(Updated) Business in Vancouver carries a short article that provides useful reference numbers for discussions about the cost of new condos in Vancouver — and presumably these numbers would apply to the types of buildings being constructed for both rental apartments and strata condos.
What drives high cost of building a Vancouver condo? (By Frank O’Brien, Business in Vancouver, 14-June-2016)
Below we take the main points, in bullet form. For the full text please visit the article. Data are from the 2016 Construction Cost Guide prepared by Altus Group. The Cost Guide is available for download if you provide contact information.
- Construction costs per square foot
- Typical highrise concrete condominium in Vancouver range from $210 to $270.
- Typical low-rise, four-storey wood-frame condominium would cost from $130 to $165.
- The land component for a multi-family strata development could add from $200 to more than $400 per square foot of buildable space, depending on the location (source: a study of recent deals by RealNet Canada).
- Example: A 1.3-acre multi-residential site on West 8th Avenue in Vancouver bought by Delta Group in February 2016 for $70 million. Land zoned for floor space ratio of 3.0, or nearly 170,000 square feet. Considering gross buildable square footage cost is approx. $412 per square foot. “Cost of completing a highrise condo tower in just land and construction costs would be in the range of $660 per square foot. Building a high-quality, four-storey wood frame condominium project on the same site would require hard costs, for land and construction, of around $560 per square foot.”
- Altus Group annual construction cost guide excludes “soft costs,” including land, property taxes, community amenity contributions and other municipal fees, site servicing, legal fees, design, landscaping, advertising, marketing, broker commissions and any developer profit.
- A fall 2015 study for the Urban Development Institute by Urban Analytics found that new concrete condominiums downtown were pre-selling for an average of $1,100 per square foot and topped an average of $825 per square foot on Vancouver’s west side.
The above figures are from the perspective of construction and profits. A lot more than land and construction costs affects affordability. CityHallWatch readers are pointing out other aspects to this discussion. See comments by Brendan further below regarding parking costs, etc.
Another reader e-mailed to ask these questions:
- What are the environmental costs (carbon footprint, etc.) of high-rise concrete vs low-rise wood?
- What are the maintenance costs of high-rise vs low-rise over the life of structure, including strata fees, special levies, and so on.
- What are environment costs of replacing high-rise concrete vs low-rise wood at end of life?
- What does the speculative factor add to costs if speculators expect Council will easily rezone land for a high-rise?
- How often are mountain views resold over and over and what does that add to land costs?
- Until planners can answer all these and provide valid price-comparison units why should Council approve high-rise towers if the end result is supposed to be affordability?