Saturday, April 30, 2011
The Inn was the Bonniebrook Lodge on the ocean in Gibsons. A night's stay and gift coupon for the restaurant had been donated by Lina Jakobs and Mark Darlington, the current owners of a facility that is billed as the oldest continuously operating accommodation on the Sunshine Coast. A large, four storey heritage house, it has been extensively renovated. Our third storey view suite, dubbed the East Penthouse, was extremely well fitted out with everything one could ask for, including dressing gowns, a high quality High Definition TV/Video system, very good linens, and corner jacuzzi tub.
A surprising highlight of our stay was dinner in Chasters, their restaurant, which is apparently well known on the Sunshine Coast for the quality of the chef. While not inexpensive, it truly was a gourmet restaurant. We were out of season, and the dining room was by no means full. However, we did get into a chat with some people at the next table, one of whom, a charming older Englishman, we were told had been the director of the well known English movie, The Dambusters. His friends told us he also directed Around the World in 80 Days. So we googled him. If we're correct, he was Michael Anderson, and at the age of 90, lives nearby and is a frequent diner in the restaurant. (It was once one of Sally's favourite movies.)
The next day we explored the region, checking out properties and trying to guess real estate prices. There are a lot of properties for sale, and prices are quite high, especially for waterfront. A number of new condominium projects have been built or are being planned, no doubt catering to people from across Canada and elsewhere, who are attracted to a place called The Sunshine Coast!After checking out Sechelt this morning, we returned to Gibsons for lunch, since we were told there was a very good oyster restaurant. We found it, just below Molly's Reach, at the bottom of a wooden staircase overlooking the Marina. It's called Smitty's Oyster House, and like Chasters, serves astonishingly good foodl. It was a very sophisticated operation....the sort of place we expect to find in California, not BC. The proprietor told us that his business, and that of other good restaurants like Chasters, has been seriously affected by the new provincial drinking regulations. In fact, he indicated that he will likely close down this coming winter, since it is too hard to cover costs.As we now head back to Vancouver on the 50 minute ferry trip, I would urge those of you who haven't been to the Sunshine Coast for a while to do what we did....book a night inBonniebrook Lodge (with or without a coupon from a charity auction), have dinner in Chasters and then lunch the next day at Smitty's. But don't wait for summer, do it now, while prices are a bit lower, and the establishments need your business. I think you'll be pleasantly surprised by what you find, just like we were!
Friday, April 29, 2011
A proposal to build a collection of duplexes and coach houses on three lots in the 2000-block of Esquimalt Avenue in West Vancouver will move to the public for consideration next month.
Council first considered the Esquimalt Drive lots for development in 2005, but defeated a proposal in 2006 because of the challenges in "introducing new housing types in established single-family neighbourhoods." Five years later, district councillors have decided unanimously to send the alternate-housing proposal to a public hearing, scheduled for May 16 at municipal hall.
"This is housing that's been asked for. . . . We know that it's needed. Really, it's time that we addressed this," Coun. Shannon Walker said at an April 18 council meeting.
The proposal, dubbed Hollyburn Mews, calls for nine housing units built on three lots in the 2000-block of Esquimalt Avenue -- six duplex units facing Esquimalt and three detached coach houses facing the rear lane -- all built at 2031, 2046 and 2063 Esquimalt Avenue.
Vancouver-based architecture firm Geller Properties Inc. is stickhandling the revamped proposal since taking over the development plans after the initial 2005 application and buying the three lots in August 2010.
The proposal requires a rezoning of the three lots, each currently occupied by an older rental house, and an OCP amendment for the block. The developer is seeking an increase in the lots' permitted density from 0.35 to 0.61 floor-space ratio.
In his presentation to council, Michael Geller of Geller Properties Inc. said the development would provide West Vancouver's empty nesters and aging residents with smaller, more age-friendly housing options. He described the units as cottage-like units with porches, lush gardens, and interiors equipped to meet seniors' needs.
"I think these are things that people of West Vancouver would be looking for in this location," Geller said. "Hopefully we'll meet the aspiration that I know many people hope to achieve in the new type of housing."
Coun. Bill Soprovich questioned the affordability of the duplexes and coach houses in Geller's proposal.
Geller agreed that the units will not qualify as "affordable" per se, but said he hopes to achieve "relative affordability" in his project given the cost of land and development in West Vancouver.
According to the district's senior community planner Stephen Mikicich, the initial proposal has changed to reflect public concerns since the "enhanced consultation process" conducted in 2010. He said the design changes include smaller coach houses, improved landscaping, a focus on the character of the rear land environment, and the addition of three on-site parking spaces.
In a report to council, Mikicich also said "the proposal supports the OCP vision of a sustainable community through improved housing choice, reduced auto dependency, providing more housing in proximity to retail services and community amenities, and sustainable building and landscape features."
West Vancouver's Gary Hiscox and three other residents spoke in support of the proposal.
"These alternatives provide aging families like ours the opportunity to continue to live in an environment to which we have become accustomed," said Hiscox, who lives on 16th Street.
"Aging residents and young adults are not well served by the present stock of housing in West Vancouver," Haywood Avenue resident Lynn Broman added.
But for Gordon Ward-Hall of Fulton Avenue, who spoke on behalf of the Ambleside-Dundarave Ratepayers' Association, the proposed development is too much, too soon. He cited the district's OCP, which calls for an analysis of alternative housing needs in the district on a site-specific basis and states that OCP amendments "should apply in limited circumstances" in single-family areas.
"The present proposal for Esquimalt is a complete reversal of this policy," Ward-Hall said. "This is certainly not a gradual introduction of multi-family units into a single-family neighbourhood."
A public hearing is scheduled for Monday, May 16 at 7 p.m. in West Vancouver council chambers.
© Copyright (c) North Shore News
Thursday, April 28, 2011
Frances also posted some additional comments on her blog, linking to the G&M story. The first comment came from a Bobbie Bees.
Bobbie Bees // Apr 27, 2011 at 8:41 pm They should just bulldoze the whole lot and put up an amusement park. We could call it NPA Land.
Rather than head off to the gym, I decided to respond. Here's what I had to say:
Bobbie Bees, this is a very odd comment, and it probably doesn’t deserve a response, but I’ll respond anyway.
As PGH implies, the planning and development of the Olympic Village has spanned many administrations. Indeed, Larry Campbell’s administration deserves the credit for proposing the current plan comprising a highly sustainable, alternative building form of development.
As I have previously noted on this blog, one prominent Vancouver developer told me that he did not bid on the land because he thought that the Campbell administration was taking too long to get the plans finalized and he worried there would not be time to complete the project in an orderly fashion before the Olympics deadline.
When the NPA came into office, they did make changes, especially to the social and income mix. They cut back on the number of subsidized housing units, and some of the other amenities, given the absence of funding from senior governments. However, they did not reduce the ‘sustainability features’.
The selection of Millennium did occur during the NPA administration, and the buyers who are now suing purchased during the NPA Administration.
When Vision took office, measures were taken to ensure that the pre-sale buyers could not ‘walk away’ from their purchases. As I noted in previous posts on this blog, the city was very careful to act in a manner so that the pre-sales would remain intact. If it hadn’t been for the fact that there were so many pre-sales in place, the city would likely have taken over the direct ownership and development from Millennium much sooner.
Indeed, one of the legal measures that the city took, which resulted in the land being leased, rather than sold until the project was completed and the sales closed, contributed to Millennium’s earlier difficulties in arranging project financing.
For these reasons, I am confused by the argument by the lawyer, acting on behalf of the disgruntled purchasers, that the city is the developer, and should have been named as such in the disclosure statement. The city was not the developer of the condominiums; it leased the land to the developer during construction; and it became the project lender; but it took extraordinary steps to ensure that it couldn’t be deemed to be the developer.
I am not a lawyer, but I’ll be astonished if this aspect of the argument is successful.
As for the deficiencies, there is no doubt that there are many. Water pouring through the ceiling sounds terrible, but water poured through the ceiling on opening day on a project that I built at Larch and 41st in Kerrisdale. Ironically, it’s been recognized by the Masonry Institute as one of the best constructed buildings in the city, but a backed up irrigation line caused the problem. I have not heard of any more complaints in the 13 years since it was completed.
This is not to diminish the deficiencies at the Olympic Village. There are many, especially since so many of the units were rushed to be completed at once. There is no doubt that they need to be addressed, and the city’s Receiver is carrying out a deficiency repair program.
I must say I do feel bad for some of the purchasers who bought units some time ago, and now see similar units (similar, but not identical) being sold for less than they paid. But this happens in real estate all the time. It happens in the stock market…trust me, I know only too well.
However, in the case of the stock market, I have bought shares at prices that will never recover. In the case of real estate, I am not aware of anyone who held onto a purchase for ten years or more, who lost money. Yes, there’s a short term loss…..but over the long term, real estate in Vancouver seems to eventually go up. I predict that over the long term, the prices paid will recover, and once the community is filled up, and the restaurants and shops are in place, people will very much enjoy living in what will one day be a very lively and successful community.
As readers of this blog know, I have been very critical of many of the decisions related to the Olympic Village. I continue to have concerns, especially related to the social housing units.
However, in this case, I am disturbed by the claims of the disgruntled buyers and their lawyer. As long as the city is committed to repair all deficiencies, I do not think they are entitled to get out of their purchases.
That being said, there is no doubt that the publicity associated with their claims is affecting the sales performance, which will ultimately lead to increased losses for the city. I do hope the city, the Receiver, and their many consultants and professional advisors are carefully considering what to do to address this significant new challeng
PS My Akamai stock is down 14.8% this morning. Who do I sue?
Sunday, April 24, 2011
When I set off on my world travels in 2007, I hadn't really planned to visit Albania. I knew very little about the place, and it seemed terribly out of the way. However, in one of the guidebooks, I came across a photo of some extraordinary, multi-coloured buildings in Tirana, the capital city, and the image stuck with me.
Six months later, I was in Skopje, FYROM and rather than head off to Dubrovnik, someone suggested we go in a different direction that would take us closer to Albania. Remembering the photo of coloured buildings, I decided to follow his advice. A few days later, I was in Albania. It was fascinating. Here's a link to some initial observations about the country. http://gellersworldtravel.blogspot.com/2007/07/colourful-albania.html
It was only after I left that I learned the story of the painted buildings. It seems that in 2000, an independent was elected mayor of Tirana, the capital of Albania. His name was Edi Rama, and he was an artist. When he was elected, much of the country was in incredible disrepair. Rama knew they didn't have enough money to fix up the buildings, but he thought he could get money to PAINT them! And so he did. And rather than just paint these decrepit buildings white or a single colour, he thought of each building as a canvas, and eventually the town started to become quite colourful....and it spread to other parts of the country. As buildings were painted, the grounds around them started to get cleaned up, and colourful new buildings were added. Within a few years, much happened and in 2004 Rama was voted the best Mayor in the World.When I was in Albania, I couldn't stop thinking about Vancouver's Downtown Eastside, with its worn out buildings and storefronts. While it was by no means as run down as the country, there were similarities.... If only we could start a similar program of cleaning and fixing up.
When I returned to Vancouver, I spoke about this, and soon accepted an invitation from some people who had formed a new organization, the Building Community Society, that hoped to help address a variety of social and planning problems in the Downtown Eastside. In spring 2008, I suggested to some of the community leaders that they should organize a beautification program and spring cleanup similar to what had happened in Albania. It nearly happened, but it didn't.Today, there is much more happening in the Downtown Eastside. The new Woodwards building has definitely had an impact, and a number of the run down hotels have been acquired by the Province and rehabilitated. The Mayor's new shelters have helped take many people of the streets, but many of the storefronts, with their rusting metal gates, and peeling paint look as bad as they did in 2008. The lanes are even more unsightly. I can't help but think that so much could be done if our mayor would be more like Edi Rama and inspire the people to take control of their space and get some paint, power washers and clean up the garbage, some of which has been trapped behind metal railings for a long time.
The Downtown Eastside needs a really good spring cleanup. I know that this has to be organized by the community, but I also know that many Vancouver residents would be happy to help out, if asked. If you agree this is a good idea, maybe you can spread the word.ps One day, after I returned home and was researching Edi Rama, I was shocked to discover that an article I wrote about design controls and Albania's colourful buildings had somehow found its way onto Tirana's official website. While it is a somewhat critical story about Albania, it is still there. You can read it here! http://www.tirana.gov.al/?cid=2,58,1502
Wednesday, April 20, 2011
I must say my gentle support was also spurred on by some of the opposition. As one opponent said on CBC this morning, her opposition began because non-profits were not getting the money that had been promised by the province. Rick Cluff quite rightly said in response, “well isn’t that a provincial matter, rather than a municipal issue?” Yes, she said, but she subsequently had concerns about gambling addictions, the size of the building, etc. etc.
So I am not broken hearted that the project has been rejected. There were many other aspects about it that troubled me, that I have previously set out on on various blogs. However, I think it is worthwhile to speculate on what might happen next, both in terms of the future of this site, and where a major destination casino might land.
With respect to the latter, the Fourth Horeseman wrote on Frances Bula's blog: “stop listening to Michael Geller’s alarmist screed, please.”
I assume this is a reference to the fact that I did on one occasion report on CKNW that I had heard others suggest that a casino might locate on the Squamish lands at the South End of the Burrard Street Bridge. I emphasized that I had no first hand knowledge that the Squamish Nation was even considering this, but added that Casinos often locate on native lands elsewhere.
Ironically, this might be a greater possibility now, because of two recent decisions….one, Council has rejected an expanded casino downtown; and two, the Squamish Nation band members have rejected changes to their land code that would have made it easier and more financially attractive to develop condominiums on their lands.
Personally, if the casino is going to relocate to another site, I think there’s a greater likelihood of a major casino now being developed in Surrey, perhaps on the lands adjacent to King George SkyTrain Station. I say this since a major mixed use project including a casino was contemplated in the past for this site. It could happen….
Now as for the BC Place site, I’m troubled by another statement by the Fourth Horseman on France's blog:
“that David Podmore said, as he has said for the last few weeks, that not expanding the casino will not affect the improvements at BC Place and that taxpayers will “not be stuck with the cost”.
Which is a significant departure from what was first said.”
What I heard David say was that the BC Place roof and other improvements would not be impacted by a rejection of the casino. Well this should be obvious to all, since the works are underway and cannot be stopped.
But I am confused by “taxpayers will not be stuck with the cost”.
The cost of the BC Place improvements will not be paid for by increased beer and hot dog sales. It was hoped that the sale and lease of the adjacent lands would be a major contributor to the cost. While the casino was only contributing a portion of the total cost, the amount was not insignificant.
Council and staff have said emphatically that they do not want to see more condos on this site. Instead, they prefer commercial activities that will create jobs. I agree with this position. But I am a bit stumped when it comes to what might be alternative uses.
Yesterday I was called by CTV who asked me about the future of this property. Might we see a major shopping centre? No, I said…pointing to the nearby International Village as an example of a failed major retail undertaking. What about hotels? Well, new hotels in Vancouver are not generally viable without some form of ‘subsidy’. Condominiums are the best way to subsidize a hotel, but we don’t want condos here.
An expanded casino might have subsidized two hotels, but I doubt whether we’ll see two hotels without the expanded casino. I do think hotel may be a viable use in the future, noting there is a hotel next to Rogers Stadium in Toronto. But it is a bit of a longshot, without some supporting uses.
So, unless there are sufficient development revenues, one way or another, taxpayers will be ‘stuck’ with the cost of the BC Place improvements….they may not be just Vancouver city taxpayers, but they will be taxpayers…that’s where the province and Pavco get their money!
A final observation. Earlier this year on CKNW, Frances Bula, Jim Green and I generally concluded that the casino expansion was a ‘done deal’. On two occasions we discussed it, an neither conversation generated any phone calls…so the topic was dropped.
A week later, I got a message from Pete McMartin asking me if I had heard anything about opposition to the casino. I told him that I was aware that Sean Bickerton and his False Creek neighbours had been opposed to the casino for some time, and were trying to organize something, but he noted this was ‘old news’.
Howevever, I am told that Bickerton brought on Judy Rudin who brought on Peter Ladner and Bing Thom. Sandy Garassimo was also actively drumming up opposition and soon many, many others started to sign on and the opposition gained momentum. Like the old Arlo Guthrie song, it morphed into a movement, and once it got going, it couldn’t be stopped. As I watched this happening, I was reminded of a book I read during the last municipal election….Clay Shirky’s Here Comes Everyone: The Power of Organizing without an Organization.
It’s all about how social media are changing the way society operates. And the rejection of this casino is a perfect example. Now I can’t wait to see what will be the next big issue or cause to be driven by social media.
POSTSCRIPT: After writing these comments, I listened to the Mayor speaking to Simi Sara on CKNW's Bill Good Show, and listening carefully to his words, I think the province will be back with a revised, smaller casino proposal for the BC Place lands. That's right. It may not go to Surrey, or Squamish Lands. It's not so much what he said, but what he didn't say.
So here's my prediction. Having won accolades for opposing casino expansion, the Mayor and Council WILL ultimately approve a relocation of the Edgewater Casino to the BC Place site. Will it be expanded? Well maybe, just a little bit, but not enough to cause another furor. But it will be designed so that it can be expanded at some time in the future, when the dust has settled. Let's see if I am right.
Sunday, April 17, 2011
Since I purchased the properties, I retained Formwerks Architectural and Durante Krueck Landscape Architects to further develop plans that I prepared for the project. I now believe we have addressed many of the earlier concerns regarding the design, and its neighbourhood 'fit'.
The purpose of Hollyburn Mews is to provide new housing choices for West Vancouver residents who are ready to downsize from a larger home or lot, but are not ready, or do not want to move into an apartment. Instead they are seeking thoughtfully designed, well located ground oriented homes with small patios, porches in a garden like setting.The location of Hollyburn Mews could not be much better. It is one block north of Marine Drive with its array of restaurants and cafes, shops and services, the Library and transit. To the west is the West Vancouver Seniors' Centre and the fabulous new Recreation Centre; to the south is West Vancouver United Church; the Bowling Greens are to the south east.The proposal comprises three duplex units along Esquimalt Avenue. Each is designed to resemble a larger, single family house. Along the lane are three coach houses and garages for the nine homes. The exterior designs are inspired by traditional West Vancouver cottages and houses. Here is a link to the staff report which includes the rezoning report and project drawings. http://www.westvancouver.ca/
Below are some images of the new site plan, elevations and perspective drawings of the street view and laneway view.If you agree there is a need for this type of housing, and you feel the proposal fits with the neighbourhood, please let the Mayor and Council know by writing to firstname.lastname@example.org and sharing your thoughts. I will appreciate it, and so will the many people who would like to see this creative and innovative proposal succeed.
On April 18th, Council approved forwarding this application, along with an Official Community Plan Amendment for the entire block, to Public Hearing on May 16th. Hopefully both will be approved and construction can begin this summer. Write to me at email@example.com for further details.
Tuesday, April 12, 2011
I was intrigued to read this story in today's Globe and Mail by Gary Mason. Given all the numbers now floating around, I hope the city will respond and clarify what the outstanding loan is; how much is owed on the land; what is the sales projection is for the condos; what is the sales projection for the rental building and retail space; what is the projected loss/subsidy for the social/rental housing; what will the loss be on the condos that have now been rented out; what are the estimated carrying costs during the sales period; and what are the fees being paid to the lawyers and receivers. As I wrote in previous posts, I just couldn't believe that the losses would only be $40 to $50 million, notwithstanding the 'heroic efforts' by the current administration.
The athletes' village for the Vancouver 2010 Winter Olympic Games is pictured as construction continues at the site in Vancouver, B.C., on Friday October 9, 2009. (Lyle Stafford for the Globe and Mail)
When reporters left a briefing with City of Vancouver officials last week on the troubled Olympic Village project, there was unanimous agreement on the storyline: losses were now estimated to be in the neighbourhood of $40-million to $50-million.
While still bad, it was a far cry from the dire and pessimistic predictions that had been made in some corners, including this one, that the city’s Village-related deficit could exceed $150-million. But thanks to the heroic efforts of the governing Vision Vancouver party, it looked like the hit taxpayers were going to take wouldn’t be nearly as bad.
As it turns out, the city’s losses will be far worse than many forecast. Because, while officials were telling the media that the city expected to recover all but $50-million of the $579-million owed by defunct Millennium Development Corp. on its construction loan, it forget to mention the nearly $180-million the developer hadn’t paid Vancouver taxpayers for the land it purchased.
So, in fact, the losses on the project will total at least $230-million – that is, if the city is lucky and the stars align just right for the sale of the 340 or so remaining condos.
And that is far from a sure bet. Plus, there are other costs that don’t seem to be calculated into the accounting provided to reporters last Friday, such as strata fees that are accruing on rental units that aren’t yet occupied. There is very likely interest charges that need to be taken into account too, plus fees that need to be paid to the receiver that is managing the project.
But that wasn’t the message the city wanted to deliver on Friday. Instead, city manager Penny Ballem took reporters through a power-point presentation that highlighted the many actions that the Vision-controlled council had taken to mitigate some of the losses on the development.
I have no problem with outlining some of the decisions made to help cushion the blow to taxpayers. But at least be honest about what the final tally is instead of trying to deceive people.
When all is said and done, the Olympic Village will likely represent the biggest financial disaster in the city’s recent history. A responsible government would be completely up front with its citizens about where things stand rather than trying to sweep a nearly $180-million land loss under the mayor’s carpet.
And as I say, the final amount could be much higher yet. Just look at the numbers.
Of the $579-million Millennium owed on its construction loan (which was separate from the $178-million it owed for the land), the city is saying it expects to lose up to $50-million. So let’s round it off and say it anticipates recouping $530-million of the total loan amount.
Of that, it hopes to reap about $70-million from the sale of assets seized from Millennium Development Corp. Olympic Village marketer Bob Rennie recently sold 118 condos for an undetermined amount. But they were smaller units, not luxury ones. Let’s say the average price was $700,000. That would provide another $80-million or so. So now your loan amount is down to about $380-million.
Mr. Rennie has 340 units left to sell to make up the $380-million left. That is more than $1-million a unit. Not a chance in the current market, even if some go for a few million each. And Mr. Rennie is having to sell these units amid dreadful publicity generated by a class-action lawsuit launched by earlier buyers who want out of the Village because of what they insist is horrible workmanship and shoddy design.
And as mentioned, we haven’t factored in ancillary costs such as the receiver’s fees, estimated to be $8-million by some, and other accrued interest costs that could well be in the millions. And we also haven’t mentioned the $65-million in overruns on the social housing at the Village, which many feel should be calculated into any final accounting.
That would push the Olympic Village-related losses close to $300-million.
It will likely be a couple of years before we know how much Vancouver taxpayers got soaked on the Village. But it is far, far more than $40-million to $50-million. And it will likely be north still of the $230-million the losses are now confirmed to be.
It’s too bad the current city government is so insistent on playing politics with the project instead of just giving people the straight goods. There’s no way to sugar-coat this debacle. So why even try?
Sunday, April 10, 2011
1. The loss calculation apparently ignores the outstanding land payment of $178 million. However, it does include repayment of a pro-rata portion of the city's costs associated with servicing the OV portion of the larger Southeast false Creek property.
2. It is not clear how the revenues from the condominium sales are calculated. Presumably they are based on the numbers provided by the appraisers. However, I now read that 20 condominium units that were to be sold, have been rented. It will be interesting to see how the losses associated with these units are being calculated. There are going to be losses since the rents will not cover the unit costs. (They may be offset by increased sales prices five or ten years from now, but this remains to be seen.) Furthermore, the fact is, notwithstanding the initial weekend's sales success, there are fewer sales today than announced after the opening weekend. Notwithstanding the appraisals, it may be that prices may have to be further reduced on some of the unsold units if the project's adverse publicity continues; also although there are some very good units in the two waterfront buildings designed by Arthur Erickson, many of the remaining units have less than desirable plans and outlooks.
3. The loss calculation does not include any losses associated with the social housing. So far, the city has committed approximately $64 million in subsidies, and given that 144 of the 252 units remain empty, additional subsidies will be required.
4. It will be interesting to know what provision is being made for the holding costs, and other related costs.
So will losses be restricted to $40 to 50 million? I don't think we are going to know for quite a while...certainly not before November 2011! However, I do hope the city will share the financial information that was used to calculate its projections so that knowledgeable real estate people can asses what is continuing to be a very political matter!
Saturday, April 9, 2011
Let me say I appreciate the fact that the city is providing information to the public through the media and would be pleased if the losses are as low as being reported. However, I think we need further information in order to determine just how likely the $40 to $50 million loss will be, and how it is calculated. More specifically:
Here's the wire copy that was provided to me by Global TV
Vancouver officials estimated Friday the Olympic village will have a shortfall of between $40-50 million after all the units are sold and the construction loan paid off. That shortfall is the first concrete confirmation that the city will likely not recover all of the $578 million it is still owed by the former owner, Millennium Developments. But it is far better than initial estimates by Vancouver Mayor Gregor Robertson that the city could be "on the hook" for the entire cost of the $1 billion village. And it is better still than the potential $150 million shortfall estimated by some council members and development experts after the city forced Millennium into "voluntary" receivership.
Jeff appears to have copied this wire copy in his story. However, I would like to know where does the $578 million figure come from? Using other information in his story, I calculate the amount owed to taxpayers at $657.9 million ($479.5 for the loan and $178.4 for the outstanding payment on the land.)
1. Jeff's story states the city has sold 118 of the 737 units, implying there are 519 units remaining unsold. In fact, the receiver's report states the city has now sold a total of 403 units (including 118 units sold since the rebranding and launch) leaving 334 sales to partially offset the $657.9 outstanding. In order to know what the real losses might be, we need to ask the city and receiver a few more questions:
1. What is the total revenue estimated from these 334 units based on the total saleable square footage and the estimated average sales price per square foot for the different buildings?
2. What revenues are attributed to the 119 unit rental building and the retail space? (In the past, I have heard a number in the order of $60 to $70 million for both.)
3. What are the estimated holding costs during the sales period which has been estimated at 2 years or longer. I note the city's interest rate is a relatively low 2.5%. However, there are also strata fees, and other costs. As an aside, do the holding costs include any provision for property taxes which otherwise would be payable?
4. I note $5 million is being set aside as a deficiency reserve. How much other money is estimated to be spent to repair deficiencies?
5. How are the social housing units being accounted for? It does not appear that they are included in any of these numbers. However, the cost of these units rose from $65 million to $110 million. The rents are not sufficient to cover the costs. Furthermore, approximately 144 of the 252 units still remain empty. Will any of the social housing costs be included in the calculation of the potential city losses? They should be.
6. Finally, CBC reported that the receiver's fees (including related studies, etc.) will be in the order of $8 million. Is this included in the estimated total loss? It too should be.
While I note the city is now expecting anywhere between $45 million and $67 million from disposal of the other Millennium assets, and I agree that a $40 to $50 million loss would be much better than what I previously estimated, I still suspect that when one looks at the likely revenues from the 334 unsold units, holding costs, the losses on the social/rental housing, and other ancillary costs, the losses to the city will in fact be much more than $40 to $50 million...indeed, they will likely be much more than my earlier $150 million estimate. I hope I might be proven wrong, so it would be helpful if the city can share further information as set out above.
Friday, April 8, 2011
However, the fact is, at least up until now, the bike lanes are being used much less than most people expected, whether supporters of bike lanes or not. Moreover, they are causing havoc for many drivers, because of the reduced road width and contorted lane patterns, and also the restrictions on right hand turns. I must say, the latter is perhaps my major concern and something that definitely needs to be reviewed.
It seems that counting cyclists and complaining about bike lanes has become a new Vancouver pastime, along with discussing the price of real estate, and gloating about being able to golf year round. Perhaps that is why so many people have sent me this video over the past week. I must confess, I found myself laughing out loud...I suspect you will too.
Sunday, April 3, 2011
I'm delighted to be participating at this year's Real Estate Forum, being held on Thursday April 7th at the Vancouver Trade and Convention Centre. I hope our panel will address how best to realize more mixed-use, higher density development around new transit stations and in conjunction with other transit improvements.
Below is the program
Session A2: 10:30 am
LAND & DEVELOPMENT ACTIVITY IN VANCOUVER: HOW MUCH IS BEING DRIVEN BY MIXED USE DEVELOPMENT vs. TRADITIONAL ACTIVITY?
The panel discussion will examine the market fundamentals and dynamics driving land acquisition and development in the region. Where are current land values heading for 2011 and beyond? The panel will also debate the pros and cons of TOD (Transit oriented development) as well as the Metro Vancouver land policy. What impact does transportation and the ALR have on land values? Who are the current buyers and sellers of land today? What are the future trends for mixed use development and what are the main complexities of developing mixed use space?
Sandra Cawley, Principal, Burgess Cawley Sullivan & Associates
Phil Christie, Vice President, Real Estate, TransLink
John Conicella, Vice President, Development Strategy and Business Development, Wesgroup Properties
Michael Geller, B. Arch, MAIBC, FCIP, The Geller Group
Stephen Knight, President, Sitings Realty Group Ltd.
Friday, April 1, 2011
About 12 years ago, tied in with a visit by Prince Charles to the city, I arranged for a report in the Courier that the Prince was rumoured to have purchased a Kerrisdale condominium near a park. A number of excited purchasers contacted me to ask whether he had bought at Elm Park place. However, my favourite call was from a purchaser who was furious that I would sell to a member of the royal family without consulting with other purchasers. "How are we going to manage with all the extra security?" she wanted to know.
The following year I wrote an 'advertorial' that the provincial government had secretly approved a SkyTrain extension along West 41st with a station at Larch and West 41st. A surprising number of people were fooled, including one of my daughter's Crofton House classmates who brought in a copy of the Courier as her 'show and tell' story. "There's going to be a SkyTrain to Crofton House" she exclaimed. My daughter had to explain that it was just one of her dad's April Fools' Day jokes. Unfortunately, the girl had never heard of April Fools' Day.While some people get quite upset about April Fools' Day pranks, I think they can be wonderful. Below are excerpts from the list of 100 pranks on the museumofhoaxes.com website:
3: Instant Color TV
1962: In 1962 there was only one tv channel in Sweden, and it broadcast in black and white. The station's technical expert, Kjell Stensson, appeared on the news to announce that, thanks to a new technology, viewers could convert their existing sets to display color reception. All they had to do was pull a nylon stocking over their tv screen. Stensson proceeded to demonstrate the process. Thousands of people were taken in. Regular color broadcasts only commenced in Sweden on April 1, 1970.
10: Planetary Alignment Decreases Gravity
1976: The British astronomer Patrick Moore announced on BBC Radio 2 that at 9:47 AM a once-in-a-lifetime astronomical event was going to occur that listeners could experience in their very own homes. The planet Pluto would pass behind Jupiter, temporarily causing a gravitational alignment that would counteract and lessen the Earth's own gravity. Moore told his listeners that if they jumped in the air at the exact moment that this planetary alignment occurred, they would experience a strange floating sensation. When 9:47 AM arrived, BBC2 began to receive hundreds of phone calls from listeners claiming to have felt the sensation. One woman even reported that she and her eleven friends had risen from their chairs and floated around the room.
20: The 26-Day Marathon
1981: The Daily Mail ran a story about an unfortunate Japanese long-distance runner, Kimo Nakajimi, who had entered the London Marathon but, on account of a translation error, thought that he had to run for 26 days, not 26 miles. Reportedly Nakajimi was now somewhere out on the roads of England, still running, determined to finish the race. Various people had spotted him, though they were unable to flag him down. The translation error was attributed to Timothy Bryant, an import director, who said, "I translated the rules and sent them off to him. But I have only been learning Japanese for two years, and I must have made a mistake. He seems to be taking this marathon to be something like the very long races they have over there."
#38: Operation Parallax
1979: London's Capital Radio announced that Operation Parallax would soon go into effect. This was a government plan to resynchronize the British calendar with the rest of the world. It was explained that ever since 1945 Britain had gradually become 48 hours ahead of all other countries because of the constant switching back and forth from British Summer Time. To remedy this situation, the British government had decided to cancel April 5 and 12 that year. Capital Radio received numerous calls as a result of this announcement. One employer wanted to know if she had to pay her employees for the missing days. Another woman was curious about what would happen to her birthday, which fell on one of the cancelled days.
#43: An Interview with President Carter
2001: Michael Enright, host of the Sunday Edition of the Canadian Broadcasting Corpation's radio program This Morning, interviewed former President Jimmy Carter on the air. The interview concerned Canada's heavily subsidized softwood lumber industry, about which Carter had recently written an editorial piece in The New York Times. The interview took a turn for the worse when Enright began telling Carter to speed up his answers. Then Enright asked, "I think the question on everyone's mind is, how did a washed-up peanut farmer from Hicksville such as yourself get involved in such a sophisticated bilateral trade argument?" Carter seemed stunned by the insult. Finally he replied, "Excuse me? A washed-up peanut farmer? You're one to talk, sir. Didn't you used to be on the air five times a week?" The tone of the interview did not improve from there. Carter ended up calling Enright a "rude person" before he hung up. Enright then revealed that the interview had been fake. The Toronto comedian Ray Landry had been impersonating Carter's voice. The interview generated a number of angry calls from listeners who didn't find the joke funny. But the next day the controversy reached even larger proportions when the Globe and Mail reported the interview as fact on their front pages. The editor of the Globe and Mail later explained that he hadn't realized the interview was a hoax because it was "a fairly strange issue and a strange person to choose as a spoof."
#58: Portable Zip Codes
2004: National Public Radio's All Things Considered announced that the post office had begun a new 'portable zip codes' program. This program, inspired by an FCC ruling that allowed phone users to take their phone number with them when they moved, would allow people to also take their zip code with them when they moved, no matter where they moved to. It was hoped that with this new program zip codes would come to symbolize "a citizen's place in the demographic, rather than geographic, landscape." Assistant Postmaster General Lester Crandall was quoted as saying, "Every year millions of Americans are on the go: People who must relocate for work or other reasons. Those people may have been quite attached to their original homes or an adopted town or city of residence. For them this innovative measure will serve as an umbilical cord to the place they love best."
#93: Eiffel Tower Moves
The Parisien stunned French citizens in 1986 when it reported that an agreement had been signed to dismantle the Eiffle Tower. The international symbol of French culture would then be reconstructed in the new Euro Disney theme park going up east of Paris. In the space where the Tower used to stand, a 35,000 seat stadium would be built for use during the 1992 Olympic Games.
#95: Chunnel Blunder
In 1990 the News of the World reported that the Chunnel project, which was already suffering from huge cost overruns, would face another big additional expense caused by a colossal engineering blunder. Apparently the two halves of the tunnel, being built simultaneously from the coasts of France and England, would miss each other by 14 feet. The error was attributed to the fact that French engineers had insisted on using metric specifications in their blueprints. The mistake would reportedly cost $14 billion to fix.
100: The British Postal Address Turnabout
In 1977 the BBC gave airtime to Tom Jackson, General Secretary of the British Union of Post Office Workers. Mr. Jackson was up in arms about a recent proposal that the British mail adopt the German method of addressing envelopes in which the house number is written after the name of the road, not before it (i.e. Downing Street 10, instead of 10 Downing Street). Jackson spoke at great length about the enormous burden this change would place upon postal employees, insisting that "Postal workers would be furious because it would turn upside-down the way we have learned to sort." His comments elicited an immediate reaction from the audience, many of whom phoned up to voice their support for Jackson's campaign. What the audience didn't realize was that there were no plans to change the way the British addressed their mail. Mr. Jackson's diatribe was an elaborate April Fool's Day joke.
Next year, I will try and come up with something!