A past column I wrote for Business in Vancouver:

It looks like Vision Vancouver is STIRing up the West End.

Sorry for the pun, but it’s too obvious to resist.

STIR stands for Short-Term Incentives for Rental Housing – a time-limited program that offers developers, among other incentives, significant additional density in return for the construction of market rental apartments.  Note, that’s market rental. There’s no constraint on rental rates, only on tenure: the units must remain rental for the life of the building or 60 years, whichever is greater.

Vancouver is, surprisingly, a rental town (52 percent of all households) but these days only a small fraction of new construction is purpose-built for that market.  It’s just too profitable to build condos, sell ’em off, and move on.  Though a lot of investment-purchased condos may be rented out, there’s no guarantee they’ll stay that way, and the city’s housing stock is becoming increasingly inaccessible to lower middle-income renters.  Developers argue there’s simply no way to make the numbers work, given the low returns from rental accommodation, without the kind of incentive the STIR program offers.

And a big incentive it is.  City Council just approved the first project – a 210-foot tower on Bidwell Street in the West End that almost triples the allowable density in return for preservation of a heritage facade and 49 rental units. Another project at Comox and Broughton is awaiting consideration, this one even taller and five times the current allowable density.

Needless to say, some West Enders are, to put it mildly, concerned. As a West Ender myself (and the first City Councillor to come out of the downtown since the 1940s), I learned that, paradoxically, as the rate of change slows down, people’s anxiety about change increases.  Even the smallest alteration can ignite fear of precedent. Within that square mile only a dozen or so new buildings have been constructed since 1972, the year the highrise boom ended.  But even that proved to be too much, and so in 1989 the NPA Council rezoned the district to discourage demolition.  A rate-of-change bylaw has slowed redevelopment to practically zero.

Politically it was a no-brainer.  Redevelopment meant eviction of existing tenants with few options, a loss of affordable housing, a drop in density and the blocking of views.  Developers were directed to other parts of downtown, where rezonings encouraged much higher densities where few residents would be disturbed.  Downtown South became the new West End, taking pressure off the existing housing stock.

That era is practically over.  Downtown is almost all built out; there are few places left to massively rezone.  The STIR program, whether intending to or not, is directing attention back to the West End, where dozens of wooden low-rise apartment blocks are nearing the end of their physical lives.  Change, it seems, is inevitable.

Supporters argue that providing hundreds of more units is the only solution available to City Hall to take the pressure off demand.  Without alternative accommodation, new arrivals to Vancouver will outbid existing tenants for the only available housing or be forced out of the city altogether to places where commute times will lengthen – exactly the opposite of what Ecodensity intends.

Hence a left-wing Council is raising the redevelopment bar, justifying a de-facto subsidy of over $100,000 a unit by arguing that ‘market rental’ constitutes a public amenity.  Rather than parks or child-care centres, the West End gets additional density. 

There’s also a hidden danger: If the actual rents come in at a significantly higher rate than what the developer is expecting, it’s possible that the entire market could be recalibrated.  Landlords will argue that rents in existing buildings surrounding the new developments are below market, and hence eligible for upward adjustment. The political consequences would be most unpleasant. 

In the meantime, residents are meeting in church halls and on web sites to pressure for a stop to all rezonings until a plan is in place.  Change may be inevitable, they argue, but it must be ‘appropriate,’ without defining quite what that is.  The process required for consultation, however, could take years.

One long-time leader in the community is skeptical of anything so simplistic as a ‘plan.’ As he notes, the West End is a hodge-podge: layers of different styles and forms accumulated over a century.  Trying to define a single vision for the future actually goes against the very nature of the West End.  Better to go block by block, allowing new development when and where it fits in without rezoning the whole neighbourhood, doing so incrementally without massive disruption.

Kind of what the STIR program is attempting to do.

Comments

  1. Good analysis of the controversial STIR program in the West End, Gord. While the opponents are getting armed and ready, some of their arguments seem a little silly. For example, that if the rents did come in more that anticipated, then the entire market would have to be recalibrated. This is simply not so. A building owner in, say, the 1300 block Comox, could not simply point up the hill and declare they will apply for more rent based on that building. The system is a little more complex and has some safeguards to prevent sudden large increases as recent BC Supreme Court decisions have show. I mean, reductio ad absurdum, at the cost of land, materials etc today everywhere in B.C., if anyone anywhere in the province build a rental building – then the ‘market’ would have to be recalibarated. No rental housing would get built anywhere, ever.
    I’m sure we’ll hear other arguments like this that may not bear much scrutiny. Perhaps the real underlying reason is pure NIMBYism. We’ll soon see.

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  3. It’s unfortunate that the onus has fallen once again on municipal government, when the feds could just go back to the way they used to tax rental units in the 70’s, which provided the needed incentives and didn’t make communities choose between rental and other community benefits.

    As much as I like the idea of this program, I think they have to be careful that it doesn’t overwhelm a particular area, because communities still need things like daycares and parks and car coops, and will need them more so as the density continues to increase.

    It’s also kind of too bad that even in this project there are more condominiums than rental, but I guess that’s effectively subsidizing it.

    Still, overall, I think I have to agree that this is a good project.

  4. As an interesting side note – over the past 3-4 years I’ve been noticing quite a few of the old 3 storey wooden apartment buildings getting renovated (new windows, new exteriors, I assume some new interior stuff too). It always catches my eye because if the West End hadn’t had it’s restrictive zoning put in place in 1989, these places would have been no-brainer redevelopment sites. From one environmental perspective, it’s quite good that conditions have encouraged reuse rather than demolition.

    And while I’m not anti-density (and don’t particularly mind the STIR proposals), I do wonder if perhaps the West End is dense enough? Is there such a thing as ‘dense enough’?

  5. As a West End resident I’ve been constantly bombarded with the anti-development pamphlets everywhere. The Comox site first came to my attention when I visited a friend in the 1300-block of Nelson St who first was complaining that the new tower is “out of character” with the neighbourhood. But I pointed out that there was already a 20+ storey tower immediately to the east of his building. Then he started complaining that they didn’t want more renters in the neighbourhood (I’m hoping he was mostly joking). In any event he managed to solidify my support for the new project. I am really worried about people in older low-rises getting evicted in favour of redevelopment projects, but this project, on the site of an abandoned church, just seems ideal. Many new rental units and not a single eviction. Brilliant! And I think we need more market rental housing in the West End. My partner and I just ended up buying an apartment, but I would have been happier to rent had we been able to find something suitable (though with our pets probably we wouldn’t have been welcome in the new tower). But there should be some options for all sorts of lifestyles and income. If the city is able to encourage this with extra densities, that’s great! The combination of high density with a perfect natural setting and geography is what makes the West End, to me, the best neighbourhood I’ve found, anywhere in the world.

  6. This STIR program is probably wrong headed.
    It doesn’t address the root cause of the problem:

    their is no new rental development because the residential market are way overvalued in regard its potential income rental: that is due to the RE bubble still in full force in Vancouver.

    The STIR doesn’t address this problem, and beside some desirable pocket, there is no real shortage of rental in city and everyone walking down the streets can witness there is no lack of “availability rental” sign in town.

    One problem the area face is housing affordability, not rental, but ownership. Because it is now basically impossible even for a professional couple to access ownership in Vancouver, those productive people will tend to increasingly avoid the city then triggering its economic decline.

    This more than the STIR program will reduce the rental pressure in town…

    I don’t see any positive to the STIR program

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