Local Developer Breathes New Life Into “Tough” Block

REW.ca’s sister publication the Vancouver Courier. To read the original article, click here.

A tough block, but a changing block.

That’s how Anthony Kuschak of Sequel 138 Development Corp. describes the location of a new 97-unit housing project rising out of the ground across from the city’s supervised injection site on East Hastings.

Situated between the Regent Hotel and the Brandiz Bar and Hotel, along a strip of East Hastings that has a well-documented history of drug use and violent crime, the Sequel 138 building was a tough sell for the developer.

“It’s a challenge, it’s a conversation,” Kuschak said of the company’s nine-month drive to find buyers. “The purchasers that did buy, they knew about the area. A lot of people who bought were able to see beyond [the neighbourhood’s location] and see an opportunity to own, an opportunity to get into the market.”

The six-storey building, which is expected to open by the end of the year, will be a mix of 79 private condos and 18 rental units. The condos have been sold and the FJL Housing Society, which secured an $814,000 loan through BC Housing, will own the rental units and likely offer them to Chinese seniors.

The project is unique for three reasons: its mix of tenants, the agreement the developer worked out with BC Housing to secure a $21.8 million loan for construction and a down payment program reached with the Canada Mortgage and Housing Corporation. To qualify for the program, buyers could not be earning a household income of more than $85,000 a year.

The 79 condos range in price from $250,000 for a small one-bedroom to a two-bedroom at $394,000. The owners, Kuschak said, are mainly in their late 20s and early 30s, including a woman named Melanie featured on the developer’s website.

Melanie, whose surname was not provided, is a 28-year-old graphic designer who earns $52,000 per year and lives with her parents. She purchased a one-bedroom unit for $250,000 (plus tax) and qualified for the developer’s 10 per cent “down payment assistance program,” which has to be repaid to the developer once the property is sold or the first mortgage is renegotiated.

For Melanie, that assistance equalled $25,000, which translates to a monthly mortgage payment of $1,158. Monthly strata fees are estimated to be $90 and property taxes $75.

“These are people who were not in the market, wanted to get in the market and the developer helped them attain a home through a zero down payment program,” Kuschak said. “So that is a stab at trying to create affordable home ownership in this city.”

The building is on the site of the former Pantages Theatre, which the developer originally wanted to preserve and build housing on the property, which occupies five city lots near Main and Hastings.

But the project fell apart over delays, financing and the developer’s conclusion the theatre was in too much disrepair to renovate. It was demolished in 2011, much to the chagrin of heritage buffs and caused the developer to come up with a “sequel” to the original plan.

Sequel 138, which will incorporate commercial businesses on its ground floor, will also feature a large vegetable garden on the second-floor podium that will be used by residents. Some of the plots will be part of a Downtown Eastside program linked to area restaurants.

Liberty Arts will also operate an arts and media centre in the building.

Over the years, the developer’s proposals met with protest from community activists and the Vancouver Area Network of Drug Users, who worried about gentrification in the low-income neighbourhood.

Activist Wendy Pedersen has argued the property should have been used strictly for much-needed social housing. Pedersen told the Courier she was disappointed BC Housing chose to give the developer a loan to build mostly private condos.

“That’s a gift to the developer,” she said. “The reason why everybody struggled so hard against the Sequel project, and struggled for 100 per cent social housing, is that it will have a displacement impact because the land around it becomes more valuable. It’s not going to help the people in the Regent and the Balmoral [hotels] live a better life.”