First of a series
It's a mild Lower Mainland winter day. A light drizzle is falling as Don Coulter stands in front of piles of rebar and a construction tower crane, which pokes high into the sky.
The site, located near the end of the SkyTrain line at King George Boulevard and Fraser Highway in Surrey, will be Coast Capital Savings' new 180,000-square-foot headquarters and will house 700 employees when completed.
The credit union chose the location over 35 others throughout Metro Vancouver. It wanted to keep its administrative operations in Surrey, but there was another huge plus to this particular location.
"Being in close proximity to transit facilities … was a real pivotal factor in where we decided to go," Coulter, Coast Capital's chief financial officer, told Business in Vancouver.
He said shorter commute times will improve the quality of life for his company's employees, many of whom have young families (the new building will include a daycare).
"It helps our brand and gets the word out that Coast is a great place to work for even more reasons than it already is."
Coulter added that a Surrey light-rail system would make it even easier for employees to get to work.
But Surrey's rapid transit dreams, as well as Vancouver's pet project – a subway line along the UBC-Broadway corridor – are on hold as the province and Metro Vancouver municipalities continue to wrangle over transit funding.
Over the past three years, the province has rejected several proposals from the region's mayors, including a vehicle levy and fare increase.
A transit funding referendum promised by Premier Christy Clark during the 2013 election is now rolling full steam ahead, over the objections of the region's mayors, who warn that a "No" vote could spell economic disaster for the region.
Home to more than half of B.C.'s population and two-thirds of the province's service sector, the Lower Mainland is a vital economic hub. And while federal and provincial governments have invested billions in expanding ports and highways to build an economic gateway to Asia, relatively less money has been spent on improving the transportation network for the region's economic engine: its workers.
The political wrangling over funding transit improvements has come at a cost to the region's economy.
A recent study by Jonathan Arnold completed at the Business Council of BC, estimates that the economy is losing between $1.65 billion and $2.25 billion a year due to wasted fuel, increased greenhouse gas emissions and lost time and productivity because of the region's congested roads.
Hit hardest by the economic consequences has been the region's trucking industry, which transports 90% of all food and consumer goods traded in Metro Vancouver. According to a BC Trucking Association (BCTA) study, truckers have had to spend 30% more time to complete each trip. That has cost the economy $750 million a year.
But every sector of the economy suffers, from professionals losing productivity by getting stuck in traffic to exporters who face lower profit margins as goods delivery is slowed on crowded roads. Arnold also noted that congestion reduces long-term employment. A 10% reduction in congestion could boost job growth by as much as 4%.
Political hyperbole aside, at some point, more transit will be needed because of the region's continued population growth. Metro Vancouver expects another 1.4 million people to be living in the Lower Mainland by 2041. That would put another 700,000 cars on local roads. At the same time, B.C.'s status as Canada's trade gateway will also have expanded. According to a 2005 BCTA projection, Pacific Gateway trade is expected to result in 800,000 to 1.3 million more container truck trips in the region by 2030.
The provincial and federal governments have spent billions in the region expanding Metro Vancouver's road network in part to alleviate the congestion. The new $3.3 billion Port Mann Bridge and Highway 1 improvement project, for example, has eliminated, for now, a major transportation choke point and improved transit service between Langley and Coquitlam. The $1.3 billion South Fraser Perimeter Road, meanwhile, has created a new trucking route that directly connects Roberts Bank Deltaport to Canadian National's intermodal terminal near the Trans-Canada Highway's 176 Street exit. (See "Key link in B.C.'s Pacific Gateway set to open" – BIV issue 1258; December 3-9, 2013.) But as the region's population growth shifts to south of the Fraser River, more transit will be needed outside the traditional urban centre in Vancouver to relieve congestion in the region's fastest-growing communities.
"The movement of people and goods is absolutely key to the expansion of economic development," said Surrey's mayor, Dianne Watts.
She added that infrastructure is already stretched thin in her municipality.
"You don't service [the population south of the] Fraser with four stops of rapid transit that was undertaken in the late '80s."
Surrey faces two key major transportation challenges: it's in the path of a major trucking route from the United States, and its population is growing rapidly. Approximately 48% of Metro Vancouver's growth is projected to be centred south of the Fraser.
The municipality is also trying to transform itself from sprawling suburb to bona fide city, with local, high-paying jobs that make it possible for residents to work where they live. According to the 2011 National Household Survey, 45% of Surrey residents work within the city limits with only 13% commuting to Vancouver.
"Within Innovation Boulevard, which is about one square mile, we've got 180 health-related businesses, four universities, a regional hospital, a cancer centre, a diabetes centre," Watts said.
Michael Heeney, principal at Bing Thom Architects, noted that the centre of gravity of the region's population has migrated east over the past 50 years.
"Back in the '60s, the centre point of the population was on the East Vancouver-Burnaby border. Today, it's in New Westminster, and it won't be long for it to hop the river and settle where Surrey City Centre is."
While Vancouver-area politicians argue for expanded transit along the Broadway corridor, Heeney said some of the biggest gains in reducing congestion and improving the region's livability could come from realizing Surrey's light-rail plans.
"Both are really important. But you have to look at where the growth is, too. That has got to be Surrey, and right now, they don't have alternatives. There are alternatives [to driving] to UBC. But there is a lot of Surrey that is, frankly, so poorly serviced by transit that you're forced to drive a car."
A world-class transit system is key to realizing British Columbia's economic potential, said Michael Goldberg, a former dean of the University of British Columbia's (UBC) Sauder School of Business.
"If you're a regional headquarters, you have all these people coming in to do business with you, whether it's finance or you need lawyers or accountants, or, in mining, engineers or geologists," Goldberg said.
"You don't want to send these very expensive people to a place and then have them sit in traffic."
Goldberg also ties B.C.'s resource-heavy north with the urban south, where much of the support work for those industries gets done.
"All of what [Christy Clark] wants to do in the north needs a really, really well-functioning Metro Vancouver," he said.
Goldberg pointed to Surrey as an example of a fast-growing region that has recently seen a "staggering" amount of both office and residential development around transit stations.
Patrick Condon, a professor at UBC's School of Architecture and Landscape Architecture, agreed that Surrey demonstrates the "multiplier effect" of transit infrastructure with developments like Surrey City Centre, which includes a mall, hotel and residential buildings.
"Transit has a way of concentrating investment in one area, certainly around the line or around stations, in a way that car infrastructure does not," Condon said. "Car infrastructure has the opposite consequence: it tends to broadly spread its advantage across large landscapes because that's the nature of the car."
Light rail in Surrey would promote densification in the city, but Heeney said it would also create new opportunities for local businesses to grow and tap new clientele.
But businesses shouldn't assume that just because transit gets built, they will automatically benefit. Businesses and city planners will need to carefully design their transit-oriented developments to ensure that they become a key neighbourhood hub.
"When the SkyTrain first went in around what is now Central City, they thought it would be a panacea and they would be able to get all these customers that would be coming on SkyTrain," Heeney said. "But in fact, it backfired, because a lot of customers they used to get went to Metrotown. That's changed now, and they're growing by leaps and bounds, because of the university and the tower. But you have to be looking at the positive and negative effect.
"But I think [light rail] is only going to be positive, because what you are doing is leveraging SkyTrain all that more effectively."
Read the rest of BIV's series on transit and the economy:
Transit mired in money trouble
TransLink can't keep up with demand, but the B.C. government and municipalities have ruled out new funding to put the system back on the track
Transit at the crossroads
While major infrastructure projects catering to automobiles get the go-ahead, politicians have shunted funding of buses and trains to the slow track
Bus stops versus transit metro mega-projects starts
Region faces choice: grand plans or down-to-earth service improvements?
