Real estate suddenly becomes more valuable on Burrard Street with the departure of St. Paul's Hospital

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      It shouldn't come as a huge surprise that a government led by Christy Clark has decided to tear down St. Paul's Hospital and build a new health-care facility on False Creek Flats.

      For years, condos have been replacing movie theatres, restaurants, industrial buildings, and music venues in Vancouver. So why not a public hospital cherished by tens of thousands of local residents?

      In pure economics—and this is what today's decision is all about—a world-class health facility is not the highest and best use of the land in modern-day Vancouver.

      So large numbers of people will be inconvenienced as a new hospital is constructed on cheaper land near the Pacific Central Station.

      Providence Health Care and the B.C. government, of course, will never put it in these terms. If there's any upside to today's announcement, it will result in a huge number of construction jobs as the Manhattanization of Vancouver continues.

      There's already a real-estate rush underway in the area around St. Paul's Hospital. The Jim Pattison Group is working with Reliance Properties to build Burrard Place on 27 lots around the former Toyota dealership on Burrard Street. It will include 55-storey and 35-storey residential towers.

      Meanwhile, Amacon has redeveloped the former Commercial Electronics site at 1305 Burrard Street into a 17-storey residential building. Concert Properties is developing a 33-storey tower at 1308 Hornby Street.

      There has also been a great deal of development around the north end of the Granville Street Bridge. Don't be surprised if it starts moving north along Granville, gobbling up some of the local bars and nightclubs.

      In the meantime, the loss of the hospital on Burrard Street will have an impact on the hotels in the area. For a high-end operation like the Sheraton Wall Centre, a reduction in the number of ambulance sirens will be welcomed by guests and management. The nearby Century Plaza Hotel and Spa and the retro Burrard will likely see a lift in their land values.

      But there are also many medical-related businesses in the area that rely on traffic generated by the hospital. Over time, some of them will likely migrate to the area around the new hospital on False Creek Flats, freeing up more land for condos.

      The relocation of these businesses, in turn, will put the squeeze on people living in cheap rooming houses like the Cobalt Hotel. It adds up to a whole lot of gentrification.

      The NDP MLA for Vancouver–West End, Spencer Chandra Herbert, told the Straight earlier this month he had been hearing that St. Paul's Hospital would be replaced by condos.

      “I’m getting it from business people, from real-estate people, from health-care people, from enough sources within and outside of government that I’m taking it seriously,” Herbert said to reporter Carlito Pablo on April 2.

      Now, it's official.

      Before the 2013 provincial election, Premier Clark left voters with the impression that the B.C. government would invest $500 million to upgrade the century-old hospital in the West End. But real estate being real estate, those plans have been shelved in favour of a billion-dollar expenditure on False Creek Flats.

      Let this be a lesson in 21st-century land economics in Vancouver.

      Comments

      18 Comments

      Jim M.

      Apr 13, 2015 at 12:02pm

      Who needs heritage buildings and a hospital in one of the most populous, vulnerable (many single seniors) neighbourhoods in North America?

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      Jrhys

      Apr 13, 2015 at 12:04pm

      I can only imagine what a monstrosity will be build there. I'm sad to see it go - used to work with the elderly in the Westend and that hospital was so handy and inexpesive for them to get to. Did anyone consider the access problem for the many elderly in the Westend?

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      Serving the vulnerable is the goal, is it not?

      Apr 13, 2015 at 12:32pm

      I'm pretty sure that they people who will now have to schlep the 3km from the affluent west end to the flats can far better afford to travel east than the people on the streets can afford to go west. Not to mention we would have a newer, better (free from expensive compromises that come with any retrofit) facility.

      I guess the GS policy is 'fuck the poor, health care is only for those who can pay 1500 a month in rent'?

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      @Serving the vulnerable is the goal, is it not?

      Apr 13, 2015 at 12:39pm

      Yes, all of those seniors in the West End are rich.

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      Steve123

      Apr 13, 2015 at 1:10pm

      I don't think a new health care centre in the centre of the city is such a bad idea. It's actually a better location for residents of all neighbourhoods, and the flats are pretty under-utilized land at present. I agree with the above comment on retrofits of older buildings - very expensive and limiting.

      The gentrification argument is an old and tired one. Cities change as populations change... It's inevitable. Vancouver: 45,000 new residents per year = changing landscape. When an area is revitalized, it's going to be built to the highest marketable standard of its time, so yes it will be shiny and new looking.

      So... I work in the bad evil real estate industry. And I am forever witnessing otherwise reasonable people droning on about what a shame it is to rebuild and renew and subdivide. Often in the same conversation these otherwise reasonable people throw up their hands in the air and complain about the price of housing in the city.

      Well, I can tell you with all certainty that real estate prices go down when supply is increased. We are currently seeing older condos actually going down in price over the last 5 years (despite hysterical news stories to the contrary - current big gains in price are only for single family homes with land as they are in tight supply). This is a result of the past several years of new condo development. So, in a nutshell, new condos from sites that were previously lower density = greater supply = lower condo prices for older buildings = greater affordability.

      You can't have your cake and eat it too. If you want affordable homes in Vancouver (the city, not the region) you'll need to tolerate new development. If you want to keep it the same as it was in 1978, you'll have to accept extremely high prices due to the increase in demand for housing since then.

      If it were up to me, I'd rezone all single family neighbourhoods to townhouses and continue to support Transit Oriented Design high density and high density in all the current corridors of development. I believe this would bring affordability back down to earth (over time, not overnight) and restore a future of diversity and vibrancy in Vancouver. The alternative is to watch it simply become more and more exclusive and bland.

      That is all. Have a nice day.

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      Why not

      Apr 13, 2015 at 1:44pm

      Have a new hospital and also keep the old one as well? This would create a ton of jobs as well as ensure Vancouver keeps up with the demand of a growing population.

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      VancouverCoffeeDrinker

      Apr 13, 2015 at 2:19pm

      I've been proud to have St.Paul's in my neighbourhood. Lived in the West End since 1987. Community is important to me. I really feel that the current location should be utilized somehow for community space. Service organizations could get a break on renting office space there. There could be seniors housing specifically for the LGBT community. There could be realistically priced childcare services. I realize money money money seems to be the overall driver but wouldn't it be great to have a community oriented space.

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      ursa minor

      Apr 13, 2015 at 2:24pm

      This move will lead to fewer hospitals in Vancouver - I don't see the MoH, Vancouver Coastal or Providence Health Care keeping Mount Saint Joseph's open when their new hospital opens not that far away.

      @VancouverCoffeeDrinker

      Apr 13, 2015 at 3:06pm

      That sound you hear is all the stakeholders spitting their coffee through their noses as they read your suggestions.

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      Realist!

      Apr 13, 2015 at 3:53pm

      buildings are not meant to last forever. St. Paul's has outlived its usefulness. The hospital is not just for west end residents, it serves the entire province.

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