3 Real Estate CEOs on Vancouver Mayor-Elect Ken Sim and His Plans for Housing

HOWARD CHAI, VANCOUVER INSIDERS, STOREYS, PUBLISHED OCTOBER 25, 2022

The City of Vancouver certified its election results last Wednesday, officially crowning Ken Sim as Mayor-Elect, and bringing Kennedy Stewart’s tenure and a contentious election cycle to an end.

Sim will be armed with a strong majority, joined by all seven of the ABC Vancouver city councillor candidates that he ran with: Sarah Kirby-Yung, Lisa Dominato, Brian Montague, Mike Klassen, Peter Meiszner, Rebecca Bligh, and Lenny Zhou. The 10-member city council will be rounded out by Adriane Carr, Christine Boyle, and Pete Fry. (Kirby-Yung, Dominato, Bligh, Carr, Boyle, and Fry are retaining their seats.)

Sim and the party he founded will also have a majority on the park board and school board.

Housing affordability was widely-identified as the top voter concern heading into the election, but it appears that public safety was the issue that brought people out to vote. Sim’s promise to hire 100 new police officers and 100 new mental health nurses — although not entirely within the powers of the municipal government — was the most-publicized aspect of his platform.

On the issue of housing, when Stewart asked him to name the provincial and federal housing ministers during a pre-election debate, Sim famously responded by saying “I don’t know, but it doesn’t really matter.”

ABC Vancouver’s platform does include many points related to housing, however, with Sim placing particular emphasis on speeding up permitting. That happened to be the top concern for businesses, according to a poll conducted by the Greater Vancouver Board of Trade in early-September, so STOREYS spoke to the heads of three prominent real estate companies in BC to get a sense of how the industry is feeling about Vancouver’s incoming Mayor and ABC Vancouver’s promises.

We sat down with Jacky Chan, Founder and CEO of BakerWest Real Estate, a sales and marketing company; Toby Chu, Chairman and CEO of CIBT Education Group, the parent company of student-rental developer GEC Living; and Jon Stovell, President and CEO of Reliance Properties, developers of projects such as Burrard Place.

Immediate Reactions

“My immediate reaction to Ken Sim’s victory is excitement and hope for Vancouver’s real estate industry,” said Chan, of BakerWest. “I believe many, both within our industry and outside of it, are looking for a fresh new perspective on Vancouver’s housing challenges.” Asked about his sense of whether others in the industry feel the same way, Chan said: “Should Ken Sim deliver on his campaign promises, many in the industry feel that we can begin to address key issues in Metro Vancouver that have stifled growth and opportunity.”

And that “new” perspective is one that Chu, of CIBT, is also optimistic about.

“We are pleased that the new Mayor sees the root of the housing shortage problem as not a lack of will by the developers, but a result of red tape and delays discouraging developers from investing their time and energy in rental developments,” he said. “Everyone is spinning wheels without acknowledging the fundamental cause of the supply shortage, amplified by high demands.”

Asked how he would summarize the industry’s reaction, Chu said he believes that they’re “positive that ‘any change’ is better than the current process of five to seven years from rezoning to possession, which is an unacceptable standard compared to other world-class cities.”

That red tape and years-long process, along with supply chain issues, labour shortages, and construction costs have been repeatedly cited by developers and those in the industry as a big culprit behind Vancouver’s housing supply shortage, all of which were exacerbated by this year’s increases in interest rates.

Stovell, of Reliance Properties, shared his optimism, and was particularly content with the fact that ABC Vancouver will have a strong majority on city council. “We support all political parties,” he said. “We may not like everything they do, but I like the majority.” Stovell believes that with a majority on council, the City should be able to get things done much faster.

This is in contrast to the split council that outgoing-Mayor Kennedy Stewart had to work with, which was made even more difficult by the fact that he ran and won as an independent. In debates and interviews, Stewart has repeatedly referred to the split council as something he had to get things done “in spite of”. That was also the reason why he formed and ran with a party, Forward Together, this time around.

Stovell says he believes Stewart had a “decent record” on housing, and that he doesn’t believe the industry really had much preference between Stewart and Sim; however, he again highlighted ABC Vancouver’s strong majority, and pointed to the 10-year run Gregor Robertson had as Mayor between 2008 and 2018, when he and his party, Vision Vancouver, had a majority on council, and when Stovell believes the development industry was most satisfied.

If people don’t like what ABC Vancouver does, then vote them out in four years, he says, but at least there should be more action and less time wasted.

Permitting and Promises

During the election cycle, a point of emphasis for Ken Sim was what he called a “3-3-3-1 permit approval,” whereby it would take three days to approve home renovations, three weeks to approve single-family homes, three months to approve multi-family and mid-rise projects, and one year to approve high-rise and large-scale projects.

Stovell described this approach as “very ambitious”, but noted that ABC Vancouver hasn’t said much when it comes to projects that require rezoning, which are often more complex. He also says that Ken Sim and ABC Vancouver “may be surprised at how hard it is to affect change” and that their strong majority is also a “double-edged sword” because they won’t be able to claim that they had a dysfunctional council.

Chu was also reluctant to get too excited about the permitting promise, saying he is “skeptical about the 3-3-3-1 plan” but also that he was “pleased to see the intent.”

“The current approval process is in place for good intention, but the good intention is delayed by the lack of resources,” Chu said. And it’s not just the City of Vancouver. “Most municipalities deal with,” Chu said, “a lack of resources to expedite, review and approve even the most basic applications. Our experience has been consistently discouraging across most municipalities. In addition to delays, we also dealt with a constantly moving goalpost. We have large-scale projects in two other municipalities outside of Vancouver, and both are reaching their fifth year of the rezoning phase due to the City’s ongoing demands and new requests.”

Chu says these projects could accommodate up to 1,000 rental tenants, but notes that it’s these kind of high-rise projects that have the worst delays, especially when rezoning is involved. He says that expediting low-rise and mid-rise buildings is like “putting out a forest fire with a water pistol,” whereas “high-rise rentals can create volume and achieve results more quickly and address the vast shortage of rental inventory.”

Chan also agreed with the intent of Sim’s permitting plan. “I believe that Mayor Sim’s 3-3-3-1 permitting system is not only attainable, but necessary,” he said. “Other BC municipalities have successfully shortened their permitting timelines, and there is no reason to believe Vancouver cannot achieve this. If city hall is willing to facilitate shorter permitting times and work with industry experts to approve high-quality, sustainable developments, we can begin to make headway in addressing housing challenges in Metro Vancouver.”

Stray Observations

STOREYS also asked each CEO whether the election results in any other municipality caught their attention. Here’s what they said. [Toby Chu was out of the country and could not provide an answer.]

Chan: “I am interested to see what happens in Port Moody with new Mayor Meghan Lahti. Port Moody’s outgoing mayor and council seemed always to have challenges in proceeding with new developments and managing growth. I think that Mayor Lahti has an opportunity to work with the industry to provide innovative and intelligent housing options for the community.”

Stovell: “In Victoria, not a single councillor came back and there’s a new mayor [previously a councillor]. Langford’s mayor was ousted. Same in Kelowna. It looks like some municipalities doing well in growth were told to slow down.”

Repost from Storeys, https://storeys.com/ken-sim-abc-vancouver-election-victory-real-estate-insider-reactions/