Bob Laurie
Sun
Despite the optimism of the 2010 Olympics and the sense of pride at regularly being named the most livable city in the world, Vancouver faces a grim future.
Our disregard for the importance of industrial land will turn Metro Vancouver into the retirement community of the world, where only the extremely wealthy can afford to live and there are few jobs paying a living wage.
It is no secret that Metro Vancouver is running low on industrial land, but few are aware that the situation is reaching crisis level. The vacancy rate for industrial land in the Lower Mainland stands at 1.3 per cent and industrial land rezoning has virtually stalled. If we carry on down this path we will have no industrial land supply left in 10 years time.
What does this mean?
For businesses the impact is dramatic, with many being priced out of the market. The shortage of industrial land has led to skyrocketing prices that are becoming untenable. Lease rates have shot up by approximately 25 per cent over the past two years, with industrial land prices in Surrey generally, its Campbell Heights area and East Vancouver increasing by 100 per cent, 114 per cent and 135 per cent respectively.
A dramatic example: One acre of industrial land in Surrey’s Port Kells now sells for more than $1.5 million. In south Vancouver and Burnaby some industrial land has reached $3 million per acre, among the most expensive in North America. Most businesses can’t afford to operate in Metro Vancouver and will head for other centres such as Calgary, where thousands of acres of industrial land will be ready to develop by next year and where industrial land costs roughly $1 million per acre less than it does here.
For the average family, the effects are just as drastic. More waterfront condos are well and good, but most people need places to both live and work. Industrial land is the backbone of our economy. As industry disappears from the Lower Mainland, so does the business tax base, meaning residents will be forced to pick up an increasing percentage of the tax burden. So will the commercial and service businesses that support industry and all the jobs that go with them.
This is not just a local, regional or provincial issue — it has national implications. The future of the federal and provincial Asia-Pacific Gateway strategy is dependent on Metro Vancouver having enough industrial land to grow our port and our airports, and for the adequate movement of goods into and out of the region. Our infrastructure is part of what makes Metro Vancouver a great port city. However, our current approach to industrial land will doom the Gateway strategy to failure.
We are faced with this grim future for a number of reasons:
– Flawed data: Metro Vancouver’s Sustainable Region Initiative uses flawed data from the Industrial Lands Inventory of Greater Vancouver that grossly overestimates the amount of industrial land still available, so the starting point of the discussion is misinformed.
– Mismanagement: Many Metro Vancouver municipalities look only to the short-term gains of higher residential and commercial land values, assuming their peers will fill the industrial land void. This demonstrates a complete lack of policy direction at the regional level to support and protect industrial lands.
– Lack of rational discourse: Fifty-five per cent of all usable land in the Lower Mainland remains in the agricultural land reserve and can’t be touched — whether it is being used for agriculture or otherwise. The mere mention of using such land for industrial purposes typically ends all rational discourse.
– Industrial isn’t sexy: Metro Vancouver prides itself on its abundant green space, but industrial land is the foundation of any healthy economy. It is industrial land that pays for our healthy lifestyles and our diverse and sustainable economy.
Previous industrial land strategies have not protected Metro Vancouver’s future and this trend is continuing. If we don’t act now to protect and enhance our industrial land base, within the next decade our industrial land supply will be gone forever — something that will put our region’s economic future in peril.
Any solution to our industrial land crisis must respect the ALR. But we need to be able to have an open and rational discussion about the assets we have and how we can best allocate them to create a truly sustainable future.
We must have a real discussion about the industrial land issue now or we will become the Palm Springs of Canada, forcing all but the wealthy to live somewhere else.
Bob Laurie is president of W.R. Laurie and Associates in Vancouver.
© The Vancouver Sun 2008