Agenda Index City of Vancouver

POLICY REPORT
BUILDING AND DEVELOPMENT

TO:

Standing Committee on Planning and Development

FROM:

Director of Current Planning, in conjunction with the Managers of the Housing Centre and Real Estate Division, and the Director of Social Planning

SUBJECT:

5750 Oak Street [Lubavitch Centre]:
Request to Forego Amenity Contribution

 

RECOMMENDATION

GENERAL MANAGER’S COMMENTS

COUNCIL POLICY

The Oakridge Langara Policy Statement [OLPS], approved by Council in November 1995, requires that for a 20% increase in density on identified sites that the owner or applicant provide a City-desired public amenity.

The Oakridge Langara Public Benefit Strategy, approved by Council on June 13, 1996.

On January 8, 1998, when considering a policy report on the institutional replacement policy within the OLPS, Council resolved as follows:

At a Public Hearing held on January 14, 1999, City Council established a CAC for the site at 5750 Oak Street [Lubavitch Centre] as follows:

PURPOSE AND SUMMARY

Another request has been received from representatives for the Lubavitch Centre to eliminate requirements for the provision of a Development Cost Levy [DCL] and the CAC in conjunction with additional density which was achieved through the rezoning process. Council received and denied a similar request in January 1998.

Lubavitch has also put forward subsequent to discussion and response from staff the idea of cash payment-in-lieu of the housing, with a reduced value in recognition of their service to the community.

Staff do not feel that circumstances have changed, and recommend that Council not support the request to waive the CAC as it would be inconsistent with the Oakridge Langara Policy Statement [OLPS] and Council’s previous decision. If Lubavitch wants to provide a cash payment-in-lieu this would be supportable at full market value.

Further, there is no provision in the Vancouver Charter to exempt the residential part of the development from DCLs.

BACKGROUND

The OLPS and the related Public Benefit Strategy [PBS] provides funds for improved community amenities in two ways, through DCLs, which apply, among other things, to all residential developments over three units in size (except social housing), and through CACs. DCLs are established through a by-law while CACs are negotiated on a site-by-site basis.

Identified sites can also achieve higher density for the specific provision of a CAC. In this regard, the OLPS provides a base level of density, a bonus density for the provision of City-desired public benefits, as well as a replacement density specifically for existing institutional FSR. Through the rezoning, the Lubavitch Centre was able to maximize possible FSR in all three areas, to a maximum density of 1.98 FSR. A total of 61 residential units have been approved under DE404052.

Council will recall that Lubavitch endeavoured to build less institutional floor area and replace that unused floor area with residential use that would be sold to create an operational endowment fund for the Centre. Council did not support this proposal, and also did not support a request by Lubavitch to simply forego the CAC for the same purpose. At the Committee meeting of January 8, 1998, several members of Council commented about the seriousness of the precedent, both in Oakridge Langara and city-wide.

At the Public Hearing on January 14, 1999, Council established a condition of approval to be met prior-to enactment of CD-1 zoning that four one-bedroom units be optioned in favour of the City. This agreement was signed by Lubavitch on July 16, 1999, and registered on July 28, 1999. The zoning was enacted July 29, 1999.

DISCUSSION

The request from Lubavitch and staff response from the City Manager are attached as Appendix A to this report. At a subsequent meeting Lubavitch suggested an alternative which is described later in the report. The Minutes of the January 8, 1998 Planning and Environment Committee meeting and the accompanying policy report dated December 2, 1997, are attached as Appendix B. The discussion was fairly detailed and many of the issues raised by this most recent request were reviewed.

Oakridge Langara Policies: Amenity contributions in this area of the City are guided by the OLPS and the PBS, which were approved by Council in November 1995 and June 1995, respectively. Institutions themselves benefit under the policy statement from the ability to replace their full FSR, plus the ability to construct additional market housing in the range of 1.2 to 1.44 FSR. The range is based on the 20% bonus which is clearly connected to the provision of City-identified public benefits, which have been carefully delineated in the accompanying PBS. The PBS is an important component in the eyes of many residents ofOakridge Langara as these benefits will serve to a large degree to mitigate the impacts of the new development.

DCLs: The Vancouver Charter describes specific exemptions from DCLs, which includes churches, buildings with less than 4 dwelling units, repair or renovation work and social housing. There are no other exemptions beyond these provisions. Council can set differential rates for use categories however, as has been done for day care and industry in all DCL by-laws (elementary and secondary schools are given the same rate as child day care in Oakridge Langara).

Subject to the conditions set out in the Vancouver Charter, incorporated charitable institutions are exempt from the payment of property taxes, as well as churches, Crown and city properties, certain institutions of learning and certain hospitals designated by the Minister of Health; however, of these uses only churches are exempt from DCLs. The exact status of the site is not yet clear as it is currently registered to a numbered company which may not be tax exempt. The extent of exemptions for property tax will be determined by the B.C. Assessment Authority at the request of Lubavitch, and City staff will also review the DCL eligibility at that time. In the meantime, Lubavitch has paid a DCL of $262,642.25 for the whole development in order to expedite issuance of relevant permits.

Recent CAC Considerations: In discussing the recent rezoning of the Children’s & Women’s Hospital, staff brought forward a number of points which are equally relevant to this consideration:

(i) only the floor space for churches is exempt from DCL and CAC charges; and

(ii) public and private institutions other than churches and social housing are not exempt from DCL or CAC charges.

In the same report, the following commentary was provided:

“Staff believe that the effects of City growth charges on public institutions doing public good [such as, in this case, public health care] need careful analysis and consideration. How such institutions are defined, what demands for City amenities they generate and the appropriateness of variable rates and exemptions, are all key questions to be answered. This will be done as part of the broad review of financing growth that is now underway. However, this will take some time and, pending such conclusions, staff recommend application of Council’s current policy...”

The discussion is not whether institutions such as Lubavitch provide worthwhile services to the community. There is no disagreement with their institutional objectives regardless ofwhether some institutions may serve a somewhat narrower client group because of their religious focus. The question is whether institutions in this case should benefit from a special consideration related to development of market housing on the same site.

Implications of Exemption From CACs: Institutional uses were carefully considered in Oakridge Langara and the approved policies are an integrated package that will deliver the intent of the OLPS and the amenities in the accompanying PBS. Modification of the CAC policy to provide exemptions for institutional uses on this site would have a ripple effect on the approved policy package as it would set a precedent for other potential rezoning sites.

There would be significant implications of exemptions from CACs in Oakridge Langara. There are two other churches within high priority or reserve sub-area designated rezoning areas, the Oakridge Baptist Church and Chinese Presbyterian Church, both on Cambie just south of West 45th Avenue. In addition, St. John Ambulance, Peretz, the Jewish Community Centre, Alliance Francais, George Pearson/Dogwood Hospitals, Kensington Private Hospital and the Louis Brier Care Facility are institutional users who could all similarly request forgiveness from CAC considerations along with Lubavitch. To date, St. John Ambulance and Peretz have proceeded through rezonings.

Beyond Oakridge Langara, the implications, while more general, would also be significant. There are many service institutions now subject to city-wide or other CACs if they rezone and, from time to time, such institutions consider rezoning to intensify site use as a way to free up capital for other purposes. Needless to say, such institutions would generally appreciate more density than properties around them and less requirements to assist with public amenities needed by all residents as development intensifies. However, the City will be left in all cases to deliver the basic necessary amenities.

Amenity Contribution Reduction: Lubavitch has alternatively asked that some level of concession on the CAC be provided in recognition of the services provided to the community. The Director of Social Planning advises that Lubavitch may make application for a City Capital Grant, where the request would be evaluated in terms of priorities and available funds at the time. Staff note that while discussions took place with an individual representing the Centre, and a preliminary application was submitted, no full application was submitted. Applications for grants will not be considered now until next year, if a Capital Grants program is retained as part of the Capital Plan submission for November’s civic election.

Staff recommend that CAC considerations and other City funding mechanisms should not be inter-linked.

Alternate Consideration: A cash payment-in-lieu at market value [$626,000] for the four housing units has also been discussed; however, this was not seen to be in Lubavitch’s interest as it would not further assist the centre in its objective of achieving an augmented operational endowment. Lubavitch representatives alternatively have suggested this approach in conjunction with a decision by Council to then reduce the cash value to a low value, preferably zero, hopefully as a means of overcoming any concerns that Council might have for the precedent of their original request.

Staff feel that this last proposal is sufficiently similar in its intent that it is the same as their original proposal, to forego all CAC considerations. Staff do not support this proposal and continue to recommend a contribution as entered into and registered between Lubavitch and the City. If a cash payment-in-lieu is preferred, it should be at full market value.

CONCLUSION

Staff continue to support the requirement for a CAC related to this site for the following reasons:

· CACs in Oakridge Langara are intended to mitigate the impacts of new development on the existing community;

· Council’s previous decision and concern about the precedent; and

· the applicant voluntarily committed to a properly registered agreement on title to provide the units, as a requirement of the rezoning.

The Director of Current Planning therefore recommends that the CAC contribution of four units be maintained, or if a cash payment-in-lieu is preferred by the organization, this be accepted at full market value of $626,000.

With respect to DCLs, there is no provision in the Charter to exempt the residential portion of the development.

- - - - -

APPENDIX A

Note from Clerk:

Appendix A is not available in electronic copy. The complete report is on file in the City Clerk's Office.

EXTRACT FROM THE MINUTES OF THE STANDING COMMITTEE OF
COUNCIL ON PLANNING AND DEVELOPMENT,
JANUARY 8, 1998

COMMITTEE REPORTS

Report of Standing Committee on Planning & Environment (January 8, 1998)

2. (a) Oakridge Langara Policy Statement Institutional Replacement Policy; and

The Committee had before it Policy Report dated December 2, 1997 (on file) in which the Directors of Planning, on behalf of Land Use and Development, in consultation with the Managers of the Housing Centre and Real Estate Services, sought direction on the Oakridge Langara Policy Statement institutional replacement policy. Clarification on the policy is needed to enable staff to further process a rezoning application submitted on behalf of the Lubavitch Centre at West 41st Avenue and Oak Street. The application proposes to substitute market housing for unused replacement institutional floor area (FSR) for the LubavitchCentre. The proceeds from the market housing will be used to create an ongoing operating endowment fund for the Centre.
Staff recommend that the Oakridge Langara Policy Statement institutional FSR replacement policy be interpreted to allow only replacement of existing institutional floor space and no other substitution.

However, should substitution be considered, staff submit two options:

_ Allow the unused institutional density to be replaced with market housing but require the additional FSR to be treated as bonus density with the increased land value turned back to the City in the form of a public benefit; or,
_ allow the unused institutional density to be substituted with market housing with the increased land value turned into an endowment fund for the operation of the Lubavitch Centre.
Rob Whitlock, Planner, with the aid of a hand-out highlighting the options before the Committee (on file), reviewed the report and the implications of each of the options. Mr. Whitlock noted the replacement policy applies to a half-dozen sites in the Oakridge Langara area. The Oakridge Langara Policy Statement is the result of an extensive two-year process. Staff analysis indicates development of the Lubavitch Centre at the lower density, with no substitution, would give the Centre an endowment fund of $3.5 million.

Rabbi Yitzchak Wineberg and Victor Setton, representing the Lubavitch Centre, described the services provided by the Lubavitch Centre, and requested support for the Centre’s proposal to substitute institutional density for market housing. The monies received from the sale of the market housing would convert to an Endowment Fund. Rabbi Wineberg referred to the Centre’s request in its letter dated January 6, 1998 (on file) to have the endowment funds considered as a City desired public benefit. The Fund is needed by the Centre to survive. If the Centre doesn’t have the money, it won’t be able to do as much as it wants to do in the city. Government support for charitable organizations is finished and every charitable organization is finding it difficult to get donations. With the proposed downsizing of the building, the Centre will serve as a hub. The school will be moving; larger facilities are now being located in outlying communities. The demographics of the community is changing and growth is taking place on the outskirts of Vancouver.

Mr. Setton advised Lubavitch Centre is not looking to make a profit. The Centre wants to obtain an endowment, the total benefit of which will be given back to help people. Lubavitch needs the additional 20% bonusing money from the requested increase in density for the institution to survive.
Jim Lehto, UD&D Ltd., planning consultant for the Lubavitch Centre, advised if the requested 20% increase in density were allowed to be converted into an endowment fund for the use of Lubavitch, the Centre would be able to run a self-sustaining institution.

Alan Gjernes, representing St. John’s Ambulance, (letter filed) advised St. John Ambulance has applied to rezone its property to allow for a mixed use project, including a new St. John Ambulance facility and residential condominiums. St. John postponed its application because of the City’’s public benefits policy, which requires payment of CAC’s. St. John and Greystone are reconsidering their options, one of which may be an expansion of institutional space. They request the City considers each institutional rezoning on its own merit and not set a rigid institutional "Replace Policy" for the Oakridge Langara area.

In response to questions, Larry Beasley, Director of Central Area Planning, advised agreeing to the request from the Lubavitch Centre would create an official precedent in the Oakridge-Langara area, and an unofficial one outside Oakridge-Langara.

The Committee was sympathetic to the Lubavitch Centre’s dilemma of finding the resources to provide services, and noted all other non-profit organizations are facing the same problem. It was questioned whether there was a City policy on, or an interpretation of, endowment funds. The Committee also noted deviating from the Oakridge-Langara policy will be reneging on an agreement made with the entire neighbourhood.

The following motion by the Mayor was put and carried. The Committee, therefore,

RECOMMENDED

A. THAT the Oakridge Langara Policy Statement institutional FSR replacement policy be interpreted to allow only replacement of existing institutional floor space and no other substitution.
- CARRIED UNANIMOUSLY

The following motion by Cllr. Herbert was put.

- DEFERRED

RECOMMENDED
B. THAT the foregoing motion be deferred to the Unfinished Business portion of the Regular Council meeting following the next Planning and Environment Standing Committee meeting.

The accompanying Council report dated December 2, 1997 follows.

POLICY REPORT
DEVELOPMENT AND BUILDING

TO: Standing Committee on Planning and Environment

FROM: Directors of Planning on behalf of Land Use and Development, in consultation with the Managers of the Housing Centre and Real Estate Services
SUBJECT: (a) Oakridge Langara Policy Statement Institutional Replacement Policy; and

RECOMMENDATION

CONSIDERATION

GENERAL MANAGER’S COMMENTS

COUNCIL POLICY

The Oakridge Langara Policy Statement (OLPS) approved by City Council on July 25, 1995. The following policy applies to existing institutional uses in area:

Increase in overall site density beyond the residential FSR outlined in Chapter 3 (‘Residential Location and Density’) may be considered in order to retain the institutional use, but only if the mixed-use proposal is shown to minimize impact on the community while providing city-desired public benefits in return.

The Oakridge Langara Public Benefit Strategy, approved by Council on June 13, 1996.

PURPOSE

The purpose of this report is to seek City Council direction regarding the Oakridge Langara Policy Statement (OLPS) institutional replacement policy. Clarification is needed in order to enable City staff to further process a rezoning application submitted on behalf of the Lubavitch Centre at West 41st Avenue and Oak Street.

SUMMARY

Before proceeding to give direction to the applicant and involving the community, it is necessary to seek Council clarification of the OLPS as it relates to existing institutional sites. The issue has been raised by a rezoning application for the Lubavitch Centre, which proposes to substitute market housing for unused replacement floor area from the existing Lubavitch Centre, with the proceeds from that market housing to be used to create an ongoing operating endowment for the Centre.

Staff do not support the requested substitution, but seek advice from Council on this issue. This advice is requested in two areas:

1. Does Council wish to interpret the OLPS so as to consider the proposed substitution approach? and if so,

2. Should the proceeds of the substitution provide City desired public benefits or should they provide institutions in the area with replacement costs and operational endowments?

Should Council choose not to consider the requested substitution, the Lubavitch Centre would be required to reduce its proposed 1.98 FSR to 1.68 FSR. Assessment of the project’s proforma at 1.68 FSR indicates that the value achieved from the rezoning and redevelopment is sufficient to cover Lubavitch’s redevelopment costs, establishment of an operating endowment for the Centre, as well as providing the city-desired public amenity contribution as required by the OLPS.

Should Council support the substitution approach, staff recommend the total increased land value accrue to the City in the form of a public benefit in keeping with the OLPS.

OLPS AND LUBAVITCH PROPOSAL

The OLPS allows for a base level of density, a bonus for the provision of city-desired public benefits and increased density for the replacement of existing institutional FSR, as a means of providing for their continued existence in the area. Staff have interpreted the wording “increased density” to mean allowing the full existing institutional floor space to be replaced.

The table on the following page sets out the provisions of the OLPS and the extent to which the Lubavitch proposal meets the Policy Statement.

Rather than reconstruct the existing Centre to its present size (0.54 FSR), Lubavitch proposes to develop a smaller centre (0.24 FSR [44% of current size]) and substitute market housing in place of the unused institutional FSR of 0.30 (56% of current size equalling 1 136 m² or 12,230 sq. ft.). The proceeds or increased land value from this approach would be used to establish an endowment fund to support its ongoing operation.

The initial application for Lubavitch sought both FSR and height in excess of OLPS parameters. The applicant has now indicated an intent to reduce both to that supported in the OLPS (with the exception of the request to substitute the institution FSR).

FSR COMPONENT

OLPS

LUBAVITCH PROPOSAL

Floor Space Ratio

1.0 to 1.2

upper range dependent on the achievement of “good design”

Maximum of 1.2 proposed

Bonus FSR

0.24 FSR

A further 20% increase in density for “the provision of City desired public benefits”

0.24 FSR

Four units owned by the City proposed

Institutional

0.54 FSR existing

An increase in overall site density beyond the above residential FSR may be considered in order to retain the institution use, “but only if the mixed-use proposal is shown to minimize impact on the community while providing City desired public benefits in return”

0.24 FSR institutional
+
0.30 FSR market housing

(to be substituted in place of un-used institutional FSR)

Total FSR of 0.54

Total FSR Achievable

1.98

1.98

DISCUSSION

Question 1: Whether to Consider Substitution Approach?

Oakridge Langara Policy Statement (OLPS): The OLPS acknowledges the role of existing institutions in the community, making provision for increased density to accommodate their continued existence on present sites. This accommodation is dependent on the applicants being able to minimize impact on the community and provide city-desired public benefits in return.

The OLPS does not specifically anticipate un-used institutional floor space being converted for market housing use, whether or not this would be used to finance development andoperation of the institution. The approach suggested by Lubavitch would broaden the original intent of the policy.

Staff believe that the conversion of an “excluded” floor space allowance to cash value is a significant precedent and inconsistent with the intent of the OLPS to accommodate existing institutions. The further request by Lubavitch to retain the increased land value is also inconsistent with the institutional policy which draws a direct link between the increased density and a return in “city-desired public benefits”.

Balancing Public Benefit and Financial Viability: Regarding institutions, the OLPS specifically calls for a balance between increased density, minimizing impact and the provision of City desired public benefits in return. The term "City-desired public benefits" is interpreted to mean, throughout the OLPS, benefits which have been defined in the companion Public Benefit Strategy (PBS) which was adopted by Council in June 1996. These benefits include park acquisition, park development, child day care, replacement housing, greenway and street improvements.

The substitution of institutional FSR by market residential floor space to finance development and endowment of institutions for this and other institutional sites will have only a small net effect on the population/amenity balance developed in the PBS. However, turning the increased value into community amenities (through monetary or “in-kind” contributions) would be consistent with the central theme of the OLPS, augmenting population increases with a comparative increase in public benefits.

In the case of Lubavitch, allowing the residual institutional FSR to be translated into market units creates additional housing (replacing the un-used institutional floor space creates approximately 1 136 m² or 12,230 sq. ft. of additional housing [approx. 15 market housing units]) and comparable increase in population and traffic.

Lubavitch representatives argue that retention of the existing facility in the area will not be financially viable unless the additional funds from the market housing are used to pay for the costs of building and endowing the facility. Analysis of project proforma by the Real Estate Division (see later in report) indicates that there is sufficient funds at 1.68 FSR for redevelopment and an operating endowment and therefore public benefit/community amenity contributions need not be sacrificed.

Implications of Extending Institutional Policy in Oakridge Langara: There are seven institutional sites in the area where this expanded policy could directly apply (Lubavitch, St. John Ambulance, Kensington Hospital, Oakridge Baptist Church, Peretz School, Alliance Francaise & Chinese Presbyterian Church). Other larger institutional sites such as Louis Brier and the Pearson Centre have specific FSR limits set out in the Policy Statement.

Lubavitch and the cluster of institutional uses at West 45th Avenue and Cambie Street (St. John Ambulance, Peretz School, Alliance Francaise and the Chinese Presbyterian Church) are relatively isolated from nearby single-family development. Full replacement of the institutional floor space plus the residential floor area allowed under the OLPS should be attainable without significant impact on adjoining areas. Sites such as the Oakridge Baptist Church and Kensington Hospital may face greater difficulties because they directly abut onto single family areas.

In the case of Lubavitch, staff believe that the maximum density of 1.98 FSR can be achieved because the site is bounded on the east by the Jewish Community Centre and to its immediate south by the Unity Church. The site is relatively isolated from adjoining RS-1 sites (three houses fronting Fremlin Drive to the southeast back on to the site across a City lane). Minimizing the impact of the added density has yet to be fully proven by the applicant, as the initial rezoning proposal exceeds both recommended levels of FSR and height. The applicant acknowledges that redesign is necessary. Staff believe that a good quality of development is achievable once the density and height parameters are established. Community input will be important at the next stage.

It should be pointed out that, even if all institutions were to take up this substitution approach, less than 100 units would be created in total. In view of the fact that approximately 3,500 housing units are to be created over the life of the OLPS, at maximum take-up the substituted units would represent less than 3% of the total, and would have little appreciable impact on the overall amenity of the area.

Implications of Down-sized Institutions: Lubavitch and St. John Ambulance argue that project affordability is critical to their decisions to continue operating on their present sites. In their view, a restricted interpretation of the replacement policy to the floor space consideration could lead to decisions to leave their present sites or the city altogether. In some cases such a decision may not be as critical to the area, as services are not directly provided to local residents, but rather are of more value to the city and the region at large. St. John Ambulance is such an example.

However, many religious and cultural institutions such as Lubavitch serve members from the local area, from the city and the region. The OLPS policy to provide increased density for institutions is clearly premised on the institution continuing to operate on site and provide services to the community, whether local or city-wide. Re-location of institutions off-site would result in loss of the associated density altogether.

The more flexible interpretation of the policy may clearly result in smaller institutions. The impact of downsizing of each institution should be assessed as part of the rezoning application analysis. Both Lubavitch and St. John are now proposing smaller facilities than their existing buildings. According to Lubavitch, the reduced facility will not appreciably reduce service, but adjustments will occur as more services may be delivered on an outreach basis. St. John Ambulance would transfer provincially-based administrative services elsewhere. Applicants would need to demonstrate a level of service commensurate to that presently being provided in the community.

Staff conclude that allowing the policy to be expanded to include substitution is counter to its intent, which is a positive incentive to allow institutions to be replaced in full. Approving the substitution, as requested by Lubavitch, may have the opposite affect. Staff understand that more efficient floor plates may be able to provide the same service, but it will be difficult for staff to evaluate whether the same level of service to either the community or the client group is being provided.

City-wide Precedent Considerations: A serious question for Council is the applicability of this policy to the rest of the City. The “expanded”policy described in this report is a response to a specific policy in Oakridge Langara related to institutions. There is no similar City-wide Council policy regarding institutions except that the City no longer offers “write-downs” of City-owned lands to religious and cultural organizations. However, Council may expect that many institutions outside Oakridge Langara will translate a positive decision on Lubavitch’s request as a precedent for the rest of the city.

CONCLUSION (Question 1: Whether to Consider Substitution Approach?)

Staff believe that the answer to Question 1 should be not to allow the substitution approach. In general terms, the expanded consideration is counter to the policy’s intent, to allow existing institutions to be accommodated up to their present size, in addition to the accommodation of significant residential densities. It is a significant precedent for both Oakridge Langara and for the remainder of the city.

The proposed substitution of the un-used institutional FSR for market housing can be seen as an effective grant from the City. It is generally the policy of the City to seek the increased land value where “bonus density” is proposed. Social Planning staff note that Lubavitch would not qualify for direct City grants. The immediate community will likely prefer to see the building bulk reduced by not supporting the extended interpretation.

Analysis of Lubavitch’s specific proforma (see analysis at end of report) indicates that Lubavitch can provide for redevelopment, establish an operating endowment and contribute city-desired public amenities without the substitution. Consequently there is no basis for expanding the policy.

Question 2: Who Should Benefit From Substitution Approach?

While staff recommend that Council not allow the proposed substitution, either generally or in the case of Lubavitch (Recommendation A), if Council wishes to consider the substitution approach, there are two options:

1. Allow the residual institutional density to be replaced with market housing but require that all this additional FSR be treated as a bonus density and the increased land value be turned back to the City (Recommendations B and C).

2. Allow the residual institutional density to be replaced with market housing with the “increased land value” left with Lubavitch, as requested (Recommendations B and D).

Lubavitch and Financial Viability: The Manager of Real Estate Services has reviewed the economics of the development. At the recommended 1.68 FSR, Lubavitch would recover the value of the land, estimated at $3.1 million, and, in addition, achieve a development profit of $1.9 million. Assuming their replacement facility costs $150 per square foot to build, Lubavitch would end up with a new 908 m2 (9,780 sq. ft.) facility and a $3.5 million operating endowment as well.

Under all options, Lubavitch would provide a city-desired public amenity to the City as required under the OLPS for the 0.24 FSR housing density increase. Under the recommended 1.68 FSR, the value of the contribution to the City is $625,000. If Lubavitch’s 1.98 FSR proposal is approved (residential density bonus increases of 0.24 and 0.30 FSR, the latter being the substituted space), a total of $1.4 million in amenity contribution would be received by the City.

However, Lubavitch has asked that they be allowed to retain the increased land value for the unused institutional space under the 1.98 FSR scenario. If this were approved, their endowment would increase to $4.7 million.

If the recommendation that the City require payment of the full land value increase is approved, it is recommended that the benefit take the form of housing units to be given the City at no cost. At the recommended 1.68 FSR the City would receive four (4) units (public amenity required as part of bonus FSR) and at 1.98 FSR nine (9) units in total. These would be one-bedroom units which the City could assign to a non-profit housing society to rent. Given the location near transit and shopping, the likely target group would be seniors. Since the units would be free to the City, core-need seniors could be accommodated. Any net revenue earned from the units would be credited to the City’s Affordable Housing Fund. The Manager of the Housing Centre will report back to Council at the time of referral to Public Hearing on the details of the housing benefit.

City-owned Versus Lubavitch-owned Rental: As a result of a recent letter sent to some members of Council by Lubavitch, the Manager of the Housing Centre wishes to make clear the distinction between accepting City-owned strata units at no cost to the City, versus City-controlled rental units owned by Lubavitch. Market rental units generate a sizable net income. If Lubavitch owns the units and collects the rent, as they propose, they need to provide more units than if the City owns them and collects the rent. At an FSR of 1.68, Lubavitch would have to provide 14 market rental units instead of the four units they would have to give the City, and which the City would own and rent.

OVERALL CONCLUSION

The form of development for the Lubavitch project would be comparable under full institutional replacement or with substitution, as density and bulk will generally be the same, and so this is not seen to be an issue in this consideration. The applicant will need to demonstrate a good quality form of development through a revised submission.

Staff need Council’s advice on whether the substitution approach represents a reasonable extension of the Oakridge Langara Policy Statement policies related to “retention” of existing institutions. Staff believe that the policy should not be extended.

If Council does support the extended interpretation, the second question is whether the increased value is returned to Lubavitch, as requested by the applicant, or the community in the form of non-market housing, as recommended by staff. The applicant would like a decision by Council on both matters, in order that they can deal with business decisions which derive from FSR thresholds, etc.

* * * * *

pe991202.htm

APPENDIX A

APPLICANT, PROPERTY, AND DEVELOPMENT PROPOSAL INFORMATION

APPLICANT AND PROPERTY INFORMATION

Street Address

990 West 41st Avenue

Legal Description

Lot 1 of Lot ‘A’, Block 1008, D.L. 526, 13567 NWD

Applicant

Central Organization for Jewish Education/Lubavitch-British Columbia

Architect

UD & D Ltd.

Planning Consultant

Jim Lehto

Property Owner

same as applicant

Developer

United Properties Ltd.

SITE STATISTICS

 

GROSS

DEDICATIONS

NET

SITE AREA

3,786.5 m²

Not known at this time

-

DEVELOPMENT STATISTICS

 

DEVELOPMENT PERMITTED UNDER EXISTING ZONING

PROPOSED DEVELOPMENT

RECOMMENDED
DEVELOPMENT (if different than proposed)

ZONING

RS-1

CD-1

-

USES

One-Family Dwelling; Institutional;
Church; School; etc.

Institutional and residential

-

DWELLING UNITS

1

82

-

MAX. FLOOR SPACE RATIO

0.60

2.16

1.68 - 1.98

MAXIMUM HEIGHT

9.2 m (30 ft.); with relaxation to 10.7 m (35 ft.)

21.64 m (71 ft.)

15.24 m (50 ft.)

MAX. NO. OF STOREYS

2 1/2

Six and four

-

PARKING SPACES

As per Parking By-law

As per Parking By-law

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CALCULATION OF INCREASED LAND VALUE

The Manager of Real Estate Services states that at 1.98 FSR, assuming no land cost (property check indicates property owned free and clear of all financial incumbrances), normal development profit would be about $3.8 million. This would be after paying all costs of building the new Lubavitch Centre, but before any public benefits were paid to the City.

The OLPS requires provision of a public benefit for the 20% density bonus. On the base density of 1.2 FSR, the 20% bonus is equal to an FSR of 0.24. The increase in land value resulting from the 0.24 FSR density bonus is equal to approximately $626,000. This is calculated as follows:

Bonus density x site area x buildable = Value of bonus

In this case the bonus would amount to four seniors strata units at no cost to the City. The remaining development profit then becomes $3.5 million.

If the City required a similar level of public benefit for the substituted 0.30 FSR of floor area, an additional five units (value of almost $800,000) would be given over to the City.

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pe991202.htm

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