The City of North Vancouver is currently in the public input stage of their CityShaping initiative, which is a 6-step process that will culminate in the revision of the Official Community Plan to accomodate growth over the next 20-30 years. The City expects to draft an amended OCP sometime in the summer, with adoption by the end of 2013. This comes at an interesting time for the City in the wake of the contentious Onni rezoning at Lonsdale and 13th Ave, which was approved by a slim margin last week.

Potential Growth Areas

Source: City of North Vancouver

What are the potential changes? City staff are proposing a number of land use change scenarios that would impact specific areas. Overall the City is expecting an additional 8,000 units built by 2041. Here are few areas being contemplated for increased density:

• Central Lonsdale Town Centre – Potential changes would consider the area encompassing the 100 & 200 blocks east and west of Lonsdale from 13th Street to the Highway, the addition of up to 350,000 square feet of primarily residential development Harry Jerome precinct, the maintenance of the Town Centre Land Use designation (13th Street to 17th Street) , with provisions to increase this with density bonuses; an increase to the permissible density in the Urban Corridor Land Use designation, and the creation of a new land use designation on Lonsdale north from 17th Street to Highway #1.
• East Third Street – Apartment and/or townhouse developments could be appropriate for some locations. A number of property owners in this area have approached the City to discuss density changes in light of the anticipated reconstruction of Low Level Road and the proposed expansion of the Richardson International grain terminal. The changes also include potential increase in permissible density along the East Third Street frontages, and an area bounded by Low Level Road St, Patrick’s Avenue, 2nd Street, and St. David’s Avenue, Moody Avenue.
• Mahon Park Node  – an area south and east of Mahon Park could be considered accommodate townhouses, or medium density housing catering to families; it is currently single family.

Other points of discussion include increasing density in the Lions Gate Hospital Precinct, gently densifying areas currently designated R1, and not changing densities in the Lower Lonsdale area.

Here is a quick look at Vancouver’s largest residential and mixed-use/residential projects that are either under construction or at the latter stages of planning and approvals. What is notable is that a large majority of the projects are transit-oreinted; if not built directly near a Skytrain station, then within a short walking distance of one. Planning efforts to densify around transit have been formalized in the Official Community Plans of cities such as Burnaby, Surrey and Richmond.

Now on to the list. Limited to developments of 400 units or greater, the list represents 34 projects totaling 39,647 units. Almost all of the projects are multi-phase buildouts of 2 to 10+ years. Telus Garden, Marine Gateway and 1400 Howe are the only projects being built in one go.

There are 10-15 other major projects in the works that aren’t yet at the stage of approvals or construction.

While REITs were active buyers in the Vancouver market 5 to 10 years ago, they have been fairly quiet over the past several years as a result of yield compression and few attractive opportunities relative to other markets. Canadian REITs showed strong returns of over 15% in 2012 (more than double that of the TSX), primarily through operating gains throughout their portfolio, but in terms of acquisitions, most have been challenged to find deals in Vancouver.

Here we take a look at 10 of the larger REITs that own assets in Vancouver (in no particular order):

1. RioCan (TSX: REI.UN)

Grandview Corners

Riocan is Canada’s largest REIT, focusing solely on retail. They own two properties outright in Metro Vancouver including the Best Buy/Canadian Tire building on Cambie Street (acquired in 2004), and Impact Plaza in Surrey (acquired in 2006). They also have a 50% ownership interest in a handful of shopping centres in the Fraser Valley, including Abbotsford Power Centre, Grandview Corners in South Surrey and Riocan Langley Centre. They have been pretty quiet here, and recently announced that they are “toning-down” acquisitions Canada-wide in the near term.

2. Boardwalk REIT (TSX: BEI.UN)

Horizon Towers

Boardwalk is an open-ended REIT that is active in Canada’s major markets in Multifamily apartments. Boardwalk’s B.C. portfolio reported occupancy at 98.23% in 2012. They own several large scale apartment complexes including Horizon Towers in Burnaby and Surrey Village in Surrey.

3. KEY REIT (TSX: KRE.UN)

KEY REIT is a small-box retail property owner that specializes in niche business model, leases, quality properties and a focus on a handful of name brand tenants (primarily KFC/Taco Bell and Shoppers Drug Mart). Among their few B.C. assets are an A&W at 4605 East Hastings in Burnaby, and two KFC’s on Kingsway and East Broadway in Vancouver.

4. Calloway REIT (TSX: CWT.UN)

Calloway is a well-known retail REIT with focus on larger name brand centres. While they have a strong presence in Western Canada, their ownership in Metro Vancouver is limited to two centres: Langley SmartCentre (acquired in 2004) and New Westminster Smartcentre (bought in 2005).

5. Artis REIT (TSX: AX.UN)

Willingdon Green

Artis REIT is a diversified REIT that is active in several markets in retail, office and industrial. They have been one of the more active buyers in Vancouver in recent years. They own several sizeable office assets in Metro Vancouver including: 1045 Howe Street in Downtown Vancouver, as well as the Kincaid Building, Willingdon Green, and Production Court in Burnaby. They also own retail assets such as King Edward Centre and Delta Shoppers Mall.

6. CAP REIT (TSX: CAR.UN)

Georgian Towers

CAPREIT is a multifamily focused investment trust that owns interest in 36,683 apartment units across Canada. The REIT owns 15 apartment properties in Metro Vancouver including highrises such as: International Plaza in North Vancouver, Georgian Towers Downtown and Ocean Park Place in the West End. They also own larger scale apartment complexes in Coquitlam, New Westminster and Richmond.

7. Dundee REIT (TSX: D.UN)

Dundee REIT’s focus is on central and suburban office assets in Canada’s major markets. In Vancouver their ownership covers ten buildings in suburban markets such as Surrey, Burnaby, Richmond and New Westminster.  One of their larger assets is Station Tower, one of Surrey’s few ‘A’ class highrise office buildings.

8. Allied Properties REIT (TSX: AP.UN)

840 Cambie St.

Allied REIT was incorporated in 2003, but is relatively new on the scene in Vancouver.  Allied owns and manages what they refer to as ‘Class I’ office properties in urban markets.  Their target acquisitions are older office buildings in established areas.  In just the past 18 months in Vancouver, Allied has acquired: 1040 Hamiltion, The Sun Tower, 1286 Homer Street, 840 Cambie Street and 948 Homer Street, for a total portfolio of 244,704 SF. Their focus continues to be on the Gastown and Yaletown areas.

9. Canadian Real Estate Investment Trust (CREIT) (TSX: REF.UN)

1185 W. Georgia St.

CREIT is a diversified REIT focusing on quality retail, industrial and office properties throughout Canada. In Vancouver their largest interests are in core office assets at 1185 West Georgia, and 1508 West Broadway (the Chapters Building).  They also have assets in Maple Ridge, and a total portfolio interest of over 1 Million SF in B.C.

10. Pure Industrial REIT (PIRET) (TSX: AAR.UN)

Pure Industrial REIT invests in and manages income producing industrial properties in primary Canadian markets, including Vancouver. They have been active in the Vancouver market recently with the acquisition of several properties and they now have a portfolio of 13 properties in the Lower Mainland, including Burnaby, Delta, Richmond and Surrey. Just last week they announced the acquisition of 16111 Blundell Road in Richmond, a 280,000 SF facility for $32,300,000. PIRET is one of the few REITs that is finding opportunities in Vancouver currently.

Other REITs with significant holdings in Vancouver include: Chartwell Seniors Housing REIT, Loblaws (which is spinning its real estate into a REIT, owns several properties in Metro Vancouver.