A5

ADMINISTRATIVE REPORT

Date: Oct. 15, 2000
Author/Local:/C. Gray

RTS No. 01709

CC File No.

TO:	City Council
FROM:	The Directors of the Housing Centre and Non-Market Operations, in consultation with the Director of Facilities Development
SUBJECT:	The Renovation of the Central Residence - 42 E. Hastings St.

RECOMMENDATION

A) THAT Council approve, subject to report back on the results of a feasibility study and detailed renovation program, the Memorandum of Understanding attached as Appendix B, dated February 16, 2000, between the City and BC Housing that sets out the terms for the renovation of the Central Residence whereby BC Housing would fund the renovations in return for the City agreeing to operate the building until 2030 with rents to be set at the shelter component of welfare or, if that is not feasible, on a non-profit basis.

B) THAT Council approve retaining the firm of Chernoff Thompson Architects to undertake the evaluation of renovation options for the Central Residence at a cost of $40,000 plus GST with funding to be provided by BC Housing.

GENERAL MANAGER'S COMMENTS

The General Manager of Community Services RECOMMENDS approval of A and B.

COUNCIL POLICY

The City's interim policy is to maintain and improve the quality of the stock of low-income housing in the Downtown Eastside.

PURPOSE

Subject to confirmation that renovation is feasible, this report recommends that, in return for BC Housing funding the renovations of the Central Residence, the City guarantee that the housing is operated on a non-profit basis to serve low-income singles until 2030. The report recommends that Council approve a consultant to undertake the evaluation of renovation options.

BACKGROUND

The Central Residence was purchased by the City in 1976. It is a 6 storey building consisting of 131 SRO rooms, averaging 100 sq. ft. each. It occupies a 6,000 sq. ft. site (Lots 9 and 10, Block 8, DL 196, Plan 184) at 42 E. Cordova St as noted on Appendix A. It was built in 1893 and is listed as a `B' building on the Vancouver Heritage Inventory. CMHC and BC Housing provide on-going operating subsidies. The CMHC mortgage will be paid of in 2010 at which time subsidies will cease.

On Sept. 29, 1998, Council approved the purchase of a site at 55-67 E. Hastings St. (across the lane from the Central Residence) for the replacement of the Central Residence. The site was rezoned to CD-1 at the Feb. 22, 2000, Public Hearing. The new project (now named Joseph and Rosalie Segal Place) will consist of 98 self-contained units plus ground floor retail.

In the 1998 report recommending the purchase of 55-67 E. Hastings, Council was advised that the Central Residence at 42 E. Cordova could possibly be renovated by either combining 2 rooms to create 60 more livable SRO rooms, or by combining 3 of the rooms to create 40 or so self contained (including kitchen and bathroom) dwelling units.

PROPOSAL

The SRO rooms in the Central Residence are small and in need of upgrade. With the development of 98 units of replacement housing at 55-67 E. Hastings, there is an opportunity to undertake a major renovation of the Central Residence. BC Housing is prepared to investup to $1,000,000 over the next 3 or 4 years on the renovation in return for the City guaranteeing that the building will continue to house low-income singles until 2030 (20 years after the termination of the existing mortgage). B.C. Housing has advised that $250,000 is available in the 2000/2001 budget year. The Memorandum of Understanding between the City and BC Housing setting out the terms for the renovation and operation of the Central Residence is attached as Appendix B.

As Federal and provincial subsidies will not be available after 2010, the City would operate the project on a break even non-profit basis as it currently operates the Old Continental and Gresham Hotels. To maximize the efficiencies, the Central Residence would be operated by the City's Non-Market Operations Division in conjunction with the Joseph and Rosalie Segal Residence.

FEASIBILITY STUDY

In order to determine whether the renovation is viable, a feasibility study must be undertaken of the renovation options for the Central Residence. All options would maintain the heritage character of the building. The options include:
· doubling up rooms to create 60 or so larger SRO rooms, each approximately 200 sq. ft. in size,
· tripling up rooms to create 40 or so self-contained 300 sq. ft. apartments, or
· a mixture of both larger SRO rooms and self-contained apartments.
Several consultants were asked to submit proposals, and it is recommended that Chernoff Thompson Architects be approved as the consultants to undertake the evaluation at a cost of $40,000 plus GST. BC Housing concurs with this recommendation. The funding will be provided by BC Housing and the contract will be administered by the City's Facilities Development Division.

Once the consultants have completed their evaluation, the results will be reported to Council, with a recommendation whether or not to proceed with the renovations. It is recommended that Council approve, subject to the results of the consultants' evaluation, the terms for the renovation of the Central Residence as set out in the February 16, 2000, Memorandum of Understanding between the City and BC Housing attached as Appendix B.

If the renovations prove feasible, they would be completed in 2005/6. At that time, a total of 140-160 better quality rooms and self-contained units in the renovated Central Residence and the new Joesph and Rosalie Segal Place would have replaced the existing 131 inadequate rooms.

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(c) 1998 City of Vancouver