Joel Baglole
Sun
VANCOUVER – The amount of industrial land in Vancouver has been reduced by 37.8 per cent over the past 44 years as city council has rezoned property for residential use. But the steady erosion of the city’s industrial base now has some municipal politicians and business leaders worried that the change is hurting Vancouver‘s tax base and reputation as a business centre.
Today, there are approximately 1,600 acres of industrial land in Vancouver, compared with 2,570 acres zoned for industrial use in 1960, according to city planning officials.
Major industrial areas in False Creek, Coal Harbour, Arbutus and Metrotown have been turned into trendy neighbourhoods and suburban communities.
While the change might sit well with urbanites who live downtown, it is raising serious worries among the business-minded.
“Industrial land is a huge pillar of our economic base. If we erode that pillar we undermine our economy and our business base,” says Sam Sullivan, a Vancouver city councillor.
Sullivan is not alone in his concern.
Bob Laurie, vice-president of real estate services at C.B. Richard Ellis Ltd., a real estate advisory firm, says the loss of Vancouver‘s industrial base is a “disaster” for the city’s economy and future.
“We’re committing economic suicide,” he says. “If this continues, Vancouver will become the retirement centre of the world because of our preoccupation with lifestyle. People will only come here to retire because there will be no more jobs in the city.”
The latest industrial area to be converted to a residential neighbourhood is 126 acres in the East Fraser Lands, located in the southeast corner of the city on the Fraser River. Site of Weyerhaeuser’s White Pine sawmill until it closed in 2001, the land is now owned by Parklane Homes Ltd., a developer that plans to turn the area into a residential community capable of housing 10,000 people in a mixture of condos and townhomes. There are also plans for parks, schools and retail stores in the new neighbourhood.
Vancouver city council has approved the project and Parklane Homes plans to begin construction in 2007.
But the problem with transforming industrial areas such as the Fraser Lands into residential neighbourhoods, critics say, is that it eliminates jobs, reduces the city’s tax base and impacts the ability of Vancouver to provide services in the downtown, whether that be moving goods inland from the port or supplying food to city grocery stores.
“I think there is a legitimate fear over the erosion of industrial land in this city,” says Dave Park, chief economist with the Vancouver Board of Trade. “We’re losing industries and jobs to outlying places like Richmond and Burnaby.”
Industrial businesses pay the highest property taxes. For every $1,000 of assessed property value, major industries in Vancouver pay $28.58 in property taxes, according to the city’s tax department. That’s nearly 10 times more than homeowner tax rate of $3.06 for every $1,000. Business offices and retail stores pay $16.75 per $1,000.
Despite paying the highest taxes, industrial businesses contributed only $10.7 million — or about 2.5 per cent — to the $433.7 million in total property taxes collected by the city in 2004. Business offices and retail stores contributed the majority of property taxes at $229 million, while residential property taxes added $187.6 million to city coffers.
“Not only have we lost jobs, but we’re replacing the highest property tax regime with the lowest property tax regime,” says Laurie, the real estate adviser.
In their defence, city officials say the transformation has been a deliberate attempt to create a “job-housing balance” in Vancouver.
Ann McAfee, co-director of planning with the city, says “There’s been a concentrated effort to put more houses within walking distances of jobs.” She also notes that many land conversions have followed the loss of industries such as shipbuilding and sawmills that will never return to downtown Vancouver. However, she acknowledges that, “The residential areas have developed much faster than we anticipated,” especially since most industrial land is located on desirable waterfront property.
City council plans in 2005 to conduct a major review of land use and land requirements and develop a strategy for future zoning of land in Vancouver, McAfee says.
“It’s very much a balancing act that has to be continually re-evaluated as new demands come on the city,” she says.
However, Park says industrial land is now at a minimum level and that city council should be aware of a growing trend known as the “reverse commute.”
“Now you have the reverse commute happening, where people live in Vancouver but have to commute out to Richmond or Burnaby for work because that’s where the industries and jobs have gone,” he says.
© The Vancouver Sun 2004