The new plan for the redevelopment of Little Mountain neighbourhood in East Vancouver has been released to the public. The plan calls for wholesale gentrification of the Riley Park-Little Mountain neighborhood. The 15-acre site that previously held 224 units of social housing will be replaced with 2,000 units of market condominiums.

In exchange for a zero-percent increase in the amount of affordable housing on the site, the neighborhood will be transformed by luxury condos and retail, putting upward pressure on local property values. Like in other working-areas of Vancouver, this new high-end development will usher in rent increases, more renovictions and even more demolitions.

In Vancouver, there are on average two home demolitions per day. The Little Mountain plan ensures that the rate of demolitions will be particularly high in the Riley Park area. In addition to the demolition of Little Mountain social housing, the city has its sight set on demolishing all single-family homes at the north-east corner of the Little Mountain property.

Even though evictions and displacement are systemic throughout Vancouver, the city has not conducted a social impact study to understand the possible social effects of these demolitions and mega-projects. When asked at Thursday’s press conference whether the City plans to conduct such a study, Senior Planner Ben Johnson said “No,” claiming that there are no impacts because “homes are going for $1million in the neighborhood.” According to the city, the renters who make up large part of Little Mountain, Riley Park, Kensington-Cedar Cottage, Sunset, and Mount Pleasant are not part of the equation.

The new plan announced by the private developer, Holborn Group, consists of sixteen towers of luxury condominiums. There are nine towers planned at ten to fourteen stories, while the rest of the density is spread out between four to nine stories. It is assumed that Holborn bought the property from the provincial government for a price fixed to existing levels of zoning, at four stories, while committing to replace the 224 units of social housing.

This “one-for-one” deal is a coup for Holborn because on a mega-project of this size, the city would normally apply its mega-project housing policy requiring that 20% of all units be social housing. The planned 2,000 units would normally accompany at least 400 units of social housing, but in this case the Memorandum of Understanding (MOU) signed between the City and the Province assures Holborn that only 224 units are necessary.  Furthermore, low-income tenants have been forced into the precarious waiting room of history. The first phase of the project will now not be completed until 2017 at the absolute earliest, even though all replacement housing was promised to be completed by 2010 at the latest.

When Holborn bought Little Mountain, the land was zoned for four stories. Holborn claims to have paid an above-market rate because the Province promised that the land would be upzoned in the future to allow more condo units. Of course, rezoning is a City power, outside the Province’s jurisdiction. If the Province indeed made a guarantee to Holborn that the land would be rezoned, then the Province was on the one hand attempting to undermine the local community planning process (including the existing Riley Park Community Vision), and on the other hand seems to have misrepresented the Province’s powers to Holborn. However, there is no reason to feel sorry for Holborn. Holborn has more than enough lawyers to know exactly what they were getting into. The most likely scenario is that the Province and Holborn colluded to strong-arm the City and undercut local planning processes.

DTES delegation at the 2011 Vancouver mayoral debate

At the recent Homelessness and Affordable Housing debate (Nov 7, St. Andrew’s–Wesley Church), mayoral candidates Gregor Robertson and Suzanne Anton said a lot of things, but they didn’t debate much. They both admitted that they will not slow down or pause destructive market development in the Downtown Eastside (DTES). They agreed that a municipal tax on real estate speculation and non-resident property ownership would not be appropriate. They also agreed that inclusionary zoning, a soft and widely used development permit mechanism that forces developers to include affordable housing in all market developments, would not be good for Vancouver. They even agreed that the solution to the affordable rental housing and homelessness crisis caused by the real estate market is to be found back in the market itself. Put simply, their differences were of degree, not principle.

The most troubling thing about the mayoral debate was the way that both candidates addressed the low-income affordable housing and homelessness crisis: by passing the blame onto provincial and federal levels of government. Both Gregor Robertson and Suzanne Anton avoided the City’s role in building housing, as well as tools in its jurisdiction that could be used to save low-income housing. These are the top-three things the DNC believes a mayoral candidate would do if they were serious about ending the affordable rental-housing and homelessness crisis in Vancouver:

Vision Vancouver, Vancouver’s ruling party, won an election in 2008 by promising to “end homelessness.” But since that time, the party has adopted a housing strategy that only causes homelessness: gentrification of the Downtown Eastside.

City hall is actively pushing condo development eastward. In 2009, the city placed a de facto moratorium on condo development in much of the central business district. Simultaneously, they have been incentivizing gentrification of the Downtown Eastside (DTES) through tax breaks (see our previous article “Lowest corporate taxes in the world at heart of Vancouver’s housing crisis“).

What is most concerning is that this model of gentrification is a major component of Vision Vancouver’s “affordable housing plan.” Affordable housing tops most issue polls, but instead of creating true affordability, Vision has deployed the popular issue of affordability in order to market gentrification. Land is relatively inexpensive in the inner city, so developers can make unprecedented profits building condos for less costs than in the central business district. These condos remain unaffordable, and are far more expensive than the units they replace.

The City’s long-overdue housing plan released this summer highlights the Westbank Corporation’s gentrification project at 60 W. Cordova as a “Pilot Affordable Home Ownership Project.” The city planning department is now expending significant resources to work with developers to roll-out this gentrification model. Here are four examples:

1. After the illegal eviction of low-income tenants from the American Hotel, the city worked with the developer to convert the building into condos and market the development as “Affordable Home Ownership” (see here for an article on the American Hotel conversion). Recently, Vision councilor Kerry Jang has gone on record promoting the redevelopment of the American Hotel as evidence of council’s commitment to “affordability.”

2. The Salient Group is preparing to begin selling condo units at their newest gentrification project called “21 Doors,” at 334 Carrall across from Pigeon Park. The building used to house low-income families, and the owner allowed the site to fall into disrepair. In March 2008, the 20 low-income households living in the building were evicted by developer Robert Wilson. (Wilson had been buying up properties in the Downtown Eastside and ‘flipping’ them for profit. He sold seven buildings to the province for $28 million, for a profit of a estimated $12 million). Robert Fung of Salient Group, developer for 334 Carrall, is now marketing the units as ‘affordable’: “This is really ‘small A’ affordable housing. It’s much more affordable than our other product. The unit sizes are small but livable.” Again, these units of are far more expensive than those they are replacing.

3. This past week, Westbank Corp. announced it is planning a 17-story condo tower at the corner of Main and Keefer in Chinatown. The tower will include 145 “regular” condo units. This is one of many towers that developers and City Council have planned for Chinatown. Westbank claims that their tower will contain 24 units of senior housing in addition to the 145 condo units. It is important to recognize that these token units will not make up for the lost affordable units throughout the neighborhood. There are about 350 Chinese seniors in Chinatown alone, and over 10,000 low-income residents in the DTES/Chinatown area. A recent report by Tsur Somerville, Azim Wazeer and Jake Wetzel of UBC’s Sauder School of Business shows that the need for Chinese seniors’ housing is “overwhelming.”

4. A similar fate faces the old Pantages Theatre, next to the Carnegie Centre and across from Insite. After twice rejecting plans to save the Theatre and build social housing on adjacent lots, Vision City Council has been working closely with developer Marc Williams to build 80 condo units on the site. The low-income community has mobilized strongly against the project (see here for details). This week, COPE candidate Ellen Woodsworth came out against the project, saying “The hundred block of Hastings is not a place for high end condos.” The NPA and Vision have remained supporters of this gentrification project.

“Vancouver – Is homeownership becoming a far-fetched dream?”

That is the question at the heading of a new housing affordability report by RBC Economics Research. And the answer is “yes.” The report claims that to purchase a bungalow, the average Vancouver household has to dedicate 92.5% of its income to housing costs. The second most unaffordable Canadian city is Toronto, where the average household would have to dedicate 51.9%. CMHC defines “affordable” as having to pay no more than 30% of household income on housing.

For a ‘standard two-storey’ the average Vancouver household would have to dedicate 95.5% of their income. Again Toronto is second worse, at 61.4%. Even a ‘standard condo’ in Vancouver is severely unaffordable at 47.1%, also the worst rate in the country.

This is of course not the first report showing how housing prices are out of reach for Vancouver residents. Demographia’s annual housing affordability survey has ranked Vancouver in the bottom three out of about 300 global cities for several years in a row. According to Demographia, the average housing price has been 9 to 10 times the average family income. A report by BMO in June of 2011 calculated that ratio at an even higher 11. For our review of these reports, see here.

Realter Bob Rennie has been trying to argue that these numbers are skewed by high-end sales. But this is simply not the case, because Demographia uses medians (which exclude both low and high end sales for the analysis), and RBC uses ‘standard’ dwelling, to distinguish from the ‘average’.