional value to the developer, the city will expect to capture about 75% of the increased value or ‘lift’ through Community Amenity Contributions. This increase in value will usually result if the density can be used for condominiums.

    However, if the additional density is used for rental housing, or social housing or office space, there will not likely be any significant increase in value….therefore, the city will not likely receive any CAC’s. There may be ‘public benefits’, but they do not translate into CAC’s.

    I hope this is helpful.

  • Westender

    Just to add slightly, Michael, to the comment on the 1304 Hornby application, I suggested that perhaps 30% of the density increase could be defined for rental housing. While I agree that this 2.2 FSR increase would (probably) not have amenity contributions associated with it, the remaining 70% of the increase, the 5.2 FSR requested in excess of what is defined by the Downtown South Plan, would still have a land lift associated with it, and the City could achieve its 75% amenity contribution on this portion. It should not be an all or nothing game when there is a mix of rentals and condos.

  • Westender…you’re right…a mix of rental units and condominiums units could be an appropriate response…However, the first question should be, regardless of the housing tenure, is the proposed form of development and density appropriate?

    I know many people might wonder why I, a former President of the Urban Development Institute, might be worried about what the planners and public think about the form of development. Well the reality is that if too many inappropriate buildings get approved, eventually the public rebels, and nothing gets approved…even good, worthwhile projects.

    Everytime I see a bad development go up around the region I cringe, (and I have seen quite a few lately) since ultimately these developments detract from the attractiveness of the region, and contribute to anti-development sentiments.

    This is not to say the 1304 Hornby is an innapropriate development. I haven’t even seen the plans…ultimately the planning department, with input from the community must decide. But at a floor space ratio of over 12 , this is a very high density for our city.

    If this, and other projects at significantly higher developments are going to be approved, I would hope the planning department and Council will let us all know what the rules are going to be for other sites and neighbourhoods in the future. These ‘outlier’ approvals could create confusion for all.

    Let me conclude by saying I personally do not support this ‘let’s make a deal’ approach to zoning. I would prefer to see the city determine what the zoning should be for a site or portion of a neighbourhood, along with required contributions to fund new community amenities. Yes, there can be exceptions, but they should be exceptions, not the rule.

    It may seem like a good idea for the city to try and gain financially from individual rezonings, but in the long run, this system will not work….for either the developers or the neighbourhoods. But that’s another story.

  • Westender

    And on this:
    “Let me conclude by saying I personally do not support this ‘let’s make a deal’ approach to zoning. I would prefer to see the city determine what the zoning should be for a site or portion of a neighbourhood, along with required contributions to fund new community amenities.”
    We can agree. Thank you for sharing your thoughts and your experience. We can only hope that a more balanced approach will prevail.

  • Lewis N. Villegas

    Thanks for setting the podium-and-tower rental facts straight, Joe. I did not attend the public meetings, and I don’t have access to the real estate numbers for the WE, so thank you Michael for providing another insightful sketch of the industry.

    Municipalities that practice open and transparent consultation lay out these numbers up front, working under the principle that a well-informed public is the best way to move community visions forward.

    Thus, if there are rentals in the tower-and-podium, what are we to make of this strategy of building—what?—cheap towers? Towers are large buildings, and doing them on the cheap is not a good idea. Oscar Newman said as much in “Defensible Space”, where he noted that high-end towers come complete with doorman and concierge adding value to the street at the same time they provide service to their residents.

    Is it a kind of tower-myopia taking hold in our city, blinding it to all other possibilities? Is there cause-and-effect between land-lift economics and rising prices of real estate in the neighbourhoods? Are we overlooking values embodied in the conservation of historic neighbourhoods? Are we unaware of the importance of human-scale streetscapes for neighbourhood safety? How about the blight imposed on fronting, human-scale, residential properties by arterials carrying high vehicular volumes?

    For a City that presents itself as an international player in urbanism, if we subtract the miles and miles of coastline, and the stunning mountain scenery, what do we have to holler about? We will have even less, if we take these initiatives as a “Mark Twain” of where we are in understanding the need for urban reform.

  • Vanessa Carter

    I am concerned about the new development plan for 1401 Comox and other areas. There is a lack of afforable rental options for people that live in the West end. Why is the developer only offering 6 units under the STIR program for 5 years? Does the developer assume that the Seniors will get a massive living wage increase to their pensions? What will the developer charge for a one bedroom apartment? Will it be based on the average earnings of what people actually make or the artifial market “what the market will bear”. There is in fact a 1% vacanyc rate in the WestEnd…the average rent for a 1 bedroom apartment is 1175.00 per month – I would argue that the market rents are high because there is no competition. So what if location is downtown Vancouver? No 1 bedroom apartment is worth 1175.00 per month regardless of its location. The developer wants to build his condo why does he not offer half the units at rates of $800.00 per month and the other half of the units at the inflated, artifical rate that we now see in the West End. I and all of my friends are paying over 55% of NET INCOME on rent – now that the developers have gobbled up every piece of land in Yale Town – they now want to encroach on the West End. Well, the residents are not going to take it up the ass either. We have no options and to expect over 50,000 to relocate to basebents in Surrey is not realistic. If there is going to be additional development it has to be for the greater good of the community not just the rich. HOUSING IS NOT A PRIVELGE IT IS A BASIC HUMAN RIGHT.

    AND THE RIGHT TO PROFIT DOES NOT SUPERSEDE OUR RIGHT TO EXIST.

  • Westender

    Just to clarify, all of the units proposed to be built (193 of them) are proposed under the STIR program. Six of these units are proposed to be offered under BC Housing’s “SAFER” program for seniors’ housing. The SAFER program subsidizes low-income senior renters when they are in a unit that is below a certain maximum monthly rent. For a “one-person household” in Vancouver, that maximum is $700 per month.

    What this likely means for 1401 Comox Street is that the 400 square foot studio, which would normally rent for $900 per month will be subsidized by the developer down to $700 per month. BC Housing will then give the occupant a monthly cheque to help pay their $700 per month rent and the senior still spends 30% of their income on rent.

    The cost to the developer in this scenario is $200 per month, for each of the six units, for 60 months – a total of $72,000. At the end of this period, presumably granny moves to Cache Creek, and the rents on the units jump back up to whatever the market will bear. This “subsidized housing” component to the project amounts to tokenism.

  • Hi Westender and Michael,

    In response to your comments about the rezoning at 1304 Hornby Street, you are correct that the rezoning is to increase the FSR from 5.0 to 12.44.

    The increase in density is consistent with Downtown South Goals, Policies and Guidelines, and the Metro Core Jobs and Economy Land Use Plan, which encourage, through rezoning, increased density as means of accommodating public benefits. The principal public benefit being proposed by Concert is the transfer of heritage density.

    Concert received a significant amount of density (to transfer off-site) as compensation for designation and conservation of the YMCA building, located at 955 Burrard Street. In this rezoning, Concert is proposing to transfer its heritage density. The City has identified this site as a potential recipient of heritage density, and it is considered an appropriate public benefit by City staff.