City to protect industrial space; corporate housing sector strong

Heritage moment

Railtown features prominently on the Strathcona Business Improvement Association site, providing the background image for its “Made in Strahcona” campaign page.

The campaign was launched in 2014. It aims to celebrate Strathcona as “Vancouver’s manufacturing hot spot” and an entrepreneurial community where independent businesses thrive. With ventures such as Postmark Brewing and Vancouver Urban Winery, Bensen Manufacturing Inc., Herschel Supply Co. and Union Wood Co. the area has found its groove as a gritty yet vibrant part of the city.

Sitting adjacent to the port, Railtown has the retro-industrial feel that once attracted software companies to Yaletown and the mid-century spaces of Mount Pleasant. Hootsuite Media Inc. started here, after all, before expanding into Mount Pleasant.

This week, the city – amid opposition from the tech sector – will decide on whether to accept a staff proposal to reinforce the industrial status of Railtown’s 15.5 acres with a special I-4 “historic industrial” zoning. Software development is specifically excluded, as are gas stations.

A staff report indicates that while Yaletown and other industrial areas were rezoned to permit office and residential uses, “Railtown was maintained as an industrial area, enabling the industrial economy to continue to thrive up to today.”

Conscious of the region’s loss of industrial space, the thriving tech sector in other parts of the city, and the need to support a diverse economy, staff recommend the new I-4 zoning to “stabilise land value and discourage land speculation.” It will also reinforce the buffer between heavier port uses and lighter commercial activities to the west and south.

Opponents say the city’s stance plays fast and loose with reality, however.

“Railtown’s infrastructure was built in the early 20th century and is no longer suitable for industrial manufacturing,” say the techies, led by Steven Fast of Paradigm Group Commercial Real Estate Services.

While kegged beverage and distribution company FreshTap Logistics Inc., birthed off Vancouver Urban Winery, moved to Vernon Street when it needed to expand, its growth gives the lie to the tech sector’s concerns. While a modicum of office space will still be available to tech firms, the growth of certain industry users here underscores the area’s viability and the possibilities of industrial space near the city core.

Corporate strength

The lodging business in B.C. is enjoying boom times, with the hotel business having completed a second year of robust growth and strong occupancies. The corporate housing sector is echoing the success with strong growth of its own.

Corporate housing typically accommodates workers temporarily in the city, often for tech projects or film shoots. Insurers also send clients displaced by fire, flood or other calamities here for short-term stays. In 2016, the average length of stay at corporate housing units in Vancouver was 64 days, according to the annual report from the Corporate Housing Providers Association of Indianapolis.

The study notes that the stock of corporate housing units now stands at 576, its highest level since 834 units were logged in 2013. The average daily rate for rooms last year was $162, the most in the study’s seven-year consideration of Vancouver. The average rate was up 8.7% from 2015.

This was stronger growth than for hotel lodging in Vancouver, which market research firm STR Inc. pegs at 7.8% in 2016. Hotels across Vancouver, both downtown and suburban properties, fetched a premium however, commanding an average daily rate of $175.

AirBnB units, for the sake of comparison, rent for an average of $168 a night in Metro Vancouver, according to figures presented at the Western Canadian Lodging Conference last fall. Business and conference visitors, however, account for just 11% of AirBnB rentals.