Agenda Index City of Vancouver

POLICY REPORT

TO:

Standing Committee on Planning and Environment

FROM:

The General Manager of Engineering Services in Consultation with the Director of Current Planning

SUBJECT:

Schroeder Properties Ltd. "tech-park.com" Development (1098 Station Street - Preliminary DE405088) - Lease-Back Concept

 

RECOMMENDATION

CITY MANAGER'S COMMENTS

COUNCIL POLICY

· Industrial Lands Strategy (1995).

· False Creek Flats Preliminary Concept Plan, approved in June 1996, revised in 1999.

· I-3 Zoning Policy enacted in 1999.

· The authority for leasing streets and lanes lies within the Vancouver Charter.

PURPOSE

To seek Council's endorsement of the concept of, upon dedication to the City of roads along the internal axes of the Schroeder site, leasing for a nominal fee portions of the undersurface of such roads for use as underground parking and other facilities in connection with the development of the tech-park.com development on adjacent lands. The location of the site is shown on Appendix A.

BACKGROUND

Development Permit Board (DP Board) Decision: As part of the tech-park.com development, two roads are proposed to intersect within the site (Appendix B, Page 1 of 3). The first in a north-south direction, an extension of Gore Avenue; and the second, in an east-west direction north of National Avenue. In addition, a road is proposed along the southerly boundary of the site to provide access to this project and to the lands to the east.

The preliminary development application as submitted, proposed that the property owner would maintain ownership of the internal roads. Public access, use and regulation would be addressed through legal agreements, rather than through dedication. The DP Board did not support this approach and instead required as a condition of preliminary development application approval:

"A.2.2. [The applicant to] make arrangements to the satisfaction of the City Engineer and Director of Legal Services, for the following, subject to decisions by City Council as required: . .

"j) Arrangements to the satisfaction of the City Engineer and Director of Legal Services for the dedication of the roads along the two major internal axes, being the southerly projection of Gore Street (66 ft. width)and the central east-west street (100 ft. width).

Note to Applicant: This condition will require a redesign of the parking structure. The City requires dedication to allow for the installation of underground utilities and street trees along the new roads. The City Engineer will consider an application to provide connections between the parking quadrants, as well as parking, below the dedicated roads and at a depth that does not interfere with utilities and street trees . . .".

In explaining this condition, members of the DP Board noted support for high-tech development and for the overall development concept presented for this project. However, there was concern about the need for this project to "knit" with the community both to the north and south, and that the impact of 10,000 (now identified as 12,000) employees would

be considerable given there are many residents in the area.

In addition, DP Board members expressed concern about the number of parking spaces provided in the development. The 4,600 parking spaces proposed reflects the maximum number of parking spaces allowable under the I-3 regulations. In another condition of preliminary approval, the DP Board required that the owner submit a comprehensive transportation and parking plan, including a program to facilitate transit use, and that consideration be given to moving towards the (lower) minimum parking standard.

Specific Development Context: The proposed tech-park.com development takes the form of an urban high technology campus-type business centre, which would contain 2.2 million square feet of floor area in 14 buildings, roughly equivalent to l/l0th the occupied office inventory for the entire downtown. The number of employees is estimated to be in the range of 12,000, the equivalent of l/12th of the downtown workforce.

According to the applicant's traffic analysis, a development of this magnitude and type may be expected to generate 1,640 vehicles trips in the morning peak hour. This is the equivalent of two lanes of fully utilized arterial roadway, comparable to Hemlock Street at 13th Avenue. Staff further estimate that approximately 15,000 vehicle trips to and from the site will be generated on a daily basis. Development of a comprehensive, aggressively managed, transportation demand management plan will be particularly important in order for the development to operate successfully.

This application is very complex and there are a number of significant issues to resolve in response to the DP Board's approval in principle. Outstanding items include:

· urban design issues (focussing on the first phase southwest quadrant);

· City land sales and perimeter dedications;

· Thornton Park extension design;

· Prior Street design; and

· neighbourhood traffic management measures.

Several of these matters may be the subject of upcoming Council reports. The developer is seeking to purchase three City lots to augment the development site (the preliminary development application describes these lots as part of a potential Phase 4). The applicant also intends to come forward with a rezoning application to permit 100,000 sq. ft. of retail space. In addition, staff are completing the analysis for an area-specific Development Cost Levy [DCL] for the Flats and will be reporting back to Council in the new year.

Land Use Policy Context: Council adopted the Industrial Lands Strategy (1995) and the False Creek Flats Preliminary Concept Plan (1996, revised 1999) to ensure that the City's industrial areas were retained for future industrial and service uses. During the development of these policies, concern was expressed that some information technology firms were having difficulty finding sites in the city, especially larger companies that may have outgrown their space in the downtown core, who were looking for large floor plates that are not readily available in existing commercial areas. In July 1999, Council approved a new I-3 Industrial District Schedule to specifically provide for a wide range of high technology activities in the False Creek and Grandview/Boundary areas, in response to these concerns.

Two areas consisting of large, consolidated sites near existing or proposed rail rapid transit lines - West False Creek Flats and Grandview/Boundary - were identified as good locations for high technology uses. Both areas provide opportunities for large-scale "campus-type" development and employment and further, will contribute ridership to new/existing rapid transit services. The tech-park.com site is the first in the Flats area to be proposed for development under the I-3 zoning. (The Bentall proposal on East Broadway is also proceeding with a high-tech development under I-3 in the Grandview/Boundary area.) Council recently approved a CD-l By-law to govern the "Finning Lands" adjacent to Great Northern Way, which will permit a similar type of development.

The False Creek Flats (the Flats), extending west to east from Station Street to Vernon Drive and north to south from Prior and Atlantic Streets to 1st Avenue and Great Northern Way, is currently under review to develop a more comprehensive urban structure (streets and open space plan) and infrastructure plan. While planning is underway, staff continue to process both I-2 and I-3 development applications. On "conditional approval" applications such as this proposal, staff focus on meeting basic infrastructure requirements and achieving the best possible urban design response in anticipation of emerging planning directions for the area.

When the proposed I-3 zoning by-law was considered at Public Hearing on April 8, 2000, it was noted that this area was largely under-serviced and if a significant amount of redevelopment occurred then arrangements would be needed to finance up-front servicing. It was further noted that these needed services, including street dedications and development infrastructure could in part be achieved through future subdivision, rezoning, as as a condition of some development application approvals or through implementation of area-specific DCLs.

Road Dedication Policy Context: The issue of street dedications within the Schroeder tech-park.com development is fundamental to the development pattern within the Flats. While the tech-park.com development, alone, represents l/l2th of the downtown employment base, the potential development within the Flats could, ultimately, replicate the current downtown employment base. This will have significant impacts on public services, including transportation and utilities, but also has potential significant impacts on adjoining neighbourhoods.

The DP Board's decision to require dedication of the internal roads was based on the following public policy issues:

1. As a city develops and intensifies, it is essential to have a fine-grained pattern of fundamental public realm based on public ownership, access and control. This is important so that throughout the city, all citizens always have the certainty of access, use and enjoyment and no parts of the public realm can be cordoned off for one group or activity on a permanent basis.

2. The Flats has long been seen as a barrier by adjacent communities, discouraging north-south links between Mount Pleasant and Strathcona and east-west links from both of these communities to False Creek. In response, a conceptual street system strategy was adopted in principle by Council on February 25, 1999 (Appendix C) and subsequently contained in the July, 1999 (I-3) revisions to the False Creek Flats Preliminary Concept Plan. It was anticipated that through redevelopment and subdivision, this plan would, over time, create appropriate dedicated street system linkages. The strategy responded to the surrounding grid, while anticipating the large parcels required for high tech industrial uses.

3. Anything less than dedication of the street areas establishes a less than public realm by creating what would be viewed as a "private" space. There are potential limitations on how this space would be designed or used in the future. Public access is only one consideration and all of the other potential issues such as programming of the public space, design treatment, integration with adjoining developments, etc. are difficult to identify and fully address up front.

4. In the short-term (i.e., less than 20 years), we are essentially creating another downtown in an area which is very under-served from both a transportation and utility perspective. This area, if it is to function successfully, must be integrated in terms of servicing the whole, as opposed to independent developments. For example, utility corridors must be preserved in order to establish full flexibility in servicing the area as a whole. The initial planning for the Flats contemplated a network of dedicated streets to service the area. Any constraints to this flexibility would increase public costs.

DISCUSSION

Lease-Back Concept: While the decision has been made that the internal roads are to be dedicated, consistent with City policy, regulatory authority and practice, Council is being asked to approve the concept of leasing back undersurface areas for a nominal fee. Subject to Council's approval of this concept, staff will report back on specific arrangements. The concept of a lease back for a nominal fee is supported because, after the City's basic long-term area-wide public realm and infrastructure requirements are met, it provides the maximum opportunity for meeting the developer's needs and, in turn, facilitating City-supported development. There is successful precedent for lease backs for nominal fees in major projects in False Creek and Coal Harbour.

While Council approval of specific arrangements will be the subject of a report back, Appendix B is presented for Council's information and illustrates the most current version of a physical design which generally meets City needs including providing sufficient area and depth of soil to accommodate future undersurface utility needs and tree planting.

The primary reason that the issue of the lease back of the dedicated roads has arisen is the developer's desire to maximize the number of parking spaces and to create flexibility in the use of parking. The developer's intent is to construct 14 individual buildings (above-grade) in four quadrants, separated by roads. Below grade, however, the developer would like to build one all-encompassing three-level parking structure which would cover most of the site. Each building would have a separate entrance to and exit from the parking structure, from the adjacent roads. The overall parking structure would be designed such that clients in one building would not be restricted to parking under that building but could be located anywhere within the overall underground complex. The design would include developing the area underneath both the east-west and north-south roads with parking, mechanical rooms and a central communications and security space on level one - the public parking level.

With regard to site servicing, the applicant proposes to connect to City services on the perimeter streets (Prior Street and Station Street ) and to have only privately-owned services within the site. The owner further proposes to relocate an existing 48 in. City sewer which currently crosses the development site, again onto Prior and Station Streets, or alternately, into the future park site immediately to the east under a right-of-way agreement. This would result in the entire development site being unencumbered, both now and in the future, by City services, which would impact on the ability to have the parking structure occupy all of the space beneath the site.

Staff have not supported this approach, because the developer's concept does not meet City public realm and infrastructure requirements, as outlined in this report. However, through consultation with the developer and their architects, there has been a recognition of the private needs, particularly around flexibility for parking. As a result, a number of compromises have been proposed to limit the public's use of the undersurface of the dedicated roads, while still responding to the City's needs. For example, lease back areas are proposed to facilitate the use of parking and other functions.

Staff have agreed, in principle, to a conceptual design for the parking garage, street-tree wells and servicing corridors which would maximize flexibility of access (through the lease-back agreement). Full access would occur between all quadrants at the P2 and P3 levels and partial access would occur at the Pl level. Thirteen of the 18 initially proposed access points in the underground parking garage would be unaffected. Through further design development and operational adjustments the impact of fewer access points can be minimized (for example vehicle access ramps could go directly to the P2 level where tenants would have access to parking across quadrants). The conceptual design of the parking as a single integrated structure is, therefore, still intact.

The parking supply is not reduced by the City's proposal, only relocated. Staff agree that in concept, an open, space-shared parking structure is less expensive to construct and more flexible to operate for the parking operator. Staff do not agree, however, that relocating approximately 350 of the 4,600 parking spaces to accommodate the required City utility needs will severely impair its operation or effectively reduce the parking supply.

In addition, in response to the DP Board directive to the applicant to consider moving towards the minimum parking standard, it may not be necessary to keep all the parking affected. The applicant has indicated a strong preference for maintaining the maximum allowable number of parking spaces, citing high-tech industry standards. However, given the urban context of this site and proximity to transit, the higher end of the parking standard provisions may not be appropriate.

The design and operational implications have been assessed and staff judge these to be not as severe as indicated by the applicant. With design development and operational adjustments these implications can be minimized and City requirements can be further addressed.

CONCLUSION

The developer needs a timely decision on the concept of a lease back for a nominal fee so that staff and the developer's team can proceed to reach agreement on the detailed arrangements which will be reported back to Council. Staff will continue to work closely with the applicant to address remaining issues and provide the maximum possible flexibility and utility for the developer while respecting the City's basic public realm and infrastructure needs under the required dedication.

ATTACHMENTS THAT DO NOT HAVE ELECTRONIC COPY ARE AVAILABLE ON FILE IN THE CITY CLERK'S OFFICE

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