Developers Paint Bleak Picture of Vancouver's Future Under Status Quo
 

From Business in Vancouver:

Developers Paint Bleak Picture of Metro Vancouver’s Future Under Status Quo

Metro Vancouver is at a crucial fork in the road — does it become a global city, embracing change and growth, or does it continue down its current path and become a “museum city”?

At least, that was the perspective offered by a panel of real estate development leaders, speaking at a sold-out January 23 forecast event organized by the Urban Development Institute.

The key message from the panel was that the current status quo — characterized by demand-side policies, lack of collaboration between governments and the development industry, and continued demonization of housing and commercial development — would result in stunted growth and further supply and affordability problems.

Beau Jarvis, president of Wesgroup Properties, said, “If governments at all levels continue to develop policy in isolation and without truly engaging and listening to the private sector, whom they claim are their partners, we will not see the desired outcome in terms of achieving any level of affordability. If the federal government doesn’t start spending some of its billions in B.C., we won’t see those outcomes. If the province doesn’t start holding off on its demand-side measures and start implementing supply-side solutions — which was promised, by the way — we will continue to underbuild. If municipalities continue to develop policies that… undermine our ability to deliver housing, it will be the status quo.”

Jon Stovell, president and CEO of Reliance Properties, described the current situation as “a city of two tales.” He suggested there could be one outcome in which Metro Vancouver embraces change, economic expansion, physical growth, and international investment and immigration, and another in which the region stays on its current path and becomes a “museum city” where NIMBYism and protectionism is put ahead of supply and growth.

Chuck We, senior VP for Western Canada at international commercial landlord Hudson Pacific Properties, talked about the 50 million square feet of additional office space that would be needed in the City of Vancouver by 2050, largely driven by technology growth. Such a large amount of space would require 10 office building booms such as the recent boom creating five million square feet, over the next 30 years. This is a tall order, but not impossible, We told Glacier Media.

He told the 1,200-strong audience, “This wave of technology is creating unprecedented opportunity. We can either embrace it, or, if we keep moving the way we are, it will find a home somewhere else. We are ahead of the curve, but we need to stay ahead of it.” We added to Glacier Media after the event, “We need to keep the momentum going — the pace that we’re building at needs to be maintained.”

We’s cautious optimism was dashed by Stovell, who said, “There’s a real concern that we’re seeing all these tech workers coming in, and they love Vancouver and the lifestyle, but where the hell is everybody going to live? I cannot for the life of me understand why, for example, when you’ve got 7,000 or 8,000 Amazon workers coming to downtown Vancouver over the next few years, that a developer has to fight tooth and nail to get a rental building permit approved. Why can’t we build an office tower in downtown Vancouver that has a higher density with 10 storeys of rental on the top? People could take the elevator to work and not clog up the streets. There’s just such a lack of imagination.”

However, Stovell also had some words of cautious optimism, ending his opening remarks by saying, “But there is hope. [Supply advocates]’ resistance, haphazard at first, is becoming organized. A consistent chorus of the need for an extreme increase in supply is increasingly being heard on social and mainstream media, and even in some halls of government. A land use revolution is at hand. Generations of younger Metro Vancouverites are rising to demand reasonably priced housing, work spaces and recreational spaces.”

Full article here: https://biv.com/article/2020/01/deve...der-status-quo

Shortsightedness, misinformation and apathy rule in this town and province. Can't say anything else.

I mean, nothing is stopping you from lobbying against the viewcone laws for example, but here you are trying to turd polish and fearmonger to people who have no control over the matter.

Horse pucky. You have no reason to care who the hell is buying so long as your property sells.

Businesspeople doom-preaching in favour of more business, on a business website. Whodathunkit?

Meh. More boo-hooing from a group that was too used to being catered to by the BC Liberals and Vision Vancouver and now can't get over the fact they no longer have such influence on government.

I read that very differently. I read business owners pointing out that there's a market for the product they sell, and a societal interest in having that product available. They're indicating that the current regulatory regime is interfering with their ability to provide that product, to society's detriment.

We need more housing, and office space, and community support spaces (unless we somehow limit population growth in the metro region). How are we incentivising the development of that space? Telling developers that they've had it too good and can handle a harder reality certainly doesn't encourage more construction.

It's clear that some here aren't interested in hearing what developers understand as their impediments to production. How would you propose we enable the significant pace of required construction?

Alternately, how would you go about limiting population increase? We could go with the status quo of pricing out anyone who doesn't have enough money to make it here. Or we could set up a lottery system to determine who's allowed to move here and stay. We could even bias it to disfavour certain nationalities (wink wink, nudge nudge). Does that sound ok to anyone?

The more I hear some of the complaints on this forum, I suspect that people are more interested in finding someone to blame than in finding a realistic path forward. We aren't going to find a perfect path. Some developers might make some money in the process. The city may change in ways that upset some of its residents. Reality. Let's do our best to meet the needs of this amazing, growing city and the people who live here.

Unfortunately politics has invaded our housing solutions. There are many anti-capitalists that rather it all crash and burn rather than pay people to build our housing. Like Swanson, they insist that all housing should be built by the government at a loss and we should take from this magical group of rich people that have big pockets of money that can pay for everything annually. Honestly its kind of hilarious how much steam Swanson has lost since the election. She's starting to realize that the money just isn't there for a lot of her initiatives and has pulled back drastically. I really appreciate that she's learned from reviewing her proposals with city staff.

I think we should waive all sales, provincial income, foreign buyer, development fee, and property transfer taxes on developers that build condos in Vancouver as long as half the condos sell for under $500,000. I'd also want to do the same and provide a 5 year rental income tax waiver for people who purchase new condos or build apartments to rent out. I'm sure they'd go crazy over it and this would drastically improve our rental and housing situation. Paying income taxes on your rental properties decreases the income by 30%+. To waive that for 5 years makes investing in rental drastically more attractive, even if its just the provincial portion. Its insane that we block foreign buyers from apartment buildings and rental condos given that they are helping our housing situation by providing rentals to locals.

To raise money I would also support allowing "unlimited" density and height at certain areas that do not block flight paths as long as the developers pay for it. There's no reason to not allow 90+ storeys as long as they are well designed, pay the price, and do not block anything important.

These are community land trusts. In a nutshell, co-op housing.

David Suzuki has a plan for that. A stupid plan.

I wonder who employs you and gives you your moolah, or even if you make your own with a business, your comment is hypocritical at best. One more scenario: you receive a good allowance, but even that has to come from somewhere.

Having a huge population growth in Vancouver is a good thing. It helps to limit the spread of population all over the province and country, and limiting sprawl by densifying this city and the surrounding municipalities. Then we can justify all the investments on nice things like public transportation infrastructure development, the use of green technology and all the other good stuff that is better for the environment.

If David Suzuki doesn't agree with that, he is getting old.

I'm not a businessman and I would also preach the same thing. Wudyathink?

Sure, because developers are really interested in building rental housing, which is what a lot of tech workers (many on visas) would require.

As to limiting population increase, that would be the easy by voting in a federal party that would cut immigration levels. We're not growing by organic increases.

Well, the Westbank / Squamish Nation project is mostly rental, so now we know who might want to live there. And all those new rental towers just finishing in the West End on Davie Street.

We actually are growing by natural increase in Metro Vancouver. The number of deaths in the region isn't expected to exceed the number of births until the early 2030s. There is also net immigration from other provinces, so even if a federal government limited international immigration (and no credible political parties advocate for that), we'd still see population growth.

I think you have hit the nail on the head.
Although this is Canada, and not the USA, Seattle sprang to mind when I read your post, and of course the BIV article.
And you're right, certain 'options' for limiting - or encouraging - growth here would never be acceptable.:rolleyes: But Vancouver, being in Canada, is somewhat over-regulated, it seems.
Seattle, which is much more corporate friendly than Vancouver, has laxer laws (I believe) when it comes to development, and builds more of everything: more office space, more housing, (rentals there apparently wooing tenants ....) but whether the city or state has actually given legal incentives for all this is something I'd like to know more about.
Just a comparison, anyway, and I leave detailed explanations to the people in business and finance on SSP to interpret this.
But yeah, office space, affordable housing, and maybe more transportation infrastructure would help. Maybe start by tweaking the viewcones.
A thought provoking thread, this.

Developers, like most businesses, are fundamentally interested in maintaining positive cash flow. So they don't go out of business. They absolutely are interested in building rental when it's economically feasible; much of what they build does end up as rental. That's true whether under a city prescribed program or through other means.

There are things we can do to encourage the transfer of more of our current and future housing stock from owner-occupied to rental if we prefer that model of housing.

But vilifying developers and dismissing their insight into what factors limit their ability to provide new housing and office space works against the goal of supporting our city's growing population.

Do you think we should be trying to support our city's growing population?

Congratulations on being their hype man. Not that they'll ever thank you for it.

Very few people here would deny that we need more housing and a faster approval process.... that's not the same as letting developers do whatever the hell they want without regulations, consequences, or giving back to the community. Surely there's a middle ground somewhere?

I think that within Vancouver, and now Burnaby, the municipal authorities are doing pretty much anything they can within their financial limitations. The Province has spent more than the previous government, and the Feds have put some up, and talked about a lot more (but it has yet to show up in large amounts).

There are far more effective models at delivering enough affordable housing, but they're more socialist than would generally be accepted here. For example, Vienna is almost always 'the most liveable city in the world' these days. The City of Vienna municipality owns or controls over 400,000 dwellings - nearly half the city's stock, and leases it at between 20 and 25% of household income. Residents are never required to move out, even if household income levels increase in the following years. They build on average an additional 5,000 units a year, mostly with private sector partners who have to allow the city to rent half of the new apartments to lower-income residents. (The average building in Vienna is 3 storeys).

Berlin is taking even more direct control. 85 percent of its population rents, and rules limit rent increases and make it impossible for landlords to evict tenants who pay their rent on time. Rents are half of what they are in London and Paris, and the German capital is due to implement a five-year, across-the-board rent freeze in March. The downside is that is expected to deter development, so creating a greater housing shortage than already exists - so that's not going to come without new problems.

Absolutely, there's a lot of space in the middle. That's where we should be talking. The article that started this thread presents a great opportunity to start to hear what regulatory issues are causing the greatest harm in slowing development. We don't have to give developers everything they ask for, and we probably shouldn't. But we do ourselves and the city a disservice to dismiss what developers can provide in terms of insider knowledge. We can learn something here.

Personally I think we should not allow poor public feedback to cancel affordable rental projects as long as they follow the rules. Public feedback should be design changes at most. Also we should remove the FBT tax on rental developments. Maybe allow easier tenant eviction (3 months notice, next tenant must pay same rent) so we can kickout the criminals and bad tenants faster? And allow extra rent increases if property tax rises faster than inflation plus 1-2 months as the deposit.