BURST
Seven years after an ambitious two-tower development in Vancouver’s West End was approved by Vancouver council, the project still hasn’t broken ground.
In hopes of reigniting it, the developer has proposed converting part of the project — at 1444 Alberni and 740 Nicola streets — from market rental to social housing.
Under the original plan, there were going to be 129 units of market rental housing, and the city was to receive $75 million in community amenity contributions, including a 56-space daycare and approximately $67 million in cash for things such as parks, libraries and recreation facilities.
But under a revised rezoning application now before the city, 51 social housing units would be built, the number of market rental units would drop to 78, and the city wouldn’t get as much cash. A document on Vancouver’s Shape Your City website says the social housing units would “replace a portion of the cash-in-lieu payment.”
The exterior look of the project would be the same, with 48 and 43 storey towers. It would also have the same number of strata title condos, 314.
The proposed block-long development by Landa Global Properties and Asia Standard Americas was designed by the famed New York architect Robert Stern. Its “formalist” style echoes the art deco look of buildings like the Hotel Vancouver.
“We are trying to find practical and creative ways to move this project forward, and we remain committed to working with the city and the community to identify viable solutions,” said Landa’s CEO Kevin Cheung.
“The market has shifted significantly since we first acquired the site eight years ago, and this resubmission reflects our effort to adapt and adjust responsibly to those new conditions.”
The Shape Your City website said the developer “also proposes to remove Passive House certification” on the project.
When the project was first announced in 2017 , it was proclaimed the towers would be the world’s tallest with the green building standard that maximizes energy efficiency.
“Passive House is a European standard, initially made for single-family homes,” said the developer statement. “Instead, we will achieve the latest Vancouver code which is close to Passive House standards.”
Planner and developer Michael Geller said the proposed changes are due to changes in the real estate market.
“Virtually all the developers right now, including the big ones, are facing very difficult financial situations, both here and in Toronto,” said Geller. “I just saw a note that said last month, there were only 25 condo sales in Toronto, which is less than the number of players on the Blue Jays team.”
As a result, Geller said developers are reworking projects.
“I know that my clients have been in conversation with the city about renegotiating community amenity contributions and development cost levies,” said Geller. “Because if there can’t be some adjustments, the projects simply are not proceeding.”
The cost of building has risen sky-high in recent years.
“Some of these more architecturally designed projects are approaching $700 per foot,” said Geller. “The other problem is land values have dropped dramatically in the last year. Developers like Landa and others were purchasing their sites years ago, when land was more.”
The pool of buyers for luxury projects like 1444 Alberni has also changed.
“These high-end projects were generally being targeted to foreign buyers,” said Geller. “And today we have a ban on foreign buyers.”
The investor market has also dried up.
“Projects were generally being sold to investors when at the pre-sale stage,” Geller explained. “Even though they might wait four or five years, the expectation was that the value and the prices would go up. Unfortunately, that’s gone now, and very few people are predicting the prices are going to go up over the next year.”
The city has been collecting public input on the proposed changes on the Shape Your City site. Staff will review the revised rezoning application and report back to council.
Landa purchased the site at 1444 Alberni and 711 Broughton in April 2016 for $130 million. It had sold for $62.6 million two years earlier. The site is now assessed at $134.5 million.
The property at 740 Nicola was purchased for $40 million in April 2016. It had sold for $20.9 million in March 2014. It is currently assessed at $30.3 million.