Commercial developments are getting greenlight all across Metro Vancouver, but in some cases, new housing reminds backlogged by red tape. In this week’s top stories, we take a look at a record-breaking amount of land sales slated for housing that are facing delays and contributing to the shortage of new, available townhouse and condo units. Meanwhile, a commercial redevelop to an iconic downtown Vancouver hotel is moving forward.
In other news, a new report breakdown the demographic of recent home purchasing, revealing some surprising statistics. In Victoria, B.C., the owner of one of the city’s largest parcels of residential land is now considering selling or redevelopment.
Here are Western Investor’s pick of the top four most-buzzworthy commercial real estate stories published this week.
Record-breaking land deals locked up in municipal processes – Business in Vancouver
BIV columnist Peter Mitham reports on $6 billion worth of residential land sold in Metro Vancouver last year and expects 2017 sales to meet or exceed that value. But that may not lead to new, desperately-needed housing – at least not anytime soon.
According to Urban Analytics Inc., just 31 apartment and townhouse units were available for purchase at the end of March. This is an unprecedented dearth given demand in the local market, according to Urban Analytics, the Urban Development Institute and Scott Brown, president of Fifth Avenue Real Estate Marketing Ltd. in Surrey.
While speculators hoping to capitalize on the shortage are holding some of the land, keeping it out of the hands of developers, Brown believes municipal approval times are a bigger systemic issue.
While developers are well stocked with land, realizing projects remains tough. Often, a site acquired with no rezoning or other approvals could require two to three years to bring to completion.
“Continually, projects are stuck in this cycle of trying to get through municipal approvals,” Brown said. “I appreciate that municipalities are probably as busy [as] or busier than they’ve ever been, and they’re struggling to keep up, but it’s just exacerbating the affordability issues.”
Brown points to Maple Ridge, where slow approval times mean just one or two projects at a time are selling, creating a virtual monopoly lacking the competition that can yield pricing benefits.
Across the Fraser River in Langley, rezoning delays have forced Polygon to wait more than nine months to begin marketing an 800-unit project.
All told, Brown said less than a half-dozen wood-frame condo projects are being marketed in Surrey, White Rock, Maple Ridge, Langley and Abbotsford. This is a shift from two years ago, when at least a dozen projects were marketing, and prices have increased accordingly.
“There’s a pretty strong correlation between the fact that you’ve got hardly any projects marketing and your prices are up $100 a square foot,” he said.
Empire Landmark to permanently close September 30 – Business in Vancouver
The sale of the downtown hotel has been expected for months, and now plans for a new mixed-use commercial development are moving along and expect to be before the permit board next week. No red tape, here.
Vancouver’s 44-year-old, iconic Empire Landmark hotel, along with the revolving Cloud 9 restaurant on its top floor, will permanently close on September 30, hotel officials confirmed to Business in Vancouver.
The looming closure has been expected for months given that the site’s owners intend to tear down the 42-storey, 357-room hotel and build two towers that are 31 and 32 storeys tall.
The current proposal is for those new towers to have a total of 237 market condominiums and 63 social-housing units. Retail and office space would fill the first three floors. The proposal goes to the city’s development permit board on June 12.
The hotel’s website identifies the owner as Asia Standard Hotel Group Ltd, which is listed on the Hong Kong Stock Exchange. Vancouver’s Musson Cattell Mackey Partnership is the architectural firm that is stick-handling the measure at city hall.
While the current Empire Landmark Hotel is 394 feet tall, the proposed new towers would each be around 300 feet tall.
Bear Mountain golf resort owners ponder sale – Western Investor
A 772-acre residential resort with development rights and zoning already in place in looking for a new plan forward that could include a lot more housing and an increase in population for the area.
Last month Ecoasis hired commercial broker Jones Lang LaSalle to conduct a review of the resort that could result in the sale of the property or new investors.
The residential resort covers 772 acres of land with an existing community of more than 3,000 residents located about 15 minutes from Victoria.
A master plan would boost the area population by about 7,000 over the next 15 years with a mix of new houses, townhomes and condos.
The community also includes two Nicklaus Design golf courses, a Westin hotel, a fitness centre and health spa. “The principals of Ecoasis are primarily investors; they’re not developers,” said David Clarke, Ecoasis chief financial officer. “There’s a lot of the community still to build out here at Bear Mountain and we just felt that this was the right time now to engage JLL to review all of the options here.”
Ecoasis specializes in buying and developing residential and resort real estate and has properties in Victoria, Whistler and Hawaii.
The group bought Bear Mountain in 2013 from HSBC Bank Canada after the bank took control from the previous owners when they failed to meet loan payments, according to the Victoria Times Colonist.
JLL senior vice-president Jon Ramscar said the community is about one-third built out and has potential for more homes.
“Without a doubt, [Bear Mountain] is the largest development offering in Victoria. I would go so far as to say it’s likely one of the largest development offerings in Canada in 2017,” he said. “Some of the best land remains available for development.”
Ramscar said the property is essentially ready for an investor and developer to take over, given that much of the development rights and zoning are already in place.
Offshore investors represent a small fraction of recent homebuyers – Western Investor
Who’s buying up all the homes in Greater Vancouver? If you answered foreign investors – or any investors as a whole, really – you’d be wrong, according to new stats released by the Real Estate Board of Greater Vancouver.
Foreign and offshore investors only represent a small percentage of homebuyers, according to a new realtors’ poll.
The Real Estate Board of Greater Vancouver (REBGV) conducts monthly surveys with realtors who have recently represented buyers in a sale. The board has realized cumulative statistics from April 2016 to April 2017, demonstrating illuminating insight into the demographics of recent homebuyers.
REBGV stats show that the majority of realtors during the year-long period represented first-time homebuyers from within the Greater Vancouver area. The majority of homebuyers are families or young couples with no children. Thirty-eight percent of buyers purchased within their current community or neighbourhood, while 36 per cent moved from another city or sub-community with the REBGV area.
Only 2.3 per cent of homebuyers were described as foreign buyers. Local or domestic investors accounted for 18.5 per cent of sales. Fourteen percent of buyers reported that they are investors that will not be living at the residence.
