Residents argue Vancouver council set worrying precedent on below-market rentals

The Cambie Corridor Neighbourhood Association (CCNA) has taken the City of Vancouver to court in an effort to overturn its decision to waive below-market housing requirements for a rezoning that council approved in early July.

The development by Sightline Properties at West 29th Ave. and Ash St. would see 230 purpose-built rentals built. But none of those units would have rents set to below-market rates, despite a policy requiring it in transit-oriented areas.

In a petition to the BC Supreme Court, the organization is arguing for the decision to be overturned and sent back to council for reconsideration.

The CCNA argued the decision to waive the below-market housing requirement wasn’t reasonable, and was based on a pro forma economic analysis of the development that wasn’t available for councillors or the public to scrutinize.

That analysis determined the land value lift from the increased density wasn’t enough to justify inclusionary below-market requirements. But CCNA argued a private developer’s finances were irrelevant to the point of below-market rentals.

“If Sightline was not able to provide the minimum public benefits required by the TOA policy, it should not have been entitled to the benefits of increased height and density under that policy,” the petition reads.

“Council's decision to prefer the developer's return on investment over the city's own policies and the broader public interest, including it securing affordable housing is contrary to the TOA policy and the CAC policy and is unreasonable.”

One CCNA member raised questions in the July public hearing about whether this could set a precedent for future developments to bypass those rules.

Because the site is within 800 metres of the King Edward station along the Canada Line, the city’s ability to turn down the development based on its height and density is limited by the provincial government’s transit-oriented area (TOA) legislation.

While the city can’t block the Sightline project for its height or density — at six storeys and 3.0 floor space ratio (FSR), a measure of a development’s density, it fits in the TOA legislation’s scope — the city can block projects for other reasons.

In response to the law, council approved its transit-oriented development policy last June, which included, among other things, a requirement for projects to include 100% secured rental housing.

It also requires 20% of a project’s floor area to be rented out at rates 10-20% below city-wide average rents. In exchange, the policy waives community amenity contributions, which is money that goes towards amenities like community centres or parks.

The site was rezoned in 2018 for three-storey townhouses, according to the CCNA’s petition to the court. And the site has been empty since six single-family houses were demolished in 2023, according to a May 20 city staff report.

Sightline returned to council in July 2024 for another rezoning. Originally, the city responded to questions in an online Q&A in November last year, saying the project would be 100% secured rental and meet the requirement for 20% of floor space to be rented out at 10% below city-wide average rents.

By the time of the May 20 report, staff recommended the project be approved with no below-market housing requirements.

City staff noted in their May 20 report that a pro forma analysis found the three- to six-storey rezoning would not lift land values on the site enough to support the inclusionary below-market zoning requirement because the site was already zoned for higher density than much of its surrounding area.

Twelve people, including CCNA members, spoke out against the proposal at the July public hearing. On top of the below-market housing waiver, opponents also raised a number of common qualms with developments — traffic, parking and school capacity.

Coun. Sean Orr asked staff if the incremental zoning, from single-family housing to townhouses in 2018 and then its more recent rezoning, could be replicated elsewhere as a loophole.

City staff’s response didn’t address the question of whether this process could be replicated, only repeating that the current rezoning didn’t provide a land value lift that would justify below-market housing.

Orr also asked about seeing the pro forma, but staff said they can’t share that because it contains the developer’s confidential financial information.