2018 has been another record year for land sales in Metro Vancouver approaching $5 Billion in total sales value, surpassing both 2016 & 2017, with $4.5 and $4.4 Billion respectively. This record year is really the culmination of several large deals which were marketed and negotiated prior to the market cooling down earlier this year.

Here’s a look at each of the 10 largest land deals of 2018:

1. 9850 Austin Road, Burnaby

• Price:                   Approx. $220 Million*
• Site Area:            4.1 acres
• Vendor:               Greystone
• Purchaser:          Pinnacle International

The goods:        The largest land deal of 2018 is one you might not even have heard of. The sale comprised a large site adjacent the Lougheed Skytrain Station on the Burnaby side of Burquitlam that the City of Burnaby designated as High Density Mixed Use within the Lougheed Town Centre Master Plan. Density may range from 2.2 FAR to 5.0 FAR for RM5s zoning districts and 6.0 FAR for C-3 zoning districts. The site was listed and sold by Cushman & Wakefield. (* – the exact purchase price could not be verified due to share sale. The deal also included an unspecified VTB).

2. Burnaby Saputo Site, 6800 Lougheed Highway, Burnaby

• Price:                  $209 Million
• Site Area:           19 acres
• Vendor:               Saputo
• Purchaser:          Peterson Group

The goods:          The second largest land deal of 2018 was the sale of Saputo’s 19-acre Burnaby plant to Peterson Group was completed in October for $209,000,000. The site had been listed by Cushman & Wakefield in early 2017 and the transaction involves the relocation of Saputo’s dairy plant operations to a new processing plant on a 20 acre site on Kingsway Avenue in Port Coquitlam, which is expected to be completed within the next three years. In the interim, their sale deal with Peterson envisions a lease back until their new plant is ready in 2021. Rezoning and development plans have not been released but a large-scale mixed use development is anticipated.

3. 1045 Haro Street & 830-850 Thurlow Street, Vancouver

• Price:                  $165 Million
• Site Area:           43,266 SF
• Vendor:               Strata
• Purchaser:          Private Investor

The goods:          This sale involved the wind-up and sale of a 160 unit strata building, along with commercial units at the corner of Haro Street and Thurlow Street in the West End. The site sits in a newly formed tower zone as part of the West End Community Plan.  A rezoning application will be required before development can occur.

4. 8671-8831 Cambie Road and 3480-3540 Sexsmith Road, Richmond

• Price:                  $147 Million
• Site Area:           12.4 acres
• Vendor:               RCG Group
• Purchaser:          Polygon

The goods:          This land assembly by Polygon creates a great development site on the Eastern edge of Richmond’s City Centre Area. The assembly was the precursor to a rezoning application which envisions over 1,200 residential units and retails space in six buildings.

5. 1640-1650 Alberni Street, Vancouver

• Price:                  $130 Million
• Site Area:            17,292 SF
• Vendor:               Hollyburn Properties
• Purchaser:          Landa Global

The goods:         This tower site was owned by well-established family-owned Hollyburn Properties who had planned to rezone the site for a 42-storey rental building. With valuations for condos at an all-time high, Hollyburn wisely decided to sell the site through Simon Lim and James Lang of Colliers. While a new rezoning application has yet to be filed, the site will almost certainly now become a mix of condos and rentals.

6. 1063-1075 Barclay Street, Vancouver

• Price:                  $113 Million
• Site Area:           17,292 SF
• Vendor:              Westbank & Bosa Properties
• Purchaser:         Grand World Holdings

The goods:         Another tower site in the coveted West End Community Plan, this assembly of separate strata buildings reached a stalemate between developers who decided to sell together, rather than to each other. Simon Lim of Colliers sold the site in May 2018 to a Hong Kong based investor/developer. The Globe and Mail detailed the sale in March 2018.

7. “Park West”, Capilano and Marine, North Vancouver

• Price:                 $98 Million
• Site Area:          1.9 acres
• Vendor:              Pacific Gate Investments
• Purchaser:         Keltic Canada Development

The goods:         This 1.9 acre site at the corner of Capilano Road and Marine Drive in North Vancouver was rezoned by a group of local private investors over a period of years to allow a 258-unit, two-tower development that was ultimately named “Park West”. After rezoning enactment, the site was sold to emerging developer Keltic Canada. Park West is now in the advanced stages of marketing with over half the units sold.

8. 101 East 69th Avenue & 86 SE Marine Drive, Vancouver

• Price:                  $90 Million
• Site Area:           12.5 acres
• Vendor:              Walmart Canada
• Purchaser:         Hungerford Properties

The goods:        This site was sold by the Colliers team of David Taylor, Roy Pat and Darren Cannon in February 2018. The vacant site was owned for several years by Walmart Canada who ultimately sold via off-market transaction to Hungerford Properties who has quickly become one of Vancouver’s pre-eminent industrial and commercial property developers.

9. 5720-5800 Minoru Boulevard, Richmond

• Price:                  $60 Million
• Site Area:           3.899 acres
• Vendor:              Private Investors
• Purchaser:         Thind Properties

The goods:        This sale represents an assembly of various industrial and commercial buildings in the Lansdowne Village subearea of the City of Richmond’s City Centre area. A subsequent rezoning application envisions a new development with 384 residential units and a total density of 3.0 FAR.

10. 6645 Dow Avenue, Burnaby

• Price:                 $59 Million
• Site Area:           40,946 SF
• Vendor:              Private Local Investors
• Purchaser:         Westorchard Properties

The goods:       Also sold by Simon Lim of Colliers, this is Metrotown’s last RM5s/C2 Development site on Beresford Street – 40,946-SF Metrotown development site. The property is currently improved with a 40-unit apartment building, providing stable holding income through the rezoning and entitlement process.

*Note: The adjacent 34,650 SF site at 6675-6691 Dow Avenue also closed recently to the same buyer through Mark Goodman. The sale price was $43,275,000. The $102 Million combined price tag would create one of the largest deals of the year.

Honorable Mentions

These ones just fell off the list (via later edit) or are technically longer term land plays:

1140 Pendrell Street, Vancouver

• Price:                 $57 Million
• Site Area:          30,261 SF
• Vendor:              Strata
• Purchaser:         Skyllen Pacific

The goods:        This West End development site was sold by Hart Buck and Jennifer Darling of Colliers in September 2018 after a listing process. The Property, improved with an older lowrise strata building, is zoned RM-5B which allows for immediate redevelopment for up to 2.75 FSR density. Under the current zoning, the land price equates to $687 per buildable SF.

443 Seymour Street & 605-621 Seymour Street, Vancouver

• Price:                 $100 Million
• Site Area:          18,720 SF
• Vendor:              Private Investor
• Purchaser:         Reliance Properties

The goods:       This parkade (known by many locals as the Goldie’s pizza building) was sold via off-market transaction to well known commercial owner/developer Reliance Properties in July 2018. The site is anticipated for redevelopment with a new office building approximately 30 storeys in height.

Some notes from the above list:

• Only 4 of the 10 largest land deals in Metro Vancouver took place in the City of Vancouver (down from 9 of 10 last year)
• 7 of 10 were sold by market bid process (the other 2 were ‘off-market’)
• 5 of 10 were bought by well-established ‘local’ development groups, the other buyers were offshore or ‘new-entrant’ development companies
• 7 of 10 will require a rezoning process before development can occur

Next week, City of Vancouver Council will consider a report from the Engineering and Planning Departments seeking to approve a new City-wide utilities development cost levy (DCL) and a long term capital projects program for upgrades. The report also confirms the Utilities Servicing Plan for the Cambie Corridor Phase 3 area and the CAC target rates for the Cambie Corridor and Marpole areas.

Here is a summary of these new recommendations.

New Utilities DCL

The need for infrastructure upgrades was highlighted during the latter stages of the Cambie Phase 3 planning in which significant new density was introduced in the Oakridge Transit Centre area in plans laid out in 2017. A reassessment of the future demand on sewer, drainage and water service capacity has led to this city-wide strategy. The City is now looking at increasing DCL rates to help finance the servicing requirements across multiple developments rather than piggybacking off of the initial developments in certain areas.

The recommended new DCL framework for financing water, sewer and drainage utilities
upgrades includes a long-term capital program of approximately $1 Billion and the introduction of a dedicated City-wide Utilities DCL to cover approximately $547 Million of that cost (benefit to new development) through DCL’s by 2026.

Currently, utilities are embedded in the overall City-wide DCL rates, but the utilities component will now be separated in order to “improve transparency and certainty for developers.” 

The report highlights the utilities portion of current DCL and the proposed Utilities DCL to demonstrate the increased rates:

Interestingly, a background study by Coriolis Consulting noted the following (from report):

• New residential development downtown and on the west side of the city could
  accommodate the proposed rate increases.
• New residential development on the east side of the city has less ability to absorb
  the new DCL costs without impacting economic feasibility.
• For new non-residential development, Coriolis found in last year’s DCL report to the City that an increased DCL rate would have a negative impact on sites that are currently viable for redevelopment. For new industrial development, it would be challenging for most projects to support any increase in DCL rates given the
  inherent challenging economics. Similarly, it would also be challenging for most new office development to support an increased DCL rate.
• In all cases where there is a DCL rate increase, it is preferable to phase-in the rate increase so new development can adjust to the increased costs.

The report also recommends that the Utilities DCL be waived for market rental housing (Most rental rezonings are eligible for DCL waiver) on an interim basis until 2020 with a review by staff coming next year.

The new DCL rates will come into effect on September 30, 2018 (rates are protected for in-stream applications for one year from the effective date).

Utilities Servicing Plan for Cambie Corridor & CAC Rates

The City approved the Cambie Corridor Phase 3 Plan at council in May, though the land use plan has remained subject to a pending Utilities Servicing Plan, which intends to lay out the development sequence of sites based upon utilities upgrades.

Highlights of the plan include:

• City-initiated rezoning (“prezoning”) of townhouse areas in Stage 1 in the
  short-term (anticipated for referral and public hearing in summer/fall of 2018)
• Requirement for basic onsite rainwater and groundwater management

Here is a guideline for development in the Cambie Phase 3 area:

Lastly, here are the proposed new CAC target rates for the Cambie Corridor and Marpole Areas:

Cambie Corridor

Marpole

The full report can be viewed here: https://council.vancouver.ca/20180711/documents/cfsc1.pdf

The City of Vancouver will next week present a policy report  to the Standing Committee on Policy and Strategic Priorities that outlines the forthcoming Broadway Planning Program. 

The planning initiative seeks to develop a comprehensive land use policy plan for the Broadway area in conjunction with the anticipated Broadway subway extension to Arbutus Street. The overall Broadway Plan study area, shown in an outline below, includes lands from Clark Drive in the east to Vine Street (two blocks west of Arbutus Street) in the west. The north and south boundaries (16th Avenue) boundaries of the overall study area were determined by considering areas up to 800 metres from existing and future stations. 

From the report: “The plan will focus on opportunities to integrate development with the future transit along and around the Millennium Line Broadway Extension (Broadway Extension) to support the City’s goals of creating housing affordability, job space, social and cultural amenities, environmental sustainability and livability. Council is asked to adopt an interim rezoning policy that will apply while the planning program is underway and to approve an associated planning program budget.”

Timeline

The plan is expected to be finalized by December 2020, with the following anticipated 5 phases:

Initial – Background Phase (expected completion December 2018) comprehensive range of studies, including an area demographic profile, archaeological assessment, baseline utility capacity review, rate of change impact assessment, statement of significance/heritage assessment, transportation modelling, parking data collection and review, Broadway Extension project planning as well as other studies to inform the planning program work.

Five phases:

1. Guiding Principles (expected completion June 2019) 
   • planning principles (coordinated with and informed by broader City Core 2050 guiding principles).
2. Emerging Directions (expected completion December 2019) 
   • growth scenarios and patterns for change in land uses, housing, jobs, parks and public spaces, transportation connections and amenities (coordinated with and informed by broader City Core 2050/Economy Lands Studies, and Broadway Extension project design)
3. Refining Directions (expected completion – June 2020) 
   • draft policy plan for land use, density, layout, built form, and design. This will
     integrate policies to increase social and rental housing, while retaining existing rental and increasing protection for tenants.
   • draft public amenity strategy addressing housing, community amenities,
     transportation connections, infrastructure, parks, public space, public realm
     improvements, and social and cultural amenities. 
4. Finalizing the Plan (expected completion – December 2020)
   • final policy plan, including enhanced renter protection policy in the Rental
     Housing Stock ODP areas included in the study area.
   • final public amenity strategy.
5. Implementation (to be determined)
   • rescinding Interim Rezoning Policy
   • referral of by-law amendments and subsequent policy amendments (e.g. to
     Community Plans)

Area of Study

Within the overall study area there is a focus area to be reviewed for potential land use
change as shown on the map below, shaded in purple. Generally, this includes the C-3A, C-2, RM-3/4, FM zoned areas, and parts of the Burrard Slopes mixed employment area within proximity to the station areas, as well as VGH and City Hall Campus. It excludes RS and RT zones, the False Creek South and the Southeast False Creek ODP areas, the majority of the Mount Pleasant industrial zones and False Creek Flats industrial and mixed employment zones. The RS and RT zones will be addressed through the ‘Making Room: Adding Housing Choice in Neighbourhoods Across Vancouver’ Planning Program, a key action item coming from the Housing Vancouver Strategy that is also going before council next week (click link above for details).

Policy Considerations

The City also notes a number of other policy consideration that will shape future development scenarios. These include:

• The Rental Housing Stock Official Development Plan – City will explore renewal and retention of existing rental apartment stock. The rental districts within the study area make up one of the City’s core rental areas, containing 17,680 units of existing non-market and market rental housing – including 27% of the City’s total purpose-built rental units in areas covered by the Rental Housing Stock ODP. Planning work will explore potential future options for these sites, noting that rental replacement and enhanced tenant protection and relocation will be prioritized. 
• Jobs and Economy Policies – the Metro Core Jobs Plan is being updated by the Employment Lands and Economy Review Study set for 2019. In conjunction with that study, the Broadway Planning will consider protection of lands for job space and provision of new commercial density. Existing industrial zones will be largely excluded, save for a small stretch on 8th Avenue.
• Heights, Views & Other Considerations – 
  • Queen Elizabeth View Corridor (View #3) – testing will occur to explore whether select buildings along Broadway could enter into view 3.1 without
    eroding the overall view of the city within nature
  • Vancouver General Hospital Flight Path – VGH has a helicopter pad for emergency transport to and from the hospital. The VGH flight path is a wide apron that swings out to the north of the VGH heliport. Transport Canada limits building heights along Broadway – quite considerably between Oak
    and Laurel Streets.The City and VGH have agreed that proposals
    for new towers will be brought forward for review and discussion with VGH, Transport Canada and the helicopter operators. 
  • C-3A Guidelines (Views to City Hall) The Cambie Street (east side) C-3A Guidelines and Central Broadway C-3A Urban Design Guidelines which restrict heights along Broadway between Laurel Street and Yukon Street in order to preserve views to City Hall from public points along the north
    side of the False Creek seawall will be reviewed. 
  • Community Plans – The Broadway Plan study area includes lands covered by three Community Plans: Mount Pleasant Community Plan (2010), Kitsilano Neighbourhood Plan (1977), and Fairview (1974) – these will be reviewed as part of the process.
  • Vancouver General Hospital (VGH) and City Hall Campus – As both City Hall and VGH will be undertaking master planning initiatives to plan for their future in the near term, the larger context of these two major employment
    campuses and the area’s role as an important gateway to the City Core will be considered through Broadway planning.

Other Interim Measures

Interim Rezoning Policy During Broadway Planning Process

The City will seek to limit rezoning applications being made until the plan is finalized. It appears that new rezoning applications will only be considered for public or non-profit institutional, cultural, or recreational uses, non-market housing, or heritage retention.

New Policy Measure to Curb Speculation

As has been highlighted in recent media attention, the City will also put measures in place to prevent any land speculation over the planning phase under a new policy entitled: Development Contribution Expectations in Areas Undergoing Community Planning. This will include a new Development Contribution Expectation (“DCE”) that will charge a pre-determined rate based on existing zoning and independent consultants’ review of the economic viability of proposed projects factoring in the prioritization of job space and affordable housing.

From the report: “The overarching objective of the DCE policy is to curb land value speculation in the market. This objective is best achieved by providing buyers and sellers with clear and consistent information about the City’s priorities and objectives for the Broadway Planning program. With the information, buyers and sellers will be able to properly account for the City’s expectations when identifying a fair price for land on the Corridor.”

The report further notes that achieving additional density above existing zoning for strata will be limited.

The Broadway Planning Program policy report goes to Standing Committee on Policy and Strategic Priorities next week. A full version of the report can be viewed here: http://council.vancouver.ca/20180620/pspc20180620ag.htm