A11

ADMINISTRATIVE REPORT

Date: August 11, 1998

Author/Local: C. Gray/7207

CC File No. 4661

TO:	Vancouver City Council
FROM:	Manager of the Housing Centre in consultation with the Director of Central Area Planning and the General Manager of Engineering Services
SUBJECT:	Roundhouse Neighbourhood Seniors Housing Development

RECOMMENDATION

A.THAT Council approve the purchase of Site 2B in the Roundhouse Neighbourhood of Concord Pacific Place for a price of $429,662.08 representing 25% of the site’s non-market value (source of funds to be the PEF), and

B.THAT Council approve the lease of the site to the Society for the Christian Care of the Elderly for the development of market rental housing for seniors for a term of 60 years at a prepaid rent of $1,595,337.92, with the prepaid rent to be assigned to the vendor, Concord Pacific, and on the terms and conditions outlined in the attached Letter of Understanding, and

C.FURTHER THAT no legal rights or obligations shall arise or be created until all purchase and lease documents have been signed to the satisfaction of the Director of Legal Services.

GENERAL MANAGER’S COMMENTS

The General Manager of Community Services recommends approval of A, B and C.

POLICY

Twenty percent of the units in major projects must be designated for non-market housing with a priority to core-need households. Council retains the flexibility to consider alternative affordable housing programs for particular sites having regard to housing need, neighbourhood mix, amenities, and services.

BACKGROUND

Site 2B was designated for 69 units of non-family non-market housing through the rezoning of the Roundhouse Neighbourhood of Concord Pacific Place that was approved in 1993. The location of the site is noted on Figure 1. The site would accommodate 45,511 sq. ft. of development. It is an airspace parcel sharing a parking podium with the adjoining condominium project (Concordia I) and the Roundhouse Community Centre. The parking podium, including 12 stalls for Site 2B, has already been built.

Figure 1 Site 2B Location

Site 2B was submitted for an allocation of units through the 1994 BC Housing proposal call process. The project did not receive an allocation, and was not expected to receive an allocation soon because housing for seniors was not a priority under the Homes B.C. programs. Consequently, Council was willing to consider alternative non-market housing

proposals as allowed for under the City’s 20% non-market housing policies for major projects.

In October 1994 Council approved a proposal from the Community of Affordable Residential Environment (C.A.R.E.) for a life lease project to serve seniors. Under the C.A.R.E. proposal the City would have assigned its option to buy Site 2B to the society which would have developed strata condominiums for lease to seniors. C.A.R.E. expected to raise $1.2 Million in donations to assist the project. In July 1995 Council approved revisions to the proposal that would have allowed 64 of the strata lots to be sold with between 5 and 10 units to be retained by C.A.R.E. for rent to core-need seniors.

Following Council approval of the proposal C.A.R.E. designed the project, and a development permit for a 74 unit project was applied for (DE401574) with an address at 183 Drake St. In Dec. 1996 Council approved the form of development. The increase in units from 69 to 74 were accommodated within the approved floor space for the project and can be accommodated under the approved Roundhouse CD-1.

Unfortunately, C.A.RE. was not able to raise all the donations expected, and there was a concern that the project presented too great a market risk given the number of condominium projects under construction downtown. Consequently, C.A.R.E. was unable to complete the purchase of the site from Concord Pacific.

DISCUSSION

Society for the Christian Care of the Elderly (SCCE)

SCCE was registered in 1970 as a non-profit society and currently operates 400 units of non-profit housing for seniors. Their portfolio consist of two large projects, one in Vancouver (Twin Arms at 1030 Burnaby St. with 217 units) and another in Burnaby. The Twin Arms was built in 1972 and the mortgage has been paid off. This allows the society to refinance the project to bring equity and collateral to the Site 2B project.

SCCE’s Proposal

SCCE wants to develop the site as a purpose built unstratified rental building for seniors. They would build 74 units utilizing the existing approved design with some minor interior modifications. In the absence of senior government subsidies, the units have to be rented at market rents for the project to be viable. However, since the owner will be a non-profit society, the rents should gradually decline below market. Unlike the previous proposal, SCCE would not provide any special services in the building. The standard amenities for a seniors rental building, such as lounges, meeting space, and a resident manager would be provided but not dining or medical services. Their proposal is outlined in their submission "Affordable Senior Housing Roundhouse Neighbourhood City of Vancouver July 1998" on file with the City Clerk.

Unlike the previous C.A.R.E. proposal, SCCE wants to lease the site from the City for the standard 60 year term. The project will not be stratified so the site and the building would revert to the City at the end of the lease term, ensuring that the opportunity to continue to provide affordable housing on the site is maintained. As set out in the Roundhouse Core-Need Housing Agreement between Pacific Place and the City, the City would buy the site at 25% of $30 per buildable sq. ft. (adjusted by CPI from 1989 to when the purchase closes) so the cost to the City would be $429,662.08, based on inflation from 1989 to now. SCCE would be responsible for paying the remaining 75% of the non-market value of the site ($1,288,986.23), plus the cost of the prebuilt podium ($306,351.69) for a total of $1,595,337.92. This would be prepaid rent that would be owed the City for the 60 year lease and which would be assigned to the vendor, Concord Pacific. This is the standard arrangement for the non-market projects developed in the major projects under the City’s 20% non-market housing policy.

A Letter of Understanding (attached as Appendix A) sets out the proposal’s terms and conditions agreed to between SCCE, Pacific Place, and the Housing Centre.

Parking

The parking ratio that Engineering Services would normally prescribe for market rental for seniors here would be 2 spaces for 3 units. This would translate into a requirement for 49 spaces for this 74 unit project. Engineering Services bases the 2:3 parking ratio on its experience with seniors rental projects such as Granville House in the South East Granville Slopes where a parking ratio of 1:5 has proven insufficient. An April 1998 survey of parking needs in seniors projects has confirmed that a parking ratio of 2:3 would be preferred to meet the parking requirements in the building. The 12 spaces currently available would only permit a 100% core-need seniors housing project for which funding is not available. While SCCE’s proposal represents the alternative to 100% core-need housing that generates the least parking demand, a serious parking shortfall remains.

The General Manager of Engineering Services recognizes that there is no feasible way to increase the number of parking stalls on site from the 12 currently located in Site 2B. There are, however, currently 100 monthly parking spaces available in the Roundhouse Community Centre parking lot adjacent Site 2B. These should provide a solution to Site 2B’s parking needs for the foreseeable future. The Roundhouse Community Centre parking was built to meet the transient public parking demand in the area, and this demand could increase in the future. Consequently, SCCE needs to consider further measures if the Roundhouse Community Centre parking garage is insufficient to meet the mobility needs of future residents such as providing one or two cars for the shared use by the building’s residents (e.g. through the Cooperative Auto Network) and a courtesy van operated by the building’s staff that would serve all the residents. SCCE already operates a non-market seniors building in the West End (the Twin Arms) with a parking ratio of 1:8 so it is familiar with managing a building short of parking.

Staff believe it is important that Site 2B be developed. Development is underway on all the other sites in the Roundhouse Neighbourhood and it is very desirable that the neighbourhood be fully built out. Consequently, staff recommend that SCCE’s proposal be approved, but on condition that the society include in its tenancy agreements notice that only limited parking is available in the building and in the neighbourhood. The inclusion of these clauses in the tenancy agreements will be made a requirement of the lease between the City and SCCE.

CONCLUSION

The Society of Christian Care of the Elderly propose to build 74 market rental units on a site set aside in the Roundhouse Neighbourhood for core-need seniors. There is very limited government funding available for seniors housing. SCCE’s proposal presents an opportunity to develop rental housing for seniors in the absence of senior government funding. The lack of government subsidies requires that the units be rented at market rents for the initial years, but, since a non-profit society would be the developer and operator, rents will likely gradually decline below market. Over the long term the project should prove a valuable addition to the City’s affordable housing stock. The only issue raised by the project is that it cannot provide the desired amount of parking on site, however, monthly parking is available nearby.

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

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(c) 1998 City of Vancouver