ADMINISTRATIVE REPORT

                                           Date: July 15, 1997
                                           Dept. File No. A880-F
                                           CC File: 4651

   TO:            Vancouver City Council

   FROM:          Manager, Building Management, Corporate Services Group
   and Manager, Non-Market Housing, Community        Services Group

   SUBJECT:       Roof   Replacement  -  Old  Continental  Residence,  1390
                  Granville Street


   RECOMMENDATION

        THAT Council approve  the roof replacement  at the Old  Continental
        Residence at an estimated  cost of $70,000; source of funding to be
        the Affordable Housing Fund.


   GENERAL MANAGER'S COMMENTS

        The General  Manager of  Corporate Services RECOMMENDS  approval of
        the foregoing.


   COUNCIL POLICY

   Council  approves  funding  requests  for the  Affordable  Housing  Fund
   projects.


   BACKGROUND

   This old hotel was acquired by the City to allow for the construction of
   the Granville Street bridge and subsequently was operated by the City as
   a social housing facility, with funding provided by the province.

   This provincial funding ended in 1992 when the New Continental Residence
   was built as its replacement, located nearby at 1067 Seymour Street.

   The  continuing operation  of the  existing building,  held by  Property
   Endowment  Fund (PEF), was approved by Council in September 1992 and now
   provides  monthly accommodation  in  108 rooms.   Operational  costs are
   being covered by rental income.


   DISCUSSION

   The  uncertain  future  of   this  building  in  the  past  has  led  to
   postponement of the urgently needed reroofing.

   Council rejected a demolition option in September 1992.  The  Manager of
   Non-Market  Housing advises the building has a low vacancy rate and will
   be  needed for  the foreseeable  future. Leaks  and water damage  to the
   rooms are occurring more frequently and the roof is now considered to be
   beyond economical repair and should be replaced.

   Use of the Affordable Housing Fund for operational costs is a  departure
   from previous  practice of using the Fund to support new developments or
   major  renovations.   The  Director of  Finance advises  that non-market
   housing projects do not fit within the purview of the Property Endowment
   Fund.

   The General Manager of  Community Services will be reporting  to Council
   on  how the Affordable  Housing Fund should  be used in  the future, the
   funding implications when the City gets involved in the direct provision
   of affordable housing and how expenses for City-owned non-market housing
   such as the Old  Continental should be funded in the future.  This could
   include the potential  for   establishing reserve  funds for  non-market
   housing buildings  and using future  operational surpluses to  repay the
   Affordable Housing  Fund.   As noted,  the current  funding for the  Old
   Continental  comes exclusively from rental  income.  This  income is not
   currently  sufficient  to  address   major  maintenance  and  up-grading
   expenditures.    As  an interim  measure,  it  is  recommended that  the
   Affordable Housing  Fund  be  used as  a  funding source  for  the  roof
   replacement. 

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