It’s been an exciting but difficult process to assess the relative costs and benefits in the allocation of what is truly a rare gem – a perfectly located site for residential redevelopment, owned by the District of West Van. Purchased for $16M and now worth $80M (if allocated simply to fee simple market condos).
Our Council, staff, and the community have worked hard for several years, amidst some competing interests. Everyone agrees West Van is charming, and none of us want to lose that. But we have on one side of the debate the long-established homeowner taxpayers, pleading for prudent fiscal management. On the other side, the trends in our demographics do not look good and we are becoming an elderly community with increasing needs for services, but dangerously decreasing ability to attract a workforce. In this context, local businesses and workers suffer staff shortages and long commutes to come to provide the labour-intensive services we need here.
Several choices needed to be made: Best use? multi family housing. Few would disagree. Balance between capital subsidized (relatively affordable) rental apartments, and market priced strata condos for sale (highly profitable for the District, as land vendor)? Big disagreement here.
Some say “sell for highest gain and use the funds for municipal infrastructure, to mitigate pressure on our property taxes”. Others say “the intangible benefits of providing affordable housing are worth the financial opportunity cost, so “donate” most of the land to a non-profit to reduce its total development costs and thereby, allow rents to be permanently controlled to stay no higher than 75% of prevailing market rent”. (Other arguments on both sides are beyond the scope of this letter).
The Council had their staff consult the public, a private consultant, and some seasoned developers. They’ve decided to ratify their initial proposal: allocation of about 2/3 of the land’s buildable potential for 156 subsidized rental apartments and an Adult Day Centre, and 1/3 to a 58-unit condo building. The foregone potential sale revenue is about $60M, implying a capital subsidy of about $385,000/unit for the rentals, with free land rent to the Adult Day Centre. The condo allocation will bring in $22.2M (about $383,000/unit).
The next choice: Whether to require a test of local connections, income, and asset wealth to be used in the allocation of the subsidized rental units – in deciding who gets to live there. The decision has been to do just that, through the Kinsmen Society’s non-profit operation of the two rental buildings.
Another choice: Whether to place any restrictions on the design, marketing, and sale of the strata titled condos. There is one significant limitation in the current proposal: The sale of the land is limited to a 66-year leasehold interest. That means the land reverts to the District in 66 years, for re-purposing by the Council of that future day. (The $22.2M sale value is inherently lower for 66 years of land use, as opposed to the more common “fee simple” title which lasts into perpetuity). There is apparently no requirement of a local connections test of the first buyers, though. Strangely, after urging another developer in Horseshoe Bay to give first access to local buyers of the Sewells’ Marina site condo offering, the same Council has not imposed any similar requirement on the developer that has been awarded the Gordon Avenue condo site (a well-known local company – Darwin Properties).
Nor is there any suggestion of innovations such as a rent-to-own program to provide attainable ownership to local families and workers. With due respect for the effort so far, I think that with what’s at stake, we can do better in addressing our community’s needs.