A host of major projects are underscoring interest in Vancouver Island as building costs stabilize and a new development cycle gets underway.
With three major projects totalling more than 1,600 acres, Seacliff Properties Ltd. exemplifies the Lower Mainland developers that are finding opportunities on the Island.
A month ago, Seacliff broke ground with joint-venture partner Reliance Properties Ltd. on the Beachlands, a $1.2 billion development in Colwood set to deliver 2,850 homes over the next 15 years.
Seacliff is also in progress on the development of 2,100 homes at Fairwinds, a 750-acre master-planned community in Nanoose Bay. It received approval in November for Sandstone, a mixed-use project south of Nanaimo that will see more than 2,200 homes and 3 million square feet of industrial space developed near Duke Point.
“We really started compiling our portfolio of projects back in about 2012, 2013,” said Georgia Desjardins, director of development with Seacliff. “From a business fundamentals perspective, we just saw and continue to see a lot of potential for continued growth on the Island.”
It acquired its first project, Aquattro in Colwood, in 2013. This established a beachhead, with connections made through that project leading to the acquisition of additional sites.
“We were introduced to other large-scale opportunities and we really liked the business plan and the opportunities that we saw in acquiring these large tracts of land that had building permits in place and [could] rezone as well for added density over time,” Desjardins said. “We ended up picking up five or six of these master-planned opportunities.”
Seacliff isn’t the only Lower Mainland developer that has embraced Vancouver Island. Reliance has a long history in Victoria, while Onni Group picked up the Colwood Corners site just as Seacliff was taking over Quattro.
Many developers are pursuing multifamily rental projects, drawn by strong demand for affordable housing by new and existing residents as well as more manageable pro formas due to the relatively lower cost structure.
“The area is experiencing a sharp increase in population growth partly fuelled by the region's unique blend of natural beauty and urban conveniences,” said Volodya Gusak, president of Denciti Development Corp., which will break ground this week on a 135-unit rental project in the 800-block of Old Esquimalt Road in Victoria. “Residents need housing and places to work, making it a natural location for developments that meet these pressing needs.”
While the housing need in Victoria is acute, the West Shore communities of Colwood and Langford are fast-growing. With population growth of 6.6 per cent last year, Langford is outstripping most other municipalities in the province, and ranks as the fastest-growing on Vancouver Island. Colwood ranks second, with growth last year of 4.6 per cent.
The opportunities are prompting Cedar Coast Capital Corp., well known as a light industrial developer in the Lower Mainland, to diversify into residential. It recently launched an 84-unit project in Langford and hopes to launch a second with 130 units in the same city later this year.
“The economics work well in these smaller communities,” said Cavin Green, vice-president, operations with Cedar Coast.
The lower land values, as well as the cost of building low-rise projects versus the highrises delivering the density demanded in larger centres, make Vancouver Island communities appealing. Throw in faster entitlement processes, and smaller communities make sense.
“The delta is material,” Green said. “The smaller communities, whether they are in the Interior of BC or Vancouver Island, the economics are a bit easier.”
It’s a similar story for PC Urban Properties, where CEO Brent Sawchyn is building both multifamily rental projects in downtown Victoria and the Intraurban Cornerstone strata industrial project in Langford, which is delivering 170,000 square feet of space across 50 units designed small and medium-sized businesses.
“We believe in the long-term potential of Vancouver Island real estate, as there are a growing number of land opportunities there and a very business-friendly environment for development with the municipalities,” Sawchyn said.
The breadth of projects is what encourages Desjardins as the Beachlands gets underway.
“The Island in general has some strong fundamentals that we believe will continue to drive growth in many sectors long-term, including housing, commercial and industrial,” Desjardins said. “It offers incredible quality of life, relative affordability in the region, access to amenities. We just see all those as really positive drivers.”
