Realtor: Lack of easy transit have depressed real estate prices in Maple Ridge and Pitt Meadows until now

Derrick Penner
Sun

So many of the province’s proposed Gateway transportation improvements lead to Maple Ridge and Pitt Meadows that land values in the two Vancouver suburbs will jump as much as 20 per cent, the Real Estate Investment Network predicts.

Those two communities won’t be alone, said REIN president Don Campbell. North Langley-Abbotsford, Port Moody-Coquitlam, Surrey-Delta, areas of Richmond and Vancouver and even Chilliwack and Mission should also see increases in real estate values from 10 per cent to 20 per cent as new transportation routes are built.

Campbell and co-author Russell Westcott released their assessment in a report titled The Gateway Effect: The impact of transportation improvements on housing values in the Lower Mainland and Fraser Valley.

“[The Gateway improvements] will open up some of the economic arteries of the region,” Campbell said in an interview.

Robert Helsley, a professor at the University of B.C.’s Sauder School of Business, said it is a matter of accessibility. Wherever government installs new infrastructure — whether it is rapid transit tracks or a highway — it will influence property values and development patterns.

Campbell, however, has tried to quantify the effect of the Lower Mainland’s major transportation initiatives on property values from Richmond to the eastern end of the Fraser Valley.

He studied examples around rapid transit systems across North America, as well as several instances of highway improvements in the United States to reach his conclusions.

Campbell said Maple Ridge and Pitt Meadows should see the most dramatic increase in property prices because heavy traffic congestion has depressed real estate values there compared to communities on the south side of the Fraser River.

“People are looking for more affordable regions [to live in],” Campbell said. “The problem with some of these regions, like Fort Langley and Pitt Meadows, is that people just can’t get to work.”

He added that the convergence of Gateway projects in the Ridge Meadows area should solve that. Gateway’s North Fraser perimeter road, including an expanded Pitt River bridge and improved Mary Hill bypass should help ease traffic congestion through Pitt Meadows.

So should the new Golden Ears bridge, Campbell added, which will link Ridge Meadows with Langley, Highway 1 and even Gateway’s South Fraser perimeter project.

Campbell added that he doesn’t expect the “Gateway premium” to be fully included in property values until after the Gateway projects are complete, but industry participants in the region are already starting to see the effect take hold.

“Some of that impact is probably already being felt,” Ron Antalek, a realtor with Re/Max Ridge Meadows Realty in Maple Ridge, said.

While the booming local housing market makes it difficult to measure exactly how much the Gateway initiative has pushed up property values, Antalek said he noticed a distinct increase in interest in the Ridge Meadows area by first-time buyers and commuters once TransLink’s $650-million the Golden Ears bridge was confirmed.

“Maple Ridge is the most affordable community in the GVRD,” Antalek said. “That attracts first-time buyers, and [transportation improvements] have been the biggest drawing card for these [people] who can see a future of being able to survive a commute.”

However, Dave Keenan, CEO of Genstar Development, has worked on developments in Pitt Meadows and said he believes the premium could already be 15 per cent or higher.

The Gateway project, he added, helps create a whole new “locus of activity,” centred on Abbotsford, for regional industry.

“All of a sudden there’s this . . . different set of economic opportunities that are emerging in the Valley as opposed to the downtown core of Vancouver, or the Burnaby-Coquitlam sector,” Keenan said.

Campbell said he expects North Langley to Abbotsford area to see the next highest increase in values as twinning of the Port Mann bridge, expansion of Highway 1 improves traffic flows for commuters.

Campbell also believes property values in the Port Moody-Coquitlam corridor could rise up to 20 per cent with the Evergreen Line rapid transit link and North Fraser perimeter road.

Surrey and Delta will receive “secondary benefits” as the South Fraser perimeter road and twinning of the Port Mann bridge will help ease traffic on their major streets, Campbell said. Mission and Chilliwack, he added, will attract first-time buyers who will find it easier to commute to jobs in the Abbotsford and Langley areas.

Campbell said areas of Vancouver and Richmond along the Canada Line rapid transit link will see values increase, but not by as much as other regions because they are already high-priced areas.

David Podmore, president of the Urban Development Institute’s Pacific region, and CEO of Concert Properties, said developers are already staking positions on rapid transit lines for higher-density development.

Podmore said Concert is seeing more buyers who find urban condominiums more attractive than suburban houses.

“A lot of people . . . are estimating both the real and social costs of commuting,” Podmore added.

© The Vancouver Sun 2006

 

Best advice is to get it in writing and get a lawyer

Tony Gioventu
Sun

Every year thousands of condo buyers call our advisors looking for help out of a sticky situation resulting from a uninformed condo purchase. As the buying season fires up, buyers need to take a few simple steps to avoid disappointment and unanticipated costs. Here are five specific situations buyers have encountered in the past month alone.

1. David in Kelowna asked us for help in getting an exemption to rent a unit he just bought. The seller told him it was an investment unit, but it turned out the strata had recently passed a new bylaw prohibiting rentals.

Tip: Before you sign for a unit, read all the bylaws currently still in effect. Don’t rely on the strata or the current owner to provide you with what they think are the bylaws. Only by having your lawyer or agent review the registered bylaws in Land Titles can you be sure.

2. Alanna Johnson in Vancouver wanted a quick solution to an age exemption. It turned out the strata minimum age for residency is 55; she’s only 38. The council treasurer told her they never ask people’s age so she assumed it was OK.

Tip: Don’t rely on verbal information. If you can’t obtain a written answer to solve the concern, something is likely wrong.

3. Mrs. Lu in Richmond wrote complaining that although she had bought a specific parking space in her building, council is telling her the spaces are all being moved and she can’t keep it.

Tip: You can’t buy or sell something that doesn’t belong to you. Common and limited common property (LCP) belongs to the strata corporation. The only way to reasonably secure your parking or storage lockers is by having an LCP designation or a separate parking or storage strata lot.

4. Jane in Burnaby e-mailed that when the refunds for the PST grants and legal settlements were returned, their property manager sent them to the new buyer, who is the current owner. She thought she would automatically get the money because she paid the dues.

Tip: Whether buying or selling, special arrangements in contracts and purchase should be negotiated and written by your lawyer. Saving $1,500 in legal fees may cost you $10,000.

5. Mrs. Hickson of Courtney was surprised to find her home inspection only applied to her unit, not the whole building. As a result she found out she had bought into a leaky condo, with little recourse against the inspector.

Tip: Home inspectors are currently an unregulated industry. When you request a home inspection for a condo, make sure it includes the building envelope and common areas. Verify that your inspector/

engineer is qualified and insured to provide a complete and reliable home inspection to protect your investment, including copies of their insurance policies.

Contact Tony Gioventu, executive director of the Condominium Home Owners Association at 604-584-2462 or toll-free 1-877-353-2462, fax 604-515-9643 or e-mail [email protected].

© The Vancouver Province 2006

Bob Rennie, in a speech, champions density approvals as key to affordable and social housing

Bob Rennie
Sun

Earlier this month Bob Rennie addressed an annual meeting of the local development fraternity. This extract from his speaking notes picks up the two-city leader — Seattle and Vancouver — in the marketing and sale of new-home projects as he explains how he came to sell all 536 Woodward’s apartments in one day.

We run our company on two simple sayings — whoever gets to the truth first wins and whoever adheres to a position previously stated when times are changing is destined to fail.

While we started our Woodward’s meetings [our stated intention was] ”let’s deliver absolute affordability.”

But in the next meeting, the focus for my job [became] to persuade the Woodward’s developers that:

– Poor people don’t buy condos.

– Let’s deliver a higher quality than is currently available downtown or in Yaletown.

– Let’s not hide from what the Woodward’s neighbourhood is.

– Let’s use images of street people and local merchants through the campaign.

– And let’s use two tag lines – “Be Bold or move to Suburbia” and “This is an intellectual property.”

– Well, none of this works if you don’t believe it.

– I believe you can cause change a billion dollars at a time but nothing gets done a million dollars at a time.

– This is social engineering. The rich and poor living together.

– If Woodward’s were 87 condos on top of social housing I would not be here talking about it.

– My goal was to establish a marketing model that would allow the fortunate and less fortunate to walk down the street together.

– Well, we are really only expanding on Millennium’s L’hermitage model at Richards and Robson when we achieved 47 non-market units and 202 luxury condos.

– If you have lived in Vancouver all your life — you looked at Woodward’s as questionable and forgotten. But if you have lived in any other major city or travelled, then you a Woodward’s district as the emerging future.

– This is diversity. [Additionally] this is sustainability, and not the rhetoric of simply lower heat cost.

– Well it doesn’t take Larry Beasley (the powerful, and soon to retire, co-director of city hall’s planning department) or Bob Rennie to figure out that the city has no where else to go but east.

– And if not east, then you would have to believe the city of Vancouver is going to stop growing.

– We are moving east; one of these two possibilities does exists.

– So, on Woodward’s I spent more than $3 million of Ben and Ian’s money before we sold a single unit [Ian Gillespie and Ben Yeung, the developers]. The result was

. . .

– From Nov. 5 to the first week of April, more than 6,300 people registered [an interest], either through the Internet or on the telephone.

– From April 8 to 13, more than 4,000 people visited the presentation centre.

– On April 13, 1,600 buyers spent up to six hours calling, to register to write an offer on April 22. And the right to come back to the presentation centre to pick up a wristband.

– From April 14 to 21, 1,100 buyers picked up their wristband entitling them to their place in line. We scheduled 160 per hour.

– On April 22, buyer’s slept overnight to be at the front of their line. We sold out that day. The developer kept nothing back. We had only 28 rescissions . . .

– So, what can we learn from all this: The consumer is very aware of change and the consumer is watching.

. . . Very noticeable in the buyer lineup were buyers in old wool sweaters, buyers who ride bikes and buyers with their parents’ paycheques . . . and this is our buyer of tomorrow. We have a huge shortage of affordability. I could have sold out the bottom half of the tower three times that day. . . .

– Woodward’s is that comprehensive community that will cause change. . . . But is it a model of living for the future? Or is it a model of development for the future?

– Social housing and non-market housing is in a crisis situation. We have to find a way to produce non-market housing that attracts investors to buy into an ethical fund. Buy social housing condominiums just like we buy a studio and rent it out just like we buy into an ethical stock fund.

– This is actually something that our company is working on. We spoke with the city five years ago and we were too early and now we have to do it before we are too late.

– The model of private and public needs being met through development really is a win/win and we have to start getting creative in every city and municipality.

– But the real crisis is in affordability and this is where the politicians and planners need a huge wake-up call, or where the hell will our children live?

– Millennium has an application in to develop 16 acres above Park Royal . . . [but] nobody wants density in West Vancouver. So where does an empty-nester or 25-year-old go? They leave. This is not a sustainable community.

– In Port Moody, we are looking at a development in which the one-bedroom apartments would be 875 square feet. I want them to be 600 square feet, to create affordable product.

The answer is no because there are too many doors. There is a unit cap.

– These are just two examples of the obstacles we face in producing an affordable product.

– What if the City of Vancouver and surrounding cities and municipalities bonused density to provide affordable housing? Based on price per door achieved.

– Nobody has the answer, but nobody is addressing the problem. We are all relying on bylaws and zoning, a reliance that does not respect the real changes and challenges that we face.

Bob Rennie made these comments at a gathering of the Pacific region of the Urban Development Institute.

Bob Ransford
Sun

Not all that long ago sinking housing prices in a seriously lagging economy were a worry for some homeowners, their equity disappearing even as interest rates were relatively low.

I can remember at least two if not three distinct periods in my adult lifetime when housing prices fell substantially enough for homeowners to worry about their biggest investment.

During the devastating real estate crash of the early 1980s, skyrocketing interest rates took a huge bite out of everyone’s home purchasing power. Housing starts lagged for years thereafter.

Ten years or so later, as the 90s dawned, a short North American recession took another bite out of real estate.

Then during the dark years of the late 90s in B.C., housing prices slowly slipped and the new-home market almost disappeared.

These boom and bust cycles in real estate are common. In the past, they were accentuated in our part of the world by other cyclical forces that played on our resource-based economy.

During boom times people celebrated paper gains in the investment in their home, while those yet to enter the market grumbled about the affordability challenge.

On the other hand, times of bust brought panic, for-sale signs and foreclosures. No one talked of wanting to get into the market.

But our real estate market has changed.

We may see some price adjustments in the housing market in the future, but we are becoming immune to the huge market swings of a boom and bust economy.

Housing affordability will be a lingering concern for years to come.

Two factors are largely responsible for this change, apart from the fact that B.C.’s economy has become much more diversified in recent years.

First, Vancouver has become a destination to park real estate investments, particularly for those who enjoy visiting and want a handy downtown condo as their temporary or even permanent home base. Vancouver’s downtown housing market has been inoculated against cyclical economic forces.

Second, with our natural and man-made urban growth boundaries and the tremendous population boom we have seen over the last 20 years, we are simply running out of developable land if we plan on continuing to build at the densities we have traditionally seen as acceptable.

At the heart of the housing affordability issue, underneath all of the other rhetoric, is the simple matter of supply in the supply and demand equation that drives all markets.

Uber-realtor Bob Rennie pointed to it a week or so ago in his keynote address to Vancouver’s developers assembled at the Urban Development Institute when he revealed that all the construction cranes you see on the Vancouver skyline aren’t signalling a huge glut of condominium apartments about to hit the market.

In fact, virtually all of the units under construction have already been sold. Many have been sold to investors who are parking their money in Vancouver real estate, willing to accept very minimal returns.

At the same time, these investors are supplying the market with the desperately needed rental housing.

The other factor affecting supply — lack of developable land — can be somewhat alleviated with densification. My prediction is that we aren’t likely to see much progress in this area until things get really bad in the housing market — bad enough to seriously impact livability.

Why? The answer lies in selfishness.

Many homeowners are savvy enough to realize that higher density in their neighbourhood could mean more supply, leading to a tempering of prices.

Meanwhile, many of these homeowners are at a stage in their lives where they are equity rich — with all of their equity in their large single-family home — and income-poor. They don’t want to see affordability addressed with lower home prices.

Many of these same homeowners have developed lifestyle habits and perceptions over two and three generations now with the large lot single-family home ingrained in their minds as the only way of life.

They are the NIMBYs who will fight density in their neighbourhood at every turn.

Finally, addressing the housing affordability issue is complex. There are many parts of the market that need to be addressed–all of them with different needs. Simple supply and demand solutions won’t provide instant relief for the homeless street people, the hard-to-house with a variety of special needs, the growing cohort of income poor seniors and others.

Looking beyond the short term realities of the market is not only advisable in addressing housing affordability — it is essential because there are no short term realities in our housing market anymore.

Bob Ransford is a public affairs consultant with COUNTERPOINT Communications Inc. He is a former real estate developer who specializes in urban land use issues. E-mail: [email protected]

© The Vancouver Sun 2006

Presence of Whole Foods in development elevates the project, marketer says

Sun

CROSS ROADS

Location: Cambie and Broadway, northwest corner, Vancouver

Presentation centre address: 536 West Broadway

Hours: Noon to 6 p.m., Sat. – Thur.

Telephone: 604-729-8695

Web: crossroadsvancouver.com

Project size: 80 apartments and eight 2-storey townhouses

Residence size: 652 sq. ft. – 1,020 sq. ft.

Prices: From $390,000

Developer: PCI Group

Architect: Busby, Perkins+Will

Interior design: Scott Trepp Interior Design and Kodu Design

Tentative occupancy: 2008

Cross Roads is equally new-home project and new-neighbourhood harbinger, the latest manifestation of a collaboration between city hall and industry to transform southeast False Creek into a Vancouver residential neighbourhood.

The development is also the latest residential-over-retail arrangement in Vancouver. A Whole Foods store, a McDonald’s, three other restaurants, another major anchor tenant yet to be announced will all be located on the Cross Roads site. Additionally, an office tower, with a health club for Cross Roads residents and tower workers, will be erected.

Two blocks north of Cross Roads the first Save-On grocery in Vancouver will be located, apartments above. Seven blocks south is the almost-ready-for-occupancy Olive, a Capers grocery at street level. Seventeen blocks west is the hole-in-the-ground the Vine, London Drugs at street level.

To the south and east at 12th and Kingsway (more or less) are the Uno and Stella projects, the former with shops along Kingsway, the latter with an automobile showroom and garage.

Further along Kingsway, at King Edward Village a strong retail component was a critical part of neighbourhood endorsement of the project.

Bob Rennie, organizer of the Cross Roads sales and marketing campaign, jokes that whatever project he is currently selling “is the best.”

But, primarily because a Whole Foods will go into Cross Roads, it is especially memorable for Rennie.

“Whole Foods at Cross Roads will be the first [Whole Foods] store in Vancouver. We all know the success of the one in West Vancouver. I’ve wanted to work on a project with Whole Foods ever since I went to the Whole Foods at Time Warner in New York. It’s an experience. You don’t have to cook again.”

Rennie expects Whole Foods will do for Cross Roads what Urban Fare did for Concord Pacific on the north shore of False Creek.

“When you put a Whole Foods, Capers, Choices, Meinhardt [Fine Foods] you’ve elevated the project,” says Rennie.

Given the shortage of available land in Vancouver it makes sense that more residential projects will have a retail component. “There’s not many places left to go,” Rennie comments. ”It’s a perfect fit — residential and mixed use.”

Not surprisingly, the Rennie slogan for Cross Roads is “Live, Work, Shop.”

He expects the people buying at Cross Roads will be young professionals or people who are buying for the view of downtown Vancouver.

“It’s downtown living without living downtown,” says Rennie.

Cross Roads will also be the location of an underground rapid transit station entrance. Both the Canada Line, to the airport, and the east-west Millenium Line will pass Cross Roads.

The city is spending $29 million on a Canada Line station seven blocks north of, and down the hill from, Cross Roads, its hope a transit and retail hub serving 17,000 people in the new southeast False Creek neighbourhood by 2021.

In the city hall review of Cross Roads, homes at Cambie and Broadway are “a good transition to the neighbouring Fairview Slopes residential neighbourhood” and the project itself “has the potential to be a vibrant and energetic place.”

The developer has committed to improving the overall public realm at the corner of Cambie and Broadway with setbacks from the street, special paving, lighting and public seating. A plaza with a wood and glass canopy will link the three Cross Roads buildings, residential, office and retail.

Demolition of the site at Cambie and Broadway has already begun and preview sales will begin later this month. Occupancy is slated for 30 months from now, but banks will guarantee today’s interest rates, says Rennie.

© The Vancouver Sun 2006

Sun

Location: North shore, False Creek

Presentation centre location: 1550 Homer Mews

Hours: By appointment

Telephone: 604-899-8800

Web: concordpacific.com

Project size: 23-storey building, 115 apartments

Residence size: 1,055 sq. ft., 1 bedroom +den); 1,232 sq. ft., 2

bedrooms; 1,418 sq. ft., 3 bedrooms

Prices: From $700,000

Developer: Concord Pacific

Architect: Hotson Baaker Boniface Haden and IBI/HB

Interior design: Ledingham Design

Tentative occupancy: December, 2007

When luxury-apartment prospects go shopping they are not seeking small homes and, further, they are seeking the best finishes and appointments money can buy, if the Concord Pacific experience this year and last is a guide.

After the success of the luxury Erickson project, Concord Pacific decided there was more luxury demand to be met. All the homes measured up at 2,000 square feet at least. Most sold within weeks.

Consequently, Concord Pacific decided to redesign Flagship to appeal to luxury-apartment prospects.

Although initial designs were done on Flagship, Concord Pacific had not released the homes for sale when it went to market with the Erickson.

This meant there was still time for the designers to go back to the drawing board and increase the Flagship homes’ square footage.

This they achieved by basically scrapping one apartment on every floor, resulting in an average gain of 300 square feet, or 30 per cent, for every home not eliminated.

After Erickson, the average Flagship square footage is 1,300; before, it was 1,000 square feet.

Some of the larger homes are now large enough to accommodate a piano, a result that has resulted in the outline of a “Baby Grand” drawn on the floorplans.

Concord Pacific also polished up the ”specs.”

“Before-Erickson” upgrades, like stainless steel appliances and wood floors, are”after-Erickson” standard.

The developer also introduced the singular or unique into the interiors.

The double vanity in the master bathrooms, for example, will be built to a Concord Pacific design. It lights up, with motion sensors turning on lights when anyone enters the bathroom.

“Concord in the fall of ’05 marketed the Erickson project. We targeted a demand we saw coming through the release of our penthouses – a demand for our prime properties,” says Peter Webb, vice-president of development for Concord.

“We’re finding in today’s market people are looking for the best product they can find.”

Surprisingly, Webb says while the perception is off-shore money is fueling the hot high-end market these individuals account for less than half of the sales of this product.

Instead, he says, it is locals who are taking advantage of “low cost money.”

They realize the market is moving rapidly so they expect their properties will only increase in value as Vancouver’s economy continues to prosper and plans are underway for Olympic 2010.

The Flagship, already half sold, , is the last opportunity to buy a currently zoned False Creek waterfront property. The project is already under construction and will be ready for occupancy in late 2007.

Concord does have rezoning applications under way at city hall for future waterfront towers, near the Cambie Bridge at Pacific and Expo boulevards; at the east side of the Plaza building; and at Beatty and Georgia.

The company which has been redeveloping the former Expo site since 1987 expects to have completed the build-out within five to seven years. In the end, Concord expects to build another dozen towers in the area by the time it is through.

When Concord Pacific first began selling apartment it sold them for as low as $252 a square foot. Today, until someone in the organization comes forward and says not true, it is commanding more than $1,000 a square foot in Flagship.

Webb says he knows of quite a few people who have done well buying and reselling Concord properties, and believes the Flagship will be a good investment. He notes the tower is being built across from the Olympic Athletic Village at the southeast end of False Creek.

“People buying in this tower will of course be getting an excellent view,” says Webb.

Indeed, because the tower is directly in front of the seawall buyers can’t get any closer to the waterfront.

The glass and concrete tower was designed in such a way that even the rear units will still have a waterfront view, though restricted.

This is the only Concord tower that the city has allowed to be built directly on the seawall. Others have been required to have step-backs, such as the townhomes that surround the Erickson building.

The reason for the difference is the Flagship is adjacent to an open park – Coopers Park – so a stepback wasn’t deemed necessary by the city.

The display suite is also unique in that visitors enter via an “elevator” which has a window that shows the view homeowners have of Science World as the “ascend the building.” In actual fact, you exit into the hallway of the one-floor presentation centre.

Buyers of Flagship are able to use the 14,000-square-foot Esprit City Club, with its 60-foot pool, two bowling lanes, Hollywood style movie theatre, meeting rooms, exercise gym and concierge. There’s also a fleet of kayaks they can borrow. The Esprit Club is located nearby in another Concord building.

© The Vancouver Sun 2006