A5
ADMINISTRATIVE REPORT
Date: February 4, 1997
Dept. File No. F621
TO: Vancouver City Council
FROM: Manager of the Housing Centre
SUBJECT: Lease Terms for 20 West Hastings Street
RECOMMENDATION
THAT Council approve a lease for the New Portland Hotel project
(Lot K, BLK. 29 DL 541 Group 1, Plan LMP22692) at 20 West Hastings
Street to the Portland Hotel Society on the following terms and
conditions:
1. a term of 60 years;
2. at a prepaid lease rent of $356,250, due and payable on or before
90 days from issuance of occupancy permit;
3. commencement date being the earlier of the date of signing of the
lease by all parties or 120 days from the date of Council approval
of the lease terms;
4. the City may cancel the lease if construction has not commenced
within 12 months of the date of commencement of the lease;
5. permitted uses in this non-market project include sleeping rooms
with bathrooms, administration offices, communal kitchens, lounges,
residential amenities, and a cafeteria which may be available to
the public as well as the residents;
6. occupancy shall be restricted to core need, hard-to-house singles
and couples, with priority to persons or couples where at least one
person has a serious mental, health, substance abuse problem, or
other similar problem; and
7. Such further and other terms as are acceptable to the Manager of
the Housing Centre and the Director of Legal Services, it being
noted that no legal obligation shall arise until execution of the
lease.
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GENERAL MANAGER'S COMMENTS
The General Manager of Community Services RECOMMENDS approval of
the foregoing.
COUNCIL POLICY
It is City policy to purchase privately-owned land for non-market
housing development and lease it to non-profit sponsors for 60 years at
a prepaid rent, equal to 75% of market value.
It is also Council policy to maintain and expand housing opportunities
for low and moderate income households.
The City provides grants for non-market housing projects through the
Affordable Housing Fund where conditions require a grant to ensure
project viability.
PURPOSE
This report seeks Council s approval of proposed lease terms for the
non-market housing project at 20 West Hastings Street (see Appendix A).
BACKGROUND
At its November 5, 1996 meeting, Council approved a $300,000 reduction
in the prepaid lease rent for the 72-unit New Portland Hotel project at
20 West Hastings via a grant from the Affordable Housing Fund. The grant
was approved to compensate for both the presence of an underground
basement on the site and a property encroachment to the west. The City
had acquired this site in 1994 for $875,000 for a non-market housing
development for Downtown Eastside single men and women having mental,
health and/or substance abuse problems.
The normal lease value, at 75% of market value, would be $656,250. The
lease will be drafted using the BCHMC approved standard lease charge
terms, varied as herein set out. The lease must be signed within 120
days following Council approval not the normal 90-day period, because of
multiple funding sources that need to be co-ordinated and a customized
operating agreement needs to be prepared.
Receipt of the grant was conditional upon BC Housing agreeing to:
1) a prepaid lease amount of $356,250,
2) granting of an additional 14 more units for this project for a
total of 86 studio and
one-bed units and,
3) their acceptance that the City s share of the purchase price for
the Coal Harbour Co-op would be determined by the social housing
agreement between the City and Marathon Realty.
All three conditions have now been satisfied and the lease for the
project should now be prepared.
STATUS OF PROJECT
A Development Permit was approved July 1996 for 72 units. Conditional
approval for development of the additional 14 units, resulting in two
extra floors, has been received and a revised Development Application
will be submitted shortly. Construction start is slated for June 1997.
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