Despite the absence of below-market rents for the initial tenants, Saanich council last week moved forward a 68-unit dedicated rental development at 520 Normandy Rd. in Royal Oak, following a public hearing.
Aryze Developments’ proposal for a four-storey building at Elk Lake Drive next to Saanich Commonwealth Place drew mostly positive comments from councillors, some of whom acknowledged the municipality is starved for rental housing.
Public comments ranged from complaints about the potential effect of reduced onsite parking and extra traffic on the neighbourhood, and the removal of an affordability clause in the housing agreement, to pleas for council to approve badly needed rental units. The approval culminated roughly five years of back and forth between the developer, council, district staff and neighbours.
Council and the public heard that due to material and borrowing cost increases, the 10-10-10 part of the housing agreement – calling for 10 per cent of the units (seven) to rent for 10 per cent below market rate for 10 years – could not be accomplished at this time. But the agreement will still secure all units as rental for the lesser of 60 years or the life of the building.
Budget increases of nearly 40 per cent over the past two years ate away the hoped-for affordability aspects of the proposal, Luke Mari with Aryze Developments stated in his presentation during the hearing.
“We had very large ambitions for this project. We had originally planned to build this in 2020 and our budget was $16.8 million,” he said. In the best-case scenario, with approval tonight and a fast turnaround to get started, he said, construction could begin later this year, but the build cost will be $23.4 million.
That lack of affordability was lamented by some on council, but the securing of tenured rental housing was seen by most as a reasonable tradeoff. Coun. Nathalie Chambers, however, said “the metrics don’t work for a public interest project.”
Mari promised his company would, once the building is completed and rented, work with BC Housing to try and recapture some of the rental affordability originally pursued for the project. Those discussions, he said, would happen as the company sought longer-term financing for the building at hoped-for lower rates.
The project went through three significant design changes to get to the approved version, which sees its density shifted toward Elk Lake Drive and the entrance to the underground parkade accessed off Normandy Road.
Features to be secured by covenant include rough-ins for electric vehicle charging for all residential parking spaces, on-site bicycle repair stations and a dedicated Modo Car Share vehicle and membership for all residents who do not lease a parking space.
There was some confusion over whether a community amenity contribution from the proponent was required, given the application was submitted long before council approved its interim CAC policy. The council package referred to a standard of between $2,000 and $2,500 a door, but Mari spoke earlier of contributing $1,000 a door. In his effort to clarify the matter, Coun. Colin Plant negotiated an on-the-fly compromise with Mari who agreed to split the difference and contribute $135,000 from the project.
Construction is expected to take 18 months.