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CITY OF VANCOUVER POLICY REPORT
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Date: |
April 19, 2004 | |
Author: |
Trish French | |
Phone No.: |
7041 | |
RTS No.: |
4167 | |
CC File No.: |
8100 | |
Meeting Date: |
May 20, 2004 |
TO: |
Standing Committee on Planning and Environment |
FROM: |
Director of Current Planning in consultation with the Director of City Plans |
SUBJECT: |
Downtown District Interim Policies for Residential |
RECOMMENDATION
A. THAT Council adopt the Downtown District: Interim Policies for New Residential in areas C and F; and for Conversion of Existing Office Space to Residential as contained in Appendix A to guide the Director of Planning in consideration of development applications and rezoning inquiries.
B. THAT Council instruct the Director of Current Planning to report back with terms of reference, work program, schedule and resource needs for a study to determine the long term land use future of the Central Business District, as described in this report.
GENERAL MANAGER'S COMMENTS
The General Manager of Community Services RECOMMENDS approval of A and B.
SUMMARY AND PURPOSE
The purpose of this report is to propose Interim Policies to prevent major residential development from displacing commercial capacity in the Central Business District (CBD) and adjacent area designated for CBD expansion, pending a long term land use review in these areas.
In 1991, Council adopted the Central Area Plan: Goals and Land Use Policy. The vision for the Central Area was of smaller, more focused office areas in downtown and "uptown" (Central Broadway). These would be surrounded by new high density residential neighbourhoods, and by "choice of use" areas that had a free mixture of commercial and residential.
The new residential neighbourhoods have been realized very successfully, and faster than anticipated. The "choice of use" areas have also seen substantial development, mainly residential.
This success has brought forward a challenge, in the form of strong pressure to allow high density residential in the area designated for extension of the downtown office core. In addition, there is a move towards converting some major existing office buildings to residential in areas near the core. Under the current Downtown District Official Development Plan (DD ODP), both of these may be permitted, but the decision is discretionary.
The Director of Current Planning is of the opinion that allowing major residential in these areas at this time contradicts the Central Area Plan in two ways:
· The ability of downtown to accommodate employment growth and to remain the major office core of the region could be jeopardized by significant loss of commercial capacity, reduction in well-located large sites suitable for major office development, and a change in the dominant character of the area from office to residential.
· A high density residential neighbourhood would be created in an "accidental" way, without the level of design and public amenity that have made other new communities attractive and livable. These areas do not have appropriate design controls, public realm guidelines, or public benefit plans dealing with provision of parks and other community facilities.
It is timely to re-examine the question of whether, how, and where the downtown office core should expand, given the changes in the nature of the economy and employment since the late 80's. However, it will take time to do this. In the meantime, so as not to foreclose important options for Council, staff proposes (Recommendation A) adoption of Interim Policies that will limit residential development in DD OPD areas C Central and F (see Figure 1). Staff estimate these Policies will be in place for about two years, until Council makes a decision on the long term land use future. Recommendation B instructs the Director of Current Planning to report back to Council on the terms of reference, work program and resources for this land use study.
BACKGROUND
In 1991, a vision for Vancouver's Central Area was crystallized in the Central Area Plan: Goals and Land Use Policy, adopted by Council.
The essential land use elements of the vision were:
· Office foci in the downtown CBD and "Uptown" Central Broadway.
In order to improve the balance between employment and transportation capacity, these areas were to be more compact, reduced in total commercial capacity, and well-served by transit. They were to remain the major employment centre of the region. Significant residential was not seen as desirable in these areas. A 24 hour vibrancy was to be achieved by hotels and tourism, entertainment, retail, and the surrounding new residential neighbourhoods.
· Major new high density neighbourhoods.
Areas with low density development that had been zoned for office commercial or industrial were to receive a strong, high density residential focus, as opposed to the previous more tentative approach of trying to introduce residential through bonusing. New residents would be able to walk or bike to work, improving the mode split. Creation of a high level of amenity through urban design controls and investment in public amenities was seen as key to the successful transformation, and to long term livability.
· "Choice of Use" areas that would see a mix of major housing and office.
In some areas where a mix was already well underway, owners/developers would choose whether to build residential, commercial, or a combination. "Choice of use" was also seen as applicable to heritage areas as a way to assist in preservation.
Other significant directions in the Central Area Plan were to:
· Protect support service areas such as Burrard Slopes and Mt. Pleasant light industrial areas, to ensure the practical success of both office areas and new neighbourhoods;
· Target retail to key pedestrian streets, rather than trying to achieve it everywhere; and
· Preserve heritage in areas like Gastown, Chinatown, Yaletown and Victory Square.
In the 5 or 6 years after 1991, many of the detailed plans and zoning changes necessary to implement these directions were completed. These included:
· Downtown South planning, zoning, and design guidelines;
· Development cost levies, public benefits plans, and public realm plans for Downtown South and Triangle West;
· Zoning revisions to eliminate residential in the core CBD (i.e. areas A and B; refer to
Figure 1);
· Zoning revisions to implement "choice of use"(e.g., Area G, K 2, K3 and M); and
· Planning and zoning for the major projects on the edges of downtown--False Creek North and Coal Harbour-primarily as residential areas.
The ability to consider residential use up to a possible 3.0 FSR was maintained in some areas, including Area F (designated CBD in the Central Area Plan) and Area C (designated for CBD expansion).
In addition, in following years, policy was adopted to allow rezonings in the CBD for residential, under certain circumstances. Such rezonings may be considered to assist in retention of on-site heritage buildings or construction of "business support" facilities, but otherwise only if it can be demonstrated that there remains a 20 year supply of office space in the downtown.
DISCUSSION
Figure 1 shows the Downtown District (DD ODP) and its areas. It also indicates other areas (e.g. Central Waterfront, Gastown, Yaletown) that are considered to form part of downtown.
Figure 1 Downtown and DD ODP areas
(map)
1. Recent Development and Current Situation
In 2004, 13 years after the Central Area Plan adoption, many aspects of the vision are being realized. Figure 2 shows commercial and residential space completed in downtown in 5 year intervals between 1981 and 2005. (In this report, the term "commercial" includes office, retail, and other commercial; as well as hotel use.)
Figure 2. Downtown Commercial and Residential Floor Space Completions in 5 Year Intervals
(chart)
As can be seen, commercial development has followed long cycles, which has historically been the pattern of commercial space supply and take-up. However, there has been less built in the 90's than the 80's.
Residential development has increased significantly in each of the 5 year periods particularly after zoning changes for the Downtown South in the early 90's. New development in the "choice of use" and heritage areas has tended more towards housing than commercial. In addition, most of the transferred heritage density (to assist in preserving heritage buildings in Gastown, Chinatown, and other parts of downtown) is being used as residential rather than commercial.
Interest in residential development remains strong, partly fuelled by low interest rates, and residential selling prices are on the order of $400 per square foot of completed space. This has pushed up land values for residential so that they are significantly higher than a commercial development would pay.
Figure 3. Downtown Commercial and Residential Floor Space: Current and Future "Buildout" Scenarios
(chart)
In the DD ODP, residential is an option in all areas other than areas A and B, the core CBD. Figure 3 shows the current breakdown between residential and commercial space in the downtown. It also shows different ways in which the existing zoning could be "built out" depending on the choices that developers make, given the flexibility in the current zoning. Under current market conditions that favour residential, the trend is more towards
Scenario 1.
(It should be noted that these estimates include only the space that could be built under existing zoning, but not the floor space that may be added through bonuses e.g. for heritage, social or cultural amenities, or social housing. This bonus space is almost always residential.)
2. Challenges
There has been a marked increase in developer inquiries about doing residential projects in the existing CBD and CBD extension areas. These can be considered in three categories.
i) Residential in the Core CBD (areas A and B)
Under the DD ODP, areas A and B permit high density commercial uses, but do not permit residential. However, as noted above, site-specific rezonings to allow residential may be considered in certain cases. In some cases the amount of commercial included in the rezonings has been less than the amount permitted under the DD ODP, i.e. commercial capacity is effectively being converted to residential.
For non-heritage rezonings that propose to convert commercial capacity, policy requires there to be a 20 year supply of commercial capacity remaining. To date, consultant studies submitted with the proposals have demonstrated this to be the case. However, more detailed estimates by staff indicate that the 20 year limit may be being approached, and this will be a significant factor in assessing any future rezoning proposals.
ii) Residential in areas C and F
The zoning in these areas was not changed to eliminate residential after the Central Area Plan was adopted. While the total 5.0 FSR in area C and 7.0 FSR in area F may be all commercial, up to 3.0 FSR of it may be considered for residential. Thus, a shift in the essential nature of these areas to residential may occur under current zoning. Inquiries are also being made to rezone sites to accommodate more than 3.0 FSR residential by transferring in heritage density, or getting bonuses for various social or cultural amenities.
iii) Conversion of Existing Office Space to Residential Use
In some areas near the office core, there are initiatives to convert existing major office buildings to residential. Recently the conversion of the Duke Energy (West Coast Transmission) building was approved. Current zoning allows consideration of residential in most parts of the DD ODP, ranging from 3.0 to 6.0 FSR, depending on the area. Staff estimates that within the DD, about 970,000 sq. ft. of commercial space is located in buildings that might convert in whole or in part.
While staff feel the first category of inquiries and applications can be handled using existing policy, the latter two, if not addressed, could result in problems:
· Loss of commercial capacity and existing commercial space will affect the ability to accommodate employment growth in downtown, and may over time diminish the downtown's role in the region.
· Loss of remaining large sites near the existing CBD, and establishment of a predominantly residential character, may discourage major office developers and tenants. Areas A and B have only 3 remaining sites of more than 25,000 sq. ft. suitable for a major office building, while areas C Central and F have 14 to 15 such sites.
· Use of sites in Area C Central and F that are well served by transit (existing Skytrain, future RAV, and WestCoast Express) for residential will result in significantly less ridership than if they were developed for commercial.
· Areas C and F currently do not have the regulations, guidelines, public realm plans or public benefits strategies appropriate for a residential neighbourhood. If residential development proceeds now, the resulting neighbourhoods would be of lesser quality and livability than the other new downtown communities.
It is an appropriate time to revisit the role and future of the CBD, in light of changes to the regional economy, the downtown's role, the limited remaining commercial capacity, and the changing nature of work. However, it is critical that options be kept open pending this review, so that Council may have the ultimate decision.
3. Interim Policies
Recommendation A proposes that Council endorse the Interim Policies contained in
Appendix A, to guide the Director of Planning in consideration of residential development applications and rezoning inquiries.
The main thrust of the Interim Policies is to prevent residential development in Area C Central and Area F, pending the long term land use study. The former is the key CBD extension area, and the latter is part of the current CBD. The only residential that would be considered would be for preservation of on-site heritage buildings or renovation or replacement of SRAs.
Area C North (Victory Square) and area C South (Downtown South North) have both been recognized in previous policy planning as not part of the CBD extension area, and suitable for significant residential. Current policies and practices in these areas would continue.
The Interim Policies also propose to review proposals for conversion of existing built office space (50,000 sq. ft or more) to residential, anywhere in the DD, on a case by case basis. The Review will include assessing the amount of space converted and the general pace of coversion; whether the conversion is an opportunity to save a heritage, or post'40 heritage, building; and the quality of development proposal in terms of livability and design.
Table 1. Interim Policies Summary
1.0 New Residential Development | ||
Development Applications |
Rezonings | |
1.1 Area C North "Victory Square" | ||
As per Victory Square Policy (March 1990), or policies, zoning and guidelines for Victory Square that may be adopted later in 2004. | ||
1.2 Area C Central "CBD Extension" |
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a. New market residential not considered.
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Residential beyond what is described for Development Applications considered only for:
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1.3 Area C South "Downtown South North"
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As per current policy: up to 3.0 FSR residential if the 2.0 FSR commercial is provided |
As per current policy: greater than 3.0 FSR residential only considered for heritage transfers or bonus; SRA retention bonus; social/cultural amenity bonus. | |
1.4 Area F "CBD" | ||
Except for development sites fronting on Bute St., as per 1.2 For sites fronting on Bute St., as per current policy: up to 3.0 FSR residential if the 4.0 FSR commercial is provided |
As per 1.2 , above. | |
2.0 Conversion of Existing Office Space to Residential Use | ||
Conversion of existing office space over 50,000 sq. ft .to residential is to be considered on case by case basis. Council may be consulted on individual development applications. | ||
3.0 Live/Work | ||
Limits on live/work space to be the same as for residential described above. | ||
4. Implications of Interim Policies
The long term land use study could take twelve to eighteen months, depending on the extent of public consultation, so the Interim Policies could be in place for about two years. Staff have considered their implications from a number of perspectives.
· The City will avoid prematurely foreclosing options for the expansion of the CBD. The capacity for, and location of, future job growth will have significant impacts on the downtown's role in the regional economy, effectiveness of rapid transit investment, and the City tax base.
· The City will avoid having a high density neighbourhood created "through the back door" without appropriate planning, regulation, design, and services. The high costs of retroactively providing amenities and facilities (e.g. park space) will be avoided.
· The Interim Policies will provide clear direction to developers and investors over the short term. They will ensure consistent messages from the City to inquirers, and will help avoid undue speculation, which in itself will help keep options open.
· The Policies will not result in a shortage of housing coming on stream. Currently
4.7 million sq. ft. (6400 units) are under development in the DD. There remains another 7.4 million sq. ft. (9830 units) zoned and potential outside areas C Central and F. In the past 9 years the rate of completion has been 1040 units per year in the downtown, and over the next 3 years there will be over 2000 units per year completed. (Note that these figures do not include residential development occurring or potential in False Creek North, Coal Harbour or International Village.)
· The Policies continue to allow for developer activity in the DD. There are about 35 residential "tower sites" remaining available within the DD, outside areas C Central and F. (Five of these have active inquiries on them at present.) If the Granville Bridge ramps are relocated, as now under discussion, another approximately 5 sites would result.
· All sites with heritage buildings will continue to have the same opportunities as now. With respect to heritage density transferred from off-site heritage buildings, all the areas outside area C Central and area F remain available as receiver sites (i.e., the 35 tower sites mentioned above, as well as sites within areas A and B)
· The Policies continue to permit residential and residential bonuses for renovation or retention of existing SRAs. (There are 5 SRAs in Area C Central, and none in Area F.)
5. Long Term Land Use Study
Recommendation B is that staff report back on further planning work. This report would likely occur in the early fall.
The purpose of the long term study will be to recommend a land use and density future for the whole Central Business District, (i.e. areas A, B, C Central, and F). More consideration is needed before terms of reference can be detailed. However, in general terms the work will:
· profile the current economy (jobs, labour force, sectors, linkages) of the CBD and Central Area in the city and regional context. This will likely include getting a better understanding of office tenant types and their requirements; the role of the core as a hub of tourism and entertainment/arts/culture; and the growing education sector;
· describe alternative futures for the economy of the Central Area and CBD based on trends in the economy, workforce, and nature of work;
· create various scenarios for land use and densities in the CBD responding to the alternative futures, taking into account future employment locations elsewhere in the City (e.g. Central Broadway, western False Creek Flats, Finning Lands, Grandview/Boundary);
· evaluate the scenarios with respect to how well they further City and regional goals including the relevant directions of CityPlan (1995) and the Livable Region Strategic Plan (1995); and
· make recommendations on land use and density.
Because the future of the CBD is a question of city-wide and even regional importance, and of concern to a broad range of interests, the terms of reference will also include a public consultation plan that is customized for this situation.
In developing the work program and schedule, staff intend to assume the use of existing staff resources, so as to limit new funding to costs associated with public consultation and specialist consultants.
CONCLUSION
The new residential development in downtown neighbourhoods has been very successful, and the market for residential continues to be strong. This is leading developers to inquire about placing major residential projects in the areas designated for CBD or CBD expansion, using existing discretionary zoning and proposals for rezoning with substantial bonusing.
This would result in a future inconsistent with the 1991 Central Area Plan, in that it could both limit the ability to accommodate commercial growth in the CBD, and create high density neighbourhoods without the City's normal standard of design and public amenity. While it is timely to undertake a longer term review of the future of the CBD, it is important that development not foreclose Council's opportunities to make decisions on this future.
This report therefore recommends Interim Policies to
· prevent major residential development areas C Central and F of the DD ODP
· avoid conversion of major existing office buildings to residential use without careful consideration of each proposal.
It also recommends a report back on a long term study to determine the appropriate future land uses and densities for the CBD.
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