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Six years ago, Marathon Developments couldn’t find any takers to pay a measly $300 million for the entire 33-hectare (82-acre) Coal Harbour waterfront site between Burrard and Cardero.
Today, Fairmont Developments, the successor company to Marathon, would need to fight off a long lineup of eager developers, including some probably willing to pay up to three or four times more for the property.
Except now there’s nothing left.
“I would hate to think I could get that kind of money because people could say I sold the land too cheaply,” said Graeme Stamp, Fairmont’s executive vice-president.
With the housing boom of the past several years resulting in luxury waterfront-houses and condominiums selling at record prices, water view lots are now definitely a scarce and expensive commodity.
Even Concord Pacific Group’s inventory of waterfront on the former Expo site on the north shore of >False Creek is rapidly shrinking.
“It’s inevitable, sooner or later it runs out,” said Concord sales director Tracie McTavish. “They don’t make water any more.”
In fact, development industry representatives lament there is very little prime waterfront left around the Lower Mainland, especially in choice locations such as West Vancouver, Coal Harbour, False Creek, or along Point Grey Road in Kitsilano.
As a sign of the times, the recent asking price was just under $3 million on a 71-year-old “teardown” at 3357 Point Grey Rd., a 10-by-29.5-metre (33-by-97-foot) waterfront lot.
By comparison, a similar-vintage house across the street (not for sale) with no water view has a 2004 assessed value of $844,000.
In West Vancouver, any 18-metre (60-foot) level waterfront property — if available — is now worth $4.5 million to $5 million, having doubled in value during the past several years.
The acute shortage or prohibitive cost of centrally located waterfront land is forcing developers to seek alternatives in less traditional or glamorous spots, such as sites along the north and south arms of the Fraser River, in Richmond, east Vancouver, New Westminster and Langley.
“Waterfront sites have been getting rarer and rarer,” said developer Brent Kerr, who is building 144 residences on property located on the Fraser, near the end of Steveston Highway and No. 6 Road in Richmond, property he purchased in 1996.
“It turned out to be good timing for me to pick up this [Fraser River] site in 1996. Now it would be very difficult to acquire, because waterfront has tripled or quadrupled in price in the last six to eight years — if you can find any at all.”
Downriver, the Onni Group of Companies is nearing completion of its $200-million “Imperial Landing” master-planned community on the 16-hectare (40-acre) former B.C. Packers site in Steveston.
Onni assembled the development site three years ago.
Earlier this year, Vancouverbased ParkLane Homes purchased a 28-hectare (69-acre) site on the banks of the Fraser River, on the Vancouver side between Kerr Street and Boundary Road.
The land parcel, former home of the Canadian White Pine sawmill that was closed in spring 2002 by its owner, Weyerhaeuser Co., is to undergo $400 million to $500 million worth of redevelopment for commercial and residential uses over the next 10 to 15 years.
Meanwhile, over in North Vancouver, Pinnacle International is awaiting final approval from the city before undertaking a $400-million, multi-use redevelopment of the old Versatile and Burrard Shipyards property, east of Lonsdale Quay.
Pinnacle president Michael De Cotiis jumped at snapping up the 107,764-square-metre (1.16 million square foot) site several years ago, noting the property then represented the last major piece of prime waterfront land in the Vancouver area.
When construction is completed over the next eight to 10 years, the site will accommodate eight condo towers, office space, a hotel, retail stores and restaurants, as well as public piers, a waterfront walkway and a shipbuilding museum.
Urban demographer David Baxter says waterfront property will always hold its value.
“No matter where you go in the world, people will always be willing to pay more to be on water,” said Baxter, executive director of the Urban Futures Institute, in explaining the attraction of waterfront living.
“People will pay a premium for a waterfront view, just like they would for a nicer car with more features. Water views are particularly attractive because you can see the changing seascape, barges, boats and distance.
“You can watch storms coming in and such things. It’s kind of like having a home entertainment centre. And, by definition of having a view, other people don’t have a view of you. You don’t have people staring in at you, so there is more privacy.
“It’s privacy, it’s entertainment, and it’s vista. All of those things tied in simply make [water] a better product, adding value to a piece of real estate.”
In June, mining promoter Robert Friedland purchased a 3 1/2-year-old, five-bedroom, 887-square-metre (9,545-square-foot) house at 3330 Radcliffe Ave., in West Vancouver, for $17 million, the highest price ever paid for a residential property in B.C.
Meanwhile, a 530-square-metre (5,700-square-foot) penthouse suite in Coal Harbour sold for $6.02 million. A two-bedroom 171-square-metre (1,838-squarefoot) luxury condo on Bayshore Drive, purchased during pre-construction marketing a couple of years ago for $838,000, resold after its recent completion for $1.44 million.
Over in False Creek, values among some of Concord’s more coveted waterfront units have risen 30 to 50 per cent in the past year, according to Multiple Listing Service figures.
On the water along Marinaside Crescent, the stretch between Drake Street to the west, and Nelson to the east, is choked with about a dozen condo towers.
McTavish said Concord has two or three years left of waterfront development, although the company still has significant chunks of land away from the water.
Among projects under construction, Concord is building King’s Landing, two luxury towers with unobstructed water views, near the foot of Homer Street. The 180 units sold out in early 2004 at an average of $550 per square foot. Their current market value has risen to about $800 a square foot, McTavish said.
Next up for Concord is Silver Sea, a nine-storey, 31-unit building close to Granville Bridge.
Then, in the next two to three months, McTavish said, Concord plans to market four more waterfront towers, located east of Cambie Street bridge, immediately west of the Plaza of Nations.
Concord recently announced plans to launch its most-exclusive condo project, a 20-storey tower designed by architect Arthur Erickson and slated to be built on the site of its current sales presentation centre on Homer Mews.
Prices there are to average more than $1,000 per square foot.
“That’s it for downtown waterfront,” McTavish said. “You can’t redevelop the beachfront in the West End. There remains a huge demand for rental buildings. You couldn’t knock down all those three-storey walkups. And you couldn’t tear down the Sylvia Hotel to build condos.”
Over in Kitsilano, realtor Spice Lucks, a waterfront specialist, said properties along the “Golden Mile” of Point Grey Road — on the water side between the 2400 and 3600 blocks — rarely become available.
When something does come on the market, it is usually an estate sale, she said, adding there are generally “less than five” transactions a year.
“Ten years ago, if there was a waterfront property put on the market, there would only be one or two buyers interested or had the means to buy,” said Lucks.
“The same piece of property now, you could have 30 people lining up. There’s only one comment I hear consistently, and that is, ‘I should have bought when I had the chance.’”
Developer Bruce Langereis is among the many homebuilders lamenting the vanishing inventory of waterfront sites.
“You follow the shoreline, there’s virtually nothing left,” said Langereis, president of Delta Land Development.
“Traditionally, we try to focus our attention on Vancouver, but now we’re forced to look elsewhere, to other parts of the Lower Mainland.”
In the past three years, Delta Land, controlled by Singaporean investors, has developed two luxury Coal Harbour condo towers, called Carina and Callisto.
But when the company tried to purchase three more adjacent waterfront sites from Marathon, it was outbid for the properties by Aspac Developments, owned by Hong Kong’s wealthy Kwok brothers.
On one of those sites, Aspac is currently building an upscale condo tower called One Harbour Green, where the 530-squaremetre (5,700 square foot) penthouse has been presold for $6.02 million — the highest price ever paid for a condo in B.C.
Privately held Aspac reportedly paid about $100 per buildable square foot for the three prime waterfront sites a couple of years ago. Since then, land prices have soared, hitting $140 per foot in some non-water sites in downtown Vancouver and out on the University of B.C. campus.
Realtors say purchasers of upscale waterfront condos include wealthy Americans, Europeans and Asians, as well as locals downsizing from large homes in Shaughnessy or West Vancouver.
The purchaser of the $6.02-million penthouse is described as a business executive from Texas.
Shut out of the coveted front row of Coal Harbour waterfront after building Carina and Callisto, Delta Land acquired a site directly behind those two towers at Hastings and Bute, where it is developing a third project, a $100-million, 30-storey building called Cielo.
As a indicator that there is strong demand for condos offering what are known as “corridor” water and mountain views behind front-row buildings, Cielo’s 140 units virtually sold out in a matter of a few days in June, at prices ranging from $300,000 for a one-bedroom, to $1.9 million for a penthouse.
“Anyone who’s building on Vancouver harbour should consider it a privilege, because you’re helping to put a face on the city as seen from the waterfront,” Langereis said.
“Think of the hundreds of thousands of people aboard cruise ships and float planes who are seeing what you’re doing. Obviously, we would love to have more land to do more projects.”
As proof of rising waterfront values, Langereis said a buyer who paid $2 million a year ago for a unit in Callisto recently resold the home before taking occupancy for $2.65 million.
“The person who bought from us has profited hugely from the very limited supply of waterfront,” Langereis said.
Stamp said Fairmont still has about 7.3 hectares (18 acres) of land left on the east side of Canada Place, stretching to Main Street, but there are railway tracks on it still in use.
Asked if there would be potential for redevelopment, he said: “Probably not in our lifetime.”
WARD PERRIN/VANCOUVER SUN The north side of False Creek in Vancouver is almost completely developed with apartments and few similar sites are available to people wishing to live close to the waterfront.
MARK VAN MANEN/VANCOUVER SUN Westside Vancouver real estate agent Spice Lucks surveys the spectacular view of English Bay from a waterfront home on Point Grey Road.
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