November 27, 2017

There Goes Neighbourhood Commercial~The Story of 33rd Avenue and MacKenzie Street

Sometimes the best way to understand a problem is just to go through it. That is exactly what Kerry Gold does in her latest Globe and Mail article describing the situation of a group of residents in Vancouver’s MacKenzie Heights who are concerned about the redevelopment of the interesting commercial strip at West 33rd Avenue and MacKenzie. That little commercial area is a walkable retail area with affordable rents. Services include a dentist’s office, a barber, a florist, and an insurance agency, among the eight shops and offices on the block up for redevelopment. A large independent grocery store anchors the block across the street.” 
Sounds great, right? And it is because of its functionality for the adjoining neighbourhood that residents are worried about the impending rezoning and redevelopment of one side of the  block, as they fear that the tenants that currently occupy the shops and offices will not be able to afford to stay.  And those tenants cannot afford to go elsewhere to higher priced commercial space rentals.
The retail  property has been flipped a few times in recent years and there is now a proposal for a three level building with eight luxury units and commercial ground level space. The architect for the site, Ian Egloff  observed “I work very hard to make things better. But I am limited in what I can do.It’s a global market issue more than a local issue. I would love to live in Point Grey, where I grew up. I certainly don’t like the situation, but I don’t see anything that will change it in stopping this project. And the community group hasn’t come up with any viable options that would affect that kind of social change.”
The architect has expressed frustration that the community group is talking about things he cannot change. He can amend and argue for  building height, massing and setbacks, but he cannot provide a place for displaced commercial tenants during the rebuild, or promise affordable rents in the building once constructed. Owned by foreign buyers, it is likely the units will be sold off shore but as the architect said “that is the nature of the housing market…We are basically not a self-sustaining society. There is no other way to provide amenities we need…currently land and development is one of Canada’s biggest exports.”
Even if the commercial units were well priced once built, the merchants displaced by the development cannot go on hold for  four years until the development is completed. Residents also worry that this development will spur more, taking out all the retail use at this intersection. And this is how the unravelling of a commercial community crossroads begins, when the heart of a local shops and services precinct is taken out to provide higher and best value for a foreign buyer’s market. And the price gains on the property have been fantastic-sold to a numbered company for $5.430 in January 2015 it was flipped in four months for a gain of one million dollars.
As the architect bluntly stated “Would these be marketed offshore?’ I said: ‘That’s a possibility.’ And to be honest, that’s quite likely. There isn’t a developer who’s going to find a more lucrative market for their product.”

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Leave a Reply to Sandy James PlannerCancel Reply

  1. Interesting that there is no mention of the new building diagonally opposite to this site which is also street-front commercial with residential above, with it’s main tenant “Butter Baked Goods,” a seemingly thriving “gourmet bakery with sit-down cafe.” Butter is the true economic face of the community, much more so than the storefront services across the street. In a neighbourhood where the house asset values have gone up 10 times as fast a salaries (30x vs 3x over the past 30 years), the only stores that will be able to pay rent on real estate in the long term are the ones that relate to asset holders rather than salary makers, and Butter is much more like that than a barber or insurance agency.

  2. As the city densifies we’re going to need more commercial spaces. The obvious approach is to first add commercial space adjacent to existing clusters like this one so that tenants are not forced away from the neighbourhood while redevelopment takes place. But imagine the outcry if the city expanded commercial zoning around such clusters.
    I still think we should be moving toward commercial/residential streets parallel to existing commercial arterials – especially where they cross other commercial arterials so that we get urban places that are not focused on noisy, smelly roads. Imagine a car-lite, pedestrian and cycling friendly street with shops and services and residential above. Nice places to add density instead of the current push toward putting more people on the least desireable streets.

    1. Agreed with the comment about adding more commercial space.
      The problem here arises because there is short supply of retail space in the immediate area.
      Compare to the situation on Dunbar – Stong’s moved into a new location (in a new development) before its own old building was demolished for redevelopment.
      … and of course there’s the issue of renting versus owning your retail space, which affects both big and small retailers.

  3. “There is no other way to provide amenities we need…”
    A foolish argument. Projects create the need for amenities, not the other way around.
    The architect could refuse the commission on ethical grounds.
    Or City Council could refuse a rezoning or development permit on the grounds that the proposal provides no public benefit to the local community and has a negative impact on existing neighborhood services.
    We ought not to judge projects solely on their visual appearance but also on their contributions or lack there of to a sustainable community.

    1. Remind me: how is it more ethical for an architect to design cheap commercial rental space than expensive commercial rental space?

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  5. “The retail property has been flipped a few times in recent years”
    It would be great to know if this is another case of offshore investors driving up the price of a piece of land through repeated speculative buys.

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  7. So hang on here. Houses in the neighbourhood go up by millions but the people who own them want the commercial real estate to remain cheap enough so that the guy cutting hair doesn’t have to increase his prices. First world problem?

  8. I have come to distrust Kerry Gold’s journalistic integrity. It will be very informative to watch her column over the next while for equitable coverage on the emerging pubic housing initiatives stemming from multiple levels to deal with unaffordability. My guess is there will always be a negative angle to exploit, usually in the absence of truly independent investigative research. She finds an academic to quote, rather selectively at that, usually non-economists drawing conclusions on economic and land planning matters, then runs with a similarly preselected narrative in almost every column: Wealthy foreigners are the only cause of unaffordable housing prices. Ignore all else.
    Frances Bula and Kathy Tomlinson are better at what they do and report factually without leading, rhetorical discussions and repetitive conclusions determined in advance.
    On foreign influence, what about Canadian money working outside our borders? Bosa and Bell Canada (land division) are two of many Canadian real estate developments that occurred in California over the decades. I was assigned a junior role on a 1,500 acre Bell project near Scripps in my first job after graduation (1987). It was an environmental nightmare, literally levelling the hills and shovelling the rubble into the valleys to create level land. Single use zoning. Gated residential enclaves between two asphalted malls. A mesmerizing sameness of beige stucco and garage door architecture. Not a bus stop in sight. I hated it, and left the firm in due course. Canadian mining companies don’t exactly have a good reputation in the Third World either.
    Remember, Canadians can be wealthy foreigners too.

    1. You mean she inconveniently finds facts that don’t fit your narrative. Sad that you’ve descended to the level of crying “fake news” and smearing a journalist’s integrity. How much actual research have you done into the topic versus what Ms.Gold does? If Frances Bula follows this blog I hope she wades in to give you a well deserved upbraiding.

    2. LOL! I’m not promoting a narrative. I am promoting research from several sources, and an open mind.
      In your view it seems to be a “fact” that foreign wealth and speculation are the sole causes of our hyper land values. I think these are having an effect, but there are several other elements at play too. However, I am willing to be persuaded by evidence to the contrary.
      Gold has not provided it, and in fact summarily dismissed things like low interest rates and land supply months ago in her zeal to blame the damned foreigners. And she did it in one line in her Walrus piece. She barely touches on subjects like constraining zoning and diversity in housing types. Further, she and several others relied exclusively on the census regarding the tally of vacant homes, rather than using it with Any Yan’s research, actual BC Hydro readings, Mountain Math’s more extensive analysis, etc. and failed to note the significant differences.
      I suspect the CRA and provincial stats together will provide more accurate data on foreign wealth and income. Gotta wait a little longer for that.

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