2 minute read
Condo Sense
COMMERCIAL AND RESIDENTIAL TUG-OF-WAR IN VANCOUVER
CAMERON MCNEILL
Record low mortgage rates and working from home throughout this past year may have resulted in the flight to space trend we are seeing. But, for anyone who is nostalgic about the Vancouver of 10 years ago, you haven’t seen anything yet! This region will continue to dramatically change. The city will always be an attractive place to live and work, and urban living could soon see further desirability in the eyes of the condo buyers, as we start to see new commercial developments on the rise downtown.
While real estate prices continue to rise across Vancouver, the influx of commercial developments is making the city an even more attractive place to live and work. With new headquarters being developed downtown, more jobs will become available, meaning more people will need somewhere close to live. Vancouver will require a greater supply of residential developments to meet the forecasted increase in demand.
As new commercial spaces open and job opportunities downtown begin to soar, immense pressure will be felt on residential real estate. And let’s not forget, with the 1.2 million Canadians anticipated to land over the next 2-3 years, the downtown condo market will continue to feel the squeeze.
Amazon’s new headquarters, where Canada Post was located in downtown Vancouver, is expected to bring an estimated 3,000 to 6,000 new jobs to the city. Alongside Amazon, there are many other companies planning to open new headquarters downtown, including Microsoft’s expansion, Lululemon’s False Creek location, and Deloitte’s new office on Homer Street and West Georgia Street. These are just a few of the leading examples of what will provide a massive employment surge downtown.
Fortunately, new pre-sale residential development plans are taking shape this year. Block, by Amacon, is going to be a central development on Robson and Cambie, with 30 storeys consisting of one-, two-, and three-bedroom homes. Reliance properties has plans for a 48-storey residential tower, situated next to Burrard SkyTrain Station.
But is that enough? With the average residential highrise taking three-six years from conception to completion, there will continue to be a shortage of housing supply in the downtown Vancouver core, whether it’s in the realm of market housing or rental stock. Presently, rent is roughly 20-25 per cent higher downtown compared to other urban markets where residential values are the same. This existing price point for residential housing paired with a continued expansion of commercial developments is only going to increase the pressure felt in the downtown marketplace.
But let’s not forget, Vancouver has a diverse and strong urban planning environment. However, Vancouver will need a diversity of housing and infrastructure that will open our city for growth, with sensible density and logical locations. Our overall region has significant land supply constraints. As Vancouver grows, we will continue to see a tugof-war between residential and commercial demands.
Cameron McNeill is the executive director of MLA Canada, a comprehensive real estate service provider. MLA Canada o ers an unmatched level of expertise in advisory services, market intelligence, project marketing, sales, customer care and administration. Visit mlacanada.com
