Fri. Mar 1st, 2024

The cost of Metro Vancouver's rental housing projects have nearly doubled since 2020

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The estimated construction budget for the Connexion building, which is to be built in Burnaby, increased from $64 million to $121 million.


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The cost of two affordable rental housing projects, to be owned and managed by the Greater Vancouver Regional District, nearly doubled before construction even began.

The Greater Vancouver Housing Committee is set to vote Friday to approve the expansion of two housing projects to be located in Burnaby: the Connexion, a 174-unit redevelopment project on a attached housing project operated by Metro Vancouver, and the Steller, a 122-unit project to be built on vacant land.

According to Housing Committee documents, the budget for the Connexion's construction exploded from $64 million to $121 million. The Steller's grew from $46 million to $94 million.

Both projects were approved in 2020. Construction is expected to begin this year.< /p>

It’s complicated to deal with this explosion of costs, but I think that’s what we’re facing right now,” said committee chair and Maple Ridge Mayor Dan Ruimy. The construction industry has seen considerable change [since] the two projects were approved.

In addition to rising construction costs, the parking lot and daycare expansions are, according to Metro Vancouver, some of the reasons the budget for both projects has exploded.

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Once completed, the buildings will be added to the housing stock owned by Metro Vancouver. It has more than 3,400 rental homes spread over 49 locations. The additional cost will be covered by Metro Vancouver reserves, mortgages, construction financing and additional grants, according to Greater Vancouver Housing Committee documents.

Stephanie Allen, development strategist and former vice-president of BC Housing, is not surprised by the increase. Material costs have gone up, labor costs have gone up, shipping costs have gone up, warehousing costs have gone up, she explains.

If the cost of these projects was estimated before the pandemic, [Metro Vancouver] had probably counted on a reasonable increase, but did not expect such a surge in prices, continues Stephanie Allen, for whom the projects seem to offer good value for money and a well-balanced set of products.

The units are focused on family housing, which is sorely lacking in the housing sector affordable housing, she says.

Urban agriculture, a large daycare or even a parking area for electric scooters for the elderly…, says the development strategist as examples. These are extraordinary things in which public money must be invested.

Stéphanie Allen believes, however, that governments could be much more transparent by explaining to the public why initial budgets explode.

According to Burnaby Mayor Mike Hurley, the city is also facing significant cost increases for its other projects. Last month, Burnaby city council passed a motion to create an advisory group to review cost estimates for major infrastructure projects.

This decision was taken after the necessary upward review of cost estimates for the construction of new swimming pools, community centers and even a detachment of the Royal Canadian Mounted Police (RCMP). The City's investment budget could thus increase by several hundred million dollars in the years to come.

The intention is still to carry out current projects, assured Mike Hurley. You just have to make sure you get the best value for your money and that some people don't take advantage of the situation.

With information fromJustin McElroy

By admin

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