Agenda Index City of Vancouver

ADMINISTRATIVE REPORT

TO:

Standing Committee of Planning & Environment

FROM:

Directors of the Office of Cultural Affairs, Land Use & Development Planning, and Legal Services and the Managers of Real Estate Services and Facilities Development

SUBJECT:

Amenity Bonus Proposal - 955 Richards Street

 

RECOMMENDATION

GENERAL MANAGER'S COMMENTS

COUNCIL POLICY

The Downtown Official Development Plan under Section 6.II allows for an increase in the permitted floor space ratio or density of a building, in exchange for public, social or recreational facilities which have a demonstrated need, subject to Council approval.

Bonused amenity spaces are leased by the City and subleased to Vancouver-based, non-profit social service or cultural organizations at a nominal rent for a term of up to 20 years and include a series of requirements including the obligation to provide community services and benefits accessible to the public; to undertake a fund raising campaign sufficient to pay future operating costs; and to assume all of the City's obligations under the head lease.

PURPOSE

The purpose of this report is to seek Council approval for an amenity bonus proposal for a new residential development at 955 Richards Street (DE 403 980). The property owner has offered to provide a 5,496 sq.ft. ground-floor and mezzanine space suitable for an art gallery in exchange for 48,713 sq.ft. of additional density.

BACKGROUND

The subject site is located at the northwest corner of Richards and Nelson Streets. The applicant, Bosa Ventures Inc., has already received a Development Permit (DE 402 919) to construct two 16 and 25-storey residential buildings containing 279 dwelling units as well as 2,500 sq.ft. of retail. The applicant has submitted a new and revised application (DE 403 980) to construct two 21 and 30-storey residential buildings containing 332 dwelling units as well as a 5,496 sq.ft. amenity bonus space.

The site is presently occupied by surface parking and a variety of one and two-storey commercial buildings.

The complete development application (DE403980) was approved by the Development Permit Board, subject to Council's approval of the density bonus, on April 19, 1999.

DISCUSSION

Land Use and Urban Design

This site is within the "New Yaletown" sub-area of Downtown South. While housing is the principal use encouraged in this area, the zoning permits small amounts (up to 2,500 sq.ft.) of retail use at corner locations. Furthermore, other public uses are permitted on a case by case basis.

This site is adjacent to Nelson Street, a busy collector street in the downtown leading to the Cambie Bridge. As such, it enjoys excellent visual exposure for vehicles. It is also located only two blocks east of Granville Street, a major transit corridor. These are important locational criteria for a cultural facility such as the proposed Contemporary Art Gallery.

The proposed density bonus of approximately 48,000 sq.ft represents an increase in height of 5 stories to each of the previously south and north towers. The applicant is proposing to reduce the floor-to-floor heights of each tower, from 9'6" to 8'7", to mitigate the effect of the additional tower massing. The actual height increases are: for tower 1 - 22 ft.; and tower 2 -34 ft.. Staff have reviewed the applicant's shadowing analysis, and conclude that there are minor incremental impacts on nearby public open space or parks from this proposal. Given the large size of the site (120' x 350') the relatively small increases to the tower massing will have only marginal impact on private views of nearby residents.

Amenity Bonus

Council policy provides for bonusing to secure low-cost housing and/or facilities to meet the needs of the not-for profit social service and cultural community. Bonusing provides one mechanism to secure these facilities in the downtown where real estate costs are prohibitive for both the non-profit sector and the City.

When Council first approved a bonus in 1975 for the City Stage on Thurlow Street, it was for a term of 15 years and no provision was made for operating costs. At the end of the term, the City Stage theatre space reverted to the building owner with no further public benefit.

In 1986 and again in 1990, staff reviewed the amenity bonusing program and implemented revisions to ensure that the public benefit would remain as long as the additional density remained. To that end, the bonus calculation was revised to secure the space for the life of the building and to provide a 15 to 20-year prepaid capitalization of operating costs. Early bonuses provided for a share of the operating costs for 15 years. Later bonuses provide for all operating costs for 20 years.

Concurrent with these changes, sub-lessees of the amenity spaces entered into agreements with the City which obliged them to undertake an operating endowment fund raising campaign during the initial 15 to 20 years of their tenancy so that they would have sufficient funds to operate the amenity after the prepaid period expired.

Real Estate Services staff have reviewed the proposed amenity bonus and their analysis supports a bonus density of 48,713 sq. Ft. in return for the following:

· a 5,496 sq.ft. ground-floor and mezzanine amenity space on Nelson St. for the life of the building;

· the amenity space finished at an average quality as detailed in the society's Building Program dated October 14, 1998, including but not limited to:

· one dedicated lane loading bay;
· access at no charge to 5 parking stalls within the "visitor parking" area of P1;
· access to 1 disability parking stall within building;
· all heat, light and electrical power usage within the amenity space as well as any common area operating costs associated with the space for a period of twenty years.

In exchange, the applicant has requested an additional 48,713 sq.ft. of bonus density for residential condominium use on the site.

The bonus ratio of density to amenity is 9.37/1.00. This compares to the previously approved bonus at 488 Richards Street which has a ratio of 8.73/1.00. The proposed bonus is larger due to two factors:

· the art gallery needs one large double-height space which necessitates a transfer beam which would otherwise not be part of a retail space; and
· the bonus carries the additional costs associated with a second application fee.

The applicant had already received the necessary development approvals when the bonus opportunity arose. The additional costs associated with this subsequent submission ($53,780 application fee) and additional DCL charges have been factored into the bonus equation and add an additional .60 to the ratio. Without these two factors, this bonus proposal has a ratio of 8.63/1.00, which is slightly lower than the previously approved bonus at 488 Robson Street.

Proposed Amenity Use - Contemporary Art Gallery

The Director, Office of Cultural Affairs, has reviewed the proposed amenity opportunity and recommend to Council a sublease to the Contemporary Art Gallery Society of British Columbia. The society was established in 1971 as the Greater Vancouver Artists' Gallery by the City of Vancouver with assistance from a Federal employment program. From 1971 -1978 Vancouver artists were hired to produce art for exhibition at the gallery. This provided exhibition opportunities for artists such as Al McWilliams, Liz Magor, Judith Schwarz and Marian Penner Bancroft early in their careers. The artwork was then accessioned into the City's art collection some of which is currently on display in civic buildings. This collection, numbering some 3,000 works is managed by the society on behalf of the City of Vancouver.

In 1996, the society changed from an artist-run centre to a public art gallery. It fills a niche between the Vancouver Art Gallery and the City's many artists run centres. The gallery also is unique in its focus on Vancouver artists in the international context. The society attracts exhibiting artists from outside Vancouver to interact with local communities and supports an international exhibition network for Vancouver artists. In addition to exhibitions, the society also supports public discussions, artists talks, gallery tours, school outreach programs and acts as the City's rental agent for the collection.

The gallery has been at 555 Hamilton Street since 1973 and have outgrown its premises. While it enjoyed a long and beneficial relationship with that property owner, the space is no longer adequate for its current and future needs and does not permit on-site access to the City's permanent collection.

The society's board of directors identified the need to expand operations some time ago and have undertaken extensive planning to identify their space needs and operational capacity for growth. Staff have reviewed the operating endowment requirements with the directors and are confident that they are able to raise the required funds. Should Council approve the bonus, the society's board proposes to fundraise immediately with the goal of securing the balance of the endowment prior to the building's completion in 2001.

Staff reviewed the proposal and believe that the space will provide much improved visibility and public access to the gallery and the City's collection.

Lease and Sub-lease Agreements

Subject to Council's approval, the City will secure its interest in the amenity space through a lease for the life of the building which will be sub-leased to the Contemporary Art Gallery society of B.C. on those terms and conditions as are generally outlined in Appendix A of this report, as well as other terms as are required by, and satisfactory to the Director of Legal Services, in consultation with the Director of the Office of Cultural Affairs and the Manager of Real Estate Services.

CONCLUSION

Staff have reviewed the amenity bonus proposal and believe that the land use and urban design impacts of the additional floor space are acceptable and that the benefit in increased density to the applicant is balanced with the benefit to the public of the relocation to an accessible location of the Contemporary Art Gallery.

* * * * *

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APPENDIX A
Page 1 of 2

Terms of Lease to City

Term
· until demolition of the development

Area:
· 5,496 sq.ft. ground-floor and mezzanine amenity space on Nelson Street plus access at no charge to 6 parking stalls, including one disability parking stall in the visitor parking area of the building
Use
· No restrictions on use

Subletting, assignment, or mortgaging
· City reserves the right to sublet, assign, mortgage or grant licenses of the premises.

Rent
· nominal rent of $1 per annum

Taxes, if any
· payable by the City

Utilities, strata fee (if any) and common expenses
· payable by the Owner for a period of twenty years from occupancy including all operating expenses incurred in connection with the management, maintenance, operation and provision of the building's common areas, facilities and services as well as any costs related to the heat, light and electrical power usage for the amenity space.

Finishing and Fixturing
· The Owner to construct and finish the 5,496 sq.ft. ground-floor and mezzanine storefront space to the satisfaction of the City's Manager of Facilities Development and Director, Office of Cultural Affairs, at an average quality as detailed in the society Building Program dated October 14, 1998 including mechanical and electrical systems and fixtures, as well as public, accessible washrooms, and a fully fit-up kitchen.

Termination
· upon demolition or destruction of the building

All other terms and conditions required by the Director of Legal Services.

APPENDIX A
Page 2 of 2

Terms of Sublease to
Contemporary Art Gallery Society
of British Columbia

Term
· Twenty years

Rent
· Nominal rent of $1 per annum

Taxes, if any
· Payable by the subtenant

Utilities, strata fee (if any) and common expenses
· All costs assumed by City are passed on to the subtenant.

Fund raising obligations
· Subtenant to undertake a fund raising drive commencing in the first month of occupancy and contributing annually, to create an operating endowment fund sufficient to pay the utilities, strata fees (if any) and common expenses at the end of the first twenty year term.

Third party use
· No right to assign, sublet, grant mortgages or licences or allow third party use.

Covenants of the subtenant re: operation
· to operate a non-profit art gallery open to the public, to the satisfaction of the City.

All other terms and conditions required by the Director of Legal Services.

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pe990506.htm

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