Staff report on Vancouver multiplexes

Referral to public hearing in September

Jul 25, 2023

In January 2022, Vancouver city council voted to ask staff to prepare a policy allowing a four-plex on a 33-foot lot or a six-plex on a 50-foot lot - a form of gentle density (“missing middle”), basically a small townhouse complex.

Last week the city published the staff report, including an analysis of economic viability. Today there’s a council meeting where council will vote on sending the proposed policy to a public hearing, likely in September. Agenda for today’s meeting.

According to the report, with a floor space limit of 1.0 FSR (4000 square feet on a standard 33-foot lot), purpose-built rental projects (e.g. an eight-plex) will not be economically viable, and four-plexes on 33-foot lots will not be economically viable either. So then it comes down to how many West Side homeowners want to sell or redevelop a 50-foot lot, keeping in mind that the density bonus fees are set to minimize change in land value.

I'd be concerned about an outcome similar to Victoria's. They legalized missing-middle housing in January, after consuming years of staff time and a great deal of political capital. The number of applications received so far: zero.

There’s one option that may improve economic viability - a “zero emission building” (e.g. Passivhaus, with greater energy efficiency) basically gets a floor space bonus of almost 0.2 FSR. This helps even if Passivhaus construction adds roughly $80,000 to construction costs.

Some details from the report:

The floor space limit is still 1.0 FSR, as it has been since the policy update in February. For a 50-foot lot (about 6000 square feet), that means that the total floor space can be no more than 6000 square feet in total, or about 1000 square feet per unit for a six-plex.

For a zero-emission building (higher energy-efficiency standards, like Passivhaus), floor space can be increased to 1.23 FSR. (See pages 20-21 and 91.) The walls are somewhat thicker, so you lose about 0.05 FSR, for a net bonus of about 0.18 FSR.

Maximum site coverage for buildings is 50%, maximum impermeable area is 75% (page 38).

Multiple Dwelling use is conditional, not outright (page 30). It still has to be approved by the Director of Planning. A separate Development Permit and Building Permit are required (page 101).

There can only be two and a half floors above grade - the third floor must be no more than 50% of the second floor (page 39). By excavating, it’s possible to have 3.5 floors with the lowest floor slightly below grade (page 104).

Coriolis’s economic analysis (pages 117 to 124) assumes total construction costs per square foot (hard and soft costs) of $735-760 on the west side, $645-685 on the east side. The selling price is assumed to be $1400-1450 per square foot on the west side, $1100-1125 on the east side. These numbers aren’t that different from the simple pro forma I set up.

Secured rental housing is not economically viable (page 13).

Why "gentle density" in residential neighbourhoods is so important, January 2022
Multiplex policy update from city staff, February 2023
Multiplex design concepts from Bryn Davidson, February 2023
Simple pro forma for a multiplex, February 2023
Video: Economic viability of infill housing, February 2023
Why is the floor space limit for four-plexes and six-plexes so restrictive?, February 2023
Email to the city on proposed multiplex policy, March 2023
Vancouver multiplexes: density bonus fees announced, July 2023

Missing middle housing motion set for Vancouver city council vote. Claire Wilson, Business in Vancouver.
Vancouver about to eliminate its single-family residential zoning rules. Frances Bula, the Globe and Mail.
FAQ from the city of Victoria: “There is marginal viability for most Missing Middle housing types, meaning there wouldn't be a financial rationale for commercial developers to acquire land for anything more than current market values.” Victoria councillor Dave Thompson on Twitter: “In Committee of the Whole today I asked staff for the total number of applications received as of July 6. Answer: zero.”