Agenda Index City of Vancouver

ADMINISTRATIVE REPORT

TO:

Standing Committee on City Services and Budgets

FROM:

Directors of Community Services, Social Planning, and the Housing Centre

SUBJECT:

Crabtree Corner Relocation

 

RECOMMENDATION

CITY MANAGER’S COMMENTS

COUNCIL POLICY

It is City policy to use the Property Endowment Fund to assemble sites for lease to non-profit and co-op housing sponsors for 60 years at a prepaid cost equal to 75% of freehold market value.

The relocation of Crabtree Corner was approved as a specific priority of the 1997 - 1999 Capital Plan.

Grants require eight affirmative votes of Council.

PURPOSE

This report seeks Council approval to reserve the City-owned site at 533-539 E. Hastings for the relocation of Crabtree Corner, a social service and childcare facility operated by the Vancouver YWCA. The relocation is conditional on the Y raising the capital funds required for the project and confirming the operating funds. Once the funding has been identified and the conditions satisfied, the project will be reported to Council for approval of lease terms and any other matters that need to be resolved before the project can proceed.

BACKGROUND

Crabtree Corner, operated by the Vancouver YWCA since 1983, is currently located in 2,800 sq. ft. of at-grade retail space in the City-owned parking lot at 101 E. Cordova. It provides a number of social services supporting low income mothers and children in the Downtown Eastside: food programs, clothing exchange, counseling, parenting programs, drug and alcohol prevention, single mothers’ support, CAPC programming and it is the only emergency childcare program in the province. The community space within Crabtree is very cramped and the childcare space no longer meets current licensing standards as it lacks proper storage, nap areas and any outdoor play space.

In 1993, the YWCA approached the City asking for permission to relocate the emergency childcare service to the upper parking deck, so an outdoor play area could be added and the at-grade childcare space could be freed up for increased community programming and much needed office/reception space. Unfortunately this option was not viable because of a number of structural, regulatory and cost barriers. Instead it was decided to do a short term, temporary renovation of 3 parking spaces to create some additional storage space and to do minor renovations to the community space to increase its flexibility. Meantime the City and the YWCA committed to explore a longer term relocation option. These recommendations were made to Council in a report approved June 27, 1995, and again as part of Social Planning’s 1997-1999 Capital Plan submission where $500,000 was allocated to the relocation of Crabtree Corner.

From 1995 to 1999, City staff and the YWCA explored the feasibility of nine potential relocation opportunities. In the process, a location east of Main on the Hastings corridor was identified as preferred. A location in this area would provide good transit access for Crabtree’s clientele most of whom live either in the Downtown Eastside, or to the east in the Dundas/Wall and north Commercial Dr. areas.

533-539 EAST HASTINGS

City Council approved the purchase of 533-539 E. Hastings on July 28, 1998. The site has a frontage of 75 ft. on Hastings and an area of 9,150 sq. ft. It is zoned DEOD and can accommodate 2 FSR of commercial and 3 FSR of residential uses. Its location is noted on Figure 1.

Figure 1

POTENTIAL SMALL SUITE PROJECT

The site was purchased for the development of a small suite (200+/- sq. ft./unit) project. One of the recommendations of the draft Housing Plan for the Downtown Eastside and neighbouring communities was to explore the feasibility of developing small suites to replace the SROs (Single Room Occupancies) in the old residential hotels in the area without senior government subsidies. The intent was to see what could be done on a market basis to develop housing rented at or close to the shelter component of welfare. The proposal was to seek a developer/partner to jointly explore the feasibility of a small suite project. If it did not prove feasible, the site could be held for future non-market housing.

A call for expressions of interest was undertaken with 3 responses. All noted the difficulty of developing small suites without senior government subsidies. Concert Developments was selected to work on the project. Over the past year, Concert explored several alternatives for developing the site for small suites. With the Y’s interest in relocating Crabtree Corner to E. Hastings, and the potential for non-residential uses on the lower floors, Concert explored alternatives that accommodated Crabtree Corner in the project with its employment and counseling services on the ground floor and the childcare, including outdoor space, on the second.

Concert has now concluded that developing a small suite project on this site is not feasible without senior government subsidy or substantial equity from elsewhere. Even with the City’s land invested in the project as equity, the investment return would not exceed 3%.

CRABTREE CORNER PROPOSAL

The expectation was that 533-539 E. Hastings would be held for future non-market housing if the small suite project was not feasible. However, there are a number of other non-market housing projects that have received funding in recent years at various stages of development, and others ready to proceed should funding become available. It could be some time before 533-539 E. Hastings is required for non-market housing. It has been very difficult locating a site suitable for Crabtree Corner, in particular a site that can accommodate outdoor space that is safe and secure. The small suite project could achieve that on this site because the floor plate for the 200 sq. ft. suites allowed the open space to be accommodated on the second floor.

The Y believes this site is very well located for Crabtree Corner. In addition to the $500,000 the City set aside in its 1997-1999 Capital Plan, the Y has raised an additional $500,000 already for the project, and believes that over the next year it can raise the remaining funds required. They are concerned that they and the City have been looking for a site for several years already, and do not want to continue searching in vain if the site at 533-539 E. Hastings is available and suitable. Further delay could jeopardize the funding they have already raised and which must be used to relocate Crabtree as a condition of the donors. There is also a possible partnership with the Sheway service that provides drug and alcohol treatment for women, some whom also use Crabtree Corner’s services, and which currently operates out of rented premises at 455 E. Hastings. Sheway is supported by the Vancouver/Richmond Health Board and BC Women’s and Children’s Hospital.

It is recommended that the City’s site at 533-539 E. Hastings be held for the Y for the relocation of Crabtree Corner. Community Services (Social Planning) and the Y have signed a Memorandum of Understanding (attached as Appendix A) that sets out the proposal, including the conditions that the Y must satisfy before final approval could be considered,and the project proceed to construction. The Y must develop and finalize the program, and prepare a design for the project. The Y must identify the capital funding required for the project. The total capital cost of the project is estimated to be in the range of $2-2.5 million. The Y would have to raise up to $1.5 million in addition to the funding that is in place now. The proposal would give the Y over a year to raise the funding for the project. If the project was not under construction by mid 2002, the City would be free to consider alternative uses for the site. The intent is to transfer the operating funds from the current Crabtree location to the new location, and the Y must confirm that the operating funds are in place for the project before final approval can be given by Council.

The proposed project would consist of a 7,000 sq. ft. ground floor for Crabtree’s counseling and employment services, as well as space for Sheway, and the second floor with 3,500 sq. ft. of indoor space and 3,500 sq. ft. of outdoor space for the childcare, for a total of 10,000-11,000 sq. ft. of floor area. Under the existing zoning a total of 45,750 sq. ft. of floor area could be developed on the site. Since the site would be underdeveloped, a 60 year lease would be too long, and a 40 year lease would be more appropriate. The proposed lease would provide for a 40 year term with the Y having the right to renew for 20 years, subject to paying additional rent for the land, unless the City wanted to redevelop the site, in which case the City would either accommodate the Y in the redevelopment on the site or on another appropriate site, with the Y responsible for funding the construction costs. A 40 year lease is valued at 50% of the freehold market value, and the prepaid rent for the 40-year lease of 533-539 E. Hastings would be $380,000.

If Council approves reserving 533-539 E. Hastings for the Y for the relocation of Crabtree Corner, the Y will proceed with developing the program and design for the project, and get its fund raising program underway. It is expected that there will be a report back to Council seeking final approval of the project in the summer of 2001.

- - - -

APPENDIX A
Page 1 of 3

MEMORANDUM of UNDERSTANDING
between
the YWCA (the Y) and
the City of Vancouver (the City)
regarding the relocation of Crabtree Centre,
dated January 31, 2000.

Crabtree Centre

The Y currently leases 2,800 sq. ft. on the ground floor of 101 E. Cordova from the City. The space accommodates the Crabtree Childcare, which provides emergency childcare for 20 children aged 6 weeks to 6 years, and a family centre for women and children offering support and education services including food, clothing, parenting, single parenting, physical and sexual abuse, Fetal Alcohol Syndrome prevention and treatment of addictions. The Y pays a nominal rent to the City for the space, but is responsible for all operating costs and utilities. The lease commenced on Nov. 1, 1983, with a one-year term, and is renewed automatically each year provided the lease terms and conditions remain satisfied.

The Y has been seeking to relocate the Crabtree Centre for several years. The Crabtree Childcare lacks any outdoor space, and does not meet current childcare licensing standards.

The Y has raised $500,000 to date and the City has allocated $500,000 from its 1997-1999 Capital Plan, to relocate Crabtree Centre. A confirmed site is required for YWCA fundraising to proceed further. Once a site is confirmed the Y believes it will be able to raise a further $1,500,000 if needed.

Site

The City owns a site at 533-539 E. Hastings (the Site). It consists of 3 lots (Lots 23 to 25, Blk. 58, DL 196, Plan 196) and is 75 ft. by 120 ft. in size for a total area of 9,150 sq. ft. The site is zoned DEOD and has a development potential of 2 FSR (18,300 sq. ft. of building) of commercial space and 3 FSR (27,450 sq. ft. of building) of residential space. The Y believes the site is well suited for a relocated Crabtree Centre. The Site has a market value of $760,000.

Relocated Crabtree Centre

The proposal is to develop the Site with a 2-storey building that would accommodate the Crabtree Childcare on the second floor (including the open space for the childcare), and the associated family support services on the ground floor (the Project). The ground floor would consist of 7,000 sq. ft. of building with a storefront presence on Hastings St. and at grade parking off the lane. The second floor would consist of 3,500 sq. ft. of indoor space and 3,500 sq. ft. of outdoor space for the childcare.

The proposal is conceptual only, and is subject to further development. No architectural work has been undertaken.

APPENDIX A
Page 2 of 3

Lease

The City will lease the Site to the Y for 40 years with an option to renew the lease for a further 20 years. The prepaid lease amount for the 40 year lease will be $380,000. The option to renew will be exercisable only if both the City and the Y agree. If the City chooses not to extend the lease, the City will provide the Y with another appropriate site for Crabtree Centre at no land cost to the Y, or will accommodate Crabtree Centre in any new development on the Site at no land cost. The Y would be responsible for funding the construction and all other costs except land costs to relocate Crabtree if the City chooses not to renew the lease at the end of the 40 year term. If the City agrees to extend the lease for a further 20 years, the Y will pay the City the fair market value of a 20 year lease of the site as if vacant and valued under the zoning in place at the time. The lease rent for the 20 year lease extension may be prepaid for the full 20 years, or paid annually in monthly installments under a schedule to be established at the time the option to renew is exercised.

Funding

It is estimated that the total cost of the project would be on the order of $2,500,000 including land cost. The City’s contribution is limited to $500,000, of which $380,000 would cover the cost of the prepaid rent with the balance available to partially fund the construction costs of the project. The Y would be responsible for providing, or arranging for, the remaining financing.

Other Partners

The Y only requires half the ground floor space currently proposed. They have had discussions with Sheway who are looking to relocate. Sheway provides drug and alcohol services to pregnant women with drug and alcohol issues and is currently located at 455 E. Hastings St. They are looking for 5,000 sq. ft. and are interested in co-locating with the Y with whom they share clientele. If Sheway can provide the funding for the space, they could be accommodated within the project.

There are also potential other partners who serve the same populations and who may also be interested in co-locating if the site could accommodate them and if an agreement can be reached. The joint location of service would result in more efficient use of space, lower operating costs, and better client service.

Conditional Approval

As the proposal is only conceptual at this time, the City can only give conditional approval to the Project. Before final approval can be considered by the City, the Y must:
· finalize the program, including the participation of other partners, for the Project,
· prepare preliminary plans for the Project,
· confirm the capital cost estimates for the Project,
· identify funding to cover the full capital cost of the Project, and
· identify funding to cover the full operational costs of the Project.

Construction must have commenced on the Project by May 1, 2002, or the City may cancel the Project and use the Site for alternative purposes.

APPENDIX A
Page 3 of 3

Schedule

Council/Y Approval of MoU

Feb. 2000

Finalize Program

April 2000

Complete Preliminary Plans

June 2000

Complete Costing

Sept. 2000

Identify Funding

Jan. 2001

Council/Y Final Approval

June 2001

Construction Start

March 2002

Once this Memorandum of Understanding is signed, it will be presented to City Council and to the Y’s Board of Directors for conditional approval.

No legal rights or obligations shall arise or be created until all the conditions have been satisfied, final approval for the Project is given by City Council and the Y, and all legal documentation required for the Project has been fully executed on terms and conditions to the satisfaction of the City’s Director of Legal Services and the Y’s solicitors.

For the City of Vancouver For the YWCA

signed copy on file with City Clerk
__________________________ ______________________
Jeff Brooks, Director of Social Planning Lois Hollstedt, Chief Executive Officer

_________________ __________________
Date Date

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cs000217.htm

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