Real estate market tops list of concerns for city’s industry

The growing need for affordable housing is putting pressure on endangered industrial land in Vancouver, and may force a significant number of businesses to leave the city.

“Employers are saying they want to have (their own) employee housing, since it’s hard to find middleincome employees because there isn’t middle-income housing,” says Pietra Basilij, who works in sustainable community development for the Vancouver Economic Commission. “(They) say they can create that supply, and some very big owner-operator (business people) want to put housing above their operations. The city hasn’t shut that idea down, but as soon as you open that floodgate (allowing residential options on industrial land), there is speculation on that (industrial) land.”

A recent survey by the economic commission found the city ’s industries identify their top challenges as: rising operational costs (often due to extra shipping or distribution costs because they have to relocate farther from their customers), finding or keeping qualified employees, and access to affordable workplaces.

The study also found as many as 50 per cent of businesses are considering relocating in the next two years due to these issues.

The study estimated if 10 per cent of Vancouver’s industrial businesses were to leave in the next two years, the city would lose $700 million in revenues, 6,000 jobs and $250 million in wages.

“Displacing industrial businesses not only significantly impacts Vancouver’s employment base, it also impacts the cost of goods and services in the city ... more than 50 per cent of their clients are located within city limits and 35 per cent of their suppliers.”

“In recent years, foreign ownership taxes and other real estate investment policies, combined with rezonings in industrial areas and city-wide land value increases, have led investors that have traditionally been investing in Vancouver’s housing market to invest in industrial space as well,” the survey concluded.

“Some sites have sold at a rate that exceeds the value of what can be built on the site.”

But opinions are mixed about the compatibility of joint industrial and residential projects, Basilij explains.

Some business owners feel that with cleaner and better building technologies, it is possible to bring industrial and residential uses together.

For others, there are practical concerns about residents having to get used to living next to industrial sites where deliveries and other work takes place at all hours of the day.