29-storey mixed-use development land located in 618 Sixth Street, New Westminster, B.C

Marcus & Millichap
Western Investor

High-density mixed-use development in Uptown could host 27 to 29 storeys of residential under current zoning.

Property type: Development land

Location: 618 Sixth Street, New Westminster, B.C

Size of land: 34,801 square feet

Land size in acres: 0.79 acres

Approved development options: 29-storey market condo + rental tower with commercial podium, or 27-storey rental only tower with commercial podium

Sale price: $27.5 million

Brokerage: Marcus & Millichap, Vancouver

Brokers: James Blair, Patrick McEvay and David Morris

© 2022 Western Investor

Taming the housing market: Real estate industry at odds with B.C. government

https://rem.ax/3M7t3y5
The Vancouver Sun

B.C. Real Estate Association is pushing back against province’s plan to allow homebuyers to back out of a sale within a “cooling period” of seven days.

 The B.C. real estate industry and provincial Finance Minister Selina Robinson are at odds over how to tame the blistering housing market. Photo by Mike Bell /PNG

The B.C. real estate industry and provincial Finance Minister Selina Robinson are at odds over how to tame the blistering housing market.

Last November, the province announced plans to implement a “cooling off period,” where a buyer has seven days to change their mind and back out of a sale after agreeing to buy a property.

On Monday, the B.C. Real Estate Association, which represents 24,000 real estate agents, pushed back against the plan.

“A ‘cooling off period’ is not the answer to alleviating the stresses consumers are currently facing in real estate transactions,” said BCREA CEO Darlene Hyde, citing analysis the group conducted of similar cooling off periods in other global jurisdictions. “While attractive at first blush, in a market characterized by low supply, such as ours, we believe that a cooling-off period will cause more problems than it solves.”

Instead, the association proposes a “pre-offer period,” where buyers would get five days to research and get information about a property once it’s listed, but before any offers are accepted.

In the case of buying a strata property, it proposes ensuring that documents such as strata bylaws, depreciation reports, information on contingency reserve funds and copies of insurance paperwork are available when listings are posted.

It’s all part of a 57-page white paper with 30 recommendations that the industry has for addressing current hot housing market conditions, which it described as being “untenable” with its bidding wars, supply scarcity and soaring prices.

The association said the B.C. government’s announcement in fall 2021 that it would implement a “cooling-off period” was done without broad consultation.

Hyde estimates the province is 25,000 listings short of what is needed for a balanced market and said the lack of supply may be further exacerbated by the 70,000 to 80,000 immigrants B.C. expects this year.

On Monday, Robinson responded by saying the real estate association, as a commission driven industry, has a vested interest in the market being hot, but the government’s work is to make sure people are protected.

“I’m aware of many points of view on this, including the association’s suggestion of a pre-offer period. Pre-offer periods are unlikely to address concerns about the risk to buyers, can encourage multiple offer situations and have an unknown effect on housing prices.”

Larry Anderson, president of the Fraser Valley Real Estate Board, pointed out that the record housing market is due to a combination of other factors, including rock-bottom interest rates, major shifts in lifestyle and work habits due to COVID-19 and a very low inventory.

Alex Goseltine, executive officer of the B.C. Northern Real Estate Board, cautioned against “one-size-fits-all” answers and said the “cooling off period” answer appeared to be based on current market conditions only in specific parts of the province.

One academic argued that instead of calming the market, the so-called flexibility provided by the proposed “cooling off period” could make the market even more prone to speculation.

Andrey Pavlov, who studies real estate finance at Simon Fraser University’s Beedie School of Business, likened it to being able to buy an airline ticket or book a hotel, knowing there is no penalty for walking away from the purchase for a few days when those bookings will be much more expensive.

He said a cooling off period as proposed by the government would allow buyers to purchase a home as a speculative financial asset, fix the price and then actually decide whether to buy it for real or not a few days later without needing to pay a percentage for that flexibility. He said the situation would favour experienced buyers with deep pockets who would find incentives in making lots of transactions in a way that first-time homebuyers couldn’t do as easily.

“We have all also heard the views of mortgage brokers, home inspectors and the experiences of prospective homebuyers about taking unfair risks to find a home in a heated market,” said Robinson. “Right now, the province’s real estate regulator is consulting about ways to bring in a cooling period that could be effective in B.C.”

© 2022 Vancouver Sun

Richmond industrial deal closes at $6.7 million per acre

CBRE Vancouver
Western Investor

Near nine-acre site near SkyTrain sells for $60.58 million in one of the city’s largest industrial transactions to date

Property type: Industrial

Location: 9800 Van Horne Way, Richmond

Property size: 112,019 square foot (warehouse)

Land size: 319,604 square feet

Land size in acres: 8.99 acres

Current zoning: IL (light industrial)

Potential: Industrial strata

Floor-space ratio: 1.0 FSR.

Sale price: $60.58 million

Date of sale: January 12, 2022 (closing date).

Brokerages: CBRE, Vancouver, with Avison Young, Vancouver.

Brokers: Terry Butt (associate), vice-presidents Bruce Richardson and Fraser Rowland, CBRE; Garth White, principal, Avison Young.

© 2022 Western Investor

Prince Rupert Port plans second container terminal

Western Investor Staff
Western Investor

The potential expansion would double the annual capacity at Canada’s third-largest port

Proposed new terminal at Port of Prince Rupert would double container capacity to four million twenty-foot equivalent units (TEUs) of annual capacity. | Prince Rupert Port Authority

The potential expansion would double the annual capacity at Canada’s third-largest port

The Prince Rupert Port Authority and DP World have started a two-year feasibility study on adding a second container terminal at what is already the third-largest container port in Canada.

The potential project would add up to two million twenty-foot equivalent units (TEUs) of annual capacity to the Port of Prince Rupert, significantly increasing Canadian trade capacity with Asia-Pacific markets.

The proposed terminal represents the continued advancement of the Prince Rupert Port Authority’s container terminal master plan done in 2019, which outlined the potential for an additional container terminal, south of the existing Fairview Terminal.  

“This agreement is a clear demonstration of our commitment and confidence in the viability of a second terminal at the Port of Prince Rupert,” said Maksim Mihic, CEO and general manager of DP World (Canada) Inc. “Our vision for this proposed project will ensure the Canadian trade and supply chain landscapes are future-proofed. The feasibility studies will employ a pragmatic approach, exploring the use of advanced technologies and ideas to position the new terminal as an industry leader within Canada and the world.”

 “As Canada’s third-largest Port, Prince Rupert is a proven driver of sustainable economic development in northern British Columbia and has been fortunate to earn the support of communities throughout the corridor,” said Shaun Stevenson, president and CEO of the Prince Rupert Port Authority in a statement. “A second container terminal will help consumers, exporters and industries across the country while continuing to contribute significant economic benefit for local communities, the broader region and our Indigenous partners.”

The project’s development will maximize the value of strategic Prince Rupert attributes such as the shortest marine link to key Asian markets, uncongested marine approaches and harbour, available industrial land with room to expand critical logistics, transloading and warehousing activities and North American access via Canadian National’s Class 1 northern rail line, Stevenson added.

Once the study period is complete, both partners will finalize a development plan that will be subject to regulatory review and authorization.“The partners are committed to incorporating Indigenous knowledge, feedback and economic interested into its planning and development process,” according to the Port Authority.

© 2022 Western Investor

RBC reveals Q1 results

Fergal McAlinden
other

The bank’s first-quarter earnings arrive amid continuing challenges posed by COVID-19

Royal Bank of Canada (RBC) has posted its financial results for 2022’s first quarter, revealing net income of $4.1 billion during that period – a 6% year-over-year increase.

The bank said that its net income had risen by $248 million in the quarter ending January 31 compared with the same time last year, driven by robust earnings in its Personal & Commercial Banking and Wealth Management sectors.

It noted that strong business volume growth and double-digit residential mortgage growth thanks to housing activity had helped spur higher net interest income in Canadian Banking.

Solid performances in those areas helped compensate for the fact that the bank’s Capital Markets earnings dropped from their record first-quarter numbers posted in 2021, with Insurance and Investor & Treasury Services also seeing a year-over-year decrease.

RBC said that its pre-provision, pre-tax earnings of $5.5 billion marked a 10% increase over last year, with that performance mainly due to higher average fee-based client assets, record investment banking revenue and higher net interest income.

Read next: RBC on how Canadian home sellers are faring

In comments accompanying the banking giant’s news release, president and chief executive officer Dave McKay said that its first-quarter performance in 2022 showed the “significant momentum” it was building despite uncertain times amidst the continuing COVID-19 pandemic.

“This is a testament to our scale, diversified business model, and strategic investments in technology, talent and innovation to create differentiated value for our clients and shareholders,” he said.

“While the Omicron variant has created headwinds to the global economic recovery over the past quarter, RBC employees remained unwavering in their commitment to supporting our clients and communities.”

McKay said that the bank’s priority would remain its “Purpose-led” approach to delivering products and services in a changing world, “while also accelerating our commitments to enable a sustainable and inclusive future.”

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Kelowna 0.39-acre retail site sold for $5 million

Royal LePage Kelowna
Western Investor

Prime corner development site on Harvey Avenue at Pandosy Street sold for full list price.

Type of property: Retail

Location: 430 Harvey Street (Hwy 97N), Kelowna, B.C.

Number of units:1 (restaurant)

Property size: 5,500 square feet

Land size: 16,998 square feet

Land size in acres: 0.39 acres

Zoning: C-7

Potential floor-space ratio: 9 FSR.

List price: $5 million

Sale price: $5 million

Date of sale: June 23, 2021 (Reported to Done Deals Feb. 24, 2022)

Brokerage: Royal LePage Kelowna, B.C.

Broker: Robert Mistal

© 2022 Western Investor

Bosa set to pour foundation for 43-storey tower on New West waterfront

Theresa McManus
Western Investor

Concrete pour planned for March

 An architect’s rendering of the Pier West development that’s under construction on New Westminster’s waterfront. Contributed/File

A second “monolithic concrete pour” is set to take place on New Westminster’s waterfront in March.

City council has approved an exemption to the construction noise bylaw so Bosa Development can do a monolithic concrete pour for the creation of the foundation for the east tower of the Pier West development. The exemption would allow Bosa Development to do a one-night overnight concrete pour at 660 Quayside Dr.

“Bosa Development has confirmed that the monolithic pour of 4,500 cubic metres for the east tower core needs to occur as one single continuous event estimated to take approximately 24 hours,” said a report to council. “Bosa’s engineers report that the core footing needs to be a monolithic slab as it will be located below the water table due to its close proximity to the south Fraser River.”

According to a report to council, splitting the pour over two days isn’t recommended because it would result in a seam within the slab and introduce concerns regarding future water seepage issues due to hydrostatic pressures.

“The seam also would introduce a risk of water migrating into the elevator shaft,” said the report. “Those risks are eliminated by conducting one continuous pour.”

Bosa is hoping to begin the pour on Friday, March 11 at 6 a.m., which is one hour earlier than what’s allowed under the city’s construction bylaws. The pour would continue until 9 a.m. on Saturday, March 12, which is 13 hours after the end of permitted hours.

The exemption to the city’s construction noise bylaw allows the work to be done from 6 a.m. on March 11 until 9 a.m. on March 12. If weather prevents the work from being done at that time, the exemption allows the work to be done during those same hours on one of the following two weekends (March 18/19 or March 25/26).

“During the pour, there will be four concrete pump trucks located around the foundation of the area of the work site,” said the report. “Concrete will be supplied by approximately 19 concrete supply trucks per hour for a total load of 429 trucks during the duration of the entire concrete pour.”

Pier West, which will be one of the tallest waterfront residential properties in the Lower Mainland, will include 43- and 53-storey highrises. It will also include a three-storey commercial building that includes childcare and retail spaces, about two acres of park and open space, an extension to Westminster Pier Park, and a public plaza and esplanade space.

In October 2021, a monolithic concrete pour took place for west tower, which is the taller Pier West building.

A staff report outlined some of the transportation impacts impacting the area during the upcoming concrete pour. These include:

* Temporary closure of the 600 and 700 blocks of Quayside Drive to motor vehicles so concrete trucks and get to and from the site.

* Because of the increased truck traffic on Quayside Drive, a traffic control person will direct pedestrian traffic and ask cyclists to dismount in this area.

* The #103 bus route won’t have any bus stop closures but it could experience some minor delays because of additional congestion on Quayside Drive and the McInnis Street overpass.

* Begbie Street, south of Front Street, will be closed to motor vehicle traffic for the duration of the pour, as this is where concrete trucks will enter the site.

* In the event that trains are travelling through the area near the Begbie Street crossing, concrete trucks will detour and access the site via Stewardson Way, the Third Avenue overpass and Quayside Drive. (This is because it is “critical” that the monolithic concrete pour is continuous.)

* A traffic control person will be stationed at the intersection of K de K Court and Quayside Drive to direct customers and deliveries going to River Market.

In addition to sending out notifications to nearby residents and businesses, Bosa Development will be posting updates at www.660QuaysideDr.com.

© 2022 Western Investor

Hudson’s Bay downtown Vancouver site eyed for office tower

Frank O’Brien
Western Investor

 Rezoning application will soon go to Vancouver city hall for ambitious redevelopment plan of century-old Granville Street location

Iconic Hudson’s Bay store: rezoning sought for one-million-square-foot office tower and “next level” shopping centre. | Rendering from Streetworks Development

Rezoning application will soon go to Vancouver city hall for ambitious redevelopment plan of century-old Granville Street location

Hudson’s Bay Company (HBC) has partnered with Toronto-based RioCan Real Estate Trust in a bid to transform the iconic Hudson’s Bay building in downtown Vancouver into a mixed-use development that includes one million square feet of office space.

Streetworks Development, the real estate development arm of HBC Properties and Investments, is leading the revitalization of the Bay Building as well as a variety of HBC’s other real estate assets across North America.

The century-old HBC outlet in Vancouver is located smack dab in the heart of the city’s downtown at 674 Granville Street at the corner of West Georgia Street.

“This project represents the next chapter in HBC’s retail history and its continued commitment to Vancouver,” said Richard Hamori, COO, Streetworks Development. “We intend to honour the heritage of our flagship building, as well as that of historic Granville Street, while expressing our confidence in the future of Vancouver’s downtown.”

The proposed makeover includes reconfiguring the existing retail space into about 350,000 square feet of “next level” shopping and will allow other retailers to lease space in the complex, according to Doug Adams, senior vice president of development, Streetworks.

A new 12-storey tower will be built above the existing six-floor store, providing one million square feet of new office space. With large floorplates of up to 61,000 square feet, the aim is to attract large tech sector tenants, Adams added.

A rooftop garden and internal multi-level atriums are also planned for use by tenants in the new building.

The reconfiguration includes improved access from the building to the Granville SkyTrain station, the Vancouver-City Centre Canada Line station, local bus routes, a new underground indoor bike hub able to store up to 1,500 bicycles, and new public pedestrian walkways that will provide covered access linking the Bay complex and shopping areas downtown.

The developers are expected to apply for Vancouver rezoning in the next week, a spokesman said February 23.

Processing the rezoning application could take up to a year, or more, and will include public engagement. Once approved, an application will be submitted for a development permit and subsequent building permit, with construction potentially starting as early as 2024.

© 2022 Western Investor

Kelowna multi-family rentals hit record $500,000 per door

Frank O’Brien
Western Investor

Under-construction rental complex and new strata rental development set new price highs for residential transactions in the Okanagan city

 New 238-unit-rental project sold for $83.5 million to Centurion REIT before construction even completed | Cushman & Wakefield

Under-construction rental complex and new strata rental development set new price highs for residential transactions in the Okanagan city

A new multi-family rental project in Kelowna that is not even built yet has sold for the equivalent of $363,500 per door to Toronto-based Centurion Apartment Real Estate Investment Trust.

The same real estate team also brokered the recent sale of a new strata-titled apartment and townhouse rental complex in Kelowna at $500,000 per suite, a new record price for rental units in the largest city of B.C.’s Okanagan.

The 238-unit rental complex, Knox Mountain in downtown Kelowna, is now under construction with the first phase expected to complete in 2023. The purchase price of $86.5 million represents the largest single apartment building transaction ever in the interior of B.C., according to Peter Gibson of Cushman & Wakefield, who co-brokered the deal with Steve Laursen of Royal LePage Kelowna.

The strata development, Proxima Urban Homes, is a collection of 59 apartments and townhomes in Kelowna’s downtown, which completed in 2021. Located two blocks from Okanagan Lake, it sold for $29.5 million to Canadian Apartment Properties Real Estate Investment Trust LP, of Toronto.

Both properties are residential rentals and attracted multiple offers, according to the listing agents.

“Proxima was built out to be condo spec originally. It’s a stratified building and is located right in downtown Kelowna in Kelowna’s newest residential and retail district,” said Laursen.

Both developments were built and sold by Kerkhoff Develop-Build, with a head office in Chilliwack, B.C., and another office in Kelowna.

Kerkhoff is a family company in business since the early 1970s, which built one of Kelowna’s first downtown high-rises. Currently it is building the One Water development in Kelowna with two towers of 36 and 29 storeys, comprising 426 strata units.

© 2022 Western Investor

Canada rent prices – how are rates shaping up?

Ephraim Vecina
other

The greatest increases were seen in the nation’s largest markets

 Housing affordability continues to deteriorate for Canadian tenants amid across-the-board increases in rent rates, according to the latest data from the Canada Mortgage and Housing Corporation.

The average rent for a two-bedroom home across Canada increased to $1,167 in 2021, representing a 3% rise from $1,128 in 2020 and $1,080 in 2019. This trend was impelled by a supply-demand imbalance and by the different speeds that markets have recovered from the worst effects of the pandemic, said Bob Dugan, chief economist at the CMHC.

The increases were most prominent in Vancouver (up 2.4% to $1,824) and the Greater Toronto Area (up 1.5% to $1,666).

“When you look at lower income households the mismatch between affordable rentals and the number of households gets worse,” Dugan said. “Last year in Toronto and Vancouver, only 0.2% of the rental [segment] was affordable for the bottom 20% of earners.”

Read more: PBO highlights Canada’s deteriorating affordability situation

Per CMHC’s calculations, a tenant in a two-bedroom purpose-built apartment would have to work 198 hours per month in Vancouver and 178.3 hours in the GTA to keep the monthly rent at 30% of gross income, the level that the Crown corporation considers the threshold of affordability.

“That person has to work more than full-time or needs a second tenant in the unit with them to make that rent affordable, if they’d like to get it down to 30% of income,” Dugan said. “That’s an even bigger mismatch, when you get to that bottom 20% [of earners], so that’s something that’s a concern to us.”

The national rental vacancy rate stood at 3.1% in 2021, versus 3.2% in 2020 and 2.2% in 2019.

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