ADMINISTRATIVE REPORT

Date: October 7, 2002
Author/Local: M.G. Thomson/

7328

RTS No. 03022

CC File No. 5104

Council: October 22, 2002

TO:	Vancouver City Council
FROM:	General Manager of Engineering Services in Consultation with the Director of Legal Services
SUBJECT:	Proposed Lease of a Volumetric Portion of Georgia Street and Dunsmuir Street

RECOMMENDATION

A. THAT Council authorize the Director of Legal Services to sign, on behalf of the City, a Reference Plan of survey, to be prepared, and to make application in the Land Title Office to raise title to the portion of Georgia Street, between Beatty Street and Expo Boulevard, the same as shown in heavy outline on the plan attached hereto as Appendix "A".

B. THAT Council close, stop-up and authorize the Director of Legal Services to enter into a lease for the volumetric portion of Georgia Street, generally as shown within the heavy outline and illustrated isometrically on the plan attached hereto as Appendix "B"; subject to the following conditions:

1. The lease to be granted to the owner (the "Lessee") of Lot 291, False Creek, Plan BCP _______ ("Lot 291");

2. The lease to be for the life of the building ("the Costco Building") to be constructed within an Air Space Parcel to be created from Lot 291;

3. The Lessee to have the right to assign the lease to the owner of the Air Space Parcel;

4. The rental for the term to be a nominal sum of $10.00;

5. The lease area to be used only for access, manoeuvring and loading to the Costco Building;

6. The Lessee is to maintain the lease area, including responsibility for drainage, in a manner satisfactory to the General Manager of Engineering Services;

7. The City and the utility companies to retain the right of entry, without notice, into the lease area and to temporarily interrupt the lease for installation, removal, maintenance, repair or renewal of any utility, in, under or above the lease area;

8. The City to retain the right of entry to the lease area without notice, and to temporarily interrupt the lease for inspection, maintenance, repair, renewal or removal of the Georgia Viaduct;

9. The lease to specifically exclude, by description, all structural components (columns) of the Georgia Viaduct and to prohibit the attachment of any signs to the Georgia Viaduct, its columns or components;

10. The Lessee to be responsible for the removal of all graffiti on the structural components of the Georgia Viaduct and to ensure no hazardous or flammable materials are stored overnight under the Georgia Viaduct structure;

11. The Lessee to enter a "bridge proximity" agreement to the satisfaction of the General Manager of Engineering Services and the Director of Legal Services;

12. The Lessee to be responsible for security within the lease area, including removal of people "camping" under the structure;

13. Arrangements to the satisfaction of the General Manager of Engineering Services for completion of a fire safety hazard assessment at the cost of the Lessor so as to understand and identify the risks associated with fires and hazardous materials under the Viaduct;

14. The design of any landscaping, grade changes, sidewalk crossings, or other features in and adjacent to the lease area including signage, to be to the satisfaction of the General Manager of Engineering Services;

15. There are to be no permanent structures within the lease area. Any temporary structures shall be to the satisfaction of and will require the written approval of the General Manager of Engineering Services;

16. The lease to contain a provision for the storage of up to seven Department of National Defence vehicles within the lease area, and to provide for unrestricted access to the vehicles including ingress and egress from the lease area, all arrangements to the satisfaction of the General Manager of Engineering Services;

17. Emergency service vehicles to have the right of entry to the lease area at any time;

18. Upon expiry or termination of the lease, the Lessee is to be responsible for restoration of the lease area to the satisfaction of the General Manager of Engineering Services;

19. The Lessee to assume full responsibility for liabilities, loss and damages from their occupancy or use of the lease area, and to insure the proposed lease area with insurance policies to the satisfaction of the Director of Risk and Emergency Management;

20. The lease to contain such other terms and conditions satisfactory to the Director of Legal Services, Director of Real Estate Services and the General Manager of Engineering Services.

C. THAT Council authorize the Director of Legal Services to sign, on behalf of the City, a Reference Plan of survey, to be prepared, and to make application in the Land Title Office to raise title to the portion of Dunsmuir Street, between Beatty Street and Expo Boulevard, the same as shown in heavy outline on the plan attached hereto as Appendix "C".

D. THAT Council close, stop-up and authorize the Director of Legal Services to enter into a lease for the volumetric portion of Dunsmuir Street, generally as shown within the heavy outline and illustrated isometrically on the plan attached hereto as Appendix "D"; subject to the following conditions:

1. The lease to be granted to the owner (the "Lessee") of Lot 291, False Creek, Plan BCP ______ ("Lot 291");

2. The lease to be for the life of the Building ("the Costco Building") to be constructed within an Air Space Parcel to be created from Lot 291;

3. The Lessee to have the right to assign the lease to the owner of the Air Space Parcel;
4. The rental for the term to be a nominal sum of $10.00;

5. The lease area to be used only for access, manoeuvring, loading and parking for the tire change area of the Costco Building. The lease area is not to be used for changing tires or any other commercial purpose;

6. The Lessee is to maintain the lease area, including responsibility for drainage, in a manner satisfactory to the General Manager of Engineering Services;

7. Access to the lane east of Beatty Street, and the lane north of Lot 291 to be maintained at all times; however the Lessee to put measures in place to ensure Costco customers do not use the lane east of Beatty Street as a shortcut;

8. The City and the utility companies to retain the right of entry without notice, into the lease area and to temporarily interrupt the lease for installation, removal, maintenance, repair or renewal of any utility, in, under or above the lease area;

9. The City to retain the right of entry to the lease area, without notice and to temporarily interrupt the lease for inspection, maintenance, repair, renewal or removal of the Dunsmuir Viaduct;

10. The lease to specifically exclude all structural components (columns) of the Dunsmuir Viaduct and to prohibit the attachment of any signs to the Dunsmuir Viaduct, its columns or components;

11. The Lessee to be responsible for the removal of all graffiti on the structural components of the Dunsmuir Viaduct and to ensure no hazardous or flammable materials are stored overnight under the Dunsmuir Viaduct structure;

12. The Lessee to enter a "bridge proximity" agreement to the satisfaction of the General Manager of Engineering Services and the Director of Legal Services;

13. The Lessee to be responsible for security within the lease area, including removal of people "camping" under the structure;

14. Arrangements to the satisfaction of the General Manager of Engineering Services for the completion of a fire safety hazard assessment, at the cost of the Lessor so as to understand and identify the risks associated with fires and hazardous materials under the Viaduct;
15. The design of any landscaping, grade changes, sidewalk crossing or other features in and adjacent to the lease area including signage, to be to the satisfaction of the General Manager of Engineering Services; and B.C. Hydro with respect to an existing high voltage transmission duct in the lease area;

16. There are to be no permanent structures within the lease area. Any temporary structures shall be to the satisfaction of and will require the written approval of the General Manager of Engineering Services;

17. Emergency Service vehicles to have the right of entry to the lease area at any time;

18. Upon expiry or termination of the lease, the Lessee is to be responsible for restoration of the lease area to the satisfaction of the General Manager of Engineering Services;

19. The Lessee to assume full responsibility for liabilities, loss and damages from their occupancy or use of the lease area, and to insure the proposed lease area with insurance policies to the satisfaction of the Director of Risk and Emergency Management;

20. The lease to contain such other terms and conditions satisfactory to the Director of Legal Services, Director of Real Estate Services and the General Manager of Engineering Services.

E. THAT Council authorize the General Manager of Engineering Services to approve minor and inconsequential amendments to the lease areas, should post-construction surveys reveal minor variations in the area containing the required uses.

F. THAT no legal rights shall arise and no consents, or permissions, are granted hereby and none shall arise or be granted hereafter unless and until all contemplated legal documentation has been executed, delivered by all parties, and registered in the Land Title Office where applicable.

G. THAT once the form of all legal documentation and plans has been approved by the General Manager of Engineering Services and Director of Legal Services, that the Director of Legal Services be authorized to execute and deliver such documentation and plans on behalf of the City.

COUNCIL POLICY

The authority for closing and disposing of streets and lanes is set out in the Vancouver Charter.

At a Public Hearing on July 25, 2002, Council approved the rezoning of 651 Expo Boulevard and 690 Beatty Street.

SUMMARY

The Georgia Street and Dunsmuir Street Viaducts (the "Viaducts") between Expo Boulevard and the edge of the escarpment easterly of Beatty Street have existed for many years, over private property. City use has been secured through a statutory right-of-way.

As a condition of subdivision creating the parcel ("Lot 291") westerly of Expo Boulevard between the Viaducts, the area covered by the Viaducts is required to be dedicated as road. It is a standard subdivision condition that areas of City street and lane be dedicated to the City.

The said Lot 291 is proposed to be developed with a "Costco" store, above two levels of underground parking, with parking in the levels above the Costco store and four residential towers above. The tower lobbies will generally be at the grade of the Viaducts. The main entrance of the Costco store will be at the approximate grade of Expo Boulevard.

The areas underneath the Viaducts are of limited use. The best use is to have the area available for uses ancillary to the Costco store. The owner of Lot 291 has applied to lease a volumetric parcel under each of the Viaducts, generally for ingress, egress, manoeuvring and loading to the Costco store. The General Manager of Engineering Services supports the uses.

PURPOSE

The purpose of this report is to seek the formal authorities to raise a title for the portions of Georgia Street and Dunsmuir Street, west of Expo Boulevard containing the Viaducts and to close, stop-up and lease a volumetric portion of the space below the Viaducts for Costco's use.

BACKGROUND

The lands west of Expo Boulevard, between Georgia Street and Dunsmuir Street lie within a "hole" at the base of an escarpment, east of Beatty Street and enclosed by the Georgia Street and Dunsmuir Street Viaducts.

The lands are currently owned by Concord Pacific Group Inc. ("Concord") and are the subject of subdivision applications and a rezoning application. At a Public Hearing on July 25, 2002 Council approved the application by Concord to rezone the site at 651 Expo Boulevard (portion of Lot 156, except portions in Plans 21735, LMP12037, LMP12038 and LMP13010, False Creek, Plan 21458) and 690 Beatty Street (Lot 7, Block 49, District Lot 541, Plan 4656).

The draft CD-1 Bylaw includes provisions for up to 1116 dwelling units.

The draft CD-1 Bylaw also includes combined Residential Unit and General Office Use (live/work), Parking Uses, Services Uses, Retail Uses and Wholesale Uses, limited to Wholesaling - Class B.

The Proposed Conditions of Approval of the rezoning included requirements to dedicate the lands containing the Georgia Street and Dunsmuir Street Viaducts as road. Further, the conditions of approval included the following:

"any agreements required to allow for the granting to the applicant, at a nominal cost, and for the life of the Costco Building, the granting of a lease, easement or any other right to use the space under the Viaducts.

These agreements will take into consideration the provision of long-term parking for the Beatty Street Drill Hall."

The Proposed Conditions of Approval of the rezoning also included requirements such that, for the Costco site, all trucks enter and leave the site moving forward, all manoeuvring occurs on site and conflicts with other vehicles and pedestrians are minimized.

It is the above matters, that is use under the Viaducts, that this report seeks to address.

The General Manager of Engineering Services has reviewed an application to lease the under Viaduct space and is prepared to support the application as follows.

DISCUSSION

The area below the Viaducts has limited City use (other than for the provision of utilities) and is best utilized to meet the requirements of access, ingress, egress and manoeuvring to and from loading within the Costco Building.

Concord, having already achieved Council direction to secure the use of the space under the Viaducts at a nominal fee, seeks security in the form of tenure through a registered lease. That is Council, having already agreed to the use for the life of the Costco Building is now being asked to grant the authorities required to allow registration of a long term lease in the Land Title Office.

To register the lease it is necessary to raise a title to an area equal to, or slightly greater than the area to be covered by the lease. The portions of Georgia Street and the portions of Dunsmuir Street for which Council is being asked to authorize the Director of Legal Services to execute a Reference Plan, and to make application in the Land Title Office to raise a title for are shown within the heavy outline on Appendix "A" and Appendix "C" respectively.

These portions of Georgia Street and Dunsmuir Street containing the Viaducts will have been dedicated to the City as road as a condition of the site rezoning. Once the titles are raised, a volumetric lease parcel is created to allow the use of the area under the Viaducts for matters ancillary to the Costco Building.

As such, Council is asked to close, stop-up and authorize the Director of Legal Services to enter into a lease for the volumetric portions of Georgia Street and Dunsmuir Street as shown on Appendix "B" and Appendix "D" respectively.

Concord will create an Air Space Parcel (through subdivision application to the Approving Officer) to contain the Costco Building. The upper and lower limits of the Georgia Street Viaduct Lease and the Dunsmuir Street Viaduct Lease are designed to match the proposed Air Space Parcel. These may change marginally once the Costco Building is actually constructed. Concord will assign the lease to the owner of the Air Space Parcel ("Costco").

The use of the space under the Georgia Viaduct will be limited to access, manoeuvring and loading to the Costco Building. In addition, there will be a provision for the storage, and access to, up to seven (7) Department of National Defence vehicles.

The use of the space under the Dunsmuir Viaduct will be limited to access, manoeuvring and loading to the Costco Building, and additionally parking for the tire change area.

For both leases the lease shall be, as per Council direction of July 25, 2002, for the life of the Costco Building and for a nominal sum of $10.00 for the term..

The Lessee shall be responsible to maintain the lease areas, including drainage, graffiti removal, a restriction on storage of hazardous materials and restoration of the lease areas upon termination of the lease.

The City and the utility companies will have access to the area for installation, repair of or renewal of utilities. The City will retain the right to interrupt the lease for inspection, maintenance or renewal of the Viaducts, or emergency service access. While the lease area will include the structural columns of the Viaducts, they will be excluded from the lease. Further, no permanent structures will be allowed. The Lessee will enter into a bridge proximity agreement.

The Lessee will indemnify the City for their use of the lease areas and provide insurance to the satisfaction of the Director of Risk and Emergency Management.

CONCLUSION

The General Manager of Engineering Services in consultation with the Director of Legal Services supports approval of Recommendations A to G thereby facilitating the rezoning of the lands at 651 Expo Boulevard and 690 Beatty Street. Approval of a lease for the use of the space under the Georgia Street and Dunsmuir Street Viaducts on the conditions described herein is recommended.

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(c) 1998 City of Vancouver