Political meddling stalls development as housing starts decline

Housing knock

What former city planner Nathan Edelson called “the long night of the Beedie Living Dead” continued into Halloween last week as approximately 120 people registered to speak at a Vancouver development permit board hearing for 105 Keefer Street (95 actually spoke).

Political, cultural and social concerns, not to mention angst about the 111 residential units Beedie Development Group should build as part of its current proposal – whose compliance with the letter of civic development policies after years of discussion would normally warrant a rubber stamp – all featured as opponent after opponent spoke.

Opposition to the project stands in stark contrast to cries on all sides for more housing, an issue that knocked Vancouver out of the top spot in the new Emerging Trends in Real Estate report PwC prepares each year for the Urban Land Institute.

The report ranks Vancouver the top market in Canada for investment and development, but second to Toronto in terms of housing – a factor that bumps it into second place in the overall tally.

“A common refrain from interviewees is that governments should stop trying to interfere in the market and turn their attention to other more important issues, such as the impact of regulations and processes that are limiting land supplies,” the report notes, adding that the issue is becoming entrenched. “This echoes our findings from last year’s report, in which many stated their belief that provincial land use policies and local government approvals are factors holding back the supply of available land for development.”

Speaking to the Urban Development Institute (UDI) last month, market analyst Michael Ferreira, principal of Urban Analytics Inc., said political meddling of all stripes has to take a back seat to creating housing.

Metro Vancouver housing starts are set to decline 8% to 16% in 2018 to as little as 21,135 units, Canada Mortgage and Housing Corp. estimates. Ferreira said curbing demand without facilitating construction won’t solve the issue.

A development permit board member remarked at last week’s hearing that developers need certainty, to the chagrin of 105 Keefer opponents.

It’s the sort of scenario that Ferreira said won’t address the housing everyone wants.

“Some of this frustration I’m hearing in the market … could lead to our political leaders deciding that they want to bring in a policy,” he told UDI. “We’re a little concerned with what we might see.”

Transit stop

Vancouver’s vibrancy and safety because of the activities it hosts at all hours of the day and night were tipped at the recent launch of Vancouver Centre 2. However, it’s no 24-hour city, according to PwC, which ranks it among the world’s “18-hour cities” in its annual review of market trends for the Urban Land Institute.

Toronto is Canada’s only 24-hour city, thanks in part to investment in transit. Indeed, a chart in the report shows that Vancouver is the only major centre in Canada without a transit project among Canada’s top 100 infrastructure initiatives.

Yet transit lines are attractive to both commercial and residential developers, as the recent sale of the 4.9-acre Alderbridge lands along the Canada rapid transit line opposite Lansdowne Centre in Richmond shows.

Vancouver-based South Street Development Group acquired the property for $113 million from UEM Sunrise Berhad. Sunrise acquired it in April 2014 for $69 million. The on-transit investment was on the money, and South Street – no stranger to Richmond housing – will undertake development while UEM refocuses on its Asia holdings.

Avison Young principal Bal Atwal, who represented UEM Sunrise, said the site is particularly notable because of its frontage. While UEM previously developed Quintet, a 615-unit development two blocks south on Minoru Boulevard, the Alderbridge site features three times the frontage on No. 3 Road of any other site in the corridor (aside from the massive Richmond Centre and Lansdowne Centre sites).

“This would be the most significant,” he said. •