March 30, 2012

Burnaby on pace for blistering growth

A street-level rendering of Metroplace, Burnaby, B.C. Since the city nearly doubled allowable building density in 2010,  Metrotown has become one of the fastest growing areas in the Lower Mainland, with a projected growth of 30,000 more residents and 20,000 more workers over the next 30 years.

Burnaby on pace for blistering growth spurt

Kerry Gold
Burnaby, B.C.— From Saturday’s Globe and Mail
Published Friday, Mar. 30, 2012 12:39PM EDT

The Burnaby skyline is about to be transformed. The city is looking at plans to raise skyscrapers in Metrotown possibly as high as 59 storeys, with plans for more major towers to sprout over the next few years.

Since the city nearly doubled allowable building density in 2010, Metrotown has become one of the fastest growing areas in the Lower Mainland, with a projected growth of 30,000 more residents and 20,000 more workers over the next 30 years, according to Edward Kozak, Burnaby‟s assistant director of current planning. Projects under way include Intracorp‟s 46- storey Metroplace and 38-storey Silver towers, and the accompanying major revitalization of Beresford Street, as well as Polygon‟s 37-storey Chancellor.

There are nine more towers far into the approvals process, and three or four of those are expected to break ground in the next few months.

Metrotown may be experiencing a boom, but it‟s all part of a density plan that goes back to 1977 and has been revised along the way, Mr. Kozak says. Zoning was amended in 2010 to allow
more density in exchange for more amenities and cash contributions, dependent on a high calibre of architectural and public space design. Several of the towers soon to be completed fall under that specialized rezoning.

“I often get the concern raised, like, „Wow, this is unprecedented growth,‟ says Mr. Kozak, “People are shocked when I tell them… it‟s not unanticipated. It‟s very deliberate. There have been peaks and valleys. Right now, this is a peak.”

Like Richmond, Metrotown is a major draw for the Mainland Chinese demographic that appreciates proximity to major amenities, shopping and transit. The Metrotown SkyTrain station is the second busiest in the region. Much of Metrotown already caters to a Chinese customer base, such as the Crystal Mall.

With a revised area plan under way to handle the increased density, Metrotown is shaping up to be a more vertical and dense, urbane neighbourhood. It is going beyond its claim for having Canada‟s second biggest shopping mall and becoming an urban core, complete with restaurant, hotel and shopping destinations intended to draw residents. But if they should want to go to downtown Vancouver, it‟s 20 minutes away on the SkyTrain, making Metrotown a commuter hotspot for residential development. To take advantage of the extra density permitted, however, developers have to offer something special in return, other than amenities such as a seniors‟ centre or daycare.

“They are going to have to provide something much more unique, in terms of architecture,” says Mr. Kozak. “Most importantly, the developer will have to contribute to the community in more ways than just redeveloping a site.

“We are trying to create a compact urban core that is walkable, and linked to the rest of the
region through transit,” adds Mr. Kozak.

To that end, a percentage of the new units will even receive two-zone transit passes for two years.

For developers, Metrotown is already a dream situation. They say the cost of doing business is generally lower than pricey Vancouver. And the city process there is more streamlined than Vancouver‟s project-by-project negotiation.

“You don‟t have to negotiate with [Burnaby], it‟s embedded in their development plans, it‟s a
formula,” says Intracorp president, Don Forsgren. “You know where you will end up in costs.”

Intracorp has already built five towers in Metrotown. They currently have three more in the works, including Metroplace, of which 85 per cent sold in three weeks, under construction, as

well as Silver, about to come to market this month, and another tower in the final approval process.

While a condo might run $750 per square foot in Vancouver, a comparable unit in Burnaby is in the neighbourhood of $500 to $600 per square foot.

“There aren‟t a lot of choices in Vancouver for housing at that kind of price point,” says Mr.

Bosa president, Daryl Simpson, whose 43-storey Sovereign project sold out last year in one day, echoes the sentiment that it‟s easier to do business in Burnaby. Sovereign, which includes retail and a hotel, has a total market value of $190 million.

“Certainly we have good relationships with all municipalities, but Burnaby is a great place to do business. Is it easier than Vancouver? Yes it is, actually. Vancouver is more complicated, no question. Certainly the Burnaby density formula makes it more attractive to developers. But the City of Burnaby makes it easier.”

Urban Analytics‟ Michael Ferreira, analyst for the industry, concurs that part of the reason
Burnaby‟s Metrotown is booming is because the process is generally faster than elsewhere.

“It‟s one of the fastest growing and one of the most active neighbourhoods,” says Mr. Ferreira. “Vancouver is slower [for development] and it‟s a function of the cost of doing business in Vancouver. It‟s a lot more expensive to get into the market there for developers, so you are limiting the number of players to those that already have deep enough pockets to wait out the process.”

Mr. Simpson adds that another draw is that for the Chinese market, Burnaby‟s Metrotown is
shaping up to be a flashy microcosm of a major Chinese city.

“If you think about Shanghai, Beijing, or other major Chinese cities, Chinese people generally like things that are big and bold, and new and striking, and increased densities that the City of Burnaby has adopted in the last year have really capitalized on that form of development.”

Some developers say the boom is also due to recent Asian tsunamis, and the small earthquake on the West Coast last fall. Richmond, a long-time popular destination for the Chinese market, has a high water table. As a result, some believe Burnaby projects got a boost in popularity from that segment of the market.

“I think Burnaby may surpass Richmond in terms of the achievable sales values for condo product…. it‟s the higher ground mentality,” says Mr. Ferreira. “People didn‟t stop buying in Richmond, but it gave people pause for thought.”

And then there‟s the not-so-little issue of allowing density, although Mr. Kozak says that isn‟t the city‟s chief aim.

“What they are after is a vibrant community, and a vibrant community happens to have a lot of density in it,” says Mr. Kozak.

High-profile condo marketer Bob Rennie is also getting in on the act.

He is launching presales this fall for the Wall Centre Central Park near Joyce SkyTrain station, not far from Metrotown. The project will be comprised of three towers and 1,100 units.

But the largest scale project goes to Anthem Properties, which has embarked on a joint venture with the Beadie Group, called Station Square. They are the ones with plans for that 59-storey tower, already located on one of the highest points in the Lower Mainland. It will rival Vancouver‟s Shangri-La in terms of height, though the details are still to be determined. The 12- acre, five-tower project, which includes 1.5 million sq. ft. of residential, 300,000 sq. ft. of retail, and 150,000 sq. ft. of office space, goes to market in a few months. It is awaiting final approval. By the time it‟s complete, it will have been an eight-year project, says Anthem‟s head of sales, Greg Zayadi, whose company has owned the property for a decade.

“Ours is more comprehensive than the rest. We are going to be at this for a long time.”

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