City of Vancouver asks for input on future of co-op housing as leases run out

With the end of dozens of leases on valuable public land looming, the City of Vancouver is asking for input on a series of scenarios aimed at settling the future of co-op housing communities.

City staff unveiled a discussion paper Tuesday outlining four potential ways of dealing with the 57 co-ops that provide 3,700 units of housing on city land in Vancouver.

The options vary from a basic renewal to redevelopment and — in an option that officials admit is their least preferred scenario — the end of a co-op's lease.

"We are going through an affordability crisis and we want to ensure that the people who are ... using public land are the ones who have demonstrated need," said Gracen Chungath, the city's director of strategic operations.

"It is in response to what the co-ops said and what the co-op sector said and the affordability crisis that we have come up with these proposals."

Non-profit organizations

Housing co-ops are organizations in which residents act as share-holding members of a body incorporated under the Cooperative Association Act.

Most of B.C.'s housing co-ops are non-profit and provide rentals to residents of a variety of incomes, with higher income residents ultimately subsidizing the rents of lower income families.

They reached lease deals decades ago, long before the skyrocketing property values that have rendered the city unaffordable to many. 

But with those leases running out, residents have worried about rent increases and the pressure to develop land in some of the city's most valuable corridors — like False Creek.

And with the years remaining on their leases dwindling to single digits, some co-ops have also been unable to secure money needed for major capital expenditures on what are often aging buildings.

Autonomy crucial

The city has grappled with the future of co-ops in recent years, with council passing a framework in 2017 to handle negotiations. But staff say they made lease offers to three co-ops in the wake of that proposal, only to see all three offers rejected because of pricing and terms of the lease.

Sandra Singh, general manager of arts, culture and community service, says the city has listened to the concerns of co-op boards in coming up with the new discussion paper — particularly as they relate to autonomy.

"The right and ability of them to manage their membership and to have autonomy over who's in their community is really important to them, and we absolutely recognize that," she said.

"What we want to do is enable co-ops who have different income mixes to generate or have housing charges that are responsive to those members."

All four scenarios would call for a minimum of 15 per cent of units to be dedicated to low income housing. And the cost of ground rent allocated to each unit should not exceed 30 per cent of household income.

In most cases, the ground rent would inevitably be less than the market use for city-owned land, which means that the difference between the market value and the amount paid is considered a grant.

Devil in the details

The first of the four co-op scenarios is the most basic, with the co-op paying ground rent discounted from market value according to "moderate rental income assumptions."

The second would be tailored to the actual make-up of the co-op by providing additional grants from the city based on anonymous figures detailing the actual income and living space of co-op members.

The third option would involve redevelopment to make the most effective use of land, primarily in situations where the buildings are at the end of their lives and the site has high economic redevelopment potential.

The city says it would work to protect co-op members during and after redevelopment.

And the final scenario would see a co-op choose not to renew, in which case, the city would work to find a new non-profit operator for the building and give co-op members the option to stay in their homes.

Retired librarian Nancy Hammum, who is chair of a co-op working group in False Creek South, says she is encouraged to see the city engaged in the process but said the import of all scenarios will lie in the details.

She said co-op members are facing the same struggles as many Vancouverites.

"We're incredibly aware of millennials and our own children — who have to pay higher prices if they don't live in a co-op," Hannum said.

"We are supporting affordable housing and we'll do what we can to make it work. We just don't want to be clobbered with over-densification and ignoring the existing community."

Consultation on the proposals will close on March 24. Staff will make their recommendations to council in June.