Real estate downturn could have consequences for Coquitlam rental construction
Below-market and purpose-built rental units are often tied to market condo developments
Gary McKenna / Tri-City News
MAY 30, 2019
Townline confirmed to The Tri-City News this week that it would be temporarily postponing the sales launch of its Meridian project, a 38-storey highrise development located a block from Burquitlam Station.
Photograph By GARY MCKENNA
A downturn in the residential real estate market could jeopardize some of the purpose-built and below-market rental units awaiting construction in the city of Coquitlam.
Coun. Dennis Marsden told The Tri-City News that because many rental units are provided through density incentives, they may be delayed if developers start putting the brakes on some of their projects.
“The affordable housing and the purpose-built rental, which we have been really looking to have, are tied to market projects,” he said. “If there is a slowdown on the market project, it puts that rental component that we need in jeopardy.”
Marsden’s comments come after Townline announced it would be temporarily postponing the sales launch of its Meridian project in Burquitlam. The 38-storey highrise development, which is slated to be built a block from Burquitlam Station, includes 54 purpose-built and nine below-market rental units.
Chris Colbeck, vice-president of sales and marketing with Townline, told The News there has been a lot of interest in the 261-unit project but buyers are reluctant to make a commitment.
As a result, the company decided against moving the project to the pre-sale phase, Colbeck said, noting that a certain number of pre-sales are necessary to meet provincial regulations and lending requirements.
“When you put the brakes on the supply chain… what you get is an eventual supply crunch once the current inventories are absorbed, ultimately causing a run-up on market prices,” Colbeck said in an email. “This applies to both market condos and desperately needed purpose-built rental units.”
Townline’s situation mirrors what has been seen in many parts of the Lower Mainland, according to Michael Ferreira, a real estate consultant with Urban Analytics. His most recent report found the number of new condos and townhouses sold in Metro Vancouver during the first quarter of 2019 fell 56% compared to the same time period last year — and it’s the third lowest quarterly sales total since 2010.
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As for how Beedie intends to move forward with its Safeway site project, Raffi said “time will tell.” Construction on the retail portion of the project is well underway and the company said it expects to begin building its east tower this summer. Marketing for the west tower will commence in the fall or winter, he said.
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