Two Vancouver Island cities will get additions to their purpose-built rental apartment markets courtesy of a partnership between Vancouver’s Denciti Development Corp. and Nicola Wealth Real Estate (NWRE).
The firms have announced plans to begin construction in Q4 2020 on a 108-apartment development at 6117 Uplands Dr. in Nanaimo. They also plan to construct a 274-unit apartment development at 610-624 Herald St. and 611-635 Chatham St. in Victoria’s Old Town district, which will also include retail.
In Nanaimo, a city with a rental vacancy rate of two per cent, the plan is to transform an empty two-acre lot in the north end with a five-storey development.
“We are transforming a vacant lot in a prime location into over 100 homes for Nanaimo residents that are looking for rental options,” said Denciti CEO Garry Fawley in the announcement. “Not only will these units help ease the city’s rental housing shortage, but it will offer renters a desirable place to live close to shopping, schools, medical facilities, and parks.”
6117 Uplands Dr. is near transit and walking distance or a short drive from the Woodgrove Centre, the largest shopping mall on Vancouver Island.
Nanaimo’s tight apartment rental sector
The city’s rental market is tight for several reasons, according to Peter Gibson, a senior VP with Cushman & Wakefield:
* Potential first-time homebuyers are renting longer due to mortgage rule changes that have priced them out of the market;
* The COVID-19 pandemic has encouraged more people to work from home, and some are looking to upgrade their home environments;
* Higher strata fees in B.C.’s condo market could be making renting a more stable option than home ownership;
* There is also a seniors’ population looking to downsize and free up cash flow.
“We are seeing a boom in the number of people choosing to rent as opposed to own right now,” Gibson said in the release. “For a variety of reasons, there is a growing need for more purpose-built rental units in the Nanaimo market and the timing is right.”
This is magnified by the fact that, until this past year, there haven’t been any significant construction starts of new purpose-built rental apartments for decades, said Alex Messina, director of acquisitions at Nicola Wealth.
“We see great opportunity in projects of this kind not only in Nanaimo but across the country. There has been a 30-year lull in the building of purpose-built rental housing and as a result, renters have had few options,“ he explained.
274 apartments in Victoria
The 274-apartment development in Victoria will replace surface parking lots, a single-storey commercial building and a tire repair shop on a 1.5-acre site. In their place will be new purpose-built low-rise apartments and retail.
This city also faces a shortfall of rental apartments, with a vacancy rate of just 1.5 per cent. That figure is even more significant because 61 per cent of residents rent their dwellings, Fawley said.
“Victoria has a high percentage of people who rent, yet the market has a serious shortage of purpose-built rental housing,” he noted in the release. “There is great opportunity in this area because of its unique location in historic Old Town and its proximity to downtown.”
The units range from studios to two-bedrooms. Amenities include a gym, media room, lounge, co-working area, and central outdoor courtyard with a pet-friendly space. All parking will be underground and neighbourhood-serving retail will front Herald, Government and Chatham Streets.
Working with Denciti, NWRE acquired the Old Town properties in 2019 and 2020. A development permit application was submitted to the City of Victoria on Sept. 25.
“The scale of the project affords the opportunity to offer a unique set of indoor and outdoor amenities for the future residents,” said Josh Anderson, director of development at NWRE, in the release.
“Areas to foster community and connection with your neighbours, and at the same time, an opportunity to activate street fronts with interesting retailers and services, adding vibrancy to the area as a whole.”
Zoning is already in place via existing bylaws that allow for rental apartment or condominium use of 196,250 square feet.
Old Town took form during Victoria’s rise to prominence in the mid-19th century when it was an important port and commercial gateway that linked the Pacific Rim to the interior of British Columbia.
About Denciti, Nicola Wealth
Denciti Development Corp. is a real estate company creating urban industrial, commercial and residential development. It has delivered over $2 billion of real estate across Canada.
Nicola Wealth Real Estate is the in-house real estate arm of Nicola Wealth, a financial planning and investment firm with over $7 billion of assets under management.
NWRE acquires and manages a growing portfolio of properties in major markets across North America. Its holdings include office, retail, industrial, multifamily residential, self-storage and seniors housing.
The current real estate portfolio is $4 billion.