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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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