Land values and condo prices constrain purpose-built rental units, say developers

Developers, including some who have been reaping the gains of skyrocketing pre-sale condo prices across Metro Vancouver, say more rental stock needs to be built.

City planners, the lenders who finance projects and, of course, would-be tenants all agree adding purpose-built, rental units can temper the housing crisis.

But escalating land values as well as conflicting and competing housing policies are conspiring to make this a challenge, according to a panel moderated by Cynthia Jagger of HQ Commercial at a real estate conference hosted by Queen’s University in Vancouver on Tuesday.

Andrew Grant, president of Vancouver-based PCI Developments Corporation, said larger, mixed-use projects, such as the Marine Gateway PCI built at the south end of the Cambie Street Corridor, which includes market residential towers, retail and commercial space, allow for some easy integrating of rental buildings. He also said at its 388 Kaslo project in Hastings-Sunrise, PCI tapped the City of Vancouver’s Rental 100 program, which gives developers incentives — such as waived fees, additional density and faster processing — for constructing rental buildings instead of market condos.

“Those all made it attractive to do,” said Grant.

Despite this, he feels, “it would be harder (to choose building rental) today with what’s happened in the condo market” which has seen escalating land prices and a scarcity of pre-sale units.

He added that PCI recently dropped a plan to build a rental building with 215 units in downtown Vancouver. “It was (a project) supported by senior management (at the city), but at the mid-levels, there were conflicts with policy that made it impossible to go ahead.”

Grant declined to be more specific about the project, but suggested it might be helpful if the city had a rental housing advocate “within the planning department, spanning different departments to bridge challenges and expedite rental housing.”

“In my experience, policy and lower …read more

Source:: Vancouver Sun

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