Archive for July, 2004

Crown land changes news for investors

Saturday, July 31st, 2004

The upside for commercial campground prices could be substantial, as costs have risen slower than residential waterfront lots


The B.C. government is making it easier to access Crown land for general tourist development under an agreement inked this spring between the province and the tourism industry.

This is welcome news for those B.C. campground owners who want to expand and upgrade their existing facilities to attract the anticipated strong growth in the number of tourists attracted to Canada’s Banana Belt — B.C.

The agreement is meant to foster resort development, partly by bringing the tourism industry under the Ministry of Small Business and Economic Development, and firming up regulations on allowing resort projects on Crown Land.

The potential for easier development and a better draw for visitors is just one of the reasons why investors should be scouting out campground properties this year near B.C. rural communities. The other is some very low prices.

Prices are low, because average occupancies and incomes fell last year to their lowest levels in years.

“When you look at a campground, you have to consider the best possible use for the land in the future,” said Rudy Nielsen, president of Niho Land and Cattle Company Ltd. of New Westminster, one of the larger owners of recreational land in B.C.

Nielsen said the slowdown in tourism over the past two years — U.S. visits to B.C. were off 4.3 per cent last year for the second year in a row — has resulted in some great deals in campgrounds and old resort properties in the B.C. interior.

Many campgrounds are in good locations and offer unique features, Nielsen notes, such as lake or river frontage and, most importantly, commercial zoning and exemptions from new regulations. “It is so hard to get zoning these days for new projects,” he explained.

For instance, under provincial guidelines introduced in 2002, no new buildings can be constructed within 30 metres of a fish-bearing stream, river or lake but existing buildings in such locations can be improved.

In some instances, he added, investors will buy an old resort or campground for their own personal use with the idea of selling it down the road.

RV traffic into northern B.C. and the Alaska Highway route has slowed to a crawl in the past two years, which has spurred more owners to sell. There are between 15 to 20 campgrounds listed for sale this spring in the Cariboo region alone, according to Country Lakes Realty Ltd.

A pattern change in where RVs are parked has also affected the market, noted Joss Penny of the BC Lodging and Campground Association of B.C. “A growing number of RV users are now camping, free, at Wal-Mart parking lots,” he said, “and it is a growing trend.” In Prince George, for instance, the arrival of Wal-Mart attracted so many RVers that the local campground operators convinced the city to enact an overnight parking ban in the Wal-Mart lots. Penny noted that the widespread forest fires in B.C. last year also led to a sharp decline in RV travel.

Recent price increases and tighter regulations at government campgrounds should allow some private operators to compete on a more level basis this season.

The lands and parks ministry charges $22 per night at the best public campsites; the average price at private campsites is in the $22-$25 range.

The province has also started charging for parking and firewood at busy provincial parks and has mothballed some of the more remote public campgrounds.

I found what appear to be some good campground and resort prospects, especially when compared to non-commercial recreational property, primarily because of a somewhat depressed market.

Lodging and campground operators reported a significant occupancy decline of 19.6 per cent in August, 2003 and 14.7 per cent in September, 2003 over the same months in 2002, according to a survey by the BC Lodging & Campgrounds Association which tracked operators who were affected by the forest first of 2003.

Gross revenues for lodging were close to $1.5 million for August and September 2003 — a decline of $463,425 over 2002, and 2002 was the recovery year from the 9/11 terrorist attacks.

Gross revenues for camping in 2003 for the months of August and September combined were $828,893, which was $212,210 less than 2002 and $25,654 less than 2000.

By adjusting 2003 revenues to reflect the average room and site rates in 2000, the loss in the lodging sector for August and September stated in 2000 dollars was $385,746 and for campgrounds $162,483, compared to a year earlier.

How about it as an investment? Well, the prices of residential waterfront lots in the Cariboo have increased nearly five-fold in the past 10 years, for instance, but commercial campground prices have merely doubled. The upside could be substantial. A real estate and an income play.

While it might be difficult to get financing for the purchase of campgrounds, especially if the current income stream is low, most of the sales are owner financed. Your local credit union may be a good bet too. You may have to take the long-term view from an income point of view but the right campground is a solid land investment right now in British Columbia.

Life size sculptures of Orca Whales – Where They Are?

Wednesday, July 28th, 2004

Here’s a guide to the pods of orcas that have surfaced across the city, life-size sculptures designed and decorated by B.C. artists. Some will be auctioned on Oct. 12 to raise funds for the BC Lions Society’s Easter Seal operations and the Canucks for K


Location Orca Name Artist Sponsor

1 Burrard/Canada Place Snapshots Angie Benbow Tourism Vancouver

of Vancouver

2 Canada Place Forest Floor Richard Cole Imperial Oil Ltd.

3 Canada Place Travels with My- Marc Luc Poelvoorde HMY Airways

Orca George

4 Canada Place Recycling Orca Bill Thomson Vancouver Convention

& Exhibition Centre

5 Canada Place The Spirit of Tiko Kerr Spirit of Vancouver

Whale Being

6 Granville Square The Well Read Whale Tiko Kerr The Vancouver Sun

7 Howe/Canada Place Spirit of Community Rhonda-Lee Laurie McDonald’s

Restaurants of Canada

8 Howe/Cordova Flora Orca Mary Savage PricewaterhouseCoopers

9 Cordova Plaza Myth Orca Ken Skoda Methanex Corporation

10 Burrard/Cordova Remains of a Garden Shannon Belkin Borden Ladner Gervais

11 Burrard/Cordova All Things BC Christy Deslauriers Phillips Hager & North

& Janet Woll Investment Management

12 Bentall 5 Randie Feil Teekay Shipping

13 Burrard/W. Pender The Whale Riders Joe Mandur, Jr. Leith Wheeler

(interior) Investment Counsel

14 Burrard/W.Pender Shimorca Cim MacDonald CIBC

15 W. Hastings/Thurlow World Orca Noni Raskin Vancouver Marriott

Pinnacle Hotel

16 W. Hastings/Thurlow Country Drive Nadina Tandy Renaissance Vancouver

Hotel Harbourside

17 W. Pender/Bute Scarred Orca David Haughton Ventures West Capital Ltd.

18 Thurlow/W. Pender Orca Who Dances Jerry Whitehead Manulife Financial

With Lights

19 W.Georgia/Thurlow WahYooks Bill Helin Terasen Inc.

20 Burrard/Melville Bobby Orrca Dean Lauze Canaccord Capital

& Brad Wait

21 Burrard/Melville Daniel Mehran Razmpoosh Angus One Ltd.

22 Burrard/Dunsmuir Uplifting Westcoast Michael Tickner Polaris Minerals Corp.


23 W. Pender/Howe Dancing Orca Jerry Whitehead Global TV

24 Harbour Centre Grooves Claudia Bos MacDonald Realtors

(interior) Lorne Goldman Ltd.

Location Orca Name Artist Sponsor

25 Homer/Dunsmuir Hydra Spirit John Ferrie BC Hydro Power Smart

26 W.Georgia/Homer Carmen Mer-Orca Suzy Birstein Web Impressions

27 W.Georgia/Seymour Urban Orca Ross Penhall Scotiabank


28 Granville/W.Georgia Cora Joanna Bullock Varshney Capital Corp.

29 W.Georgia/Granville Nanorca Krisdy Shindler CKNW

30 W.Georgia/Howe Orca Borealis Sibeal Foyle Petro Canada

31 Pacific Centre Bjossa the Orca Shegon Mosaic Works KPMG

Atrium, (interior) in the Sky

32 W. Georgia/Howe Orca Home Stephanie Hill Clark, Wilson

33 W. Georgia/Hornby Gilded Orca Mandy Boursicot HSBC Bank Canada


34 Hornby/Robson, Reflections Karacters Design Group DDB Canada


35-37Robson/Hornby jackpod! Ross Agro & Ovidio BC Lottery Corp.

38 Robson/Burrard Orca Presley Judson Beaumont Bruce Allen

39 Planned orca sculpture will not be installed

40 Sutton Place Hotel Orcasmic Voyage Arnt Arntzen


41 Robson/Homer Whale Tales Judson Beaumont Starbucks

42 Upper Stadium Plaza Still Around Johanna Schmidt BC Place Stadium

/BC Place

43 GM Place Kurtenback Dean Lauze Brian Burke & Jennifer Mather

(interior) Vintage Orca

44 GM Place (exterior) Nazzy Orca Dean Lauze Brian Burke & Jennifer Mather

45 GM Place (exterior) Steamer Orca Dean Lauze Brian Burke & Jennifer Mather

46 Marinaside Chef Boy Orca Will Rafuse Metropolitan Fine Printers/

Crescent Canadian Art Prints

47 W12th/Cambie Mayorca Landon Mackenzie Mayor Larry Campbell

48 W.Broadway/Oak The Queen & King Teresa Waclawik Simmons Mattress Gallery

of Vancouver

49 Oak/W.Broadway Serious Business Pat O’Hara Dales Group

50 W. Broadway/Birch Rainbow Chaser Carolyn Kramer The Value Group of


51 W. Broadway/Birch The Pod Norm Spence Telus

52 W. Broadway/Birch Young and Free Cindy Lietz Boston Pizza Int. Inc.

53 W. Broadway/Hemlock Mercedes Dean Lauze Mercedes-Benz

Location Orca Name Artist Sponsor

54 W. Broadway/Fir Pixel Orca Dean Lauze Bell

55 W. Broadway/Maple Orca Chums Rhonda-Lee Laurie W3 International Media

56 HR MacMillan Sea To Sky Angela Tunner Safe Software

Space Centre

57 Canuck Place, Trev Orca Dean Lauze Canucks For Kids Fund

1690 Matthews Ave.

58 Easter Seal House, Orca Bus Duncan Weller Lions/Lioness Clubs

3981 Oak St.

59 UBC Museum The Medicine People Norman Tait Douglas Reynolds Gallery

of Anthropology & Lucinda Turner

60 Vancouver Northwest Coast Lawrence Paul Vancouver International Airport

International Airport Killer Whale Yuxweluptun & Glen Wood

61 Tsawwassen Ferry Spirit Karel Doruyter BC Ferries


62 Vancouver Aquarium Tourorca Jennifer Ettinger Gray Line of Vancouver


63 Capilano Rd, From Deep Within Wayne Carlick Capilano Suspension Bridge

North Vancouver

64 Edgemont Blvd./ Norca Shore Janis Blyth Edgemont Village Merchant Highland Blvd., North Van. Association

65 Horseshoe Bay Nimpkish Karel Doruyter BC Ferries

Ferry Terminal

© The Vancouver Sun 2004

1000 home development planned near Porteau Cove

Wednesday, July 28th, 2004

Michael McCullough


The Squamish First Nation is in talks with Concord Pacific Developments to build as many as 1,000 homes near Porteau Cove on the Sea to Sky Highway.

Steve Olmstead, manager of planning and development for the Squamish-Lillooet Regional District, said he expects to see an application for a development permit for the site, 38 kilometres north of Vancouver, over the next few months.

As part of a land swap with the province and B.C. Rail dating back to 2000, the Squamish Nation had the option to acquire a strip of land on the shore of Howe Sound running south from Porteau Cove Provincial Park approximately to Deeks Creek, Olmstead said.

“It’s our understanding they have exercised their option,” he said. The purchase price was reported by BCTV News on Global to be $12 million.

Though the district has not seen the proposal yet, Olmstead expects it will be on the same scale as other master-planned communities it has approved in the area, such as Furry Creek and Britannia Beach. Those were primarily residential developments with between 800 and 1,000 units at full build-out. Given the distance to commercial services, the project could also include a convenience store and/or cafe.

Covering more than 500 hectares, the site of the potential development is steep and rocky, making it expensive to service with water and sewer lines, Olmstead cautioned.

The developers may be forced to concentrate the housing in the most affordably developed pockets with stretches of green space in between.

Squamish chief Gibby Jacob was attending a funeral Tuesday and could not be reached for comment on the band’s plans.

Concord Pacific spokesman Tracy McTavish confirmed there have been discussions with the Squamish, but said nothing has been finalized.

Concord is best known for developing Vancouver‘s Expo lands on the north shore of False Creek. After 16 years, that project is nearing completion.

Concord Pacific has a reputation as a quality builder and a shrewd marketer.

In the absence of a development proposal, SLRD director John Turner, the elected representative for Porteau Cove and other unincorporated communities south of Whistler, declined to comment on the Porteau development. But he said area residents recognize there will be more development in the run-up to the 2010 Olympics.

“It’s one of the fastest-developing areas of B.C.,” Turner said, pointing to continued development by Burrard International and Parklane/Tanac at Furry Creek, the proposed redevelopment of Britannia Beach by Britannia Bay Properties, and the Sea to Sky University and other projects in Squamish, not to mention the 2010 Nordic centre in the Callaghan Valley.

Turner himself lives in Furry Creek, where 127 of a planned 900-plus homes have so far been built.

He said the pace of development there has picked up over the past two years after a lull.

© The Vancouver Sun 2004

$140M False Creek Plan Adopted

Wednesday, July 28th, 2004

City land on southeast side to become a sustainable village

Chris Johnson


VANCOUVER – Senior city planner Ian Smith calls it the most advanced urban project in the world.

But Coun. Peter Ladner is worried the money to pay for it is coming from the city’s sacred cow — its billion-dollar Property Endowment Fund.

After hours of debate and public hearings and more than eight years of planning, Vancouver council has adopted a new vision for the 20.8 hectares of land it owns on the southeast side of False Creek.

Construction over the next decade could include the Olympic athletes’ village, towers up to 15 storeys high, housing for about 4,000 people, and a new 10.4-hectare waterfront park, said Smith, senior planner for central Vancouver.

“It’s going to be the most cutting-edge, unique development in the world. It’s taking a really comprehensive approach to sustainability.”

Smith said the project’s energy-saving measures could include composting, low-flow faucets and shower heads, a non-motorized boat service, and “edible landscaping” through channelling rainwater onto rooftop gardens. “It’s kind of exciting, something Vancouver can be proud of.”

Smith said he’s happy with council’s changes to plans he has been re-drafting since 1997. The height limit for towers shrank from 25 storeys to 15. The amount of low- and middle-income housing grew from 20 per cent of the total to 66 per cent, leaving only one-third of units to be priced according to the market.

Heritage buildings, including the Domtar Salt building, will be saved from the wrecking ball.

Details of development plans won’t be finalized until after public hearings in October and further debate at city hall in November and December, he said.

But Ladner wondered if the project’s $140-million financing sets a dangerous precedent.

He said the $50 million earned in the sale of industrial land on the site won’t be plowed back into the Property Endowment Fund, as it should be.

“We’re selling this land, but not putting it back into the fund.”

Ladner said it’s dangerous to take from the fund’s principal, instead of its $7-million yearly interest earnings, as is normally the case with city projects.

“What we did … was unprecedented in 30 years of this fund,” Ladner said.

“We decided to radically change the policy of how we use this fund, with only a few minutes of discussion about this in the council meeting. We should have a lot of thought on this, instead of jumping in and saying ‘Let’s plunder the fund.’ “

Mayor Larry Campbell disagreed.

“At some point, you have to use this,” Campbell told BCTV News on Global.

He said the money shouldn’t be just “socked away for a rainy day.”

But Ladner said he’s worried that using the fund could hurt the city’s bond rating, which currently allows it to borrow money at low interest rates.

“This is a signal that will be picked up by bond-rating agencies. It’s a signal that somebody’s hand has slipped on the tiller and we’re not sure where this is going to go.”

He said that although the project could be “fabulous” in terms of creating sustainable living, “we should be disciplining ourselves to doing what we can afford.”

© The Vancouver Sun 2004

Most home owners insured for Earthquakes

Saturday, July 24th, 2004

Michael Sasges


Apropos of nothing but their receipt in The Sun newsroom this week:

The British Columbia Automobile Association sent out a news release in response to three earthquakes in less than a week, its subject: ”the potential value of including earthquake insurance in home insurance policies.”

If you’re already protecting your home-and-belongings investments with earthquake insurance, you’re in good company:

% of BCAA Lower Mainland policyholders who carry earthquake insurance: 65

% of BCAA Vancouver Island policyholders who carry earthquake insurance: 72

% of all (almost 100,000) BCAA policyholders who carry earthquake insurance: Almost 50

Things to know, according to the BCAA:

– ”Most home insurance policies do not automatically include coverage for earthquakes.”

– ”Earthquake insurance is usually offered as a rider or option to most home insurance policies, and is rarely available as a stand-alone policy.”

– ”It’s even more important to purchase earthquake insurance to ensure that fire damage resulting from an earthquake is covered under your policy.”

– – –

The most recent memorable generation-divide dispatch comes from Bloomberg News, in a report on American baby boomers in their peak earning years who are igniting U.S. demand for second homes near beaches, lakes, ski resorts and golf courses.

Selling price last month of Patricia and George Riddiford’s vacation home at a golf-resort property near Las Vegas: $925,000 US

% gain, in two years: 28

Royal LePage Relocation Services reports that one out of every two Canadians experienced some stress during a house move. Organization and planning, however, can keep that stress manageable, it says.

– Start packing early.

– Label each box to indicate into which room it will go, if it should be loaded last so it can be unloaded first, and whether the contents are breakable.

– If using a mover, get all quotes in writing.

– Have a yard sale or donate unwanted items to charity to avoid clutter and unnecessary moving.

– Mail change-of-address forms two to four weeks prior to moving. The cards are available at the local post office. Arrange with the post office to forward mail to your new address.

– – –

In Old Country news (for some of us):

Singapore‘s home prices rose 0.1 per cent in the second quarter from the previous three months, the first gain in seven quarters, Bloomberg News reports, with sales of new homes easing an oversupply.

New home prices in Bangkok may rise as much as 10 per cent in 2005 because of higher costs for some construction materials. “Demand is still strong for construction materials,” Longlom Bunnag, chairman of property consultant Jones Lang LaSalle (Thailand) Ltd. told Bloomberg News. Developers “have to have a margin of safety. So I’m sure everybody is looking to slap on another seven to 10 per cent for that sort of a contingency.”

© The Vancouver Sun 2004

City sets record for building permits

Tuesday, July 20th, 2004

The boom extends across the region and is putting pressure on both municipalities and developers

William Boei


CREDIT: Photo Mark van Manen, Vancouver Sun, Graphics Vancouver Sun

Construction (inset) is underway on the large site between the off ramps of the Georgia viaduct; an artist’s drawing of a city-approved development including a Costco, office and residential space, all in a downtown tower.

Vancouver set a record in June for the value of building permits issued in a single month and is headed for an all-time high for the year as a regional building boom keeps perking along.

The value of building permits issued is running at about double last year’s pace, Rick Scobie, Vancouver‘s director of development services, said Monday.

The boom, which extends across Greater Vancouver, is putting pressure on the ability of municipalities to process permits and is forcing builders to fine-tune their building schedules so they don’t lose skilled workers between jobs.

Scobie said he thinks the hot pace is being driven mainly by low interest rates, and possibly by optimism about the state of local and provincial economies.

“And who knows, maybe it is already being fuelled somewhat by anticipation of the Olympics,” he added.

In June, with large residential developments around the downtown core leading the way, Vancouver issued building permits for $518 million in construction value — the highest for any month on record.

That includes a permit for a major Concord Pacific Group project with 900 housing units in four residential towers atop a 145,000-square-foot Costco store to be built between the Georgia and Dunsmuir viaducts near GM Place.

“June is one of our busier months historically, and this year it’s just been phenomenal,” Scobie said.

The six-month Vancouver building-permit total of $1.04 billion is nearly up to last year’s full-year figure of $1.06 billion and the city should easily pass the 2002 record of about $1.1 billion.

Residential construction was the biggest contributor, Scobie said in a memo circulated to city councillors, with permits for 4,865 new housing units issued so far this year, up from 1,718 by the same time last year.

Large residential projects accounted for 54 permits totalling 4,041 housing units for an average of 75 units per project.

Some of the building permit applications were likely filed in June to beat a July 1 increase in Vancouver‘s development cost levies, and some of those projects may not be built immediately.

“Nonetheless, all of that construction will happen,” said Peter Simpson, chief executive of the Greater Vancouver Home Builders’ Association. “That’s a great sign for jobs and for economic development in the city of Vancouver.”

Simpson emphasized that the boom extends far beyond downtown Vancouver, which gets much of the attention.

“There’s activity right across the Lower Mainland,” he said. “We’ve got single family homes, we’ve got town houses, three- to four- storey condominiums. … Some builders have multiple sites going at the same time.”

Scobie said the demand for development and building permits is putting a strain on city hall’s ability to process applications.

The city is approving more overtime, calling in temporary staff and deferring vacations, but is still having trouble processing applications for development permits.

A development permit for a major project, which normally takes 12 to 13 weeks, is now taking up to 18 weeks, Scobie said. But the city remains on schedule with building permits, maintaining a five-day turnaround.

Scobie said other Greater Vancouver municipalities are in the same boat, handling large numbers of building permits, bringing in extra staff and working overtime.

Simpson added that the building industry is struggling — but coping, so far — with a shortage of skilled trades.

“Builders are scheduling their jobs so they’re not left in the lurch by not having people to complete the work,” he said.

He said industry is working with government to try to speed up trades training, and some workers who left B.C. during the lean years are starting to return.

Other areas experiencing building booms, including California, have had to put projects on hold for lack of skilled trades, Simpson said.

“We’ve had some scrambling, but there have been no projects that I know of that have been put on hold because they can’t get the workers.”

He said it’s important for municipal governments to keep up with the flow of applications so as not to disrupt finely-tuned construction schedules, and singled out Surrey for its efforts in hiring more staff, ordering overtime and bringing in people to work weekends.

Economist Helmut Pastrick said the boom should continue for some time.

Home-building activity in most of Canada, including Ontario, has begun to taper off, but B.C., which lagged the national economy, “can reasonably expect further gains,” he said.

Industrial construction in B.C. is beginning to show increases as well, said Pastrick, chief economist with Credit Union Central of B.C.

Office and hotel construction should move into a higher gear in the next year or two, he said.

Pastrick said there will be ebb and flow, but generally, construction should be in an upswing for the rest of the decade.

“The trend between now and the Olympics will certainly be up,” he said.

“There will be further strong gains, and then we’ll see some brief periods of softness at some point.

“This year and next year I’m expecting more gains in residential construction, and the gains in non-residential will begin to accelerate later on.”

© The Vancouver Sun 2004

Convention Centre’s expansion plan has October start date

Tuesday, July 20th, 2004

Ashley Ford


The Vancouver convention centre expansion project plan calls for a ‘green link’ connecting Stanley Park to the Canada Place cruise-ship facility (shown upper left).

Construction of the long-awaited $565-million Vancouver convention centre will begin in October with clearing work on the site west of Canada Place where the existing convention centre is housed.

Talks are now under way between the Vancouver Convention Centre Expansion Project Ltd. (VCCEP), and the various float-plane operators who must relocate to allow construction to begin. It is not yet known where they will go.

Russ Anthony, president of VCCEP, has confirmed construction will start in October with a completion date for the 100,000-square-metre project set for 2008.

Announcement of the construction date will prove a big boost to convention marketing efforts.

Barbara Maple, general manager of the Vancouver Convention & Exhibition Centre, said in a telephone interview from Seattle that, while initial marketing worldwide has begun, having a “definite construction date puts more reality to the project and allows us to step up our marketing activities.” The final budget has also been set and approved by the Provincial Treasury Board. Russ Anthony, president of VCCEP, said setting the budget is an important step forward.

“To date we have been operating off a series of costs estimates, so it’s an important milestone to confirm a budget based on a defined program of facilities and an achievable construction schedule.”

The federal and provincial governments will now contribute $222.5 million each, the tourism industry a further $90 million and $30 million will come from project-facility revenues from a variety of sources including parking, supplier agreements and retail leases. That budget also includes $40 million to provide a connector to the 17-year-old convention centre and major refurbishing. That expense was not included in the preliminary cost estimates.

Anthony said the $30 million in project-facility revenues will help build a centre that will make it a unique “people place” for visitors and residents alike.

While final design by three companies — LMN Architects of Seattle, Musson Cattel Mackey Partnership and Downs Archambault of Vancouver — has yet to be approved, the latest drawings will differ little from the final product that includes a signature 2.4-hectare “living, or green, roof.”

The roof, specifically designed to fit into the natural spaces along the harbour and a “green link” to nearby Stanley Park will feature a mix of grasses and plants that will prosper in this climate and create a mini-eco system for insects and birds.

The centre will also serve as a showcase for B.C. lumber and include architectural and structural use of wood.

Over the next three decades, the centre is projected to generate $1.5 billion in economic benefits as well as more than 6,700 person-years of employment, plus create 7,500 full-time jobs when completed.

© The Vancouver Province 2004

Home buyers snap up variable rate mortgages

Monday, July 19th, 2004

Loans now undercut their fixed-rate cousins by two or three percentage points

Andrew Flynn


TORONTO — Variable-rate mortgages are tempting a growing number of Canadians with alluringly low interest rates, some of them lower than three per cent and promising substantial savings over fixed-rate mortgages.

And while choosing a deal that floats with the bank prime rate might seem like rolling the dice on one’s home, variable-rate mortgages are sexy because they currently undercut their fixed-rate cousins by two to three percentage points.

But, as with any deal that seems too good to be true, there’s a catch.

The key element of variable-rate borrowing is the link to banks’ prime lending rates, with special discount offers of up to one percentage point. It also requires consumers to determine their own comfort level and it demands — above all — vigilance.

“Although I’m not sure I’d call it a gamble, it’s certainly speculative,” says Moshe Milevsky, finance specialist at York University‘s Schulich School of Business in Toronto. “You have to realize that taking the smaller number sometimes means that it may become bigger later.”

Variable-rate mortgage holders have to stay aware of current interest rates because they can spike up, though most analysts are predicting only modest-paced increases for the next year. A Bank of Canada survey released this month says its senior managers foresee slightly higher inflation — which makes it very likely the central bank will boost interest rates as early as September.

If the prime rate climbs two or three per cent, a variable-rate mortgage costs a lot more. But at this point, analysts feel interest rates will only creep up, probably not much more than one per cent over the next year.

Most banks and lenders offer consumers the option to lock in to a standard fixed-rate mortgage when they feel the prime is going up too much or too fast. Beware of extremely low-rate variable mortgages that don’t have a lock-in option — if interest rates skyrocket, you are tied to them with no way out until the mortgage term is up.

How to choose when it’s time to lock in is crucial to managing variable mortgages.

“There’s never a perfect time, but there’s a better time than others to make that decision,” says Colin Dreyer, president of the Canadian Institute of Mortgage Brokers and Lenders.

For example, if a person’s employment status changed, a bump in rates could signal it’s time to consider the stability of a fixed rate.

“To be on the safe side, they’ll lock in, rather than gamble on their rate and a possible change in employment at the same time.”

But just because rates are on the rise doesn’t mean it’s automatically time to lock in. If rates go up but are expected to fall again later, the savings will still be there over the long run.

“Those variations are always going to be there. You can’t predict rates,” says Dreyer.

Milevsky suggests setting monthly payments under a variable-rate mortgage at exactly what they would be had you taken out a fixed-rate mortgage (your bank manager or mortgage broker can do the calculations). That way, if you do have to lock in, you won’t feel any difference in your daily finances.

And he pays very close attention to the spread between variable- and fixed-rate quotes.

“If that spread gets very, very small — perhaps even negative — I might take a look and say ‘It’s not worth the risk any more,'” Milevsky says.

“The question to ask yourself is, ‘How high can the rate go before you actually start to feel the pain?'”

You should also know the difference between an open floating-rate mortgage and closed floating-rate borrowing. With an open mortgage, you can pay down any amount you want during the term. With a closed mortgage, there is a penalty for making payments over and above the set payment schedule.

About one-third of all Canadian residential mortgage holders are going with variable-rate mortgages tied to a prime rate currently around 3.75 per cent.

“I think people look at that and say, ‘I can buy more real estate because of that aspect of it,'” says Dreyer. “It’s the affordability factor.”

Paul Mims, vice-president of CIBC Mortgages Inc., says the popularity of variable-rate mortgages has seen an explosion in recent years because of low rates.

“If you’d asked five years ago, it would have been less than five per cent [of the mortgage market],” says Mims. “The CIBC portfolio was less than 10 per cent. And now we’re 50- per-cent variable.”

Mims believes that right now the variable is the way to go.

© The Vancouver Sun 2004

What life will be like in False Creek’s Utopia

Sunday, July 18th, 2004

An ambitious plan for the last stretch of vacant land on the shores of False Creek is taking shape. The dreamers behind it hope to create a model village that will attract worldwide attention for solving some of the problems that have blighted the world’

John Bermingham


It’s a village in the heart of the city.

The City of Vancouver is planning the world’s most sustainable community on the banks of southeast False Creek.

VIA Architecture – Courtesey City of Vancouver

This is the view looking north over False Creek that some residents of the new model community could have.

An ambitious plan for the last stretch of vacant land on the shores of False Creek is taking shape. The dreamers behind it hope to creat a model village that will attract worldwide attention for solving some of the problems that have blighted the world’s cities for centuries.

For nearly a decade, countless planners, experts and community groups have been slowly bringing a 21st-century eco-friendly vision into reality.

On an 80-acre tract across from the old Expo 86 site, 15,000 people are expected to live healthier, simpler lives in a dense downtown development.

City planner Ian Smith said South East False Creek, as the project is being called, will be sustainable where other high-rise neighbourhoods like Yaletown aren’t.

“What we’re trying to do is cut down on our [consumption of] resources and the waste we produce, and to do it in a way that’s healthier and more sustainable for future generations,” he said.

South East False Creek is the last great undeveloped chunk of real estate in the city centre.

The industrial area once had a world-class shipbuilding yard, but it’s now rundown and contaminated.

The new community would have its own solar power and rainwater supply. It would use fewer resources, create less waste and offer a healthier lifestyle.

The streets will be designed for pedestrians, not cars, and will make possible more activity.

“You can get what you need on a daily basis without getting into your car,” said Smith.

An updated plan is due out in September for public reaction, and a development plan is to be completed in late fall.

The early work will focus on the athletes’ village for the 2010 Olympic Winter Games, located on-site, which will house 3,000 athletes and later be converted into about 500 condos.

Work will begin on the village in 2007.

South East False Creek lies on 50 acres of public land and 30 acres of private land. But half the public land has already been allotted for a waterfront park.

The plan is to create a community of families, seniors, the affluent and the less-so. About 40 per cent of the units will be social housing.

Project architect Graham McGarva expects a series of apartment buildings between 12 and

18 storeys tall, located in heavy greenery and with a rugged urban look, reflecting the area’s industrial history.

“The opportunity would be missed if it was another high-rise district,” said McGarva. “And the opportunity would also be missed if everything is squashed so it becomes a relentless eight-storey barracks.

“It’s a place where you and your family can walk everywhere,” he said. “You are also as connected as anyone else to the region.”

John Irwin, co-ordinator of grassroots community groups involved in planning, said people also wanted a community based on equity.

“They wanted a community that’s inclusive, not exclusive,” he said. “It includes people of all backgrounds and all incomes in the city.”

David Hocking, spokesman for the David Suzuki Foundation, said South East False Creek is pointing the way to a healthier urban future.

“The way we live in the cities, the way we move around, the way we heat our homes, the way we find our food — all of those things put stresses on the planet,” he said. “We have to look at all the ways we can live in a more harmonious way with nature.

“It’s demonstrating that respecting nature can be integrated into our daily lives in a way that’s convenient and comfortable.”

Ron Bain, who chairs the group that’s been steering the vision since 1997, said South East False Creek will be a pilot project for the entire city.

“We were trying to find a way to build a different kind of community,” he said. “In one way or another, this is going to get attention around the world.”

A snapshot of daily life in Vancouver‘s planned model community

This illustration was submitted to the city as part of the proposal for a model sustainable community on the lands in the
southeast corner of False Creek, roughly from the Cambie Street Bridge to Science World.
VIA Architecture – Couresy City of Vancouver

The Province

Sunday, July 18, 2004

What will life be like in the South East False Creek utopia?

Here are some details of how it’s envisaged residents will work, play, shop, move around, bring up their children, use energy and co-operate with one another to enhance the inclusiveness and vitality of their model community:


Grow your own food in community gardens. Sell it at the farmer’s market. Enjoy the extensive array of plants and shrubs.

Do some gardening on the high-rise roof gardens or catch some lunch at the rooftop cafe.


Walk or cycle downtown on the network of pathways. If you’re feeling lazy, catch a streetcar nearby or jump the SkyTrain. But if you must drive, collect a shared car from the co-operative.


Drop off your recyclables at the facility. While there, collect some rainwater for your plants. Compost your food wastes.


Families will make up a third of all units, so there will be plenty of playmates for the little tykes. Drop them off at the community

K-7 school, or at the daycare if they’re younger. Pick them up from after-school care or at the teaching garden, if they’re there.

In the evenings, watch them play street hockey outside in the courtyard or running around in the green space outside your door.


Take a walk in the waterfront park and see the native B.C. species of trees and plants along the shoreline. Check out the restored wildlife habitat, the stormwater duck pond or cycle along the city’s seaside bike route. There’s also a sports field for games and festivals.


Swing by the butcher for a cut of meat, the baker for some fresh bread, or the greengrocer. Have an organic coffee and home-baked muffin at the local deli. If you need a litre of milk, send your child on an errand to the corner store.

At night, pop down to the village centre for a bite at the bistro.


You’ll burn less energy and have solar power and energy-efficient appliances. You will produce

40 per cent fewer greenhouse-gas emissions. Your water use will also be lower, and you’ll use low-flush toilets. Solar shades will keep your rooms at the right temperature.

Each home will be made with non-toxic building materials, paints and glues, which will make the air inside cleaner and help with allergies.


You may be able to work at home if you’re an artist, an artisan or run a small business. Telecommuters can plug in instead of driving to work, while neighbours will co-operate in making your business grow.


Local volunteers will help out at the various amenities. Community groups will meet at the local meeting room. The focus will be on equity and co-operation between age groups and social classes.


You can still bring your gas-guzzling SUV into the community, but you will have to buy or rent a parking-space, which will be located at the edges. There will be cars on hand for residents who need one in an emergency.

© The Vancouver Province 2004

Firenze – Hong Kong developer wading into Duck Pond

Sunday, July 18th, 2004

Van. Cour.

Three towers are slated for the property known locally as the duck pond. Photo by Dan Toulgoet.

Hong Kong developer ready to wade into ‘duck pond’ By David Carrigg-Staff writer. It’s taken almost a decade, but Hong Kong-based Henderson Developments is starting to see its Downtown Eastside gamble payoff.

The company bought a large patch of land bounded by Expo Boulevard and East Pender Street and Beatty Street and Taylor Way in the mid-1990s from Li Ka-shing, who had acquired the site as part of the Expo ’86 lands deal.

In 1999, Henderson built International Village, a cinema, shopping and residential complex, between Pender and Keefer streets and Abbott and Taylor way.

At that time the area was struggling with social disorder and was on the periphery of Chinatown, leading to several village tenants bailing out of the project. The future of the mall was uncertain.

However, the area is changing rapidly. The Village Starbucks faces busy Keefer Street and people now walk their dogs in nearby Andy Livingstone Park, which was once a place to use and hide drugs.

Vancouver School Board is also considering building an elementary school near International Village.

A sold-out condo tower is under construction at the corner of Keefer and Taylor, and Henderson will this week seek council approval to develop three towers on a large block bounded by Andy Livingstone Park, Abbott Street and Taylor Way.

The lot can be seen as you drive over the Dunsmuir Street viaduct and is currently a large hole in the ground filled with water. An earlier attempt to develop the project was abandoned due to market conditions.

Labelled the Firenze, the proposal is for a 31-storey tower, a 25-storey tower and a six-storey midrise with retail at grade. Almost all of the 457 units, which range in price from $170,000 to $730,000, have been pre-sold.

Several hundred metres away, in a lot just west of General Motors Place, work on the Costco condo tower development is underway, which will further revitalize the area.

Henderson now has only one undeveloped lot, which is on Keefer Street, west of Abbott and is currently used as a carpark.

Albert Fok, chairman of the Vancouver Chinatown Merchants Association, said business in the area is starting to improve for merchants.

However, residents of the Taylor and Firenze projects will not move in until 2006, so the full financial impacts of the developments will not be known until then.

“What is encouraging is the real will to revitalize that area,” Fok said.