Did City get a ‘bad deal’ in secret land swap? A look at view cones, height and density suggests the public lost $44.6 million in one deal

(Updated) One of the details discussed during this week’s 4-day B.C. Supreme Court trial on a secret land swap deal was the difference in value between 508 Helmcken Street (owned by City of Vancouver — that is, the public — before the swap) and 1099 Richards Street (owned by Brenhill Developments before the swap).

The real estate department at the City of Vancouver calculated that 508 Helmcken was worth just $6.6 million more than 1099 Richards. But in this article, we find that some of the City’s statements and assumptions may have been incorrect and incomplete. Looking at factors including height and density, the difference between the two properties may have been closer to $51.2 million. If so, could it be that the citizens of Vancouver got $44.6 million less than they should have in this deal? Did the City make a fair assessment? Did the City really look after the fiduciary interests of taxpayers as part of the land swap? More specifically, did the real estate department severely under-value City-owned land?

Here we look at several factors, starting with the view cones and height restrictions as listed in the two staff reports. Vancouver prides itself in a system that protects cherished views of the North Shore mountains from clearly-defined locations in the city. New buildings are prohibited from entering those views and blocking the mountains. In effect, the “view cones” are a strong limit on heights of buildings in certain locations.

New Yaletown viewcone height limitsSeveral view cones are in play and these limit the building heights on the two properties. Let’s examine the most restrictive view cone for each of the sites. The original Brenhill site at 1099 Richards is limited to a maximum height of 165 feet as shown in the staff report (above); this is due to the restrictive View Cone D (Heather Bay). The site across the street at 508 Helmcken, on the other hand, is limited in height to 320 feet by a higher view cone (F1.1 from Choklit Park). By swapping the two sites, the developer obtained a site where it could build to a height of 36-storeys. The site originally owned by Brenhill would only allow a tower of 19-storeys, assuming of course that Council would rezone to allow a highrise to reach the full height of the view cone. Was this difference calculated into the final price? The two view cones are illustrated below:

View Cone Comparison

An easier way to see the view cones is in 3D. All of the view cones affecting the two sites are illustrated in Google Earth below. The top view cone (QE 3.2.1) is 69 feet above the Choklit Park (F1.1) view cone, and not a limiting factor.

3d view cones in Google Earth

For comparison, the lower view cones are turned off in this Google Earth rendering:

View Cones upper labelled

The property swap allows for an extra 17-storeys in height, on a property that is larger in area. As well, the site at 508 Helmcken is adjacent to Emery Barnes park, and it’s a more desirable location as there are no other towers on the block. In contrast, 1000 block on Richards Street already has two towers. An open question is would the City have allowed for a third tower on the block in a rezoning? There’s also a tower across the lane on the same city block:

Richards Street

Zoning for the Downtown District states that the maximum density for all uses on this site will be 3.0 FSR and it makes a few exceptions to allow 5.0 FSR for social housing. On the other side of the street, the terms of the secret land swap guaranteed over 17 FSR at 508 Helmcken. If City Council would have rezoned 1099 Richards Street, there are limits to the density that can be crammed into 19-storeys.

Concert Salt Tower at Hornby and Drake

1308 Hornby (Salt tower)

Was the land swap agreement a bad deal for the City? It’s possible to look at a comparative site in the City. The new Salt tower by Concert Properties at 1304-1308 Hornby (at Drake) is 309 feet in height, with 31-storeys and has a FSR of 12.44. This tower is also located on a smaller site (11,992 sq. ft / 1,114 m2). The 2014 value produced by BC Assessment for the Salt tower site is $30,773,000.

The site area of 508 Helmcken is 20,945 sq. ft (1,945.8 m2) which is 74.6% larger than the Salt tower site. The Floor Space Ratio of 17.19 is over 38% greater than the density of Concert’s Salt tower. Assuming that all factors are the same, an estimate of the property value for 508 Helmcken is $74,270,000 (adjusted for lot size and density only; many other issues also impact assessments).

The site at 1099 Richards Street has an area of 12,000 sq ft. A similar property a block away at 1085 Homer that also falls under the view cone D has a 2014 BC Assessment value of $10,974,000. The site at 1085 Homer is 14,991 sq ft. in size, or 24.9% bigger than 1099 Richards. If the BC Assessment value is adjusted for the area difference alone, 1099 Richards Street would be assessed at $8,784,470. If a similar comparative exercise is one with the property west of 1099 Richards at 1082 Seymour is done instead (site around twice as big), a value of $23,069,825 can be calculated based on the size differential.

Here’s a little simple math based on the very rough estimates:

$74,270,000 – $23,069,825 = $51,200,175

 How did the City’s Real Estate Department come up with the $6.6 million difference in price between the two properties at 1099 Richards Street and 508 Helmcken? There’s a large discrepancy between $51.2 million and $6.6 million. It’s a difference of $44.6 million. If our math is correct, Brenhill Developments may have benefited $44.6 million more than it should have. Conversely, the citizens of Vancouver may have received $44.6 million less than they should have in this deal. Should the City’s figures be examined by an external auditor? Does the City’s real estate department deserve more public scrutiny?  Continue reading

Day 4 of New Yaletown trial. Summary, closing comments. Court decision is pending. Case exposes bad habits, undermines trust in City Hall, public hearings, community plans.

The Law Courts

The final day of the trial between the Community Association of New Yaletown (CANY) and the City of Vancouver ended on Thursday, August 29th with Justice Mark McEwan reserving his decision. Regardless of the outcome of the trial, one of the lessons learned is that the system is broken. Many of the dealings and practices of the City of Vancouver were exposed during the course of the trial. The entire morning and part of the afternoon on Thursday was spent listening to arguments from the attorney representing Brenhill Developments. The petitioners’ lawyer responded and also made closing comments later in the afternoon, leading up to the decision to reserve judgement. It’s unclear how much time this will take.

1099 Richards Street

Construction crane at 1099 Richards was erected over the weekend of Aug 23-24, 2014

The arguments presented during the first three days are summarized in our earlier story (Update on CANY v. CoV: Citizens’ Supreme Court challenge of City of Vancouver on “procedural fairness”, August 27, 2014). Brenhill’s attorney made a list of expenses incurred by the developer to date, with a claim that $7.7 million has been spent to date, as well, there are further contractual commitments toward the construction of a 13-storey building at 1099 Richards Street. The Yaletown Montessori ceased operations and planned to relocate to the other side of the street when the 36-storey tower is completed at 508 Helmcken. With respect to the development, Brenhill argued that “it’s so far down the road that it can’t stop” and noted that they are bound to another $24 million in expenditures. They also claimed that they knew nothing about the Freedom of Information Requests put forward by the petitioners, and also said that Brenhill did not see the City’s staff report for 508 Helmcken prior to it being released before the Public Hearing last year.

The construction of a 13-storey tower at 1099 Richards Street is in full swing; a construction crane was erected over the weekend of August 23-24. The building permit was issued at the end of May in 2014. The lawsuit was filed in mid-May. The developer plans to finish the building, move residents over from the current Jubilee House across the street, and complete a land swap with the City of Vancouver. Brenhill would then construct a high density (17.19 FSR), 36-storey tower at 508 Helmcken, at the east end of Emery Barnes Park. The current Jubilee House was built in 1985 and has 87 units of social housing. After the planned relocation, there would be no increase in the number of social housing units as the remaining 75 units at 1099 Richards Street would be full market rental. Emery Barnes Park was originally envisioned to take up the full length of the block between Helmcken and Davie; a 36-storey highrise at 508 Helmcken will not allow this plan to be realized.

Jubilee House

Jubilee House at 508 Helmcken was built in 1985. Site of planned 36-storey tower.

The lawyer for Brenhill Developments also looked at case law and offered his interpretation of several precedents. He questioned why the petitioners didn’t file their case earlier in the process. He also questioned why didn’t the petitioners ask for further information from the City. A claim was made that it can be inferred that details of the secret land swap deal are stated in the city’s staff report (“City will contribute up to $6.6 million from the proceeds of sale of the 508 Helmcken Street site”, on Financial section from page 13). Justice Mark McEwan wondered ‘what’s the point of the plan’ if it can be amended. With respect to the Downtown Development ODP, he said, “if you’ve got a plan, you shouldn’t have to change the plan”, while Brenhill’s representative argued that there’s ambiguity in the wording of the plan. An interpretation of the fettering of discretion of Council and examples of selling zoning were brought forward.

The response and summary from CANY noted a number of issues with the Public Hearing process. The staff report released by the City claimed a total of 162 social housing units in the new 13-storey building: “The proposed 162-unit social housing project will replace and renew 87 existing units at the Jubilee House and add 75 new non-market units (page 14). Rezoning planner Karen Hoese also made this claim verbally many times during the Public Hearing. Examples were given on how there was support for increased social housing from the public, and that criticism of the project was tempered because some residents did not want to be against more social housing. The City’s claim of 162 social housing units was characterized as a “big bait and switch”, as later it turned out that there would be no net increase in the number of social housing units. This number would stay at 87. The additional 75 new units would be market rental. This was not what was sold to the public.

excavation

1099 Richards Street, site of new 13-storey Jubilee House

Speaking of the secret land swap deal, CANY’s attorney asked, “How can you know the terms of a deal if you don’t know there’s a deal?” Issues of procedural fairness were raised. Would Council have voted differently if the public had a chance to comment on all facets of the proposal? Was Council already fettered to deliver 365,000 square feet of space by July 29, 2013 as part of the secret deal?  Is it unfair to the public hearing process to withhold documents from the public? Concern was raised about the view of the public hearing as “venting from the public”, as it underestimates the public and the quality of the arguments that could have been made.

CANY’s lawyer questioned whether the figure of $7 million spent to date by the applicant was inflated, as DCLs and some other fees would be reimbursed by the City if the decision were to be reversed. After the petition was filed in mid-May of 2014, the developer received their permits later that month, and went full speed ahead. Brenhill’s attorney noted that the construction schedule has committed a $500,000 cost per month and said they are caught between a rock and a hard place. It’s not clear how much time the court will take to render a decision.

After reviewing the timeline for this project, one that involves a complex land-swap, an open question is why didn’t Brenhill wait for all of the permits and approvals to be in place for both sites before proceeding with development? Why did they charge ahead with starting the new Jubilee House at 1099 Richards after the petition was filed? Why did the City of Vancouver try to thwart Freedom of Information requests, release partial and heavily redacted documents, and release these files late?

Emery Barnes Park, New YaletownOne of the questions that the judge had to CANY was whether they believed that the City had made a bad deal during the land swap. The answer was that this wasn’t part of their legal argument. Regardless of the legal framework for the case, it might be worth examining this question. The land-swap deal states that the City will receive $6.6 million as the difference between the two sites (the proceeds are to be put back into the new Jubilee House). The City’s real estate department calculated that 508 Helmcken is only worth $6.6 million more than the property at 1099 Richards. Is this an accurate assessment? We’ll explore this question in a future post. The smaller 1099 Richards Street site has a height limit of 165 feet as a result of a restrictive view cone (D), while the other site at 508 Helmcken is limited to 320 feet with a much higher view cone (F1.1). There are already two towers on the same block as 1099 Richards Street, which would also limit building height; no such restriction is in place at 508 Helmcken because of Emery Barnes Park. [Update:  We did the detailed analysis on August 29, resulting in this post: Did City get a ‘bad deal’ in secret land swap? A look at view cones, height and density suggests the public lost $44.6 million in one deal]

Open Houses Aug 28 and Sept 4: Second round of consultation for Capital Plan. $400 million more debt proposed for 2015-2018

Capital Funding proposed breakdown debt and revenues

The City of Vancouver has announced two open houses on the proposed $1.085 Billion Capital Plan for 2015-2018. The Capital Plans determine future budget allocations for City infrastructure such as roads, parks, community centres and cultural facilities. The Open House events will be held at the following times:

  • August 28 (Thursday), 3-7pm, Hillcrest Centre (4575 Clancy Loranger Way / Ontario St & 30th Avenue)
  • September 4 (Thursday), 11am – 4pm, Vancouver Public Library Central Branch (350 West Georgia)

An online survey is available on the City’s website.

A total of $400 million out of the $1.085 billion budget is proposed to be financed via debt; $685 million would come out of general revenues (including taxes, permits, DCLs & CACs). For the proposed 4-year capital plan, the borrowing works out to $100 million per year. The current 2012-2014 Capital Plan included borrowing of $75 million per year. Financial reports on the current capital plan spending are available on the City’s website.

The Council Committee meeting held on July 9, 2014 included a draft 2015-2018 Capital Plan report as well as a staff presentation (the video clip contains the Q&A from Council). A number of concerns were raised at the meeting that the staff report skewed the results of the first round of consultation. If many members of the public are asking for amenities such as outdoor pools, then why are these not included in the staff recommendations?

A plebiscite question is planned for the November 2014 election on the Capital Plan. Will Vancouver voters authorize the City to take on an additional $400 million in debt to finance a portion of the proposed Capital Plan? This works out to an average of $661 debt per Vancouver resident. In the event that Vancouver voters defeat the Capital Plan borrowing plebiscite question and decide not to burden future generation with additional debt, the City will need to find ways to fund infrastructure projects within its revenue stream.

Update on CANY v. CoV: Citizens’ Supreme Court challenge of City of Vancouver on “procedural fairness”

508 Helmcken, artist's rendering

508 Helmcken, artist’s rendering

Further to our earlier story (Supreme Court CANY vs CoV. On trial: The integrity of Vancouver City Hall (CityHallWatch, 15-Aug-2014) below, we provide brief coverage of the first three days of the four-day lawsuit. The central theme of the legal case is “procedural fairness.” Justice Mark McEwan is presiding. This case is in the court of law, but will it be a court of justice?

This case has significance far beyond one street corner. Look at the processes this land deal has exposed. Observe how our local government is treating this community. Notice the legal arguments made by the City of Vancouver via its lawyers in Supreme Court. Marvel at the public resources being used by City Hall to defend one single private developer against the public. Is this case the tip of the iceberg? Can other neighbourhoods expect the same treatment?

Recent articles before Day 1:

Yaletown citizens take City of Vancouver to court: CANY alleges city, developer kept details secret (Bob Mackin, Vancouver Courier, 20-Aug-2014)

Yaletown residents sue Vancouver (Brett Mineer, 24 Hours Vancouver, 24-Aug-2014)

DAY 1 (Monday, August 26, 2014)

Vancouver mayor, council accused of ‘sham’ public hearing for Yaletown condo tower (Jeff Lee, Vancouver Sun, 25-Aug-2014). This article is a good summary of Day 1 of the hearing. Nathalie Baker, lawyer for the Community Association of New Yaletown, presented the case. See also CANY’s website for the basic summary of legal claims.

DAY 2

Vancouver right to consider land swap before rezoning for new Yaletown tower: city lawyer (Jeff Lee, Vancouver Sun, 26-Aug-2014). A summary of Day 2. Continue reading

Laneway Infill Proposals – Cardero, Comox, and Nelson Streets: Analysis and comments

Originally posted on West End Neighbours:

Development signs have recently been installed and notices to neighbours have been mailed for new development proposals at 1601 Comox/1071 Cardero, 1546 Nelson  and 1529 Comox. Each of these proposals includes the construction of new buildings ranging from three to four storeys in height in the rear yard areas of the buildings on the sites.

It appears these projects can be approved without a Public Hearing, as a result of adoption of the West End Community Plan. The three projects will be reviewed by the city’s Urban Design Panel at the meeting of Wednesday, August 27th (note corrected date).

Please read below and ask yourself, is this what you expected when the City said “laneway housing” was coming to the West End?

Project information is now posted for these each of these developments is listed on the City of Vancouver website at the links below.

1601 Comox (Addressed at 1071…

View original 1,044 more words

Arbutus Corridor in Pictures. Community meeting on August 28th

6th Avenue tracks

The Arbutus Corridor stretches from Marpole to Granville Island. We’ve document the line in a series of photographs. Canadian Pacific started the process of clearing gardens along the southern end of the corridor in early August.

all-gardens-meeting-08-28-2014-two-flyer

Aug 28th meeting, Arbutus Victory Gardens

A group of residents have organized a meeting for all Arbutus Corridor Gardeners on Thursday, August 28th, from 6:30 to 8pm. The meeting will be held at the Kitsilano Community Centre (Larch & 12th). Further details are available on the Arbutus Victory Gardens website. This website has also collected links to numerous articles about the recent actions of CP in clearing the right of way 10 metres from the rail bed along the corridor.

The railway tracks have not been in use since 2001, and consequently are overgrown in many places. It’s unclear why CP has decided to reactivate the corridor at this time. Canadian Pacific has leased small parcels of land in both Kerrisdale (near 41st) and in Kitsilano  (at 11th) for parking.

The photos are meant to document the current state of the Arbutus corridor. The gardens in the corridor are still untouched in Kitsilano and Fairview. CP has removed the gardens around West 71st and north and south of the tracks at SW Marine Drive:

SW Marine Drive
Above: Gardens removed in rail corridor north and south of SW Marine Drive. Below: looking north (W 61st Avenue)
57th Avenue

Continue reading

The Revolt Against Vancouverism

Originally posted on lewisnvillegas:

1t3sw2

“Vancouverism”

Google Image Commons

Time magazine called it “Hong-couver” in the 1990s. Between Expo 1986 and the 2010 Vancouver Winter Olympics planning in Vancouver took a turn for the worse building a tower-and-podium typology many hoped would make the city ‘world class’. However, as tower developers drive into the neighborhoods in search of cheap land a different Vancouver is being loudly proclaimed.

View original 1,470 more words