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.