Vancouver City Council enables phased Oak Street condo project to improve viability | Daily Hive

Vancouver City Council modifies conditions to enable phased four-building Oak Street condo project, improving financial viability

Concept of Frank at 8029-8225 Oak St. and 1012 West 64th Ave., Vancouver. (Arno Matis Architecture/Enrich Developments)

As another example of the challenging economic conditions for constructing new housing, Vancouver City Council has provided a sizeable condominium project in the Marpole neighbourhood with some relief through new flexibilities in fulfilling its obligations.

Without any debate today, City Council swiftly approved City of Vancouver staff’s recommendations allowing a mid-rise, four-building residential and commercial project along Oak Street to proceed in two phases, with adjusted cash Community Amenity Contribution (CACs) payments intended to improve the project’s financial viability and support the City’s overarching housing supply goals.

You might also like:

The project at 8029-8225 Oak St. and 1012 West 64th Ave. — situated at the southwest corner of the intersection of Oak Street and West 64th Avenue, replacing 12 single-family houses — originally saw its rezoning application approved in a public hearing in February 2023.

8029-8225 Oak Street 1012 West 64th Avenue Vancouver

Site of Frank at 8029-8225 Oak St. and 1012 West 64th Ave., Vancouver. (Arno Matis Architecture/Enrich Developments)

8029-8225 Oak Street 1012 West 64th Avenue Vancouver Frank Condos Enrich Developments

Site of Frank at 8029-8225 Oak St. and 1012 West 64th Ave., Vancouver. (Arno Matis Architecture/Enrich Developments)

Vancouver-based Enrich Developments is marketing the property under the name of “Fränk.” The complex of buildings spanning nearly the entire length of the city block is designed by Arno Matis Architecture.

There will be three six-storey buildings and one eight-storey buildings, generating a total of 200 strata market ownership condominium homes and about 10,000 sq. ft. of retail/restaurant space within the ground level of the two southernmost buildings.

Amid challenging market conditions marked by rising construction costs, high interest rates, suppressed housing demand, and reduced investor confidence, the project’s developer requested to subdivide the site into two separate lots and move forward in two phases rather than one. According to City staff, this approach would make it easier to secure financing and allow construction to begin sooner.

Under the initial plan, the developer was required to provide a cash CACs payment to the City of $16.55 million to support the delivery of the Marpole Public Benefits Strategy, payable before the enactment of the rezoning bylaw. The now-revised approach enables splitting this payment in line with the phased construction schedule.

Concept of Frank at 8029-8225 Oak St. and 1012 West 64th Ave., Vancouver. (Arno Matis Architecture/Enrich Developments)

Specifically, following City Council’s approval today, a payment of approximately $6.8 million will be made prior to rezoning enactment for the first phase, covering two buildings. The remaining balance of $9.75 million would be deferred and secured, with payment due before either the issuance of the stage one building permit for the second phase or 24 months after bylaw enactment, whichever comes first.

To protect the City’s interests, the outstanding balance will be secured through legal agreements, including a deferred CAC agreement, covenants, and at the City’s discretion, a Surety Bond or letter of credit. Interest would accrue at prime plus one per cent, payable quarterly until fully settled.

Last month, City Council also approved City staff’s broader policy strategy to defer cash CACs and Development Cost Levy (DCLs) payments, providing developers with a longer runway to fulfill these obligations to the City. As well, as a measure to free up capital for more productive uses such as construction financing the City will expand the use of Surety Bonds as an alternative to the letter of credit.

Earlier this month, the provincial government also introduced similar measures that give developers significantly more time to pay fees to municipal governments and expand the use of Surety Bonds.

Concept of Frank at 8029-8225 Oak St. and 1012 West 64th Ave., Vancouver. (Arno Matis Architecture/Enrich Developments)

You might also like: