The Butterfly | 178.6m | 57Fl | Completed

[s211]

Originally Posted by Anorak

Well if you don't mind, I'd like to know how much knowledge of economics you have that puts you in a position to be so condescending. Being dismissive and acting like you know better than everyone isn't a way to have a proper discussion.

Hmmmm.... how does a degree in urban land economics and almost 30 years of real market experience sound? Well, that's me.

Instead, your post had all the real life market understanding of a rather cloistered left-wing "economist".

[LeftCoaster]

Originally Posted by Anorak

Well if you don't mind, I'd like to know how much knowledge of economics you have that puts you in a position to be so condescending. Being dismissive and acting like you know better than everyone isn't a way to have a proper discussion.

Explain to me this; lets say theoretically a developer initially assesses the market and figures they can sell 100 identical units at $500,000 each, but then gets slammed with $5 million in CAC's, are they going to sell the units at $550,000 now, even though they previously judged the units will only sell at $500,000?

In your hypothetical assessment yes.

A builder will only build to achieve a certain return, and if that return is below hurdle they will either reduce costs or increase income. When all builders are being hit with the same high CACs the market moves up as they are all under pressure to increase their sell prices.

[Changing City]

Originally Posted by LeftCoaster

In your hypothetical assessment yes.

A builder will only build to achieve a certain return, and if that return is below hurdle they will either reduce costs or increase income. When all builders are being hit with the same high CACs the market moves up as they are all under pressure to increase their sell prices.

Most development in the City of Vancouver doesn't involve a CAC - so all builders aren't hit with the same CACS. It's only in major rezonings like this that negotiated CACs come into play. This example is unusual, because some heritage expenditure (to seismically upgrade the church) and some replacement housing costs (as there's already rental housing on site) are included in the total CAC table shown above.

Here's what the City's CAC annual report to Council last month noted "In 2014 the City commissioned an independent assessment to determine if CACs were negatively impacting housing affordability in Vancouver. Coriolis Consulting concluded that CACs did not cause housing prices to rise or negatively impact housing affordability. Coriolis based their assessment on a review of development activity and trends in the City of Vancouver over the past 25 years. The Coriolis report found that CACs did not have a negative impact on new housing supply or the pace of new housing development, but rather they put downward pressure on the overall cost of land. The study found that CACs supported a substantial increase in the City’s capacity to absorb new apartment development and, in some cases, enabled the creation of affordable housing units that would not otherwise have been built. They also found no difference in new housing unit prices when comparing projects that provided a CAC and those that did not. Coriolis’ report concludes that it is much more likely that multiple market factors rather than the City’s CAC policy have resulted in rising housing prices in the Region. The Coriolis report can be accessed on the City’s website at: http://vancouver.ca/financegrowth."

[Vin]

Originally Posted by Changing City

Most development in the City of Vancouver doesn't involve a CAC - so all builders aren't hit with the same CACS. It's only in major rezonings like this that negotiated CACs come into play. This example is unusual, because some heritage expenditure (to seismically upgrade the church) and some replacement housing costs (as there's already rental housing on site) are included in the total CAC table shown above.

Here's what the City's CAC annual report to Council last month noted "In 2014 the City commissioned an independent assessment to determine if CACs were negatively impacting housing affordability in Vancouver. Coriolis Consulting concluded that CACs did not cause housing prices to rise or negatively impact housing affordability. Coriolis based their assessment on a review of development activity and trends in the City of Vancouver over the past 25 years. The Coriolis report found that CACs did not have a negative impact on new housing supply or the pace of new housing development, but rather they put downward pressure on the overall cost of land. The study found that CACs supported a substantial increase in the City’s capacity to absorb new apartment development and, in some cases, enabled the creation of affordable housing units that would not otherwise have been built. They also found no difference in new housing unit prices when comparing projects that provided a CAC and those that did not. Coriolis’ report concludes that it is much more likely that multiple market factors rather than the City’s CAC policy have resulted in rising housing prices in the Region. The Coriolis report can be accessed on the City’s website at: http://vancouver.ca/financegrowth."

You honestly don't think 100 mil is excessive? Sounds almost like the City is trying to secure more revenue to fund their pet projects: eg. tearing down viaducts. May not be direct, but by saving on their obligations, they may scrounge up more funds to do their foolish deeds.

[Prometheus]

Originally Posted by LeftCoaster

A builder will only build to achieve a certain return, and if that return is below hurdle they will either reduce costs or increase income. When all builders are being hit with the same high CACs the market moves up as they are all under pressure to increase their sell prices.

Precisely.

And when the market moves above what many local consumers can afford, producers will look more and more to expand the market by targeting foreign consumers with greater wealth to support the higher prices. A scenario that sounds familiar.

It is probably the City of Vancouver (with its current CAC system and refusal to liberalize the redevelopment process) that relies on foreign real estate investment more than anyone.

[Changing City]

Originally Posted by Vin

You honestly don't think 100 mil is excessive? Sounds almost like the City is trying to secure more revenue to fund their pet projects: eg. tearing down viaducts. May not be direct, but by saving on their obligations, they may scrounge up more funds to do their foolish deeds.

It's not $100m in CACs. Over $6m are DCLs. Everybody pays those (except a few exempt rental projects). $21m are the heritage restoration costs on-site - so that's presumably (along with the non-market housing) what the church are getting for 'selling' the land - and there's another $4.3m for heritage contingencies. Another $6.5m is the 'value' of the onsite rental replacement that's being built. The list makes it clear where the remainder of the money will be spent, and the West End Plan has pages describing the new and renovated facilities that the CACs will contribute to.

The City didn't say 'If you want to build that, it'll be $98m'. The developer offers the package - and they have to show the calculation of costs, and anticipated selling prices. It looks as if the City are finally getting a more accurate take on how much developers are selling projects like this for. The developer always calculates the profit they want to see - and probably actually gets much more than that in a rising market.

Elsewhere somebody pointed out that the same developer's 'Joyce' tower has units selling at over $1,400 a square foot for a 1-bed apartment. That whole project offered under $5m in CACs, presumably based on a much lower sales price expectation. It looks like they probably didn't contribute as much in CACs as it now looks like they could afford in that case.

[s211]

294 market strata units are proposed for the complex.

Dividing that between the CAC ranging from $90M-100M equates to $300K per unit.

I recall a time when condos used to sell for $300K, and that's not exactly ancient history.

[VancouverOfTheFuture]

Originally Posted by s211

294 market strata units are proposed for the complex.

Dividing that between the CAC ranging from $90M-100M equates to $300K per unit.

I recall a time when condos used to sell for $300K, and that's not exactly ancient history.

i remember that to, my grandparents bought a place in Yaletown in 2002, brand new from the developer.

south facing on Marine Side Crescent so it will always have a view over False Creek, City Hall, South Vancouver. on the 33rd floor with 3 bed, 2 bath @ 1,400 sqft. they paid ~330,000.

it was not long ago at all... that was before marketing overseas to Asians was the priority.

[sacrifice333]

If my simplistic understanding of the $99M in CACs is correct it's actually *only* about $46M in CACs.

The other $53M is:
$20M - value ascribed to the existing church and the fact it's not being torn down
$4M - additional budget for heritage retrofit
$20M - meeting spaces, etc. - i.e. the church is expanding their offices and multi-purpose areas into the new building
$10M - "parks" - i.e. the grounds being accessible. By simply having the tower's grounds be somewhat accessible to the public they are "giving" $10M in value

Note: I presume all CACs are calculated in the inflationary manner used to come up with the $99M... but it's certainly not $99M in cash put up by a developer.

[Vanville]

Looky what came in the mail...

[Metro-One]

A height of 169.5 meters?

WTF has happened?

Has the Tower been reduced in height? Has the design been dumbed down?

[LeftCoaster]

Yes the world is falling!

No I think they usually only list the height to the top of slab excluding any mech penthouse fins etc...

[phesto]

The height was actually increased by 6 feet as they managed to get another floor of condos approved.

Interestingly, I was told that the neighbouring tower (Nelson on the Park) will have to be reduced in height to comply with new shadowing restrictions (on Robson St. and Nelson park), but the Westbank proposal was exempted as they somehow got the application processed before the new rules were implemented.

[osirisboy]

How would this shadow Nelson park?? Maybe for 10 minutes early in the morning in the summers?

[trofirhen]

Originally Posted by osirisboy

How would this shadow Nelson park?? Maybe for 10 minutes early in the morning in the summers?

Heaven help this building if it does. The UDP officials would likely chop ten storeys off it.

[Vin]

Originally Posted by sacrifice333

If my simplistic understanding of the $99M in CACs is correct it's actually *only* about $46M in CACs.

The other $53M is:
$20M - value ascribed to the existing church and the fact it's not being torn down
$4M - additional budget for heritage retrofit
$20M - meeting spaces, etc. - i.e. the church is expanding their offices and multi-purpose areas into the new building
$10M - "parks" - i.e. the grounds being accessible. By simply having the tower's grounds be somewhat accessible to the public they are "giving" $10M in value

Note: I presume all CACs are calculated in the inflationary manner used to come up with the $99M... but it's certainly not $99M in cash put up by a developer.

If the developers already pay so much for propping up a heritage church building, then why does the City still demand so much ($53 mil) in CACs to make the total 100mil? It's nonsense.

[Vin]

Originally Posted by osirisboy

How would this shadow Nelson park?? Maybe for 10 minutes early in the morning in the summers?

Assuming there is even sunshine, like 20% of the year? The glass will actually reflect more light onto the park.

[Vin]

Originally Posted by phesto

The height was actually increased by 6 feet as they managed to get another floor of condos approved.

Interestingly, I was told that the neighbouring tower (Nelson on the Park) will have to be reduced in height to comply with new shadowing restrictions (on Robson St. and Nelson park), but the Westbank proposal was exempted as they somehow got the application processed before the new rules were implemented.

Looks like the Planning department is still run by the same type of people.

Originally Posted by trofirhen

Heaven help this building if it does. The UDP officials would likely chop ten storeys off it.

Blasphemy!

[Metro-One]

Originally Posted by LeftCoaster

Yes the world is falling!

No I think they usually only list the height to the top of slab excluding any mech penthouse fins etc...

I had just come home from drinking and saw that, haha.

Good to know.

That is too bad about the Nelson on the Park site. We don't need more height restriction variables...

[officedweller]

Here's the diagram:


https://westendneighbours.wordpress....ublic-hearing/