The proposed infill redevelopment in the West End, at Beach Avenue and Harwood Street, is another example of Vision Vancouver’s approach, which provides incentives and benefits to developers without ensuring affordability for tenants.
The city is promising incentives to the developer, but is not asking for any affordability requirements in return. As a result, the new housing will be too expensive for most Vancouverites. The owner has already admitted that they expect one bedroom apartments to rent at $1,400 to $2,600 per month. As renters will know, this is at the higher end of the market, far exceeding average rents in the West End (which are $1,179 for a one bedroom, according to the city’s own numbers).
Meanwhile, the owner, Devonshire Properties, receives gifts from the city. They get their land rezoned, increasing the amount of developable land. This is like giving the developer “free land”—an extremely valuable thing in Vancouver!
Normally the city recoups this land value increase, but in this case the city calculated the value of 133 units’ worth of new land as being less than $300,000, an unbelievably small amount. This estimate is based on the developer’s own calculations and expected profit rate (pro-forma), none of which has been made public. The city justifies their underestimate by saying that Devonshire properties will eat up costs associated with renting the new housing, but as we’ve seen these are market rents, for which there are no “costs”. The city’s calculations haven’t been made public either. That’s pro-developer mathematics.
A progressive city hall would publicize the developer’s pro-forma, including expected profits, as well as the city’s own calculations on land value increases. Transparency and accountability around rezonings is particularly important in a context where half of the campaign contributions to Vision Vancouver and the NPA come from property development corporations.
A progressive city hall also wouldn’t give free land to corporations without ensuring affordability requirements. In exchange for free land or tax breaks, at the very least rents should be fixed to the established definition of affordability, calculated as 30 percent of income.
For example, the city admits that the average annual income of renter households in Vancouver is $34,000, making affordable rent—according to the Canada Mortgage and Housing Corporation definition—less than $1,000 per month. So it makes sense to impose a requirement for the average new unit at Beach Towers to be $1,000 per month. In addition, the city could ensure that there are subsidized units for low-income tenants. COPE’s recent housing affordability report calls for one-third of units in new developments to be low-income.
The city will surely tell us that infill is good, but infill is better if it’s truly affordable. They’ll also say that rental is good, but rental is better only if it’s affordable. At COPE, we will continue to ask the questions: Density for what? Affordability for whom? We need a city hall that looks at housing with with an affordability lens, which will not happen so long as parties funded by property development corporations continue to run city hall.