Trapp Block: Housing plan flourishes as market slumps

May 27th, 2009

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Globe and Mail – Housing plan flourishes as market slumps
Group seizes chance to ease homelessness in New Westminster with space left over from commercial reno jobs that were put on hold

Wendy Stueck
Globe and Mail
Wednesday, May. 27, 2009

The economic downturn has resulted in a short-term shot in the arm for affordable housing in New Westminster.

With development plans for a trio of heritage buildings sidelined as a result of a deep chill in commercial real-estate financing, developer Robert Fung has turned over one of the buildings for use as social housing.

The building, which was vacant when Mr. Fung’s Salient Group acquired it in 2005, is to be managed by the non-profit Atira Women’s Resource Society and will provide 23 units for women and children who are homeless or at risk of being homeless.

Provincial agency B.C. Housing has provided some financial assistance to renovate the building.

Salient has committed to the arrangement for at least two years. The neighbouring buildings have interim tenants.

“Philosophically we don’t like vacant space, because it has such a negative impact on the street,” said Mr. Fung, whose company has tackled several high-profile renovations of heritage buildings in Gastown and who sits on the board of Vancouver’s Streettohome Foundation.

Atira will pay a nominal fee to lease the space, but Salient will break even or come out marginally ahead through the deal, he said.

“It’s an opportunity to deal with a short-term housing need that is really important,” he said. “I’m also hoping that in the short term, there is some long-term planning for permanent housing solutions.”

The buildings, which include the neighbouring Trapp Block, are part of a once-proud New Westminster neighbourhood known as the Golden Mile.

Salient originally thought of renovating the buildings, but as a result of structural concerns, is now contemplating a project that would retain heritage facades but include mostly new construction.

Mr. Fung was not surprised that housing agencies welcomed a chance to provide social housing outside of the downtown core. “We have tremendous housing need everywhere,” he said. “The most visual example of [the housing shortage] is in the Downtown Eastside, but that’s only because that’s where we have concentrated all the services and all the housing.”

In putting its New Westminster development on hold, Salient joins a number of developers that have put off or cancelled residential projects ranging from condominium hotels to west-side apartment blocks over the past 12 months. But there are signs that the trends that undermined the viability of new construction and heritage revival projects are changing course.

The British Columbia Real Estate Association has revised its forecasts, saying that house prices are not expected to decline as steeply as predicted at the start of the year and that supply and demand are starting to line up in Victoria, Vancouver and the Fraser Valley.

That news comes as no surprise to realtors such as Mark Longpre, who has noticed a sharp uptick in activity since the beginning of April.

“Over the last seven weeks or so, buyer confidence has increased significantly,” said Mr. Longpre, an agent with Re/Max Crest Realty Westside. “Especially first-time buyers, whether it’s for condos or lower-end houses.” Lower interest rates and lower asking prices have helped entice buyers into the market, he added.

Affordability reached a three-year high in April, according to the BCREA, with the carrying costs of an average-priced home in the province down 24 per cent from the previous year.

The BCREA yesterday forecast the average residential price in B.C. will decline 8 per cent to $420,000 in 2009, compared with a 13-per-cent drop predicted at the beginning of the year. The majority of the decline in home prices has already occurred and home sales are climbing out of a trough, said BCREA chief economic Cameron Muir.

The BCREA expects residential sales to decline 12 per cent to 60,775 units this year, but to climb by 10 per cent to 66,740 units in 2010.

You can see the original story here on the Globe and Mail’s website.

See alsoVideo: Streetohome Foundation (Feb 23, 2009)

Please visit www.streetohome.org for more info.