The developer behind a long delayed social housing and condo development next to Vancouver’s Queen Elizabeth Park is asking the city to drop occupancy permit holds on the project, arguing they’re holding up construction.
The request refers to Holborn Property Ltd.’s development on the so-called Little Mountain lands, where 238 former social housing units were evicted after the company bought the site from the province in 2008. The site has sat virtually empty since then.
As a part of the controversial sale, Holborn was required to replace the lost units — later upgraded to 282 new social housing units.
Most of the social housing will be in buildings constructed on BC Housing lots, with the exception of one building with 48 units and a neighbourhood house and civic plaza to be built on a city-owned lot at the site.
The holds, a part of an agreement with the municipality, bar the city from giving the company occupancy permits for its planned market condo units until Holborn completes the social housing agreed to in the first two phases of its development.
“Essentially, people can’t move into a building once it’s built. So an occupancy permit needed to be available to do it,” explained Vancouver Coun. Mike Klassen.
The company, however, says those holds have prevented it from obtaining the financing it needs from the project.
According to a staff report heading to council next week, Holborn wants to launch pre-sales for one building by the end of the year, and intends to submit development permit applications for two other buildings at the same time.
“However, these dates have been delayed due to difficulties obtaining financing for the project as a result of the (occupancy permit) Holds placed on the Phase 1 and 2 Market Lots,” the report states.
“The developer has made it really clear they are going to get that social housing built, but for them to be able to go to the bank and get the financing to get this project going, they needed to come and get the occupancy permits on a couple of their market buildings,” Klassen added.
The staff report recommends the city drop the holds in the interest of getting the project moving and citing BC Housing’s support for the move.
According to the report, BC Housing has “verified that the purchase and sale agreement between Holborn and (thee Provincial Rental Housing Corporation) provides adequate security for delivery of the Social Housing Units on the sites that are intended to be transferred by Holborn to BC Housing after completion.”
The staff report goes on to cite apparent progress in social housing construction at the site in its support for removing the occupancy permit holds.
Holborn has already delivered one building to BC Housing, with a second under construction and two more slated to break ground in spring 2024, the report states.
It further notes that removing the holds would not affect a separate occupancy permit hold related to completion of the building on city-owned land. That project is slated to break ground by the end of 2023, the report states. The change would also not affect occupancy holds on buildings slated for phases 3 and 4 of the project.
While staff recommend eliminating the holds, the report does note a potential risk to the city.
“Releasing the Occupancy Permit holds in the Housing Agreement on the Phases 1 and 2 Market Lots with respect to the completion of the Social Housing Units on the BC Housing Lots reduces the City’s ability to ensure that these Social Housing Units are constructed and
occupied ahead of the market residential units in the Development,” it states.
Asked if he was concerned the city could lose a key measure to hold Holborn accountable on the long-delayed social housing, Klassen said the city would put “a lot of pressure” on the developer to ensure the work is done.
“Anything could happen with a project like this, but there is a huge amount of impetus for all parties to work on this,” he said.
“The developer has made it really clear they are going to get that social housing built, but for them to be able to go to the bank and get the financing to get this project going, they needed to come and get the occupancy permits on a couple of their market buildings.”
The Little Mountain development has been fraught with controversy since its inception.
About 700 long-time residents were displaced from social housing demolished on the site in 2009. Since then just 54 affordable housing units and a modular housing structure have been built on the site.
The developer’s contract with the then-BC Liberal government didn’t close until 2013, and has since been criticized as a “sweetheart deal.”
The contract saw the province sell Holborn the land for $334 million, but also give the company a $211-million loan that remains interest-free until the end of 2026, and did not include any construction deadlines.
The contract also stipulated that Holborn couldn’t build any of its planned 1,400 market condos until it replaced all 234 lost social housing units.
The City of Vancouver finally rezoned the property in 2016.
With files from Travis Prasad