Funding for Metro Vancouver transit: are we there yet?

Surrey Central SkyTrain station

Over the past 20 years, British Columbia and local governments have failed to agree on a long-term transit funding formula for Metro Vancouver.

The regional transit authority (TransLink) sits in a governmental neutral zone, neither provincial nor local, and it suffers for a lack of political champions.

We’ve seen successes, for example the recent opening of the Evergreen rapid transit extension, but we also have too-crowded buses on key routes in Vancouver, not enough buses in growing cities south of the Fraser, and long delays in launching rapid transit projects such as the Arbutus SkyTrain extension* and Surrey LRT.

On March 16, 2018, local mayors issued a statement indicating that the funding deadlock had been broken. We were headed for “the largest transit and transportation investment in Metro Vancouver history,” including the big rapid transit projects in Vancouver and Surrey. Funding would come from increases in fare increases, property taxes and development cost charges, as well as increased revenue from higher transit ridership. This was conditional on a confirmation of funding from the provincial and federal governments.

Fraseropolis transitAfter hearing this optimistic announcement, I waited for something to go wrong. Some mayors would change their minds, or an anti-tax coalition would lead a citizens’ revolt.

Instead, Ottawa and Victoria announced an agreement on infrastructure spending, with $2,691,101,894 (and not a penny more) promised for “new urban transit networks and service extensions” over 10 years. And that means that everything is ready to go, right?

Well, not exactly. The mayors have “agreed on a plan to fund the regional share” of Phase Two of their 10-year Vision, but they have not agreed to fund the regional share. See the difference?

In May, 2018, TransLink will conduct further consultations, with surveys and an “engagement bus” to be stationed at key public events (as listed on page 6 of a recent mayors’ meeting agenda.) The mayors will then wait for a month, to see if something goes wrong. Could something go wrong? And then, on June 28, (according to page 7 of a different meeting agenda), the mayors will vote on whether to approve funding for Phase Two of their Vision. If the vote is positive, increased transit investment will proceed.

This matters because transit creates opportunities for low-income working people, students, seniors and teenagers, it improves labour mobility for the benefit of employers, it takes cars off the road wherever service is frequent and convenient, and it supports commercial activity in urban villages such as the many that are described on this site.

My thanks to the kind staff at TransLink for their transparency in explaining the status of this issue. Let’s hope the mayors’ June 28 vote is a non-event.

[* The official name of the Arbutus extension is now the Millennium Line Broadway Extension.]

 

Your own pond at New Westminster Quay

Fountain and pond south of Quayside Drive, New Westminster

With its Riverfront Vision, the City of New Westminster is building a zone that will attract visitors from around the region, in the same way that Fort Langley and White Rock have become local destinations.

30 years after the establishment of the high-density Quayside neighbourhood, tower construction continues near the public market.

This marks a new push in a 30-year-old program to transform the city’s trackside industrial waterfront. The market building at New Westminster Quay was constructed in the 1980s, on a public market model that has failed in many places (Surrey, Calgary, Robson Street in Vancouver). The Quay struggled for many years, but the residential densification of New West’s downtown has brought new customers, along with the conversion of part of the market building to office and meeting space.

Pathways are being steadily extended east and west. On a recent sunny Saturday, much of the 2.5 kilometres of pathway from the SkyTrain bridge to Rialto Court was busy with pedestrian traffic.

Co-tourist Robert Smarz and I started our tour near the WOW, a sculpture at the eastern end of Westminster Pier Park. We noticed first that Front Street’s steel-girder parking garages, featured in countless movie chase scenes over the years, have been largely torn out. The streamlined new parkade features an elevator that drops visitors at the edge of the waterfront pathway.

The WOW, looking toward the SkyTrain bridge and the soon-to-be-replaced Pattulo traffic bridge.

After taking a peek at the market building, we continued west. The western end of the Quayside neighbourhood continues to evolve, and now features a Venetian-style square adjacent to second riverside square with a fountain. Mr. Smarz, as always, was considering the benefits of moving to this area. “It looks like you could get your own pond in New Westminster Quay, he said.”

Beyond Rialto Court the prettification gives out, and we returned to downtown New West via a gritty car-and-pedestrian overpass of the railway. Back on the mainland, there’s a mish-mash of decayed heritage architecture (this is British Columbia’s oldest city) and recent construction. Columbia Square Plaza, with supermarket and cafes, offers an above-average suburban-style shopping opportunity.  The City facilitated the development of a multi-storey shopping centre around the New Westminster Station about a decade ago. The Anvil Centre, dismissed by one visitor to this site as the ugliest building in the world, provides space for local conferences and arts activities.

Finally, we come around to old Columbia Street, a classic Canadian high street dating from the 1920s and before. The retail use here is oddly specialized: we counted a dozen bridal wear outlets nestled around one of the region’s few surviving strip clubs. The architecture is rich, but the vibe is not. The Army and Navy, in the old Woodward’s department store building, is still selling discount gym socks and paint rollers. The Met Bar & Grill, where we had our five-dollar brunch, seems more sad and stale than it did a decade ago.

This is New Westminster, however: the new Brooklyn of Metro Vancouver, home to young working people, neatly placed for a quick commute to less-interesting Surrey or Metrotown. Columbia Street will turn quickly when it turns.

[Downtown New West was one of the first urban villages to be listed on our Urban Villages page, in March 2013. It is increasingly difficult to make a real judgement on housing choice in our region, given that housing is increasingly unaffordable wherever you go. Nonetheless, on reviewing the Downtown New West index score, I have raised it a couple of points, judging Downtown New West to be one of the most livable urban places (foir ordinary folks) on the Canadian west coast.]

The riverfront pathway east of the market

The riverfront pathway west of the market

Semi-rural streetscape on Third Avenue above Twelfth Street, a few hundred metres from the downtown towers

Holding for development — a vintage industrial shop functioning as a carwash

Postwar retail with towers, Tenth Street

 

 

 

 

 

 

 

 

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Apartment development in Surrey: crowdfunding as a doorway to home ownership

Tower construction seen from alongside the proposed new development on 104 Avenue, Surrey

I recently joined our friend David Plug on a real estate investors’ bus tour around Surrey Central. The tour’s purpose was to encourage passengers to commit at least $25,000 in financing for a proposed apartment housing complex.

With a large number of smallish investments, the development company hopes to raise at least $7.5 million, a big chunk of the estimated $13.5 million cost of purchasing land. The project prospectus lays out three scenarios. In the minimum scenario, under present City of Surrey zoning, the builders would construct 210 units in a 6-storey wood-frame complex; with revised zoning, they might achieve 359 units, and a higher rate of return to investors.

Negotiations on the hoped-for property, 800 metres from the Surrey Central SkyTrain station, were still underway on the day of the tour. If the land is secured, and if the project is approved by the City of Surrey government, and if the structure is built and opened on time, and if the units sell at the target price, we were told that investment partners would earn an 18 to 20 per cent annual rate of return from 2018 to 2023. That’s the year when construction is to be completed and partner contributions paid back.

The front man for the development company is Dave Steele, and his company is the Western Canadian Properties Group, affiliated with Investment Revenue Realty Inc. He has a track record in single-family and low-rise development in B.C. and Alberta, and a partner who has 15 years of experience with bigger, name-brand companies. In a sit-down information session after the bus tour, he did not oversell the risks or the rewards of his crowdfunding approach. “You’re betting on us to execute the project,” he said.

Is this a wide investment? On the upside, the projected 18+ per cent rate of return is better than the 0.80 per cent that I am currently earning on bank savings, and re-zoning approval from the City could drive that return even higher.

On the downside, the demand for new housing in Surrey may collapse. The investment fund would be put on hold, with no return for the investors.

Of course, it’s hard to imagine a market collapse in north Surrey, with its access to transit and its growing employment base, including two new university campuses. The price of apartments in Surrey, Steele said, is $750 per square foot, compared with $1300 at Metrotown in Burnaby and $2,000 in central Vancouver. There’s strong demand for apartments in Surrey, starting as small as 400 square feet. We drove past a residential construction site called the King George Hub, where Steele said 4,000 people had submitted applications to purchase 443 units when the first phase of the project came on the market last year.

At least a couple of the passengers on the bus stepped forward to put their money down. I decided to stand clear, for no other reason other than my past inability to read markets. However, I’ll make three observations in my blogger persona.

First, the redevelopment proposal conforms to the familiar, and unfortunate, pattern where modest rental housing in Metro Vancouver is to be replaced by relatively expensive condo apartments, with no plan to provide for the evicted tenants. In this case, the target for replacement is the 1960s-era Elizabeth Manor, with 57 units. “They’re just not building rental housing fast enough,” Steele said. “It’s a problem everywhere, and we have to get more rental housing built.” True enough; but there is no current thought to include purpose-built rental housing in Steele’s project.

Second, I saw no evidence that this was a tour for foreign investors or their agents. The people I spoke with were Vancouver-area residents like myself — people approaching retirement, looking for ways to top up their insufficient retirement savings funds. Dave Steele quoted a source who told him that of the 738 units in King George Hub, 697 went to people with B.C. addresses. He also guessed, based on what I do not know, that residents of his own Surrey Central development would be about 85 per cent owner-occupants and about 15 per cent renters.

Finally, this financing model could hypothetically lead to a situation where investors are the only members of the public who get the opportunity to purchase new housing. $25,000, invested at high risk, puts you at the front of the queue; but what if the queue for all new developments is made up entirely of people who are willing to invest money at high risk?

The show office for the King George Hub development, near King George station. The same building houses a regional office for Coast Capital Savings, one of Surrey Central’s new employers.

A quick look at Sunshine Hills

This is a perfect suburban neighbourhood in conventional terms: single-family homes distributed along nested crescents, tall trees, tranquility. Watershed Park sits on the southern edge, a wide patch of rain forest with a fine network of trails. There are no hills in Sunshine Hills, but the park slopes down to the coastal plain and provides a buffer against the noise from Highway 99, the route to Seattle (south) or Vancouver (north).

You can walk from most of Sunshine Hills to the shops at Scott Road and 64th in 20 minutes or less.  The area plan, published by the municipality of Delta in 2015, makes it Sunshine Hills Centre reducedclear there is no intention to create a more explicitly walkable ring of medium-density housing around the commercial area. The residents seem to like things as they are. We did not see a single “For Sale” sign during our visit. Continue reading

Vancouver’s Chinatown: heritage site, urban village, tourist zone

Gore Street at Keefer in Vancouver’s Chinatown.

Vancouver City Council voted in November 2017 to seek World Heritage Site status for the Chinatown district. This founding neighbourhood began as a segregated zone for Chinese-speaking labourers and merchants outside the railway and lumber camp that covered today’s Waterfront and Gastown areas.  It functioned for many decades as a commercial and cultural hub for Chinese-speaking immigrants, and takes a prominent place in the modern English-language literature of  the Chinese-Canadian community. The retail hub, it should be said, has been supported by apartment housing, Chinese seniors’ housing and small-lot detached housing, either in the core or in the old Strathcona neighbourhood to the east. Continue reading

Surrey Central — Retrofitting or replacement?

Rendering from the 2017 Surrey City Centre Plan, a fantasy perspective showing library (middle background), SkyTrain line, future light rail line and new towers

About 10 years ago, the term “Retrofitting Suburbia” came to describe the art or science of converting automobile-dependent sprawl into liveable urban landscape.

Coincidentally or not, it’s about 10 years since then-Mayor Dianne Watts announced her vision of a City of Surrey downtown, a focus for Surrey’s hodge-podge of malls and paved-over farmland. Simon Fraser University and the Fraser Health Authority had just moved to a new Surrey Central tower close to rapid transit; the City has since add a civic plaza with a City Hall. Residential and business towers are springing up close by. Continue reading

Governments gamble on a minimum wage hike

On January 1, Ontario raised the  general minimum wage in its jurisdiction to from $11.60 per hour to $14.00. British Columbians are promised a similar jump in the near future, though the timing is subject to the work of a government-appointed commission.

Members of the Tim Hortons restaurants’ founding family reacted to the Ontario increase by taking petty revenge on their own workers, stripping them of non-wage benefits at the locations they still own directly. This triggered a brawl within the Tim Hortons organization, with the corporate head office urging franchise owners to handle the issue more discreetly. Continue reading