City plans to change non-market rental requirements

During Burnaby’s Planning and Development Committee meeting on Jan. 20, delegations from two real estate developers spoke about the city’s current inclusionary zoning and rental replacement requirements. 

The first delegation was from Greenbrier Holdings, a developer that owns the building at 6355 Kingsway. The first presenter was Ted Zacks, the owner of the development, who spoke about the 60-unit building. Zacks said his father purchased the building in 1969. Most of the apartments in the building are one- and two-bedroom units. 

“We have many newcomers to Burnaby, and certainly many over the years that we’ve owned the property. Half of our tenants have lived in their suites for over five years and for as long as 28 years. And the other half have resided in our property for less than five years. Twenty-five per cent of our tenants pay less than $1,000 a month, and you can understand why, because of the duration of their tenancies,” Zacks said. “Our building is nearing the end of its expected useful life. We’ve invested to maintain the building and the surrounding property over the years, but significant investments are less and less economically justifiable.” 

Zacks went on to suggest that the city make an exception for buildings with existing rental housing regarding the number of non-market rental replacement units and height.   

“I’m suggesting that Burnaby policies have to support all of the objectives and its own requirements for us to build 60 suites at current costs on a redevelopment, but rented at uneconomic rents. The rules that govern the redevelopment really must permit us the height and the density that make redevelopment economically viable,” Zacks said. “We need rules that recognize that sites with existing rental housing need special treatment to reflect the burden imposed on their redevelopment, and without such rules, older rental housing like ours will simply continue to deteriorate over time, become eyesores and potentially socioeconomic disaster areas.” 

Michael Mortensen, a consultant from Liveable City Planning, accompanied Zacks and continued the presentation by saying that developers need greater density to make the non-market, inclusionary, and replacement rental requirements viable. 

“We need about five times the existing density. We probably can’t get there with 12-storey, big slab buildings,” Mortensen said. He added that increasing the density would allow the developer to provide the required number of units. 

According to Mortensen’s presentation, rental replacement requirements at 20% below market require five times the existing density and tower flexibility.

The second delegation at the same meeting was from the developer Keltic. The Keltic delegates addressed inclusionary housing requirements. 

Rachel Lei, CEO of Keltic, and Nicholas Kasidoulis, the company’s vice president of development, presented Keltic’s ideas for changing the regulations around inclusionary rental requirements. 

The first of Keltic’s ideas was for the City of Burnaby to directly manage a self-executed development function for inclusionary rental units. This means the city would take on the responsibility of developing non-market rental housing, and developers may contribute by paying in lieu, for example. 

Keltic also suggested a height waiver/allowance for provision of inclusionary rental units under Height Based Framework – here Lei suggested the city allow developers to add the extra inclusionary units as additional height to a development. “Then the developers actually don’t have to shoulder the land cost for those inclusionary units,” Lei said. 

The third idea the Keltic delegates suggested was to decrease the inclusionary rental unit contribution from 15% to 10% in relation to market units. 

“We think that reducing the requirement to 10% will enable projects to move forward again while still delivering affordable housing,” Kasidoulis said. 

Finally, they suggested that the city exempt developers from municipal development cost charges (DCCs) for inclusionary rental units. Kasidoulis said it costs developers $339,000 to develop one inclusionary unit. He suggested that the city waive the DCCs for developments with inclusionary units, which would save the developer $25,000 per unit. DCCs are fees the city collects to pay for things like infrastructure, including water, sewage, and transportation. 

In response to the developers’ requests, Coun. Pietro Calendino said reducing the inclusionary zoning requirement from 15% to 10% is a “work in progress.” The city’s general manager of planning and development, Ed Kozak, added that staff would come back to council in the coming weeks with changes to the requirements, although he did not mention what those changes would be. 

During its meeting on Oct. 7, 2024, Burnaby City Council reduced the inclusionary rental requirement from 20% to 15%. The city defines inclusionary rentals as units offered at 20% below market rates.

This piece was made possible by the Local Journalism Initiative.

Like what you just read? Do you support local journalism? Help us keep going—and growing.

Sign up for our once a week newsletter, or become an Insider to show your love for local reporters and writers.