CRD affordable housing and CRD parks services Q&A with Stephen Henderson of the CRD
Ten on the 10th
Published November 10, 2020
Citified's Ten on the 10th is a monthly question-and-answer segment connecting our readers with the insight and knowledge of Victoria's top real-estate and business professionals.
November's Ten on the 10th features Stephen Henderson, the Manager of Real-Estate Services at the Capital Regional District.
Asking the questions is Ross Marshall, Senior Vice President of the Victoria offices of commercial real-estate brokerage CBRE. As a leader in facilitating large-scale commercial real-estate transactions throughout the Capital Region – which include apartment complexes, industrial retail and office properties, and land/development opportunities – Ross and his team are at the forefront of market-leading real-estate transactions on Vancouver Island.
Would you like to be featured as part of a future Ten on the 10th Q&A? We'd love to hear from you.
There are two properties on Viewfield Road in Esquimalt purchased some years ago by the CRD for the Core Area Wastewater Treatment project, which were recently sold. Can you elaborate on the sale of these properties?
The two Viewfield Road warehouse properties that were initially purchased for the Core Area Wastewater Treatment project, prior to my employment at the CRD, were sold for over $22 million dollars. We realized early in our ownership that the industrial demand for large warehouse buildings in the core had changed and we shifted towards securing several smaller tenants that generated a cash flow that was attractive to investors. We were able to sell one property in 2019 and the second in 2020. We realized a $3.7M gain and we thank CBRE for their assistance as the listing agent involved in the lease-up and the sale.
The CRD's Core Area Wastewater Treatment project has been discussed for many years. How is this project progressing?
The Core Area Wastewater Treatment project is nearing completion and going through commissioning (testing). This means we are actually treating wastewater during this testing phase. We remain on schedule to meet our regulatory requirements by the end of the year. Tertiary treatment is one of the highest levels of treatment and will reduce many pharmaceuticals, hormones, microplastics and other contaminants left after secondary treatment. The project construction is winding down and the CRD is now focused on operations, as a result some of the temporary office space and staging areas are being vacated, and staff are relocating to the new facilities. This is the largest capital investment in the CRD at $775 million.
The CRD operates the Capital Region Housing Corporation (CRHC). Can you expand on the CRHC’s role?
The CRD delivers housing projects through the Capital Region House Corporation (CRHC) with Kevin Lorette as the General Manager. The CRHC is a wholly-owned subsidiary of the CRD. Its mandate is to develop and manage affordable housing to meet the needs of people living within the Capital Region.
The primary activities of the CRHC are the day-to-day management of housing, providing property management services, and providing services to residents who live in 46 housing complexes across seven municipalities. The current mix of tenants is about 70% rent geared-to-income, and 30% near-market rent.
As the largest social housing provider in the Capital Region, the CRHC delivers affordable, attractive, inclusive, and sustainable housing. The CRHC provides low and moderate-income families with safe, suitable homes that remain affordable as their lives and families change and grow. The CRHC also provides affordable housing for low-income seniors and people living on government disability pensions. Another important role is that the CRHC works with developers to manage affordable housing covenants on behalf of municipalities.
The CRHC is also committed to increasing affordable housing opportunities for individuals and families, especially for those in core housing need. To that end, the CRHC has been reviewing its current housing stock while looking for new opportunities.
The CRD is involved in quite a number of affordable housing developments, but in different capacities. Can you explain the Regional Housing First Program and how it leverages funds?
The CRHC owns and operates almost 1500-units in projects throughout the Capital Region. A major program that is currently being delivered is the Regional Housing First Program (RHFP). The RHFP program was initiated in 2017. This is an innovative partnership between the CRD, the BC Government and the Government of Canada to eliminate chronic homelessness and generate new rental housing options on southern Vancouver Island and surrounding Gulf Islands.
The program aims to meet a broad range of housing needs while moving at-risk individuals into long-term, tenant-based, supported housing to enable recovery and integration into society. The program avoids the need for dedicated support programs in specific locations. Instead, where required, flexible, mobile services will be delivered within the housing units located throughout the region.
The Regional Housing First Program will invest up to $120 million toward projects that meet a variety of housing needs. The mix of rent levels will be: 20% provincial income assistance units, 31% affordable units and 49% near-market units. The provincial income assistance units will be offered to individuals who are experiencing homelessness and are ready to live independently with ongoing supports. The rent for these units will be set at the provincial income assistance rate of $375 per month. This model avoids the need for dedicated support programs in specific locations. Instead, Island Health will deliver flexible, mobile services based on the individual needs of people living in the housing units. This approach helps empower individuals, reduce stigmatization and creates more options for individuals seeking supported housing.
The program’s Request for Proposals (RFP) process provides non-profit and private developers the opportunity to propose viable projects that meet the program criteria. CRD and BC Housing will purchase housing units to secure their respective long-term investments. Placement of tenants will be managed through a partner-led, coordinated assessment and access system. By purchasing units up-front, the CRD and BC Housing will reduce the proponent's need for debt financing of those units, which frees up funds that can go toward operating costs only. Proponents will also be able to access low-interest construction financing via BC Housing or Canada Mortgage and Housing Corporation (CMHC). Revenue from all units will cover the operating and maintenance costs.
In order to provide opportunities for development partnerships or to allow for the direct development and construction of projects, BC Housing and the CRD are pursuing land opportunities. The criteria for assessing land acquisitions includes whether or not the property is zoned for multi-family housing, situated within one kilometre of transit, and close to services.
Can you provide us with a status updated for CRHC/CRD housing projects?
I can provide a quick list that I think would be of interest. The recently completed projects include:
- Millstream Ridge in Langford, with 132-units completed in 2019
- Westview in Saanich, with 73-units completed earlier in 2020
- West Park in View Royal, with 152-units planned for completion in December 2020
- Spencer Close in Langford, with 130-units planned for completion in December 2020
Projects in progress under the Regional Housing First Program which involve a partnership with BC Housing and CMHC include:
- Cedar Grove in Victoria, with 72-units
- Charters Road in Sooke, with 75-units
- Drennan and Sooke Road in Sooke, with 170-units
- Croftonbrook on Salt Spring Island, with 56-units
- Hockley House in Langford, with 120-units
How does the Procurement work for the Regional Housing First Program?
CRD/CRHC projects for the Regional Housing First Program are vetted through an RFP that closes every 3 months with a rolling closing date. Projects are reviewed at a partnership meeting with BC Housing, CMHC and CRHC to ensure the development will meet the programs needs for location, size, scope and unit mix, as well as meet financial targets that focus on financial sustainability.
We have screened over 100 projects throughout the region from Salt Spring Island to Sooke. The next RFP closes for new projects at the end of January 2021. Typically we would work with potential proponents in advance of their submission to ensure they understand what we are seeking. A link to the RFP website is available here.
Can you detail the CRD's efforts with respect to the federal government's Rapid Housing Initiative?
The CRD is asking local municipal and electoral area staff to identify appropriately zoned land or properties that meet the criteria for funding under the Government of Canada’s Rapid Housing Initiative (RHI). The RHI was announced on October 27 and $13.1 million was allocated to the CRD to help house people experiencing homelessness in our region. This amount of funding is intended to assist in 52-units of permanent housing.
A letter was sent to local area municipal administrators on October 30 that requests for them to identify appropriately zoned land that could be contributed or is for sale, or to identify existing properties that are for sale, that could be used in a regional effort to develop more affordable and supportive housing projects. We have also been communicating with many market developers and real-estate professionals. The CRD must develop and submit an Investment Plan to the Canada Mortgage and Housing Corporation (CMHC) by November 27, 2020 outlining the capital projects that will be built as part of the program.
The funding can be used for the following purposes:
- acquisition of land and the construction of affordable multi-residential modular housing units;
- acquisition of land and buildings for the purpose of conversion of non-residential into affordable multi-residential housing units; and
- acquisition of land and buildings in disrepair or abandoned for the rehabilitation into affordable multi-residential housing units
CRD staff have also engaged BC Housing to explore the potential to leverage the funding with other provincial programs.
Once approved, the CRD will have only 12 months to complete and have projects occupied with qualified tenants. Should the CRD not achieve the agreed upon building completion or occupancy targets, CMHC may request that unused funds be returned. The CRD is committed to working with partners and other levels of government to leverage resources in order to create more housing directed toward improving the quality of life of vulnerable people experiencing or at acute risk of experiencing homelessness.
Can you speak to the recently completed Summit at Quadra Village seniors housing project on Hillside Avenue?
This project was managed by Michael Barnes who is the Senior Manager of the Capital Region Hospital District (CRHD) and Kevin Lorette, General Manager. The Summit at Quadra Village is a state-of-the-art complex care facility, designed and built by the CRHD on behalf of Island Health. Located on Hillside Avenue between Quadra and Blanshard streets, it provides 24-hour care and support to 320 residents with complex long term needs. The Summit was built to replace the aging Oak Bay Lodge (which had a capacity for 243 residents) and Mt. Tolmie Hospital (with capacity for 77 residents) and received its occupancy permit on January 31, 2020. The Summit has been leased to Island Health for 25 years. This new project complements a CRHD-owned development near Uptown Shopping Centre on Carey Road that is operated by the Baptist Church.
Switching gears, can you tell us about any recent acquisition activities by the CRD’s Park Services?
The CRD has a Regional Parks Service that is managed by General Manager Larisa Hutcheson and Senior Manager Jeff Leahy. They manage the Regional Parks system across the entire CRD that includes Thetis Lake, Sooke Potholes, Elk and Beaver Lake, Island View Beach and several others parks. Also, the CRD has a Community Parks Service that covers the rural areas outside of municipalities in the Juan de Fuca Electoral Area and on the Southern Gulf Islands.
The CRD is continuing to acquire park land throughout the region. New parkland is a mix of acquisitions, land donations, and subdivisions that put aside land for park use. The CRD recently acquired 103-acres on Mayne Island for our Regional Parks. This acquisition included a $105,000 donation from the land owner, and a $50,000 donation from the Mayne Island Conservancy. Another recent acquisition was a 75 acre property owned by Money Family Projects Ltd (MFPL) since 1945. The land was valued at $759,300 and MFPL donated the majority of the value to the CRD subject to receiving a donation receipt for $506,000 and financial compensation of $253,000. The CRD was pleased to receive a cash donation of $253,000 from a separate donor to enable the acquisition to be completed. The property includes Money Lake on Saturna Island and will benefit the Saturna Community Parks and Recreation Service and the CRD Lyall Harbour Boot Cove Water Service.
Additional park land acquisitions continue to be considered and are progressing across the CRD. The CRD has a land acquisition strategy to direct expenditures with a focus on making existing park lands larger and connected.
You mentioned park land donations. Can you elaborate on this?
The CRD has what we call a Legacy Program. We annually receive requests from land owners who are interested in donating their lands to either the CRD’s Community Parks or Regional Parks services. We work with the land owners to better understand their interests. Occasionally these opportunities become immediate acquisitions, or alternatively some landowners prefer to continue to reside on their estate and we can provide a life estate, and some landowners prefer to offer their property through a future right of first refusal, or as a donation in their will. Many options exist and the CRD’s website on the Legacy Program can provide further information. This program has resulted in some exceptional properties being added to our park systems. C
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