The Future of False Creek Flats - Adam Mitchell and Jarvis Rouillard

Greater Vancouver Board of Trade President and CEO Bridgitte Anderson is joined by Low Tide Properties Vice President of Asset Management and Development Adam Mitchell and PCI Developments Senior Vice President Jarvis Rouillard to discuss why their organizations see so much potential in the False Creek Flats.

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GVPOD is the podcast of the Greater Vancouver Board of Trade. President and CEO Bridgitte Anderson talks to leaders in the business community about the challenges and opportunities they experience, as well as issues impacting our region.

0:00:00.3 S1 [BRIDGITTE]: Hello everyone, and Happy New Year. Welcome to GVPOD Greater Vancouver's business podcast, exploring the challenges and opportunities facing your region. My Bridgitte Anderson, President and CEO of the Greater Vancouver Board of Trade, we're picking up where we left off last year. With a closer look at the False Creek flats, if you're not familiar with this area, it's a major job center in Vancouver, bordered by Main Street to the west... Great Northern Way to the South, prior Street to the north and Clark drive to the east. The flats is home to the new Emily Carr University campus, and the new St. Paul's Hospital that is under construction. About 8000 people work there at over 600 diverse businesses, and in the next 15 years, this area is about to change dramatically with employment expected to triple. Joining us today to talk about the future of the flats is at Adam Mitchell Vice President, asset management and development at low tide properties, and Jarvis Rouillard Senior Vice President at PCI developments. Welcome, gentleman.

[Both] Nice to see you too.

[Bridgitte] Adam, Let's start with you. Low tide properties is known as one of Vancouver's largest life sciences landlords. Why is the False Creek flats so important to your organization?

0:01:17.9 S2 [ADAM]: I think the interesting thing about the False Creek flats as it relates to life sciences, it's had a good history of life science use in the past, there's some pre-existing life science buildings that were built anywhere from 10 to 15 years ago, and they were really built in the Falls Creek flats, because the... At the time, the land cost was low enough that you could build a life science building, those buildings are more expensive to build than a traditional office or industrial buildings, so there was a good history of life science tenants in the area, and then the announcement of St Pauls was another key catalyst that really is going to change the area, particularly related to life science research and laboratory use, and the emergence of the Mount Pleasant District is also another catalyst for life science in the Paleo, having some of the bigger names in our life science ecosystem locate there, like upsell and Zymeworks is really beneficial and falls at the fall, the nexus of those two, what I would call anchors, the new St. Paul Hospital and the Mount Pleasant district.

0:02:31.4 S1 [BRIDGITTE]: Yeah, for sure, you can see that there is a real cluster, and that's the word I think that a lot of people are using around life sciences, but Jarvis PCI development is a partner with low tide on several of the properties along Great Northern Way. So what do you see as the potential of this area...

0:02:48.2 S2 [JARVIS]: Well, I think one, it's a unique, large tract of land that with proximity to downtown, so I think that there's nothing else like it that's left available in the city. So that's the first part, and I think that's where the city planning process, which started with the False Creek flats plan a number of years ago, and it's kind of evolved to a portion of being included in the Broadway plan, which was enacted in this past September. I think it was critical and great that the city was able to look at... We look at that and say, Okay, there's a huge opportunity here with the infrastructure of the rapid trains going in and other things. So I think that was really interesting. I think the key pillars we look at in particular... And we can talk a little bit about a specific Great Northern Way corridor that we're focused on. There's key piles are close proximate downtown, like I said, which some companies would see not being in the heart of downtown, but being close enough to get to downtown, there's benefits to that. Access to the Central Valley Greenway for cycling rapid transit expansion, UBC from the VCC Clark station with the Great Northern Way Emily Carr station being constructed at Horton Street, and then also the educational cluster that's there.

0:03:56.5 S2 [JARVIS]: You got the BCC, Emily Carr Center for Digital Media and others looking to move there, so I think those are very key pillars and what we look at for an opportunity to grow a large well-class site.

0:04:07.9 S1 [BRIDGITTE]: And certainly, Adam low tide properties has seen great opportunity here so maybe give us a little bit of background on your organization and the projects that you've been involved in in the Fall Creek flats.

0:04:19.8 S2 [ADAM]: Sure, so low tide as a company with started in 2010, the strategy has been to explore neighborhood outside the Downtown core, so you'll find us in Gaston track, Mount Pleasant, Catalina, and of course, the quality class. We also operate a similar strategy in Seattle, where we kind of like to look at some of those neighborhoods where we feel they're either emerging or they've got a great growth trend happening, and we tend to accumulate a number of properties in both neighborhoods to really then try and put a more macro strategy in place, Try and curate the retail so that we're providing the right mix to those communities, and the False Creek Flats, again, is a very similar to story that just on a much larger scale. So as you mentioned, we got involved with PCI on starting to acquire sites along the Great Northern Way in and around those post-secondary institution anchors with the thought that eventually that rapid transit extension would come through the area. So we began accumulating and really the goal here is to really put in place what we would consider a more complete community into the False Creek Flats and along the Great Northern Way quarter, and really trying to introduce a variety of uses to that area because it really is in that transition point from a classic industrial to more of a mixed urban industrial with Office and hopefully more residential and retail amenities for people down there.

0:05:57.3 S1 [BRIDGITTE]: Yeah, I'm glad you raised the word community because I think that this has been a long time industrial space, and I think we'll talk about industrial land in the industrial land shortage in a moment. I wanna get your thoughts on that, Jarvis. We're all trying to be more sustainable and having people live closer to where they work is one of the ways to do that, or closer to transit hub, so is that the vision for this area is that there will be some residential included in the mix?

0:06:25.3 S2 [ADAM]: I think, absolutely, as we look at what we would call a complete community residential has to be some component of that, and again, I think to your point about sustainability, it does have to act as... I'll call it the 247 destination and extent. I know that that term is probably overused, but providing people the things they need within that 15 to 20 minute radius, whether it be walking or some form of light transportation, either by bike or electric scooter or things like that, so that's our... Again, I would defer to Jarvis is probably more on what exactly that looks like as the development lead on this, but from a low tide’s perspective, when we talk about community, it's really providing people the things they need within an accessible radius.

0:07:13.2 S1 [BRIDGITTE]: So not only are we providing some opportunities to grow important clusters like like sciences, but could be going a ways to solving some of the housing shortage problems that we've got, so Jarvis is what would the ideal mix then be in this area around light, industrial and residential

0:07:31.7 S2 [JARVIS]: Well, I think we have to respect that there is, like you mentioned briefly, there is an inductor shortage, and I think the city is looking to protect some of that, I think... Having said that, we've been around for 40 years, we're kind of synonymous or development group with building transitory, mixed use communities around rapid transit were really big believers that mixed use is sustainable way you mentioned it, it's sustainable base of how development should be... To evolve going forward, Adam mentioned security, we call eyes on the street 247 mixed use spring set that if it was just gonna be commercial down that is tracked, you'd have a... It's just another office park that after 5O'clock and even perhaps now, the way office use is going, it's more fluid, there's people are coming in for less hours, it may become more of a dead zone, so it really is important to create that mixture of uses to provide, the other thing we're really looking to do here, this is Vancouver's tech, life science, creative innovative ecosystem has evolved over last two decades, and it's grown to a great scale, you look at all the brokerage reports that kind of track tack across North America.

0:08:46.7 S2 [ADAM]: Vancouver is quickly rising the ranks, and there's no large world class ecosystem that exists in the city, and there's a huge demand for it, and really what that ecosystem needs to be, it has to have a mixture and allow for a mixture of all those uses, so that those people can collide and create ideas and have gathering spots that you have public coming it all mixed use from what we've done with Crossroads, and Broadway and marine gateway, and so Vancouver and now recently King George and Surrey, what we've learned is it's really... We focus on the ground up, it's the retail, the residential draws the retail, the retail draws the office, it's a circular demand, and when you get all three of those, and you know you're throwing industrial into the mix as well, in certain sites like this one, you really they're all synchronous and they create demand for each other.

0:09:38.4 S1 [BRIDGITTE]: So Adam what is this then gonna look like from and why the Life Sciences piece may be from low tides perspective.

0:09:46.5 S2 [ADAM]: I think life science fits into the larger narrative that Jarvis just mentioned in terms of that creative ecosystem here in Vancouver, and it does tie back to community... You've had Tracy Redies from Science World on the podcast previously. And we've had a number of meetings and discussions with her to say, How can we collaborate best, and that I think is one of the other unique things about the False Creek Flats, is the willingness and eagerness for all these different groups, whether it's science world, St. Paul's ourselves to collaborate to create something that truly is world class, and again, I put life science into that more creative frontier type economy that's being developed in Vancouver, and at the end of the day, I think it comes back to the talent that is produced in Vancouver, and the region broadly. So again, more specifically to the False Creek Flats, like Emily Carr, VCC or the Center for Digital Media, they are producing talent that on a world stage is probably pound for town better, and because of that, Vancouver is putting itself on the world stage in a lot of these new areas like life science, clean tech, VR, AR, all of these frontier technologies.

0:11:01.4 S2 [ADAM]: And they just don't have a home, and I think we see that as a tremendous opportunity in the Fall Creek Flats, it's really create that world class ecosystem for these groups to thrive.

[JARVIS] I think too, just to add to out of this point, we've kinda seen when we started this strategy, if it was eight, nine years ago together, when we started building what they call the slide, which is a five, six, five Great Northern Way, and there's the pedal with the nemesis that some or listeners might know about, that really the demand for that, we were fully leased by the time the building was finished, and that was... And you look at the types of tenants that were in not building that kind of... It was a sneak peas to the type of user that kind of solidified or thesis. And then the other piece that solidified our thesis was early 2020, mid-2020, we acquired a vacant office building, it's a beautiful wood building just down the street, closer to VCC Clark was the former MEC headquarters and built it directly for them, they vacated... It was a vacant building. We acquired it on the thesis that when everybody else was saying office was dead, we collectively, the partnership really believe in certain areas, it will thrive, and it was part of a larger assembly plan, and within five months of buying that vacant building, we lease it to EA Sports.

0:12:14.4 S2 [JARVIS]: And so again, it kind of validated our thesis on the program, and I think that's only gonna strengthen as we go forward.

0:12:19.7 S1 [BRIDGITTE]: So for sure, the demand is there, and there's vision about the clusters, but land values and lease rates are increasing and some would say it is becoming unaffordable in our region for, especially for startups and for those smaller kind of established businesses already, so is there a strategy in place or what do you do to mitigate to make sure that you're still keeping... 'cause life sciences really thrives on start-ups and some of those small businesses, so how can that be addressed to make sure that it is profitable, but that those rates are being capped in that affordable range?

0:12:57.0 S2 [JARVIS]: To be honest, one of the solutions, and we talked about it with city staff and others, and passes, there's a lot of places in the city where we have limits to height for various different reasons, some valid and some arguably not. We really wanna preserve the ground plan, I think that's important for reliability in a city, but if we're able... If developers are gonna be able to... We talk about costs going up in sustainability objectives to build these new buildings, they're expensive, if there's gonna be ability to foster spaces for the arts and for others, and creatives, and some of these startups, I think density needs to be increased to help offset those costs and all within reason, but I think that's something that the Broadway plan is gonna help foster, obviously being... Putting a lot more density through that area, I think it was great and will hopefully allow for better ground plans, get allowed for more setbacks off of the street, more walkability, and also potentially some areas where there can be community gathering spaces and potentially urban maker spaces and things like that.

0:13:59.4 S1 [BRIDGITTE]: And that's gonna take a bit of a, I think, a shift in mindset too, for a lot of people in this region that maybe they're still grappling with the need to increase density to be able to address the industrial land shortage, to address the housing supply, we're seeing it happen though globally, density hasn't been so much of an issue as it has been, maybe because we're a newer city.

0:14:23.6 S2 [JARVIS]: and I think the same goes for purpose-built rental. It's the same thing in purpose-built rental, doesn't necessarily pencil right now, where land values have been and not values will come off, but I don't believe come off enough to fully justify a whole bunch of new rental coming, and so I think that's gonna be critical as well, as where we can smartly add density around stations and otherwise and add quality purpose-built rental that will help the housing crisis and be a piece to it.

0:14:52.5 S1 [BRIDGITTE]: Yeah, for sure. Well, Adam, you mentioned low tide and strategy, you mentioned Seattle and in the research I've been doing about the False Creek flats, other places around the world have done this where they have clustered different industries or sectors to really get a lot of creativity and innovation going in one particular geography. So is this the idea for some of the work that you're doing around the life sciences and looking at... To other jurisdictions globally.

0:15:21.6 S2 [ADAM]: Absolutely, certainly there's some great precedence out there that we've spent a lot of time analyzing and understanding how they work, Southlake Union in Seattle is obviously closest to us, that's a good example. The Boston innovation district, new lab in New York City, Kings cross in London in the UK. I think stations in Paris is another good example. So it's a long list, but there's certainly places that have achieved this in some great lessons that we can do, but one of the main lessons from all those different projects or areas that they're very unique to the city they're in, and so there's no template to drop in here, what we do will be very unique in Vancouver-centric, and that's part of the story we wanna tell. Again, we want Vancouver, especially low tide, there's a great affinity to the city of Vancouver for our shareholders and for Low Tide. And we really want it to be on that world stage and do something that the city can be proud of.

0:16:29.3 S1 [BRIDGITTE]: Yeah, and it's funny, as you were talking, I was thinking about the fashion district in New York, and there's all kinds of places and different industries that are clustered, and so there's a real natural inclination to do that here in Vancouver. Are super exciting opportunity. Jervis, what is the timeline here... Are we talking about five years, 10 years, 25 years? What are we seeing? Well, I think...

0:16:54.8 S2 [JARVIS]: I guess going back a little bit with the city process, so the Broadway plan was enacted and that was kind of a city-wide planning exercise that kind of set the blueprint for what is... What would be allowed on that quarter or for... That was enacted in September, so we are... And up until that, during that kind of two to three-year process, while the Broadway plan was in place, they weren't in the city was not allowing any rezoning at that time, so there was kind of a more times that's kinda kept everybody on hill, so now we're in talking to the city, and we're not, out of respect for city staff, we're not able to really talk about the details on the exact plans that we're proposing yet, but safe to say our hope is that we'll be putting in an... A pre-zoning application kind of in the next quarter, at which time then some of those deals be made public, and then at that time that that will take a couple of years to go through that process and getting permits and things like that. And at the same... So that's when we would be able to start putting shovels in the ground, our hope is in the next couple of years, and that should be timely because that's when the train will hopefully be finished in 2025, and we'll be able to go there.

0:17:59.2 S2 [JARVIS]: So we have a total of eight acres roughly down that corridor, really kind of book-ending at the VCC Clark station of heading west, and then we have a couple acres including the air rates above the new station that's being built. I expect that we're gonna have a really, really unique gathering spot in that area, and I think like Adam mentioned, I think we're really happy PCI is because we're part of a unique Vancouver-based bank of her passionate partnership a lot, and I think that's gonna come through and people see the plans of or

0:18:33.4 S1 [BRIDGITTE]: Well, it's gotta be good news than to hear the maybe the change in approach by the City of Vancouver around permitting delays in licensing and really looking to accelerate some of those timelines, as we all know, those delays actually end up putting more cost on the project, which is of course offloaded everywhere else too. Are you seeing that, that change in mindset? As well, at the municipal level.

0:18:57.7 S2 [JARVIS]: I think there's a... Well, our hope is that there will be, I think, unfortunately, with the Broadway plan being, putting everything installed for a few years now, there's been an influx of applications, so I think what they're going to be doing is likely prioritizing ones that they feel are the most important hopefully ones around transit stations and other up, but I think there's no doubt that there's a backlog that they're gonna have to get through and that may delay the process for many projects.

0:19:25.5 S1 [BRIDGITTE]: So I can't believe we're almost running out of time already because there's a ton more that we could talk about this, but maybe I'll finish with the same question for both of you, and Adam I'll start with you, if you were to put your mind... I say a decade. What would be your hope for the false great flats?

0:19:42.8 S2 [ADAM]: Yeah, I think at that time, I'd expect obviously the Broadway extension to be complete and running, certainly the St. Pauls hospital will be operational to some capacity, maybe not the full campus plan, but a good part of it. So at that point in time, I would love for us to be able to showcase what we're planning for the area, centered around probably the Thorton station at Emily Carr and being able to really show people what's possible in this city when we have a great collaboration amongst the stakeholders in the area, as well as the city itself, and having them buy into this vision that we're trying to create... Again, I reference some of the work we're doing with science world, and I think really giving those types of groups who operate in that innovation system a place to showcase their best work, if we're there in 10 years, and it's a very compelling place for people in the city to come check out what is new and exciting? I think I'd be pretty satisfied.

0:20:52.4 S1 [BRIDGITTE]: That's great. And so you set the vision, Jarvis, as a developer, what's your hope over the next decade to get to that point? Well.

0:21:00.2 S2 [JARVIS]: You know, I think it's gonna be a steady process, it's an incredibly unique opportunity for us, we've worked on some great exciting kind of large complex projects, but this is a wonderful project to work on our old team, we've got a great partner, obviously patient generational partner to work with that really has a global vision for this, so I think... My hope would be that when we look back on this, they're gonna say, Well, our partner deliver it again for us, and it's gonna be a place that like Adam mentioned, people when they come to Vancouver, it'll be on the map of the place that people really need to go check out.

0:21:37.2 S1 [BRIDGITTE]: So as long as we've got to government at all levels supporting this and moving things along quickly, we've got the business community behind it and really hoping that we get there very quickly out of Adam Mitchell Vice President, asset management and development at low tide properties and Jarvis Rouillard, the Senior Vice President at PCI developments. Thanks so much for the conversation today, I really appreciate it.

0:21:57.7 S2 [BOTH]: Thank you. Thanks for having us.