appraisal of a commercial/rooming house property - regent ... · determine the required renovations...

Appraisal of a

Commercial/Rooming House Property -

“Regent Hotel”

located at:

160 East Hastings Street,

Vancouver, BC

effective date of valuation:

October 1, 2019

prepared for:

Young Anderson

October 28, 2019 Reference Number: 14493C-0618

Young Anderson

Barristers and Solicitors

1616-808 Nelson Street

Box 12147 – Nelson Square

Vancouver, BC V6Z 2H2

Attention: Mr. Sukhbir Manhas

Re: Appraisal of a Commercial/Rooming House Property - “Regent Hotel”

Located at 160 East Hastings Street, Vancouver, BC

Further to your request, we have prepared an appraisal of the referenced property estimating the

current market value of the fee simple interest. This appraisal was prepared as an update to the

original report (reference #14493-0618) for the City of Vancouver “the City”, with an effective date

of March 9, 2018 and our previous report (#14493A-0618) for Young Anderson with an effective

date of February 25, 2019. The estimated market value of the subject property as of

February 25, 2019 was $1.00.

The subject property comprises a ±6,100-square-foot site, located on the south side of East Hastings

Street between Columbia and Main Streets. The site is zoned DEOD (Downtown Eastside-

Oppenheimer District) and situated within Sub-area 1 of the DEOD Development Plan. The site is

improved with a ±106-year-old, eight-storey plus basement building that includes ground floor

commercial space previously occupied by the Regent, and 161 single-room occupancy (SRO)

licensed units on the second to eighth floors.

As of the effective date of valuation, the entire building was vacant due to health and safety

concerns and a large number of outstanding work orders issued by the City, which resulted in the

building being deemed unsafe to occupy. The building was vacated on June 28, 2018. As a “Do Not

Occupy” order was issued on June 20, 2018 by the City until completion of the outstanding work

orders, an accurate estimate of restoration costs was an essential part of this appraisal.

Due to the complexity of estimating the costs involved in restoring the Regent Hotel to a condition

that would allow it to be legally occupied, we contacted BTY Group, who has significant experience

with costing the renovations of Single Room Occupancy (SRO) hotels. Following an inspection of the

building and discussions with BTY, they were not able to provide a written report and estimate of

renovation costs without properly defining the required scope of work. This type of analysis was

also beyond our expertise.

We next contacted GHL Consultants Ltd., a building code consultant company. However, as GHL had

already provided advice (although apparently not formally engaged) to Spratt Emanuel Engineering

Ltd., who was working for the subject property’s current owner, we considered it appropriate to

engage the services of another consultant.

At this time, we asked BTY to suggest another consultant with expertise in this type of work with

downtown Eastside SRO properties. They recommended Merrick Architecture be engaged. Merrick

indicated at the outset that due to the complexity of this type of work, it would be necessary to

engage the services of the following consultants.

1. Architecture and Heritage prepared by Merrick Architecture,

2. Building Code prepared by McAuley Thorson,

3. Structural Engineering prepared by Bush Bohlman and Partners,

4. Mechanical Engineering prepared by MCW,

5. Electrical Engineering prepared by WSP,

6. Building Envelope prepared by Morrison Hershfield,

7. Hazardous Material Abatement prepared by Pinchin West and,

8. Environmental prepared by Hemmera.

9. To determine the building’s required renovation costs we have relied upon the cost

management report (Regent Hotel Regeneration Schematic Design Class C Estimate)

prepared by BTY Group.

Prior to reporting these findings back to our client, we discussed the need to assemble such a large

team with others in the marketplace, as the consultant costs would be significant. From those

investigations it quickly became apparent that the services of the entire recommended consulting

team were essential for a reliable analysis to be undertaken. When purchasers of similar complex

properties in a poor state of repair undertake due diligence, a similarly composed team is generally

assembled. Each member of the team brings the expertise essential to evaluating the obligations

that the SRO hotel will present for it to be restored and occupied.

In light of the public’s knowledge of the subject building’s issues (i.e., the “Do Not Occupy” order by

the City), a reasonable purchaser would likely complete the same level of due diligence we

undertook. Furthermore, being safely able to accommodate 154 rooms (upon completion of the

assumed renovations) in this location, along with a pub, in an old and complicated nine storey plus

basement building will need to be carefully scrutinised. Discussions with BC Housing indicated that

the City was extremely co-operative and timely with their approval process for the 13 SROs they

renovated between 2012 and 2017, due to the need to deliver much needed accommodation in this

location.

Merrick and their team moved forward with their investigations and reporting, which has been

referred to in this report. We emphasized the importance to Merrick to provide a market-driven

approach for both the scope of works required and final costing. As part of that, we instructed

Merrick to assume that a pub would still be a permitted use on the ground floor, as this is the retail

use that would have the greatest demand on this block. Merrick was also well aware of the appeal

of the SRO hotel to the non-profit and government sector of the marketplace. Ignoring these types

of purchasers that make up a large segment of the market place in this area of the downtown

Eastside would not be reasonable.

Merrick completed a renovation scenario, which although it included a pub, also included other

uses more suitable to a not-for-profit operator, such as administration and health care support

offices on the main floor. We note that if the area of the pub were to be increased and the amenity

support areas decreased, the value of the subject property “as complete” would increase. However,

costs would not likely change significantly and the final value would still be a significantly negative

value. As such, there would be no material changes to our final value conclusions.

Although it would take considerably more time and expense, and it has not been completed in this

appraisal, we recommend two scenarios of value be provided. The first would be a purely market

approach with the assumption the property would be sold to a market purchaser, as opposed to a

not-for-profit group. The second scenario would consider the type of works a not-for-profit group

would undertake. In this scenario, there would be no pub and likely more amenity space or other

commercial/office area.

In any event, due to the significant costs of restoration and renovation, both scenarios would

continue to conclude with a negative value.

In order to estimate the subject property’s market value we have completed the following two

valuation approaches:

1) Land Value Less Demolition Costs, and

2) Value as if Renovated Less Renovation Costs.

Under the first approach we have estimated the land value and also provided a land value less

demolition costs. The demolition costs are based on the building’s estimated hazardous materials

removal cost prepared by Pinchin West and our discussions with industry participants, including BTY

Group.

Under the second approach we have estimated the value as if renovated less renovation costs. To

determine the required renovations to the subject building, including assumed environmental

remediation, we have relied upon the Regent Hotel Regeneration Report prepared by Merrick

Architecture, dated February 26, 2019. The Regeneration Report included information and/or

costing pertaining to Architecture and Heritage prepared by Merrick Architecture, Building Code

prepared by McAuley Thorson, Structural Engineering prepared by Bush Bohlman and Partners,

Mechanical Engineering prepared by MCW, Electrical Engineering prepared by WSP, Building

Envelope prepared by Morrison Hershfield, Hazardous Material Abatement prepared by Pinchin

West and Environmental prepared by Hemmera. To determine the building’s required renovation

costs we have relied upon the cost management report (Regent Hotel Regeneration Schematic

Design Class C Estimate) prepared by BTY Group, dated February 25, 2019.

As per Merrick Architecture’s Regeneration Report, “Upgrades to the Regent will conform to new

building code requirements as far as possible. Because it is an existing early 1900’s building

relaxations will need to be sought for a number of non-conforming code issues such as:

• Non-conforming stair rise and run

• Residential units opening into an exit stair

• Low headroom issues

• Non-conforming elevator”

As noted in this report the two approaches both produced negative values. Due to the significant

renovation and removal of hazardous materials costs, the value as if renovated less all costs of

renovations indicated a negative value of -$17,840,000. The land value less demolition and

hazardous material removal costs also indicated a negative value of -$100,000. However, at this

time there is no definitive direction from the City whether the subject building can be demolished.

It is uncertain as to what the current market value for the subject property is at the present time. It

may be reasonable to assume that a potential purchaser would pay $1.00 for the property with the

intention to hold until such time that changes or improvements in the market make renovation

economically feasible. However the holding costs including property taxes and building insurance,

risk and other considerations will likely deter most private market participants.

After consideration of all factors pertinent to value, it is our opinion that the current market value

of the subject property, subject to the Assumptions and Limiting Conditions herein, as of

October 1, 2019 is estimated at:

ONE DOLLAR

$1.00*

*We are unaware of any instances of property being transferred with a negative value. Therefore,

a value of $1.00 is concluded for the subject property with the knowledge that a purchaser would

be required to assume the financial obligations with either holding or demolishing and

redeveloping the property. In light of these risks and significant costs of both demolition or

renovation provided to us and on which we have relied, we consider the most likely purchaser

would be a government or non-profit group where the benefits of providing social or low cost

housing might be considered to offset the costs.

To determine the required scope of renovations, we have relied upon reports prepared by

Merrick Architecture, Thorson McAuley, Bush Bohlman and Partners, MCW, WSP, Morrison

Hershfield, Pinchin West and Hemmera. Based on this required scope of work, we have relied

upon the costing report prepared by BTY Group. The costing report was prepared on February 25,

2019, and we assume there has not been a material change to the costs, as of our effective date

of appraisal. We have relied on the recommendations of the above consultants to restore the

subject property to a condition required by City regulations and bylaws and the costs of

construction and renovation that would allow them to be legally occupied. Should those City

regulations be relaxed or changed, it is probable that the costs we have relied upon will change

and therefore, so would our estimates of value. Should this occur, we reserve the right to amend

our values accordingly.

Our report and addenda are attached and form the basis of our opinions and must be read as a

whole, as sections taken out of context may be misleading. Reference is made to the Terms of

Reference and the Assumptions and Limiting Conditions contained therein.

The appraisal may be used 1) in negotiations with the claimant to settle the claim for

compensation; 2) as the basis for an advance payment to the claimant pursuant to Section 20 of the

Expropriation Act; and 3) as expert evidence before the BC Supreme Court (if appropriate). This

report has been prepared for Young Anderson, and their representatives, for the uses stated above.

The report has been prepared to meet the Canadian Uniform Standards of Professional Appraisal

Practice (Standards). Should any questions arise by reason of the report, please contact the

undersigned at your convenience.

Yours truly,

CWPC Property Consultants Ltd.

Per: Reagan Stinson Stuart Carmichael B.Com (hons), AACI, P.App, MBA B.Bus. (L.Econ.), AACI, P.App

photographs of the subject property

East Hastings Street from Subject Looking West East Hastings Street Across from Subject Looking East

Front View of Subject from East Hastings Street

Looking Southwest

Front View of Subject from East Hastings Street Looking Southeast (Taken October 1, 2019)


Front View of Subject’s Ground Floor Looking SW Rear View of Subject Looking Northeast

View from Subject’s Roof Looking East Commercial Space

Main Floor Pub Space Main Floor Pub Space


Main Floor Pub’s Men’s Washroom Main Floor Pub’s Women’s Washroom

Basement Space Basement Unit

Grand Staircase from Lobby to Second Floor Common Residential Hallway


Common Residential Stairwell

Rooming Unit

Rooming Unit

Water Damage on Ceiling of Shower/Tub Room

Shower/Tub Room Passenger Elevator

table of contents

Letter of Transmittal

Photographs of the Subject Property

1.0 SUMMARY OF FACTS ...................................................................................................... 13

2.0 DEFINITION OF THE APPRAISAL EXERCISE ....................................................................... 15

3.0 DEFINITION OF TERMS ................................................................................................... 22

4.0 IDENTIFICATION OF THE SUBJECT PROPERTY .................................................................. 24

5.0 MARKET AREA DESCRIPTION .......................................................................................... 28

6.0 SITE DESCRIPTION .......................................................................................................... 32

7.0 DESCRIPTION OF EXISTING IMPROVEMENTS AND ASSUMED RENOVATIONS ................... 35

8.0 ZONING AND PLANNING ................................................................................................ 42

9.0 HIGHEST AND BEST USE .................................................................................................. 49

10.0 LAND VALUE .................................................................................................................. 53

11.0 APPRAISAL METHODOLOGY FOR AS IF RENOVATED LESS RENOVATION COSTS ................ 64

12.0 INCOME APPROACH (AS IF RENOVATED) ........................................................................ 65

13.0 THE CAPITALIZATION PROCESS ....................................................................................... 92

14.0 THE DIRECT COMPARISON APPROACH .......................................................................... 111

15.0 VALUE AS IF RENOVATED AND ESTIMATE OF CURRENT MARKET VALUE ........................ 120

16.0 CERTIFICATION ............................................................................................................. 125

17.0 ASSUMPTIONS AND LIMITING CONDITIONS .................................................................. 127

addenda

Appendix “A” Copy of the Subject’s Regeneration Schematic Design Class C Estimate prepared

by BTY Group

Appendix “B” Copies of the Subject’s Title Information and Easement and Indemnity

Agreement

Appendix “C” Copies of the Subject’s and Balmoral Hotel’s Marketing Brochures

Appendix “D” Copies of the Subject’s Floor Plan

Appendix “E” Copies of the Zoning Bylaw and Official Development Plan Excerpts

Appendix “F” Qualifications of the Appraisers

Young Anderson REF NO. 14493C-0618

Re: Regent Hotel - 160 East Hastings Street, Vancouver, BC

1.0 SUMMARY OF FACTS

Effective Date of Valuation: October 1, 2019

Civic Address: 160 East Hastings Street, Vancouver, BC

Existing Property Description: Eight-storey plus basement commercial/rooming house

building with ground floor commercial space, basement

storage space and seven upper floors demised into 161

licensed “single-room occupancy SROs” with shared

washroom facilities (42 of these rooms have insuite

washrooms).

2019 Property Assessment: Land: $ 3,049,000

Improvements: $ 109,100

Total: $ 3,168,100

2019 Gross Property Taxes: $13,738.42

Site Area: ±6,100 square feet

Gross Building Area: ±50,080 square feet (including the basement)

Zoning: DEOD (Downtown Eastside Oppenheimer District)

Official Development Plan: Downtown-Eastside/Oppenheimer ODP,

Sub-area 1 Main/Hastings

CONCLUSIONS

Highest and Best Use: As If Vacant

Commercial/residential development with non-market

housing and secured market rental housing in accordance

with the existing DEOD municipal zoning and development

plan guidelines.

As Improved

A holding property until economic forces and market

conditions warrant either renovation of the existing

improvements or demolition and redevelopment.



SUMMARY OF FACTS (continued)

Estimate of Current Market Value: $1.00*

*The value as if renovated less all costs of renovations

indicated a negative value of -$17,840,000. The land

value less demolition and hazardous material removal

costs indicated a negative value of -$100,000. However,

at this time there is no definitive direction from the City

whether the subject building can be demolished. We are

unaware of any instances of property being transferred

with a negative value. Therefore, a value of $1.00 is

concluded for the subject property with the knowledge

that a purchaser would be required to assume the

financial obligations with either holding or demolishing

and redeveloping the property. In light of these risks and

significant costs of both demolition or renovation

provided to us and on which we have relied, we consider

the most likely purchaser would be a government or non-

profit group where the benefits of providing social or low

cost housing might be considered to offset the costs.



2.0 DEFINITION OF THE APPRAISAL EXERCISE

EFFECTIVE DATE OF VALUATION

This appraisal reflects an estimate of market value as of October 1, 2019 (the date of exterior re-

inspection).

TERMS OF REFERENCE

CWPC Property Consultants Ltd. has been retained by Young Anderson to prepare an appraisal in

connection with expropriation of the property at 160 East Hastings Street, Vancouver, known as the

“Regent Hotel”. This appraisal was prepared as an update to the original report (reference #14493-

0618) for the City of Vancouver “the City”, with an effective date of July 4, 2018, and our previous

report (reference #14493A-0618) for Young Anderson with an effective date of February 25, 2019.

The purpose of the appraisal is to estimate the current market value of the fee simple interest of

the subject property legally described herein as of the effective date of valuation. The property was

appraised free and clear of all encumbrances, except as noted otherwise herein.

The appraisal may be used 1) in negotiations with the claimant to settle the claim for

compensation; 2) as the basis for an advance payment to the claimant pursuant to Section 20 of the

Expropriation Act; and 3) as expert evidence before the BC Supreme Court (if appropriate).

This report has been prepared for Young Anderson and their representatives, for the use of the City

of Vancouver, and there are no other intended users for the specific purpose as stated. Any other

user or use is unintended by the appraisers.

To estimate the subject property’s current market value we have completed the following two

valuation approaches:

1) Land Value Less Demolition Costs, and

2) Value as if Renovated Less Renovation Costs.

Under the first valuation approach (Land Value Less Demolition Costs), we have estimated

approximate demolition costs based on the building’s estimated hazardous materials removal cost

prepared by Pinchin West and our discussions with industry participants, including BTY Group.



DEFINITION OF THE APPRAISAL EXERCISE (continued)

Under the second valuation approach (Value as if Renovated Less Renovation Costs), to determine

the required renovations/upgrades to the subject building, including assumed environmental

remediation, we have relied upon the Regent Hotel Regeneration Report prepared by Merrick

Architecture, dated February 26, 2019. Please refer to separate document. The Regeneration report

included information and/or costing pertaining to Architecture and Heritage prepared by Merrick

Architecture, Building Code prepared by McAuley Thorson, Structural Engineering prepared by Bush

Bohlman and Partners, Mechanical Engineering prepared by MCW, Electrical Engineering prepared

by WSP, Building Envelope prepared by Morrison Hershfield, Hazardous Material Abatement

prepared by Pinchin West and Environmental prepared by Hemmera.

To determine the building’s required renovation/upgrade costs we have relied upon the cost

management report (Regent Hotel Regeneration Schematic Design Class C Estimate) prepared by

BTY Group, dated February 25, 2019, which is included as Appendix “A”.








As per Merrick Architecture’s Regeneration Report, in combination with its consulting team, the

following scope of works are assumed to be required for the subject property to be renovated and

available for occupancy:

• 154 rooming units in total, each with an exterior window, suitable only for single-occupancy,

and are approximately 133 square feet in size, with the exception of the accessible rooms

comprising 130 square feet. The second to eighth floors will each include 22 rooming units

with shared washroom facilities, with one accessible unit and two units with two-piece insuite

washrooms on each floor;




• Each unit will contain the following furnishings: a small kitchenette area comprising a

stainless steel counter unit with single-basin stainless steel sink, stainless steel backsplash and

stainless steel door front, two stainless steel mounted shelves, mini-fridge, and microwave, a

single bed solid steel frame with mattress, metal wardrobe, steel-topped table and steel-

welded chair, and steel-topped bed stand, four metal coat hooks and horizontal vinyl window

blinds;

• The shared washroom facilities on the second to eighth floors will comprise one accessible

toilet, one accessible shower, four shower rooms, two combined shower and toilet rooms,

one men’s washroom with two toilets and two sinks, and one women’s washroom with three

toilets and two sinks;

• The building will include residential amenity space on the ground floor comprising a common

kitchen with a full-size fridge, oven and range hood, dishwasher, microwave and table and

chairs, a common lounge/dining area with a table and chairs, sofa and/or loveseat, wall-

mounted flat screen television and DVD player;

• The building will include a storage room with split-level, wire mesh cages and heavy duty

shelving;

• The building will include an administrative office and nurse’s room on the ground floor;

• The building will include coin-operated laundry machines (one washer and dryer per 15

residents);

• The building will include a bed-bug sauna;

• The building and units will have access to free wifi and basic cable with free electricity and

heat;

• There will be some form of 24-hour, on-site property management (i.e., management staff

and/or a caretaker) and weekly janitorial services to common areas;

• Security will include FOB entry and security cameras at the front entrance and throughout

the interior public areas;

• A single elevator will service the building as per what exists now;

• A pub will be located on the ground floor with a portion of the basement used for pub

storage;




• The Landlord will provide shell space for the commercial pub space to be leased to a third

party, and;

o The building’s existing Liquor Primary Licence (#5041) will be provided to the third-

party pub lessee. The Liquor Control and Licensing Branch (LCLB) Head Office

reported the licence allows for 227 seats; however, the LCLB was unable to provide

any further details regarding the Licence or the permit. The City reported that the

Licence permits hours of operation from 11:00am to 12:00am on Sunday to

Thursday and 11:00am to 1:00am on Friday and Saturday. For the purposes of this

appraisal, we assume the Licence includes a permit for the off premises sale of beer,

packaged coolers, cider and wine; however, we note were unable to confirm this.

We assume the off-sales permit could not be separately transferred to a different

location, consistent with our enquiries on the Balmoral Hotel.

SCOPE OF APPRAISAL

The scope of this appraisal encompasses the research and analysis necessary to provide an estimate

of market value for the subject property in accordance with the Canadian Uniform Standards of

Professional Appraisal Practice (2018 STANDARDS).

Stuart Carmichael inspected the subject property on March 9, 2018, and completed an exterior

inspection of the subject property on July 4, 2018. Reagan Stinson inspected the subject property

on May 29, 2018. Both appraisers re-inspected the subject property on November 1, 2018 and

completed cursory exterior re-inspections of the subject property on February 25, 2019 and

October 1, 2019. The interior photographs contained herein reflect the status of the property as of

the date of inspection on May 29, 2018 and the re-inspection date of November 1, 2018. The

exterior building and street view photographs were taken on February 17, 2019 and

October 1, 2019. During the interior inspections the appraisers inspected the residential common

areas, a selection of rooming units, the commercial space and the basement. We note that access

to the rooming units and shared washrooms was not available on the re-inspection date of

November 1, 2018 as the rooms had been boarded up.




Land title information maintained by the BC Land Title and Survey Authority and obtained through

myLTSA was reviewed. For the purpose of this appraisal, the subject was appraised as though free

and clear of encumbrances and charges, unless otherwise noted in the report. The subject’s site

area and dimensions were obtained from the City of Vancouver, verified with BC Assessment and

the Legal Plan (VAP 184) and are assumed accurate. The gross building areas were obtained from

Merrick Architecture. Other property data (i.e., land use policies and building age) were compiled

from public records at the City of Vancouver.

In estimating Highest and Best Use for the property, we analyzed data compiled for the market area

description, site, existing improvement and zoning description sections. The Income and Direct

Comparison Approaches to value were used in this report.

Market data used in this report includes, but is not necessarily limited to, information obtained

through access to:

• The Paragon multiple listing service of the Real Estate Board of Greater Vancouver;

• Record data maintained by the B.C. Assessment Authority;

• File data maintained by CWPC, and;

• Discussions with realtors, developers, City of Vancouver planning staff and other persons with

knowledge of the market.

Listed below are the extraordinary limiting conditions that apply to this assignment.

1. We were provided with a copy of the Limited Phase I Environmental Site Assessment and

Liability Assessment dated November 28, 2018 for the subject property prepared by

Hemmera Envirochem Inc. The Phase I report identified a possible underground storage tank

and unknown fill. Based on Hemmera’s previous experience at similar SROs, they provided

an estimate of total remaining environmental liability ranging from $80,000 to $125,000. We

assume the environmental information and cost estimates provided by Hemmera are

accurate and we reserve the right to modify our value conclusions upon receipt of a detailed

estimate of remediation costs, if any.




2. Building plans were not available for the subject property; however, a typical floor plan for

the residential floors was provided by our client. The subject’s individual gross floor areas

and estimated gross building area were provided by Merrick Architecture, which was

measured from CAD files based on available drawings dimensions. We assume these areas

are correct; however, a professional survey is recommended.

3. The subject’s DEOD zoning restricts development to social housing and secured market

rental housing with a maximum floor space ratio (FSR) of 5.0. Further, the subject is

governed by the City of Vancouver’s Single Room Accommodation Bylaw, which would

require a payment of $125,000 per unit in the event the units were to be converted or

demolished. We have assumed the subject improvements could not be reconstructed to the

current FSR of 8.21. We have assumed the existing SRO use would be required in a new

development. However, as a new building with a lower density would likely not be able to

accommodate the existing 158 licensed rooming units, we have assumed there would be no

penalty from the City for a loss of any units beyond what could be reconstructed.

4. The City of Vancouver reports the subject building is currently licensed for 158 SRO units;

however, based on our inspection and discussion with Atira, the subject’s onsite property

manager, there appears to be 161 constructed rooming units. We note three of the units on

the sixth floor have been combined to create one larger unit. We also note there is a small

5'6" wide room on each rooming floor that may have been used as a rooming unit suggesting

there could be 168 constructed rooms; however, this could not be verified by on our

inspection or discussion with Atira. We did not view all the units during the inspection on

May 29, 2018, as a number of the units were boarded up at the time of inspection and

certain sections of the building on some of the floors were vacant and had been boarded up.

5. Under the second valuation approach (Value as if Renovated Less Renovation Costs), as per

Merrick Architecture’s designs, we assume the subject building will include 22 rooming units

on each of the seven rooming floors. Under this approach, we assume the subject includes

154 functional SRO units operating in this capacity, which is a net loss of 4 rooming units

from the existing 158 licensed rooming units. We also assume a pub use would be permitted

on the ground floor and the building’s existing Liquor Primary Licence (#5041) will be

reinstated and provided to a third-party lessee.




6. To determine the required scope of renovations, we have relied upon reports prepared by

Merrick Architecture, Thorson McAuley, Bush Bohlman and Partners, MCW, WSP, Morrison

Hershfield, Pinchin West and Hemmera. Based on this required scope of work, we have

relied upon the costing report prepared by BTY Group. The costing report was prepared on

February 25, 2019, and we assume there has not been a material change to the costs, as of

our effective date of appraisal. We have relied on the recommendations of the above

consultants to restore the subject property to a condition required by City regulations and

bylaws and the costs of construction and renovation that would allow them to be legally

occupied. Should those City regulations be relaxed or changed, it is probable that the costs

we have relied upon will change and therefore, so would our estimates of value. Should

this occur, we reserve the right to amend our values accordingly.

7. The Cost Approach has been omitted from this report. The Income and Comparison

Approaches have been used since they are market driven approaches to value.



3.0 DEFINITION OF TERMS

PROPERTY RIGHTS APPRAISED

The property rights appraised in this report are fee simple title ownership, except for normal public

limitations. The fee simple interest can be defined as:

"The greatest interest an individual can own in land, or complete ownership in law,

subject only to the governmental powers of taxation, expropriation, escheat and police

powers."

MARKET RENT

Market Rent may be defined as:

"The rental income that a property would most probably command on the open market

as indicated by current rentals being paid for comparable space (as of the effective date

of appraisal)."1

DEFINITION OF MARKET VALUE

The "Canadian Uniform Standards of Professional Appraisal Practice" (2018 Standards), defines

Market Value as:

"The most probable price which a property should bring in a competitive and open market

as of the specified date under all conditions requisite to a fair sale, the buyer and seller each

acting prudently and knowledgeably, and assuming the price is not affected by undue

stimulus.

Implicit in this definition is the consummation of a sale as of the specified date and the

passing of title from seller to buyer under conditions whereby:

1. buyer and seller are typically motivated;

2. both parties are well informed or well advised, and acting in what they consider their

best interests;

3. a reasonable time is allowed for exposure in the open market;

1 Ballinger Publishing Company, "Real Estate Appraisal Terminology", 1975.



DEFINITION OF TERMS (continued)

4. payment is made in terms of cash in Canadian dollars or in terms of financial

arrangements comparable thereto;

5. the price represents the normal consideration for the property sold unaffected by

special or creative financing or sales concessions granted by anyone associated with

the sale.”

NET LEASE AGREEMENT

A lease where, in addition to the contract rent stipulated, the Lessee assumes payment of all

operating expenses pertaining to a property, such as taxes, insurance, utilities and maintenance,

but excluding structural repairs. This is commonly referred to as a triple net lease.

NET EFFECTIVE RENT

For the purposes of this appraisal, we assume the net effective rent to be the rent related to a

certain lease transaction (expressed as an annual rate), based on the present value using the

common discount rate (5.5%) compounded monthly, of all Base Rent (minimum rent) receivable by

a Landlord over the initial fixed term, less the present value of all tenant inducements, free rent and

the fixturing period, with such remainder present value then amortized over the fixed initial lease

term. Our calculations exclude realtor’s commissions.

EXPOSURE TIME

Exposure time, as specified by “The Standards” defined by the Canadian Uniform Standards of

Professional Appraisal Practice, means the estimated length of time the property interest being

appraised would have been offered on the market before the hypothetical consummation of a sale

at market value on the effective date of the appraisal.



4.0 IDENTIFICATION OF THE SUBJECT PROPERTY

CIVIC ADDRESS

160 East Hastings Street, Vancouver, BC

REGISTERED OWNER

Triville Enterprises Ltd., Inc. No. 353575

159 East Hastings Street

Vancouver, BC

V6A 1N6

TITLE NUMBERS

BE173213

BE173214

LEGAL DESCRIPTION

Lots 39 and 40 Block 12 District Lot 196 Plan 184

P.I.D.’s: 013-263-072 and 013-263-111

REGISTERED CHARGES

Perusal of titles for the subject property indicated the following legal notation and registered

charges:

Legal Notation

• Expropriation Act Notice, See CA6954759, July 25th, 2018 - Dealings Restricted.

Charges

• Easement and Indemnity Agreement (A31840) registered to the City of Vancouver in May

1973. The charge pertains to an Encroachment Agreement between the subject property and

the City. The agreement grants “unto the Owner permission to construct and maintain an

encroachment comprising a sidewalk cavity and fuel oil tank, situate on Hastings Street and

having a total area of 630 feet”. The Owner is required to pay $157.50 per year for

continuation of the agreement. However, as per Section 8a), “the agreement may be revoked

at any time by the City”.



IDENTIFICATION OF THE SUBJECT PROPERTY (continued)

Our client’s April 2019 discussion with the City suggests that it would likely revoke the

agreement to reclaim the easement area upon a major renovation of the subject property.

We were also advised by Merrick Architecture that the subject’s encroachment area has been

blocked off as it is in most buildings with this historical feature and the City is unlikely to allow

an owner to reclaim the area as the City prefers to retain these areas for services. Given this

and that the agreement can be revoked at any time, a purchaser would likely not consider the

encroachment area to have value. Therefore, we have not included this encroachment area in

our valuation of the subject property assuming completion of the assumed renovations;

• Mortgage (BE193891) and Assignment of Rents (BE193892) registered to Aetna Trust

Company in August 1991;

• Mortgage (BE193893) and Assignment of Rents (BE193894) registered to Aetna Trust

Company in August 1991;

• Claim of Builders Lien (CA6921963) registered to Darrel Dunlop on July 10, 2018; and,

• Certificate of Pending Litigation (CA7467377) registered to Darrel Dunlop on April 26, 2019.

The legal notation and charges registered on the titles (with the exception of the Easement and

Indemnity Agreement (A31840)) were not investigated in conjunction with this assignment and it is

assumed they do not impact the value of the subject property. Copies of the title documentation

and Easement and Indemnity Agreement are included as Appendix "B".

ASSESSMENT & TAX DATA

2019 Property Assessment:

Land: $3,049,000

Improvements: $ 109,100

Total: $3,158,100

2019 Gross Property Taxes: $13,738.42

The “Actual Assessed Value” indicated above reflects the opinion of BC Assessment as to the

market value of the fee simple interest in the subject property as at July 1, 2018, on the basis of its

physical condition as at October 31, 2018.




PROPERTY SALES HISTORY

According to BC Assessment records, the last arms’ length transaction of the subject property was

in 1989 for the consideration of $1,500,000. To the best of our knowledge, the property is not

currently listed for sale. In July 2018, through our enquiries in the market, we were provided with

copies of the marketing brochures for both the subject property and the Balmoral Hotel (159 East

Hastings Street), which is also owned by the subject’s owner. Copies of these marketing brochures

are included as Appendix “C”.

Through a formal demand under Section 20 of the Expropriation Act, and as part of our due

diligence, we were provided with copies of Offers for the subject property and the Balmoral Hotel

(five for the subject property and six for the Balmoral Hotel). Copies of the Offers and our

conversation notes have been retained in our working file.

The Offers, dated from June 8, 2018 to July 10, 2019, indicated a range of offer prices for the

buildings from $7,000,000 for each building to $14,000,000 for the Balmoral Hotel only. We

completed a review of each of the Offers and attempted to contact each Offeror to determine what

due diligence they had done prior to making the Offers. We spoke directly with four of the six

Offerors (or their agent). One of the Offerors has not responded to our request for a discussion and

the other Offeror has communicated directly with our client. Our discussions were limited to fact

finding only and we did not communicate any information to the Offerors regarding the due

diligence completed by our client’s building and cost consultants.

In conclusion, we feel that the Offerors have not completed the necessary due diligence to make an

informed offer that represents fair market value, or the Offers contain a subject period where this

due diligence would be completed. To the best of our knowledge, none of the Offerors who were

contacted had commissioned professional building inspection, structural, engineering or cost

consulting reports. We also note several of the Offers include considerable Vendor take-back

financing clauses.




There was no information provided in the Offers that would contradict or call into question the

information that we have relied on from the following sources:

1) Reports prepared by Merrick Architecture, Thorson McAuley, Bush Bohlman and Partners,

MCW, WSP, Morrison Hershfield, Pinchin West and Hemmera, to determine the required scope of

renovations to the building, and

2) The costs prepared by BTY Group based on this required scope of work.

As a result, these Offers have not impacted our value conclusion.



5.0 MARKET AREA DESCRIPTION

The subject property is located in the City of Vancouver, east of the downtown commercial core,

south of the historic Gastown area, north of Chinatown and northeast of the International Village

area of Concord’s redevelopment of the former Expo lands. More specifically, the subject property

is situated on the south side of East Hastings Street between Columbia and Main Streets, within the

Downtown Eastside Oppenheimer District. The location of the subject property is identified on the

neighbourhood map illustrated below.

The subject property area is considered a fringe location and is described as a low-income area. The

subject is situated along the East Hastings commercial corridor, which is mainly comprised of low

income and non-market housing, including some market residential strata and rental units. The

Vancouver Police Station and the Provincial Government’s bank, established specifically for the

subject area to provide banking services to low-income people and welfare recipients, are located

approximately a half block east on Main Street.



MARKET AREA DESCRIPTION (continued)

The Gastown area to the northwest is a six-block area developed along Water Street. It has enjoyed

considerable refurbishment, rehabilitation and redevelopment of older heritage-style buildings to

provide updated offices, condominium apartments and street-level retail. This redevelopment has

attracted some mid- to upper-level housing, in effect accommodating the complete spectrum in

terms of income earners.

Hastings and Cordova Streets provide principal east-west connectors through the area, providing

vehicular and public transportation links to the eastern municipalities. To the east, Quebec and

Main Streets provide similar access southwards to other areas of the city. The adjacent downtown

area is well-serviced with public transportation, including the SkyTrain, SeaBus and West Coast

Express commuter rail service.

SUBJECT’S IMMEDIATE AREA

The subject’s immediate area is plagued by social problems, including on-street drug use and

unsanctioned vendors. There are also a number of properties in a state of disrepair, including some

that have been vacant for many years. However, City of Vancouver community initiatives and new

commercial/residential redevelopments and conversions have helped to improve the area.

Furthermore, due to its proximity to Gastown and low rents, over recent years the area has become

a more popular location for trendy shops and cafes.

Immediately west of the subject property on East Hastings Street is “Sequel 138”, a concrete

condominium project constructed in early 2014, with 79 residential market units, 18 social housing

units and ground floor commercial space.

Over the past decade the Provincial Government purchased 24 SRO-designated hotels to retain as

low-income housing, with the majority of these properties located in the Downtown Eastside.

Approximately half were substantially upgraded prior to the October 2011 announcement of BC

Housing’s SRO Renewal Initiative project to renew and restore 13 of the SROs at a cost of $143.3

million. Discussion with BC Housing indicates the project was completed in early February 2017.




“Hotel Irving”, at the northeast corner of East Hastings and Columbia Streets, half a block west of

the subject, “Roosevelt Hotel”, one property east of the subject on East Hastings Street, and “Hotel

Maple” just northeast of the subject, were part of the renovation project and offer recently

renovated commercial and rooming house space.

The subject area’s largest redevelopment is the Woodward’s project located approximately three

blocks west of the subject in the 100 block of West Hastings/West Cordova Street. The

development was completed in 2010 and includes 536 market and 200 non-market residential

units, commercial space and a Simon Fraser University campus.

A number of other recently constructed (or currently under construction) commercial/residential

developments help improve the general area, and include:

• An 11-storey, mixed-use rental building by Wall Financial Corp. approximately one block east

of the subject at 288/292 East Hastings Street, recently completed construction in mid-2018.

The development includes 68 market units and 104 non-market units. The building is the first

tower in Vancouver’s downtown Eastside. The market units were reportedly fully leased after

being actively marketed for three months. The rental rates reportedly averaged $2.67 per

square foot for the various unit types;

• A nine-storey, mixed-use rental building with 47 market rental units comprising studio units,

nine social housing units and retail at grade recently completed construction in early 2019 on

the west side of Main Street between Powell and Alexander Streets, approximately two

blocks northeast of the subject. As of August 1, 2019, approximately 13 rental units were still

available for rent with rental rates reportedly averaging $3.84 per square foot;

• “In Gastown”, a nine-storey, 61-unit mixed-use residential development by Port Living is

located at 150 East Cordova Street, approximately one block north of the subject. The project

was completed in late 2016 and was reported to be sold out in the first quarter of that year;

• “Olivia Skye”, a 13-storey, 198-unit mixed income residential building with ground floor

commercial space at 41 East Hastings Street, approximately one block west of the subject,

recently completed construction, with occupation in early 2018;




• “The Lux”, a nine-storey social housing development with 92 self-contained studio units

constructed in 2008, is located approximately one block west of the subject at 65 East

Hastings Street;

• “East”, a 22-unit loft development by Jamieson Development Corp. constructed in 2008, is

located one and a half blocks south of the subject on 71 East Pender Street;

• “Koret Lofts Building”, a 118-unit heritage redevelopment constructed in 2006 offers good

quality office, retail and living space and is located one and a half blocks northwest of the

subject at 55 East Cordova Street;

• “Framework”, an eight-storey, 61-unit, mixed-use condominium building with ground floor

commercial space by Porte Homes at 231 East Pender Street, approximately one block

southeast of the subject. The development completed construction in late 2016;

• “Burns Block”, a six-storey heritage conversion offering 30 affordable compact rental units.

The project was completed by Reliance Holdings in 2011 and is located approximately one

and a half blocks west of the subject at 18 West Hastings Street;

• In 2014, the City of Vancouver acquired the ±32,184-square-foot vacant parcel in the 0 block

of West Hastings Street for a future social housing development;

• “Paris Block”, a five-storey, 29-unit heritage conversion constructed in 2008, and “Paris

Annex”, a five-storey, 16-unit, live-work building constructed in 2011. Both projects were

completed by Salient Group and are located approximately two blocks west of the subject at

53 West Hastings Street and 47 West Hastings Street, respectively.

CONCLUSION

The subject property is located in the Oppenheimer area of the Downtown Eastside along the

Hastings Corridor. The subject is located in proximity to traffic corridors and many public transit

routes. There has been an improving trend in the area involving City of Vancouver rental housing

initiatives and Chinatown revitalization strategies. However, the immediate area, particularly the

subject’s 100 East Hastings Street block and the 0, 200 and 300 East Hastings Street blocks,

continues to be negatively impacted by the high number of homeless people and local social/drug-

related issues.



6.0 SITE DESCRIPTION

DIMENSIONS AND SHAPE

The subject consists of two rectangular-shaped legal lots with ±50 feet of frontage on the south side

of East Hastings Street with a return depth of ±122 feet. The lot dimensions were obtained from the

City of Vancouver online map (illustrated below) and confirmed with BC Assessment data and Legal

Plan VAP 184. Based on these dimensions, the total site area is ±6,100 square feet.

TOPOGRAPHY AND SOILS

The topography of the site is generally level and at grade with East Hastings Street and the rear

lane, with no major changes in elevation from one point to the next. However, we note the site has

a gradual downward slope (approximately one metre) from east to west.

We assume soil conditions are stable and that the underlying geology is adequate to support the

existing and assumed renovated improvements. No representations have been made concerning

soil conditions. (See Assumptions and Limiting Conditions.)



SITE DESCRIPTION (continued)

ENVIRONMENTAL

We were provided with a copy of the Limited Phase I Environmental Site Assessment and Liability

Assessment dated November 28, 2018 for the subject property prepared by Hemmera Envirochem

Inc. The Phase I report identified a possible underground storage tank and unknown fill. Based on

Hemmera’s previous experience at similar SROs, they estimated the following environmental

investigation and remediation costs:

• Determination of contamination/liability extent (i.e., via Phase II investigations) - $30k to

$50k;

• If contamination is present and/or upgrades require removal of soil - $50 to $75k;

• The total remaining environmental liability is estimated at $80k to $125k.

We assume the environmental information and cost estimates provided by Hemmera are accurate

and we reserve the right to modify our value conclusions upon receipt of a detailed estimate of

remediation costs, if any.

ACCESS AND STREET IMPROVEMENTS

Vehicle and pedestrian access to the property is from East Hastings Street, a four-lane, paved

thoroughfare with concrete curbs, sidewalks and street lighting. Metered street parking is available,

only during non-rush hours, in sections of the subject’s block of East Hastings Street. Access to the

site is also available from a rear lane accessible from Columbia Street and a side lane from East

Hastings and East Pender Streets.

SERVICES

All municipal services are assumed to be available, including hydro, water, storm and sanitary

sewers, natural gas, telephone, cable and adequate fire and police protection. No representations

are made concerning engineering and servicing requirements, as this requires the services of a

qualified engineer.



SITE DESCRIPTION (continued)



7.0 DESCRIPTION OF EXISTING IMPROVEMENTS AND ASSUMED RENOVATIONS

The subject building was constructed circa 1913 according to City of Vancouver building records,

and is an eight-storey, plus full basement commercial and SRO facility known as the “Regent Hotel”.

As of the effective date of appraisal, the entire building was vacant due to a large number of

outstanding work orders issued by the City, which resulted in the building being deemed unsafe to

occupy. The building was vacated on June 28, 2018.

The structure appears to be of masonry brick, steel and wood beams, concrete and concrete block

construction and sits above a concrete slab foundation. Exterior finishing consists of masonry brick,

tile, painted concrete and stucco with concrete window sills. The windows are single-glazed set in

steel and wood frames. The roof is flat and is a “torch on” roofing system. There is an elevator

machine room on the roof.

Overall, the building is similar to a number of other older residential structures in the area;

however, it is taller than most buildings in the area. The improvements have a site coverage of

100% and as such, there is no on-site parking.



DESCRIPTION OF EXISTING IMPROVEMENTS AND ASSUMED RENOVATIONS (continued)

Building plans were not available for the subject property; however, a typical floor plan for the

residential floors was provided by our client and is included at Appendix “D”. Building plans

indicating the subject’s total area were not available. The subject’s individual gross floor areas and

estimated gross building area were provided by Merrick Architecture, which was measured from

CAD files based on the original drawing dimensions. We assume these areas are correct; however, a

professional survey is recommended.

The subject’s main floor has a gross area of ±6,100 square feet and comprises the residential lobby

with two demised security offices and ground floor commercial space. There is a marble grand

staircase providing access to the second floor located immediately off the residential lobby. The

subject’s two ground floor commercial units are accessible from East Hastings Street. The ground

floor mainly comprises the Regent Pub. An inspection of the pub space, including photos, was not

permitted by the pub operator at the time of our inspection on May 29, 2018. Therefore, our

inspection was limited to a brief walk-through the pub space from the front entrance to the

basement entrance at the rear of the unit. The pub appeared to be generally open in design with a

high ceiling height and finished to a level similar to other pubs in the immediate area. Men’s and

women’s washrooms are located towards the rear of the unit. Access to the pub is from the

northeast side of the subject off East Hastings Street. There is also access from the unit to the rear

lane via a metal pedestrian door.

A small commercial unit (estimated at approximately 300 square feet) is situated immediately west

of the pub and comprises a front retail area and rear area with a sink and wood cabinetry. Access

into the unit was limited as the front retail area was cluttered with old equipment from the

previous tenant, a pizza restaurant. The space appeared to be in poor condition. The commercial

unit is accessible from East Hastings Street and also from the residential lobby.

The basement is accessible from a stairwell at the rear of the pub, and comprises unfinished space

with concrete flooring and an open ceiling with exposed piping. The majority of the basement has

been demised into rooms of various sizes with a number of the rooms used by the pub tenant for

storage. The boiler and electrical rooms are located on the south side of the basement. A small

three-piece washroom is also located on the south side of the basement.




The entrance to the residential lobby is located off East Hastings Street. Access between the

residential floors is from one stairwell and one passenger elevator. The elevator provides access to

the upper floors and the basement. We note there is a second internal stairwell located at the

south side of the building; however, it is reported to have been sealed off. There is an external fire

escape at the rear of the building.

The rooming component contains a total of 161 rooming units with 23 units located on each floor;

however, we note that on the sixth floor, three of the units have been combined into one large unit.

Based on our discussions with Atira and the floor plans provided by our client, fourteen of the

rooming units (two on each floor) are reported to have two-piece insuite washrooms and 28 of the

rooming units (four on each floor) are reported to have full insuite washrooms with a bath

tub/shower. At the time of the initial inspection on May 29, 2018, 63 of the 161 rooming units were

reported by Atira, the building’s property management company, to be vacant and boarded up.

Discussions with the City of Vancouver’s Property Use Inspection Department indicated that the

subject building is currently licensed for 158 SRO units only. However, based on our inspection and

discussion with Atira, there appears to be 161 constructed rooming units. Given the limitations of

the building in terms of accessibility (one small elevator) and limited washrooms we are of the

opinion that the building maximum capacity is 161 SRO units.

Heating in the units and common areas is provided via hot water heaters. The building does not

have shared kitchen or laundry facilities. Each of the residential floors has shared washroom

facilities. Each of the units has an exterior window. The rooming units are considered to be either

similar to, or slightly larger in size in comparison with, typical units in the market.




ASSUMED RENOVATIONS

As per Merrick Architecture’s Regeneration Report, in combination with its consulting team, the

following scope of works are assumed to be required for the subject property to be renovated and

available for occupancy:

• Renovated to a good standard comparable to other recently renovated micro-unit buildings in

the general area, including the 13 SRO buildings that were part of BC Housing’s SRO renewal

initiative;

• 154 rooming units in total, each with an exterior window, suitable only for single-occupancy,

and are approximately 133 square feet in size, with the exception of the accessible rooms

comprising 130 square feet. The second to eighth floors will each include 22 rooming units

with shared washroom facilities, with one accessible unit and two units with two-piece insuite

washrooms on each floor;

• Each unit will contain the following furnishings: a small kitchenette area comprising a

stainless steel counter unit with single-basin stainless steel sink, stainless steel backsplash and

stainless steel door front, two stainless steel mounted shelves, mini-fridge, and microwave, a

single bed solid steel frame with mattress, metal wardrobe, steel-topped table and steel-

welded chair, and steel-topped bed stand, four metal coat hooks and horizontal vinyl window

blinds;

• The shared washroom facilities on the second to eighth floors will comprise one accessible

toilet, one accessible shower, four shower rooms, two combined shower and toilet rooms,

one men’s washroom with two toilets and two sinks, and one women’s washroom with three

toilets and two sinks;

• The building will include residential amenity space on the ground floor comprising a common

kitchen with a full-size fridge, oven and range hood, dishwasher, microwave and table and

chairs, a common lounge/dining area with a table and chairs, sofa and/or loveseat, wall-

mounted flat screen television and DVD player;

• The building will include a storage room with split-level, wire mesh cages and heavy duty

shelving;

• The building will include an administrative office and nurse’s room on the ground floor;

• The building will include coin-operated laundry machines (one washer and dryer per 15

residents);




• The building will include a bed-bug sauna;

• The building and units will have access to free wifi and basic cable with free electricity and

heat;

• There will be some form of 24-hour, on-site property management (i.e., management staff

and/or a caretaker) and weekly janitorial services to common areas;

• Security will include FOB entry and security cameras at the front entrance and throughout the

interior public areas;

• A single elevator will service the building as per what exists now;

• A pub will be located on the ground floor with a portion of the basement used for pub

storage; and

• The Landlord will provide finished shell space for the pub space to be leased to a third party.








Please refer to Merrick Architecture’s Regent Hotel Regeneration Report for a full description of the

assumed renovations.

A copy of the building summary sheet prepared by Merrick Architecture is provided on the

following page and illustrates the subject’s building areas, existing number of rooms and washroom

facilities, and proposed number of rooms and washroom facilities and size of each rooming unit.




AGE AND CONDITION

Based on inquiries at the City of Vancouver, the building was constructed circa 1913; therefore, the

chronological age of the improvements is ±106 years.

The appraisers are not qualified to give engineering opinion as it pertains to the structural nature of

the improvements. During the course of our inspection, only cursory observations were made and

areas inaccessible or covered were not inspected. The roof was viewed by Reagan Stinson during

the inspection on May 29, 2018 and is a “torch on” roofing system. The age could not be confirmed.




Under the second valuation approach (Value as if Renovated Less Renovation Costs), upon

completion of the assumed renovations, the subject building is assumed to offer renovated

commercial and residential accommodation with a modern and good level of finish and functional

layout. We note that with building upgrades and renovations, the economic life can be further

extended. It is important to note that the appraisers are not professional building inspectors. A

detailed and professional building inspection is recommended to a prospective purchaser.

To clarify the extent of renovations required to conform to building codes, the following consultants

were engaged due to their extensive experience with renovating similar buildings in the area, and

their opinions have been relied upon in this report:

• Merrick Architecture – Architecture and Heritage;

• McAuley Thornson – Building Code;

• Bush Bohlman and Partners – Structural Engineer;

• MCW – Mechanical Engineer;

• WSP – Electrical Engineer;

• Morrison Hershfield – Building Envelope;

• Pinchin West – Hazardous Materials;

• Hemmera – Environmental.

When purchasers of similar complex properties in a poor state of repair undertake due diligence, a

similarly composed team is generally assembled. Each member of the team brings the expertise

essential to evaluating the obligations that the SRO hotel will present for it to be restored and

occupied. In light of the public’s knowledge of the subject building’s issues (i.e., the “Do Not

Occupy” order issued on June 20, 2018 by the City), a reasonable purchaser would likely complete

the same level of due diligence we undertook. Furthermore, being safely able to accommodate 154

rooms (upon completion of the assumed renovations) in this location, along with a pub, in an old

and complicated nine storey plus basement building will need to be carefully scrutinised.



8.0 ZONING AND PLANNING

ZONING

The City of Vancouver Zoning & Development By-law (3575) governs and controls the types of use

and building requirements in particular zones to ensure they ultimately conform to the overall

scheme of the area.

As at the date of valuation, the subject property is zoned DEOD (Downtown-Eastside/Oppenheimer

District). The intent of this schedule is to permit the following uses: residential, commercial, and

light industrial uses, parks and open spaces, public uses and facilities, urban farm – Class B, and

other uses comparable or accessory to such uses. A zoning map obtained from the City’s online

mapping program is provided below for illustration purposes; the subject is outlined in green.

There are no site area, coverage, setback or FSR restrictions under the DEOD zone; however, there

are further development guidelines in the DEOD Official Development Plan and the Downtown East

Side Local Area Plan.



ZONING AND PLANNING (continued)

DEOD OFFICIAL DEVELOPMENT PLAN

The DEOD zone is a Comprehensive Development District that is “subject to the form, location and

any special characteristics being in conformity with any Official Development Plan”. The Official

Development Plan (ODP) for the Downtown-Eastside/Oppenheimer area is “intended to control and

guide the development of all uses in that part of the City of Vancouver for which the Zoning District

is described.”

The subject property is situated within Sub-area 1 Main/Hastings of the DEOD, which is “intended to

be a high-density, mixed commercial and residential area, appropriate for a mix of office, retail,

local social services, and other similar uses. Residential uses are also permitted. Pedestrian-oriented

uses, primarily retail and restaurant, are encouraged at ground level with an emphasis on continuity

of facade and narrow frontages for individual uses on Main Street from Hastings to Cordova and

along Hastings Street from Carrall to approximately Dunlevy. The retention and upgrading of

existing multi-unit residential buildings is encouraged. The development of new residential units on

upper floors of buildings is encouraged through a floor space bonus system. Special design

measures, however, should be undertaken to mitigate the air and noise pollution problems.”

Within Sub-area 1, the maximum building height for any development is 98 feet, “with

consideration of additional height to 120 feet on corner sites through review of site specific context,

heritage considerations, and urban design performance”. The maximum FSR for any development

shall be 1.0, except that the Development Permit Board may permit an increase in the maximum

density:

“(a) to a maximum floor space ratio of 5.0, if at least 60% of the residential units comprising

not less than 40% of the gross floor area above a floor space ratio of 1.0 are developed as

social housing and the remaining 40% of the residential units comprising not more than 60%

of the gross floor area above a floor space ratio of 1.0 are developed as secured market

rental housing; or




(b) to a maximum floor space ratio of 7.0 on corner sites if:

(i) at least 60% of the residential units comprising not less than 40% of the gross

floor area above a floor space ratio of 1.0 are developed as social housing and the

remaining 40% of the residential units comprising not more than 60% of the gross

floor area above a floor space ratio of 1.0 are developed as secured market rental,

(ii) the corner site has a frontage no greater than 30.5 m, and

(iii) the Development Permit Board first considers:

(a) the intent of this Official Development By-law and all applicable Council

policies and guidelines; and

(b) height, bulk, location and overall design of the building and its effect on

the site and on surrounding buildings and streets and existing views, with an

emphasis on preserving and strengthening prevailing context and mitigating

the impact on the liveability of adjacent residential areas and the impact on

public areas such as parks and plazas.

Despite the provisions of subsection 4.5.1, the Director of Planning or the Development Permit

Board may permit an increase in the maximum floor space ratio to 1.5 for retail, service,

manufacturing, or wholesale uses and accessory uses, if:

(a) the uses are existing as of April 29, 2014;

(b) the uses are located on a site existing as of April 29, 2014; and

(c) there is no conversion of existing residential floor area.”

Excerpts of the DEOD section of the zoning bylaw and the DEOD Official Development Plan are

attached as Appendix “E”.

DOWNTOWN EASTSIDE LOCAL AREA PLAN

The City of Vancouver approved the new Downtown Eastside (DTES) Local Area Plan in March 2014.

The intent of the Plan is to provide a framework to guide change and development in the DTES over

the next 30 years. The Local Area Plan aims to ensure that the future of the DTES improves the lives

of all those who currently live in the area, including low-income and middle-income residents, the

homeless, seniors, women, children and families.




The plan is also intended “to enhance and accelerate a strategy to implement the Council’s 2005

DTES Housing Plan” thereby improving the diversity of affordable market and non-market housing

options in the neighbourhood.

The DTES local planning area is comprised of the following seven sub-areas: Chinatown, Gastown,

Industrial Area, Downtown Eastside Oppenheimer District, Strathcona, Thornton Park and Victory

Square.

The subject is located within Sub-area 1 of the Downtown Eastside Oppenheimer District, which is

described as having potential for allowing development heights of 98 feet, with consideration of

additional height (to a maximum of 120 feet) “through review of site specific context, heritage

considerations, and urban design performance”.

The baseline density is 1.0 FSR. Bonus density up to 5.0 FSR total is available for projects with 60

percent social housing units and 40 percent secured market rental housing units, with potential for

additional bonus density up to 7.0 FSR on corner sites. Rezoning for density above 7.0 FSR will be

considered on a case-by-case basis where zoning bonus density requirements are met or exceeded.




“Projects will be considered on a case by-case basis with consideration of site context, urban design

performance, and detailed proposal review”. The Plan also supports “the expansion of local

business by offering a moderate amount of bonus density (up to 0.5 FSR over the base density of

1.0 FSR for a total of 1.5 FSR) to existing commercial and industrial uses for the expansion of floor

space, without requiring the delivery of social housing”.

DTES PLAN SUMMARY

The new Downtown Eastside plan strives to find housing solutions for current residents, avoiding

displacement. As housing costs rise, low income residents have fewer housing options. Through the

new plan the City is hoping to add new social and supportive housing units in the Downtown

Eastside wherever possible through increased density (including rezonings) and partnerships.

As per the ODP, the maximum FSR for any development shall be 1.0, however an increased FSR of

5.0 and 7.0 (for corner sites) may be permitted if not less than 60% or the units are developed as

social housing and the remainder are developed as secured market rental housing.

PARKING

Parking requirements for the subject property are governed by the City of Vancouver’s Parking

Bylaw. Within the subject’s DEOD area:

(a) off-street parking shall not be required for any ground floor retail and similar use in the

area, (b) the provision of parking facilities may not be required with developments,

however, where parking is provided, it shall be subject to the following conditions and

regulations:

(i) office commercial, live-work, and residential uses shall require not more

than one parking space for each 93 square metres of gross floor area of such

uses,

(ii) other permitted uses shall require not more than the requirements set out

for such uses in section 4.2, unless otherwise determined by the Director of

Planning.

For the subject’s rooming house use, a minimum of one parking space is required for each 37

square metres (398 square feet) of floor area used for sleeping units, exclusive of bathrooms.




SINGLE ROOM ACCOMMODATION (SRA) Bylaw (#8733)

In 2003, the City of Vancouver implemented the Single Room Accommodation (SRA) Bylaw (#8733).

The Bylaw was created to manage the change of low-income housing in the downtown Vancouver

core. This area is bounded by Burrard Inlet to the north, Burrard Street to the west, False Creek and

Terminal Avenue to the south and Clark Drive to the east. Owners are now required to obtain

permits to demolish or convert existing SRO buildings.

We note that as of July 2015, the City of Vancouver, in an effort to prevent Vancouver’s declining

rooming stock, amended the Bylaw and increased the demolition/conversion fee from $15,000 to

$125,000 per room. In addition to these increased fees, all minor repairs to units now require a City

permit. The permit requires the applicant to provide a plan for temporarily relocating the impacted

tenants and also allow them to re-occupy the unit at the previously charged rent. The Bylaw may

affect future redevelopment of the subject property.

HERITAGE REGISTER AND DESIGNATION

The subject building is classified as Heritage “B” under the City of Vancouver’s Heritage Register.

The Heritage Register is a listing of all City of Vancouver buildings considered to have heritage

value. The City of Vancouver indicates that a Heritage “B” class building “Represents good examples

of a particular style or type, either individually or collectively; may have some documented

historical or cultural significance in a neighbourhood”.

The property is also listed on the Canadian Heritage register in November 2007 noting the

property’s character defining elements as:

• Its skyscraper form, scale and massing

• Its siting on the property with no setbacks

• Its functional relationship with other buildings within the Hastings Street strip and adjoining

neighbourhoods

• Chicago-style elements which define the Regent Hotel include; pilasters which terminate in

arches, indented spandrels with decoration, pattern of fenestration including a single one-

over-one double-hung sash flanked by two sets of three one-over-one double hung

windows, the overhanging metal cornice on the front of the building with its brackets and

dentils




• Continued use as a residential hotel

Based on the above, redevelopment of the existing building could be affected. At this time there is

no definitive direction from the City whether the building can be demolished.



9.0 HIGHEST AND BEST USE

The definition of “Highest and Best Use” is as follows:

“The reasonably probable use of real property, that is physically possible, legally permissible,

financially feasible, and maximally productive, and that results in the highest value.”

Source: Canadian Uniform Standards of Professional Appraisal Practice, 08/2018.

Many factors and appraisal principles become considerations in the determination of "Highest and

Best Use". These include government regulations, supply, demand, anticipation, balance, surplus

productivity, contribution, competition, etc. The definition also includes the presumption that the

use is in keeping with zoning and legal requirements.

The concept of "Highest and Best Use" recognizes that land use patterns can change over a given

period and that the optimum use of a site is determined by need or demand at any given point in

time. Elements affecting value that are dependent upon events or a combination of occurrences

that, while within the realm of possibility, are not shown to be reasonably probable, should be

excluded from consideration. This is also the case if the intended use is dependent on the uncertain

act of another person.

Highest and Best Use – As if Vacant

The subject site comprises a ±6,100-square-foot, rectangular-shaped, basically level site. The

property is situated on the south side of East Hastings Street between Columbia and Main Streets

within the Downtown Eastside. The parcel has ±50 feet of frontage and good traffic and pedestrian

exposure is afforded to the subject. All municipal services requisite for urban development on the

subject site are assumed to be available to the property line.

The subject is zoned DEOD (Downtown-Eastside/Oppenheimer District). The zone is a

Comprehensive Development District that is “subject to the form, location and any special

characteristics being in conformity with any Official Development Plan”. The Official Development

Plan (ODP) for the Downtown-Eastside/Oppenheimer area is “intended to control and guide the

development of all uses in that part of the City of Vancouver for which the Zoning District is

described.”



HIGHEST AND BEST USE (continued)

The subject’s DEOD zoning specifies a wide range of conditional uses for the subject site, which

includes residential, commercial, light industrial, parks and open spaces, public uses and facilities

and other uses comparable or accessory to such uses. Within Sub-area 1 of the ODP, the maximum

FSR for any development shall be 1.0, however an increased FSR of 5.0 and 7.0 (for corner sites)

may be permitted if not less than 60% or the units are developed as social housing and the

remainder are developed as secured market rental housing.

The subject’s immediate area is generally developed with retail/office buildings and mixed-use

rooming house developments. The subject is located on the periphery of an area that is currently

undergoing urban renewal and revitalization as evidenced by numerous recently constructed

mixed-use residential projects, including the Woodward’s development located to the west of the

subject and the Sequel 138 development directly west. However, the immediate area continues to

be negatively impacted by the high number of homeless people and local social/drug-related issues.

Based on the existing zoning and size of the site, it is our opinion that the "Highest and Best Use" of

the property, as though vacant, is considered to be commercial/residential development with non-

market housing and secured market rental housing in accordance with the existing DEOD municipal

zoning and development plan guidelines. However, as noted later in this report the costs of

demolition may be prohibitive such that the demolition and redevelopment at this time may not be

financially feasible.

Highest and Best Use – As Improved

When a site is improved, the integrated unit of land and building must be continued in the use for

which the improvement was designed, adapted, or could readily be converted, so long as the land

and building in combination have a higher market value than the land alone, if vacant and available

for a better use. It follows, therefore, that provided the subject improvements contribute value to

the whole, over and above the value of the land alone, they represent the “Highest and Best Use”

of the site for the remainder of its economic life.




The improvements comprise a ±106-year-old, eight-storey plus basement commercial rooming

house building with ground floor commercial space and 161 residential units on the upper seven

floors. The building’s estimated gross area is ±50,080 square feet, indicating an FSR of 8.21.

As of the effective date of valuation, the entire building was vacant due to a large number of

outstanding work orders issued by the City, which resulted in the building being deemed unsafe to

occupy. Residents of the building were vacated on June 28, 2018 after a “Do Not Occupy” order was

issued by the City on June 20, 2018.

Under the second valuation approach (Value as if Renovated Less Renovation Costs), upon

completion of the assumed renovations, the subject will comprise average to good quality

commercial and micro-residential unit accommodation. The subject’s DEOD zoning allows for the

commercial and rooming house use of the property. However, the subject’s DEOD zoning restricts

development to social housing and secured market rental housing with a maximum FSR of 5.0.

Further, the subject is governed by the City of Vancouver’s Single Room Accommodation Bylaw,

which would require a payment of $125,000 per unit in the event the units were to be converted or

demolished. Based on current zoning, the subject improvements could not be reconstructed to the

current FSR of 8.21. We have assumed the existing SRO use would be required in a new

development. However, as a new building with a lower density would likely not be able to

accommodate the existing 161 rooming units, we have assumed there would be no penalty from

the City for a loss of any units beyond what could be reconstructed.

The subject building is also classified as Heritage “B” under the City of Vancouver’s Heritage

Register, which may affect redevelopment. While several buildings in the area have been renovated

or redeveloped over the past few years, the immediate area continues to be negatively impacted by

the high number of homeless people and local social/drug-related issues. Given these challenges,

redevelopment of the existing building is not considered financially feasible at this time.

Our estimate of land value as vacant and available for development to its most economic and

legally permitted use is $3,050,000. However, after deducting demolition costs of $3,152,787, the

estimated land value is concluded at $1.00.




Assuming completion of the assumed renovations, the subject improvements will contribute value

to the whole, over and above the value of the land alone. However, the renovation costs that we

have been provided and relied upon far exceed the value of the subject property upon completion

of the assumed renovations, indicating that the renovation project is not economically feasible at

this time.

It is frequently assumed that the concept of “Highest and Best Use” must be associated with some

form of immediately productive use. However, owners awaiting certain events in the market place,

which may, at some point in time, command a specific use of development, frequently hold sites in

a vacant state. These properties can also be acquired by parties who need to control certain lands

due to their ownership interests in adjacent lands, and they are not as time sensitive as other types

of investors.

Holding properties with uncertain use potential and long holding horizons are often bought and

sold simply as a commodity, until economic forces and market conditions warrant either renovation

or demolition and redevelopment. The values of these types of properties seem to move up and

down with the general real estate cycle. Holding properties generally appeal to investors that have

a long term view. In other words, “holding use” is a legitimate Highest and Best Use in its own right.

To conclude, the Highest and Best Use of the subject property, as at the effective date of this

report, is considered to be a holding property until economic forces and market conditions warrant

either renovation of the existing improvements or demolition and redevelopment.



10.0 LAND VALUE

There are six recognized methods of valuing vacant land. These methods are identified as the Direct

Comparison Approach, Abstraction Method, Extraction Method, Subdivision Development Method,

Land Residual Technique, and Gross Rent Capitalization Method. In this report, the Direct

Comparison Approach was used to estimate the market value for the ‘vacant’ subject site under its

highest and best use.

The two methods of comparison are:

• Price per buildable square foot;

• Price per square foot of site area.

The comparable properties include sales and listings of holding and potential development sites

located within the immediate Downtown Eastside area. The updated Downtown Eastside area plan,

implemented in 2014, significantly impacts the ability to develop DEOD-zoned properties with

market residential. New projects built beyond the existing zoning will be required to contain 60%

social housing and 40% “secured” market rental housing. Given these restrictions, we would expect

the subject property to command a lower price per square foot than adjacent zonings. Our

comparables are limited to similar DEOD-zoned properties that permit a maximum FSR of 5.0.

Since the driving factor behind a development property’s value is its development potential, the

price per square foot of buildable area has been considered as an indicator of value. It is a

commonly accepted and widely used method when valuing multi-family residential development

properties in the Lower Mainland. However, the density achievable for the subject property is

speculative due to site size, future planning considerations, and potential for rezoning and/or

density bonuses. Therefore, we have valued the subject property on a price per square foot of site

area, rather than on a price per buildable square foot. However, the price per buildable square foot

value parameters have also been given significant consideration.

The comparables were selected from a range of sales and listing data investigated in the general

vicinity of the subject. A map of the comparable property’s locations is illustrated on the next page,

followed by an analysis of the comparables.



LAND VALUE (continued)

COMPARABLE LAND SALES LOCATION MAP

The summarized comparables are presented on a price per square foot and price per buildable

square foot basis and indicate sales of vacant or redevelopment multi-family commercial properties

ranging from ±3,000 to ±6,100 square feet in size. Sale values (before adjustments) range from $377

to $708 per square foot of site area, or $75 to $142 per square foot of buildable site area. The

permitted FSR for each comparable is ±5.0, commensurate with the subject. The lower end of the

value range is illustrated by Comparable No. 2, a March 2016 sale of a ±6,099-square-foot site

immediately adjacent to the subject property at $377 per square foot ($75 per buildable square

foot). The upper end is illustrated by Comparable No. 3, a June 2018 sale of a ±6,000-square-foot

lot, approximately two blocks northeast of the subject on Main Street, at $708 per square foot

($142 per buildable square foot).

Based on our research of commercial land transactions in Downtown Vancouver and discussion

with local real estate professionals, adjustments were applied to the comparables for differences in

location, size and exposure and for the change in the market since the date of sale.




The updated Downtown Eastside area plan, implemented in 2014, significantly impacts the ability

to develop DEOD-zoned properties with market residential. New projects built beyond the existing

zoning will be required to contain 60 percent social housing and 40 percent “secured” market rental

housing. Given these restrictions, we would expect the subject property to command a lower price

per square foot than adjacent zonings.

The Downtown Vancouver land market has continued to see price increases; however, discussion

with participants active in the market indicate that the subject’s block of the Hastings Corridor and

blocks to the east are not as desirable as other blocks in the area, and the large increases in land

value generally experienced by the Vancouver market are not applicable to the subject’s block.




No Location Sale Price Zoning & Area Plan

Site Size

(Sq.ft.) &

FSR

Price/ Sq.ft. &

Price/ Sq.Ft.

Buildable

Comments

1 108 $3,150,000 DEOD 6,100 $516

E Hastings Street Jul-18 Sub Area 1

Vancouver Main/Hastings FSR

5.0

DTES Oppenheimer 30,500 $103

District - Area A2

2 141 & 151 $2,300,000 DEOD 6,099 $377

E Hastings Street Mar-16 Sub Area 1


5.0


District - Area A2

3 138 $4,250,000 DEOD 6,000 $708

Main Street Jun-18 Sub Area 1


5.0


District - Area A2

COMPARABLE LAND SALES

Located within the subject's block. The site has ±50 feet of frontage

and rear lane access. Zoned DEOD, Sub Area 1, the same as the

subject property. At the time of sale the property was improved

with a two-storey commercial building built in 1982 with some

renovations and upgrades completed in 2008 to provide 16 artist

studios. Reportedly, the purchaser acquired the property for

investment. At time of the contract in April 2018 there was a head

lease in place at a below market rent of $66,000 per annum with

month-to-month gross subleases totaling $179,974 per annum

indicating a net income of $118,823. Reportedly, the head lease was

to be terminated.

Located within the subject's block on the north side of East Hastings

Street. The site comprises two legal lots with ±50 feet of frontage

and rear lane access. Zoned DEOD, Sub Area 1, the same as the

subject property. At the time of sale the property was improved

with two single-storey, single tenant, commercial buildings (1920).

Located on the east side of Main Street between Alexander and

Powell Streets. The site comprises two legal lots with ±50 feet of

frontage and rear lane access. Zoned DEOD, Sub Area 1, the same as

the subject property. The site was vacant and unimproved at the

time of sale. A non-profit acquired the site for a future 70-unit

affordable housing development. The site had been listed in 2017

for $3,995,000, or $133 per buildable sq.ft. and the listing agent

reported the purchase price was slightly above market.





Site Size

(Sq.ft.) &

FSR

Price/ Sq.ft. &

Price/ Sq.Ft.

Buildable

Comments

4 219 $1,650,000 DEOD 3,000 $550

Main Street Jun-16 Sub Area 1


5.0


District - Area A2

5 426 $1,830,000 DEOD 3,050 $600

E Hastings Street Sep-17 Sub Area 1


5.0


District - Area A2


Located on the west side of Main Street between Powell and

Cordova Streets. The site has ±25 feet of frontage and rear lane

access. Zoned DEOD, Sub Area 1, the same as the subject property.

Improved with a two-storey plus basement mixed-use building built

in 1908 with an assessed value of $16,200 at the time of sale. The

top floor was reported to include a three-bedroom residential suite

and an office suite with four private offices, kitchen, reception, and

storage. The main floor comprises a 3,000 sq.ft. retail unit and the

full basement has four private rooms, reception, kitchenette, and

storage. Subsequent to the sale, the building appeared to be vacant;

however, as of the effective date of appraisal it appeared to be

occupied by Pier Health Resource Centre. The building does not

appear to be on the Heritage Registry.

Located on the south side of East Hastings Street, east of Dunlevy

Avenue. The site has ±25 feet of frontage and rear lane access.

Zoned DEOD, Sub Area 1, the same as the subject property. Zoned

Downtown Eastside Oppenheimer District - Sub Area 1. At the time

of sale the propert was improved with a ±5,235 sq.ft. mixed-use

building with a retail unit on the ground floor and a large five-

bedroom residential unit on the second floor reported to be

renovated with a new kitchen and new floors. At the time of sale

the retail unit was leased to meat shop for $2,200 per month, net;

however, the lease was reported to expire in April 2018.





Site Size

(Sq.ft.) &

FSR

Price/ Sq.ft. &

Price/ Sq.Ft.

Buildable

Comments

6 330 $1,680,000 DEOD 3,050 $551

E Hastings Street Listing Sub Area 1


5.0


District - Area A2

7 317 $1,800,000 DEOD 3,050 $590

E Hastings Street Listing Sub Area 1


5.0


District - Area A2


Located on the south side of East Hastings Street, between Gore and

Dunlevy Avenues. The site has ±25 feet of frontage and rear lane

access. Zoned DEOD, Sub Area 1, the same as the subject property.

Improved with a three-storey mixed-use building comprising four

residential units and two ground floor units, all reported to be

leased. In August 2018, the listing agent reported there was an

accepted subject offer with conditions to be removed at the end of

July; however, the purchaser was unable to obtain financing and the

deal collapsed. The agent also reported there is some value in the

building with net income of approximately $46,674. In late 2018,

the asking price was reduced from $1,799,000 to $1,680,000. In

October 2019, the agent indicated there has been interest and other

offers; however, no additional information was provided.

Located on the north side of East Hastings Street, east of Gore

Avenue. The site has ±25 feet of frontage and rear lane access.

Zoned DEOD, Sub Area 1, the same as the subject property.

Improved with a 2,028 sq.ft. commercial office building comprising

seven offices, reception area, waiting area, kitchenette, three

storage rooms, three washrooms and two gated parking stalls at the

rear of the building. In late 2018, the listing agent reported there

was interest from developers to purchase the site as part of an

assembly; however, there were no official offers. The agent also

reported the building has some value and was listed for lease

($5,020 per month, gross). In October 2019, the agent reported the

property had been leased for approximately $30 per sq.ft. and there

has been interest to purchase the building, but no official offers.

Reportedly, the vendor is firm on the asking price.




ANALYSIS OF COMPARABLE LAND SALES

Comparable No. 1 (108 East Hastings Street), at $516 per square foot, provides the most recent

land sales evidence within the subject’s block. The property comprises a ±6,100-square-foot lot with

±50 feet of frontage onto the south side of Hastings Street. The property was under contract in April

2018 and sold in July 2018 for $3,150,000. Based on the maximum permitted density of 5.0 FSR

under the Downtown Eastside Oppenheimer District (Sub-area 1), the unit value equates to $103

per buildable square foot. At the time of sale the property was improved with a ±13,020-square-

foot, two-storey commercial building built in 1982 with some renovations and upgrades completed

in 2008 to provide 16 artist studios. The comparable provides good evidence for the subject’s land

value given its similar location, size and zoning; however, offsetting adjustments for the

comparable’s improvements are warranted. The property was purchased to hold given its net

income of $110,526. Overall, a land value close to, but below $516 square foot is appropriate for

the subject.

Comparable No. 2 (141 & 151 East Hastings Street) at $377 per square foot, is the March 2016 sale

of a ±6,099-square-foot redevelopment site across from the subject on East Hastings Street. At the

time of sale, the comparable was improved with two single-storey, single-tenant commercial

buildings that were not considered to contribute material value. However, as of the effective date

of appraisal, we note the buildings appeared to be occupied by a marijuana dispensary. Based on

the maximum permitted density of 5.0 FSR under the Downtown Eastside Oppenheimer District

(Sub-area 1), the unit value equates to $75 per buildable square foot. The comparable provides

good evidence for the subject’s land value given its similar location, site size and zoning; however,

an upward adjustment is warranted for the improvement in the market since the early 2016.

Overall, a value greater than $377 per square foot is appropriate for the subject.

Comparable No. 3 (138 Main Street), at $708 per square foot, provides the most recent DEOD-

zoned bare land sales evidence in the subject’s area. The comparable is located on the east side of

Main Street between Alexander and Powell Streets, approximately two blocks northeast of the

subject. The 100 block of Main Street is considered superior to the subject’s location. The property

is a ±6,000-square-foot vacant site comprising two adjacent legal lots with a total frontage of ±50

feet.




The property sold for $4,250,000 in June 2018, and was vacant and unimproved at the time of sale.

Based on the maximum permitted density of 5.0 FSR under the Downtown Eastside Oppenheimer

District (Sub-area 1), the unit value equates to $142 per buildable square foot. A non-profit

acquired the site for a future 70-unit affordable housing development. The site was listed in 2017

for $3,995,000, or $666 per square foot, and the listing agent and the purchaser reported the

purchase price was slightly above market as they were highly motivated to acquire the site.

Downward adjustments for the comparable’s superior location and slightly above market purchase

price support a lower price per square foot for the subject.

Comparable No. 4 (219 Main Street) at $550 per square foot is the June 2016 sale of a ±3,000-

square-foot property on the west side of Main Street between Powell and Cordova Streets,

approximately one block northeast of the subject. At the time of sale, the site was improved with an

older two-storey plus basement mixed-use building that appeared to be vacant subsequent to the

sale; however, as of the effective date of appraisal it appeared to be occupied by Pier Health

Resource Centre. Based on the maximum permitted density of 5.0 FSR under the Downtown

Eastside Oppenheimer District (Sub-area 1), the unit value equates to $108 per buildable square

foot. The comparable provides evidence for the subject’s land value given its similar location and

zoning. However, downward adjustments for the comparable’s smaller site area and improvement

value, which are partially offset by strengthened market conditions since mid-2016, support a lower

price per square foot for the subject.

Comparable No. 5 (426 East Hastings Street), at $600 per square foot, is the September 2017 sale

of a ±3,050-square-foot, improved property on the south side of East Hastings Street, east of

Dunlevy Avenue. The property sold for $1,830,000, and at the time of sale the site was improved

with a ±5,235-square-foot, mixed-use building with a retail unit on the ground floor and a large five-

bedroom residential unit on the second floor. The building had reportedly been recently renovated.

The building was also reported to be fully rented and the retail unit was leased to a meat shop for

$2,200 per month, triple net. Based on the maximum permitted density of 5.0 FSR under the

Downtown Eastside Oppenheimer District (Sub-area 1), the unit value equates to $120 per

buildable square foot. Downward adjustments for the comparable’s smaller size and significant

holding value, which include a large renovated residential unit, indicate a lower price per square

foot for the subject property.




Comparable No. 6 (330 East Hastings Street), at $551 per square foot, is a current listing for a

±3,050-square-foot redevelopment site located approximately two blocks east of the subject on the

south side of East Hastings Street. The property is currently improved with a mixed-use building

comprising four residential units and a ground floor retail unit, all currently leased. In August 2018,

the listing agent reported there was an accepted offer with conditions to be removed at the end of

July; however, the purchaser was unable to obtain financing and the deal collapsed. The agent also

reported there is some value in the building, with net income of approximately $46,674. In late

2018, the asking price was reduced from $1,799,000 to $1,680,000 in 2019. In October 2019, the

agent indicated there has been interest and other offers; however, no additional information was

provided. Based on the maximum permitted density of 5.0 FSR under the Downtown Eastside

Oppenheimer District (Sub-area 1), the unit value equates to $110 per buildable square foot.

Downward adjustments for the comparable’s smaller size, holding income and listing status indicate

a lower price per square foot for the subject property.

Comparable No. 7 (317 East Hastings Street), at $590 per square foot, is a current listing for a

±3,050-square-foot redevelopment site located approximately two blocks east of the subject on the

south side of East Hastings Street, east of Gore Avenue. The property is currently improved with a

mixed-use building comprising four residential units and a ground floor retail unit, all currently

leased. Based on the maximum permitted density of 5.0 FSR under the Downtown Eastside

Oppenheimer District (Sub-area 1), the asking price equates to $118 per buildable square foot. In

late 2018, the listing agent reported there had been interest from developers to purchase the site

as part of an assembly; however, there were official offers. The agent also reported the building has

some value and was listed for lease ($5,020 per month, gross). In October 2019, the agent reported

the property had been leased and there has been interest to purchase the building, but no official

offers. Reportedly, the vendor is firm on the asking price. Downward adjustments are warranted for

the smaller size, improvement value and the listing status of the comparable, suggesting a lower

price per square foot for the subject property.

ESTIMATE OF LAND VALUE

In estimating a land value for the subject, considerations were given to the following items:

• The subject is a ±6,100-square-foot, generally level rectangular site, comprised of two legal

lots with full access to municipal services;




• The subject site has vehicular and pedestrian exposure with ±50 feet of frontage along East

Hastings Street, a busy traffic thoroughfare, and also has rear lane access;

• There has been an improving trend in the general area involving City of Vancouver rental

housing initiatives and Chinatown revitalization strategies. However, the immediate area,

particularly the subject’s 100 East Hastings Street block and the 0, 200 and 300 East Hastings

Street blocks, continues to be negatively impacted by the high number of homeless people

and local social/drug-related issues;

• The subject property is situated within Sub-area 1 Main/Hastings of the DEOD ODP, which is

“intended to be a high-density, mixed commercial and residential area, appropriate for a mix

of office, retail, local social services, and other similar uses. Residential uses are also

permitted.”;

• As per the ODP, the subject’s baseline density is 1.0. Under residential redevelopment the

density may be increased to 5.0 FSR for market (although limited to 40% market rental

housing component) and non-market housing;

• The supply of redevelopment land in the downtown area is limited and not expected to

increase; however, we note our research and discussions with market participants suggest

the market for development land in the subject’s immediate area is slow given the block’s

social/drug-related issues and the DEOD zoning’s more restrictive zoning.

Review of the comparable data indicates that notwithstanding the potential of the properties for

redevelopment under the existing zoning, the presence, size and condition of existing

improvements (in relation to the site size), and their potential to provide significant holding income,

has a marked impact on the achievable price per buildable square foot. The motivation for purchase

in some cases may have been driven to some extent by existing value in the improvements.

The land sales data considered in this report applies to the subject’s immediate neighbourhood and

nearby areas, and therefore provides a reasonable guide to value for the subject. Based on the

earlier analysis, and after adjustments, Comparable No. 1 at $516 per square foot of site area,

located within the subject’s block, provides the most recent and best evidence of an appropriate

price square foot for the subject. After an adjustment for the comparable building’s holding income,

a value just below Comparable No. 1 is warranted. Therefore, we concluded with a value of $500

per square foot for the subject’s underlying land value.




Based on the preceding, the estimated market value of the subject property (as if vacant) under the

Direct Comparison Approach, as of October 1, 2019, would be calculated as follows:

Site Area X Price Per = Value

(Square Feet) Square Foot Estimate

6,100 X $500 = $3,050,000

THREE MILLION FIFTY THOUSAND DOLLARS

($3,050,000)*

*The estimated land value above is based on the Highest and Best Use of the subject site as if

vacant and available for development to its most economic and legally permitted use. However,

as the subject property’s existing improvements are currently vacant and have been condemned

by the City, demolition costs should be considered as they would be substantial given the

building’s size and presence of hazardous materials. Our January 2019 discussions with BTY Group

indicate the subject building’s demolition cost would include any costs for hazardous materials

removal and an additional $12.00 per square foot of gross building area. Based on the hazardous

materials removal budget provided by Pinchin West of $2,551,827, and the per square foot cost

of $12.00 per square foot, the subject building’s demolition costs are estimated at $3,152,787.

Land Value - As if Vacant (Rounded): 3,050,000$

Less: Demolition Costs

Hazardous Materials Removal - per Pinchin West - Dec 13, 2018: 2,551,827$

Additional Demolition Costs ($12.00 per Sq.Ft. of Gross Building Area): 600,960$

3,152,787$

Land Value after Demolition Costs: (102,787)$

Land Value after Demolition Costs (Rounded): (100,000)$



11.0 APPRAISAL METHODOLOGY FOR AS IF RENOVATED LESS RENOVATION COSTS

Under our second valuation approach, in estimating the market value of the subject property as of

October 1, 2019, the following conventional methods of appraisal were considered:

COST APPROACH

The Cost Approach is based on the premise that an informed purchaser will not pay more for a

property than the cost of producing a substitute property. This approach involves an estimate of the

cost to build a new building identical to the subject at current prices, subtracting accrued

depreciation that is a measurement of the loss in value from reproduction cost new, and adding the

estimate of land value as if vacant.

This approach is best suited for special purpose properties or properties that have been recently

constructed where depreciation of the improvements is more easily measurable. Depreciation of

the subject building is difficult to accurately measure; therefore, this approach was excluded from

our analysis.

DIRECT COMPARISON APPROACH

The Direct Comparison Approach implies the Principle of Substitution, which states that a prudent

purchaser will not pay more for a property than the price to acquire an equally desirable substitute

property. The properties selected for comparison must be similar in most respects to the one being

appraised. This approach was used in this report because it provides a good indicator of value in our

analysis as the building has been assumed to be renovated.

INCOME APPROACH

The Income Approach is a valuation method whereby the estimated annual net income produced

by a property is capitalized at an appropriate rate into an indication of the property's capital value.

The subject is an income producing property with potential to generate significant income upon

completion of the assumed renovations. For income producing properties, the typical valuation

method utilized is the Income Approach. Thus, the Income Approach was utilized in the valuation of

the subject. Within the Income Approach, the Direct Capitalization Method was utilized assuming a

renovated building.



12.0 INCOME APPROACH (AS IF RENOVATED)

The Income Approach is a method of estimating the value of a property based on the present, or

discounted, worth of the anticipated income benefits that it may reasonably be expected to

produce during the course of its remaining economic life. The process of converting an income

stream into an estimate of present worth is known as “capitalization”.

The basic steps involved in valuation by this approach are:

1. Estimate the gross annual income of the property, less any allowances for bad debts and

vacancy;

2. Estimate the total annual operating expenses;

3. Calculate the annual net operating income (gross income less expenses);

4. Select an appropriate capitalization rate;

5. Select an appropriate method of capitalization;

6. Using a suitable procedure, convert the anticipated annual net operating income stream

into an indication of the capital value of the property.

ESTIMATE OF MARKET RENTAL VALUE

The first three steps in the Income Approach result in an estimate of annual net operating income

for the property being appraised. The first step in developing an operating statement is to estimate

total potential income based upon its "Market Rent".

Market Rent may be the actual rent payable under a lease (“contract” rent) as determined by

analysis of existing lease agreements covering the property, or it may be the appraiser’s estimate of

the rent obtainable in the market for similar properties (“economic” or “market” rent). In

estimating “economic” or “market” rent, an attempt is made to determine the rent a tenant is

warranted in paying. In analyzing income potential, the quality and durability of the income stream,

not just the quantity, are valid concerns, since these factors are reflected in the thinking and actions

of the prudent investor.



INCOME APPROACH (continued)

Most commercial leases are usually stated on a “triple net” basis to the landlord. A “triple net”

lease generally describes a lease where, in addition to the contract rent stipulated, the tenant

assumes payment of all operating expenses pertaining to a property such as taxes, insurance,

utilities and maintenance, but excluding structural repairs. However, we note that pub space within

the subject’s area commonly rents on a “gross” basis with the landlord paying property taxes,

building insurance, structural repairs, maintenance expenses, management fees and all operating

expenses.

COMMERCIAL LEASE DATA ANALYSIS

Prior to the Regent Hotel being closed, there was an SRO hotel on the upper floors and a ground

floor pub. Given the limited demand in the subject’s block and adjacent blocks for alternative retail

or office space (with the exception of cannabis dispensaries, pharmacies, convenience stores and

non-profit or government uses) as indicated by nearby ground floor commercial space vacancies,

including the Sequel 138 development immediately adjacent to the west, a pub use would appear

to maximize the revenue generation from the ground floor. We assume a pub use would be

permitted on the ground floor and the building’s existing Liquor Primary Licence (#5041) will be

provided to a third-party lessee.

In estimating current market rental value for the subject’s renovated ground floor commercial pub

and basement space, we analyzed leases of pub/liquor primary premises in the subject’s general

area. We have also analyzed leases of commercial/retail and restaurant space within the subject’s

immediate neighbourhood to provide supporting rental evidence. Comparables analyzed provide a

general index for the estimate of market rental value for the subject and are provided on the

following page. The comparables indicate a range of current and asking rents between $7.00 per

square foot, net and $50.50 per square foot, net for ground floor commercial space (including

mezzanine) and $0 per square foot, net to $5.00 per square foot, gross for basement

commercial/storage space. The comparables are illustrated in the comparable map and charts on

the following pages.




COMMERCIAL LEASE COMPARABLES LOCATION MAP




No. AddressLease Date

Lease Term

Rentable

Area

(Sq.Ft.)

Face Rent

Per Sq.Ft.

TI Allowance

Free Rent

Fixturing

Net Effective

Rate per

Sq.Ft.

Comments

1 160 E Hastings Street Aug-18 - $11,000 N/A N/A

3 years per month

Renewal Gross

2 488 Carrall Street Dec-13 3,000 $13,200 None N/A

5 years plus per month

(Terminated) Mezz Gross

Office

3 926 Main Street Late 2016 5,000 $18.25 $100,000 $15.64

5 years (Approx) to $25.50 TI Allowance Net

Net 90 Day

Fixturing

2 Months

4,000 $0 Free Rent $0

Basement Net Net

Commercial Lease Comparables

Pub/Liquor Primary Leases

The prior lease of the subject's "Regent Pub". The liquor

primary licence, owned by the Landlord and subject to a third

party agreement with the tenant, permitted 227 seats with

hours of operation from 11:00 am to 12:00 am, Sunday to

Thursday and 11:00 am to 1:00 am, Friday and Saturday. The

tenant is responsible for repairs and maintenance.

"The West" pub in the West Hotel, a commercial/SRO building

on the east side of Carrall Street just south of E Hastings St.

Reportedly, the lease is no longer in effect as the new owner

bought out the lease and took over the business. The lease

included the mezzanine office area; however, the size of the

mezzanine could not be confirmed. The lease agreement does

not specify the basement space is included; however, it is our

understanding the pub utilized a portion of the basement for

storage and business operations. The lease included a five-year

option to renew on the same terms and conditions.

Ground floor retail unit and basement space in the American

Hotel just south of the Viaducts. The rent increases to $20.50

per sq.ft. in the second and third years, and $25.50 per sq.ft. in

the fourth and fifth years. The space was fully improved and

the deal included a $100,000 TI allowance, a 90 day fixturing

period and two months gross free rent. The basement was

leased at $0 net with the tenant responsible for op costs. The

tenant is the American Pub - the owners of the Pub previously

owned the now closed Cobalt, which was located across the

street. The op costs and taxes are estimated at $12.00 per

sq.ft.





Lease Term

Rentable

Area

(Sq.Ft.)

Face Rent

Per Sq.Ft.

TI Allowance

Free Rent

Fixturing

Net Effective

Rate per

Sq.Ft.

Comments

4 210 Abbott Street Jan-18 4,550 $50.50 - $52.47

5 years to $55.00 Net

Renewal Net

5 91 Powell Street Jan-15 5,531 $33.00 None $34.89

10 years Multi- to $37.00 Net

(Terminated) Level Net

1,241 $5.00

Storage Gross


Pub/Liquor Primary Leases

Ground floor pub space in a recently renovated mixed-use

commercial/SRO heritage building at the corner of Abbott and

Water Streets in Gastown. The space has a good quality interior

finish and includes an outdoor patio area fronting Abbott

Street. The tenant is the "Lamplighter Pub". The rental rate

escalates to $53.00 per sq.ft. in year 3, $54.00 per sq.ft. in year

4 and $55.00 per sq.ft. in year 5. The op costs and taxes are

estimated at $9.00 per sq.ft. The liquor licence, which is issued

to the Provincial Rental Housing Corporation, is under third

party agreement to the Donnelly Group, and permits 183

indoor seats and 35 patio seats with hours of operation until

2am Sunday to Thursday and 3am Friday and Saturday.

Multi-level commercial unit features entrances from both

Powell and Alexander Streets, three separate ready-to-go bars,

a new state-of-the-art sound system, multiple lounge areas, a

dance floor, storage space, and built out washrooms. The rental

rate increases by $1.00 per sq.ft. each year of the term. The

deal did not include any inducements. The tenant was the

Alexander night club. The pub closed in October 2017. The

space reportedly included a Liquor Primary License for 143

seats and Food Primary License for 96 seats.





Lease Term

Rentable

Area

(Sq.Ft.)

Face Rent

Per Sq.Ft.

TI Allowance

Free Rent

Fixturing

Net Effective

Rate per

Sq.Ft.

Comments

6 138 E Hastings Street Expired 4,100 $7.00 N/A N/A

Unit 120 2018 Listing includes Net

Mezz

138 E Hastings Street Expired 1,110 $10.00 N/A N/A

Unit 110 2018 Listing includes Net

±300 sq.ft.

Mezz

Nov-18 $24.32 N/A N/A

3 years Gross

Collapsed $13.16

Deal Net

138 E Hastings Street Asking 821 $37.00 N/A N/A

Unit 146 3 years Gross

Escalating

$19.00

Net


Commercial/Retail Leases

Expired listings for quasi-retail/office units and current listing for a

retail unit in Sequel 138, a recently constructed mixed use condo

building located on the south side of East Hastings Street, within the

subject's block. The expired listings comprise concrete shell space

with mezzanine, have fully glazed facades, high ceilings from

approximately 19 to 22 feet, access to a commercial loading bay,

parking and bike lockers, overlook the street level breezeway and

have fob access. Op costs and taxes for Unit 120 were estimated at

$10.51 per sq.ft. The listing agent indicated the unit was on the

market for a significant amount of time, the asking rent was reduced

from $18.00 to $7.00 per sq.ft. net and there were no official offers.

Unit 110 was to include a constructed washroom and includes two

parking stalls and has a roll-up garage style door in the unit. The

listing agent reported that the asking rent was decreased from

$18.00 to $10.00 per sq.ft. net in February 2018. The agent also

reported there was a verbally negotiated deal with a Downtown

Eastside tenant looking for additional office space. The negotiated

rate was $2,500 per month, gross, with a three month fixturing

period and the landlord was to construct a bathroom; however, the

deal did not complete. Op costs and taxes for Unit 110 were

estimated at $11.16 per sq.ft. Unit 146 fronts the street, and was

improved by its former occupant, "Eden Medicinal", a cannabis

dispensary. The listing agent for Unit 146 indicated the unit has been

listed for several months with most of the inquiries for a food use,

which cannot be accommodated due to the lack of venting. The

agent indicated there is a party seriously interested in leasing the

space for a pharmacy; however, the City may not permit this use. Op

costs and taxes for Unit 146 are estimated at $18.00 per sq.ft.





Lease Term

Rentable

Area

(Sq.Ft.)

Face Rent

Per Sq.Ft.

TI Allowance

Free Rent

Fixturing

Net Effective

Rate per

Sq.Ft.

Comments

7 105 E Hastings Street Nov-19 3,000 $20.00 Landlord's $19.63

5 years Gross Work Gross

1 Month

Fixturing

8 185 E Hastings Street Asking 1,005 $12.00 Small N/A

3 years Net TI Allowance



Upcoming lease of a ground floor retail unit in a three-storey plus

basement commercial/SRO building on the north side of E Hastings

Street, within the subject's block. The unit has a 3/4 length glass

storefront and includes some basement space; however, the size

and condition of the basement space was unknown. The leasing

agent reported the unit was not being actively marketed for lease;

however, the owner had placed an old "for lease" sign in the window

and the leasing agent was contacted. The unit was leased to a

convenience store tenant on a gross basis for a five-year term and

included a one month fixturing period and landlord's work

(installation of vinyl plank flooring in the front retail area and all

existing heating, lighting and plumbing is in good working order).

The op costs and taxes were not available; however, the agent

indicated they would likely be less than $10.00 per sq.ft.

Current listing for a ground floor retail unit in the Ford building, an

eight-storey affordable housing building at the NW corner of E

Hastings and Main Street. The unit has a glass storefront, fronts E

Hastings St., does not include parking and has shared washrooms

with the other two retail tenants. The unit has been leased to a

cheque cashing facility for the past ten years and has basic

improvements. The listing agent reported the unit was listed in late

September 2019 and two offers have been received, one from an

electronics repair shop and the other from a non-profit community

based artist gallery. Both offers are below market; however, the

agent indicated a deal is currently being negotiated with the gallery,

and it is likely a below market rent would be accepted to

accommodate the non-profit use. A small TI allowance will also likely

be provided. Op costs and taxes are estimated at $10.00 per sq.ft.





Lease Term

Rentable

Area

(Sq.Ft.)

Face Rent

Per Sq.Ft.

TI Allowance

Free Rent

Fixturing

Net Effective

Rate per

Sq.Ft.

Comments

9 101 E Hastings Street Withdrawn 1,375 $14.00 N/A N/A

2019 Listing Net

10 265 E Hastings Street Asking 3,126 $14.00 Basement N/A

Net Free Rent



Withdrawn listing for a ground floor shell retail unit in Hotel Irving, a

commercial/SRO building at northeast corner of East Hastings Street

and Columbia Street, within the subject's block. The unit has an

entrance on the east side of Columbia Street, featuring a private

washroom, 12 ft. ceiling height, HVAC and large window glazing.

Additional rent is $9.00 per sq.ft. The agent reported the space was

listed in approximately mid-2018. In the summer of 2018, the listing

agent reported there was an offer being written for the space and it

should rent for close to the asking rate with some free rent

provided. As of October 2019, the agent indicated the party

interested in leasing the space was a coffee/grocery store tenant;

however, it did not lease as the landlord intended for the space to be

rented to a certain non-profit. The agent indicated the listing was

withdrawn several months ago, and the space was rented to the non-

profit. The agent could not confirm the rental rate; however, he

thought it was completed at a rate below market.

Current listing for a ground floor shell retail unit in a

commercial/SRO building located on the north side of East Hastings

Street and west of Gore Avenue. The unit has an entrance on the

south side of East Hastings Street, featuring a private washroom, 12

ft. ceiling height, HVAC, rear lane access and loading door. Additional

rent is $9.00 per sq.ft. The asking rate also includes a 4,463 sq.ft.

basement storage area. The agent reported the space was listed in

approximately mid-2018 and as of October 2019 the space is still

available for lease. The agent indicated there has been minimal

interest due to the large size of the unit and there would likely need

to be a reduction to the asking rent.





Lease Term

Rentable

Area

(Sq.Ft.)

Face Rent

Per Sq.Ft.

TI Allowance

Free Rent

Fixturing

Net Effective

Rate per

Sq.Ft.

Comments

11 475 Main Street Asking 2,422 $20.00 Fixturing N/A

3 years and Gross only

2,490 $8.78

Net

Oct-19 One unit $25.00 6 months $11.33

Offer Gross Fixturing/ Net

3 years $13.78 Free Rent

Net



Current lease listings and reported current offer at the Main and

Pender building, a two-storey plus secured parkade retail/office

building at the NW corner of Main and Pender. The building has

elevator service and each unit is reported to have its own HVAC

pump. Major anchor tenants include Dollar Tree and Waves Coffee.

The building's property manager reported there are two adjacent

vacant retail units along Main Street. The units have glass

storefronts with metal security bars. The property manager reported

they have had issues leasing the units as the bus stop is directly in

front of the space and the landlord will not rent to any marijuana

dispensary or grocery store tenants. In late 2018/early 2019 the

asking rent was $25.00 per sq.ft. gross with op costs and taxes

estimated at $12.00 to $13.00 per sq.ft. The asking rent is currently

$20.00 per sq.ft. gross with op costs and taxes estimated at $11.22

per sq.ft. However, the listing agent reported there is currently an

"as is" offer at $25.00 per sq.ft. gross for one of the units. The offer

includes a combined 6 month fixturing/free rent period.




Comparable No. 1 (160 East Hastings Street –Regent Pub), Comparable No. 2 (488 Carrall Street –

West Pub), Comparable No. 3 (926 Main Street – The American) and Comparable No. 4 (210

Abbott Street – Lamplighter Public House) illustrate current and terminated leases for pub space

within the subject’s immediate area and adjacent areas, including the previous pub lease within the

subject building, and provide good evidence for an appropriate rental rate for the subject’s pub

space. Of primary interest is the gross monthly rental value, as opposed to the rental rate per

square foot. Typically, in the subject’s area, they are rented in the range of $10,000 to $14,000 per

month, gross.

Comparable No. 1 (Regent Pub) comprises the pub lease within the subject building prior to the

building being vacated. The lease commenced in August 2015 for a three-year term and was

renewed for an additional three-year term to commence in August 2018. The rental rate was

$11,000 per month, gross, and the liquor licence permits 227 seats with hours of operation from

11:00 am to 12:00 am, Sunday to Thursday and 11:00 am to 1:00 am, Friday and Saturday. The

previous pub space was larger in size compared to the space that will be available for lease upon

completion of the renovation. However, an offsetting adjustment is warranted for the subject’s

newly renovated condition.

Comparable No. 2 (West Pub) is located approximately two blocks southwest of the subject on

Carrall Street at the northern edge of Chinatown. The lease at $13,200 per month gross

commenced in December 2013 for a five-year term and included one five-year option to renew on

the same terms and conditions. However, reportedly, the lease is no longer in effect as the new

owner bought out the lease and took over the pub business. The lease included the ±3,000-square-

foot main level and included mezzanine office area; however, the size of the mezzanine could not

be confirmed. The lease agreement did not specify the basement space was included; however, it is

our understanding the pub utilized a portion of the basement for storage and business operations.

According to several industry participants, the lease was slightly above market; however, our

discussion with the lease holder suggests the rent was more or less at market.




Comparable No. 3 (The American) is located on Main Street just south of the viaducts. The lease

commenced in late 2016 and comprised approximately 5,000 square feet of ground floor space and

approximately 4,000 square feet of basement space in the American Hotel. The rental rate

commences at $18.25 per square foot and increases to $25.50 over the five-year term. The space

was reported to be fully improved and the deal included tenant inducements, indicating a net

effective rate of $15.64 per square foot. The basement was leased at $0 per square foot net with

the tenant responsible for operating costs for the basement space. The operating costs are

estimated at $12.00 per square foot, indicating a monthly gross rent ranging from approximately

$16,600 to $19,600 over the five-year term. The comparable’s space was previously improved and

its location is considered slightly superior to the subject, warranting downward adjustments. The

comparable’s larger size further supports a lower monthly gross rent for the subject’s pub space.

Comparable No. 4 (The Lamplighter Public House) is a January 2018 lease renewal of ±4,550 square

feet of ground floor pub space in a recently renovated mixed-use commercial/SRO heritage building

at the corner of Abbott and Water Streets in Gastown. The space has a good quality interior finish

and includes an outdoor patio area fronting Abbott Street. The rental rate escalates from $50.50

per square foot to $55.00 over the five-year term. The operating costs and taxes are estimated at

$9.00 per square foot, indicating a monthly gross rent ranging from approximately $22,500 to

$24,300 over the five-year term. The comparable’s superior quality space including an outdoor

patio area and Gastown location warrant significant downward adjustments. The comparable’s

larger size further supports a lower monthly gross rent for the subject’s pub space.

Comparable No. 5 (91 Powell Street) is a terminated January 2015 lease of the Alexander night

club, a liquor primary, at the corner of Powell and Alexander Streets in Gastown. The lease included

±5,531 square feet of multi-level space and ±1,241 square feet of storage space. The rental rate for

the multi-level space commenced at $33.00 per square foot, net and escalated to $37.00 per square

foot, net over the five-year term. The basement space was rented at $5.00 per square foot, gross.

The operating costs and taxes were not available. The comparable has a superior corner location in

Gastown, warranting a downward adjustment; however, offsetting adjustments are warranted for

the improvement in Gastown’s retail leasing market since early 2016 and the subject’s smaller size.




Comparable No. 6 (138 East Hastings Street) comprises the expired listings for quasi-retail/office

units and current listing for a retail unit in the Sequel 138 development across from the subject on

East Hastings Street. The listing for Units 120 and 110 expired over approximately the last year. The

units comprise concrete shell space, have mezzanine space, overlook the street level breezeway

and have fob access. The units also have fully glazed facades, high ceilings from approximately 19 to

22 feet and access to a commercial loading bay, parking and bike lockers. Unit 120, comprising

±4,100 square feet, was marketed as ideal for shared workspace or a tech company. The listing

agent indicated the unit was on the market for a significant amount of time and the asking rent was

reduced from $18.00 to $7.00 per square foot net. The agent also indicated there were no official

offers. Unit 110, comprising ±1,110 square feet, was to include a constructed washroom and

included two parking stalls and has a roll-up garage style door in the unit. The listing agent reported

that the asking rent was decreased from $18.00 to $10.00 per square foot net in February 2018. The

agent also reported there was a verbally negotiated deal with a Downtown Eastside tenant looking

for additional office space. The negotiated rate was $2,500 per month, gross, with a three-month

fixturing period and the landlord was to construct a bathroom; however, the deal did not complete.

The agent also indicated the unit was not actively marketed since summer 2018. Although these

units offer recently constructed space, they are considered quasi-retail given the fob access to the

units. The subject’s pub space would achieve a higher rental rate.

Unit 146 comprises an ±821-square-foot unit with direct exposure to and access from East Hastings

Street. The space has a fully glazed storefront and was improved by its former occupant, a cannabis

dispensary. The listing agent indicated the unit has been listed for several months with most of the

inquiries for a food use, which cannot be accommodated due to the lack of venting. The agent

indicated there is a party seriously interested in leasing the space for a pharmacy; however, the City

may not permit this use. The asking rent is $37.00 per square foot, gross with operating costs

estimated at $19.00 per square foot, suggesting a net rent of $18.00 per square foot. Although

downward adjustments for the comparable’s current listing status and smaller size are warranted,

the subject would achieve a higher rental rate given its assumed pub use and newly renovated

condition.




Comparable No. 7 (105 East Hastings Street) is the most recent reported commercial lease within

the subject’s block, and comprises an upcoming November 2019 lease of a ±3,000-square-foot retail

unit within a non-renovated commercial/SRO building located on the north side of the street. The

unit has a 3/4 length glass storefront, and includes some basement space; however, the size and

condition of the basement space was unknown. The unit was leased to a convenience store tenant

on a gross basis for a five-year term at $5,000 per month, gross, which equates to $20.00 per

square foot, gross. The lease included a one month fixturing period and landlord's work (installation

of vinyl plank flooring in the front retail area and ensuring all existing heating, lighting and plumbing

is in good working order). The operating costs and taxes were not available; however, the agent

indicated they would not be more than $10.00 per square foot. The subject would achieve a higher

rental rate given its assumed pub use and newly renovated condition.

Comparable No. 8 (185 East Hastings Street) is the current listing for a ±1,005-square-foot ground

floor retail unit in the Ford building, an eight-storey affordable housing building at the northwest

corner of East Hastings and Main Street. The unit has a glass storefront, fronts East Hastings Street,

does not include parking and has shared washrooms with the other two retail tenants. The unit has

been leased to a cheque cashing facility for the past ten years and has basic improvements. The

listing agent reported the unit was listed in late September 2019 and two offers have been

received, one from an electronics repair shop and the other from a non-profit community-based

artist gallery. The agent also reported they were targeting $12.00 per square foot for basic rent.

Both offers are reported to be below market; however, the agent indicated a deal is currently being

negotiated with the gallery, and the owner of the building will likely accept a below market rent to

accommodate the non-profit use. A small tenant improvement allowance will also likely be

provided. Although consideration has been given to the comparable’s current listing status and

likely below market rent, the subject would achieve a higher rental rate given its assumed pub use

and newly renovated condition.

Comparable No. 9 (101 East Hastings Street) and Comparable No. 10 (265 East Hastings Street) are

the withdrawn listing and current listing of ground floor retail space within the subject’s block at the

northeast corner of East Hastings and Columbia Street and one block east of the subject along the

Hastings Corridor.




Both comparables are situated within mixed-use commercial/SRO buildings that were recently

renovated as part of BC Housing’s SRO Renewal Initiative. The asking net rent for each unit is $14.00

per square foot and the additional rent is reported at $9.00 per square foot. Comparable No. 9

comprises ±1,375 square feet and features 12-foot ceilings, a private washroom and large window

glazing. Past discussions with the listing agent indicated that the space was listed in approximately

mid-2018. In the summer of 2018, the listing agent reported there was an offer being written for

the space close to the asking rate with some free rent provided. As of October 2019, the agent

indicated the party interested in leasing the space was a coffee/grocery store tenant; however, the

lease did not complete as the landlord intended for the space to be rented to a certain non-profit.

The agent indicated the listing was withdrawn several months ago, and the space was rented to the

non-profit. The agent could not confirm the rental rate; however, he believed it was completed at a

rate below market.

Comparable No. 10 comprises ±3,126 square feet. The unit features 12-foot ceilings, a private

washroom, rear lane access and loading door, and basement storage area of ±4,463 square feet.

The basement storage area is included in the rent for no additional charge. The agent reported the

space was listed in approximately mid-2018 and as of October 2019 the space is still available for

lease. The agent indicated there has been minimal interest due to the large size of the unit and

there would likely need to be a reduction to the asking rent. However, given the subject’s assumed

pub use, the subject would command a higher rental rate.

Comparable No. 11 (475 Main Street) is the current listings and reported offer for retail space in

the Main and Pender building, a two-storey plus secured parkade retail/office building at the

northwest corner of Main and Pender Street. The building has elevator service and each unit is

reported to have its own HVAC pump. Major anchor tenants include Dollar Tree and Waves Coffee.

The building's property manager reported there are two adjacent vacant retail units along Main

Street. The units have glass storefronts with metal security bars. The property manager reported

they have had issues leasing the units as the bus stop is directly in front of the space and the

landlord will not rent to any marijuana dispensary or grocery store tenants. In late 2018/early 2019

the asking rent was $25.00 per square foot gross with operating costs and taxes estimated at

$12.00 to $13.00 per square foot.




The asking rent is currently $20.00 per square foot gross with operating costs and taxes estimated

at $11.22 per square foot, indicating a net rent of $8.78 per square foot. However, the listing agent

reported there is currently an "as is" offer at $25.00 per square foot, gross, which equates to $13.78

per square foot net, for one of the units. The offer includes a combined six-month fixturing/free

rent period, indicating a net effective rent of $11.33 per square foot. Although the location of the

comparable units is considered slightly superior, the subject’s assumed ground floor pub use and

newly renovated condition warrant a higher rental rate.

Commercial Rental Summary

We note that demand for commercial space in the subject’s area appears to be primarily limited to

pubs, cannabis dispensaries, pharmacies, convenience stores and non-profit or government uses.

Retail leasing agents active in the subject’s area indicate that commercial units with direct frontage

to East Hastings Street that are suitable for general retail uses in the subject’s block would

command a net rental rate in the low teens. Higher rates are typically achieved from properties

offering newer and better quality space with higher levels of finishing.

However, our discussions with industry participants in the subject’s area suggest that pub leases in

the Downtown Eastside area are commonly on a gross basis with monthly rents ranging from

approximately $10,000 to $14,000 per month. Based on our comparable analysis and discussions

with industry participants and retail leasing agents active in the subject’s area, the subject’s pub

space (main floor and basement storage), would command a rent towards the lower middle of this

range at approximately $11,000 per month gross, given its size including basement storage space

and newly renovated condition. This rate also assumes the tenant is provided with a minimum 10 to

15-year lease term to help offset the costs required to finish and establish the pub space.

Assuming an approximate operating cost of $10.00 per square foot for the subject’s commercial

space (which is in line with commercial space in newer or recently renovated, good quality

developments in the area), the main pub level would command a gross rental rate of $60.00 per

square foot gross.




Based on discussions with market participants, rental rates for basement space in the subject’s area

vary depending on finishing, ceiling height and access. Basement space without separate exterior

access typically commands a storage rent ranging from $4.00 to $5.00 per square foot, gross. Based

on our discussions and comparable analysis, including Comparable No. 5, a projected rent at $5.00

per square foot gross is supported for the subject’s basement commercial space.

The above projected gross rental rates for the subject’s ground floor and basement commercial

space equate to a gross rent of just under $11,000 per month.

ROOMING UNIT RENTAL ANALYSIS

The building is currently improved with 161 rooming units (licensed for 158 rooming units);

however, upon completion of the assumed renovations, the subject building will offer 154 rooming

units in total, each with an exterior window and suitable only for single-occupancy with shared

washroom facilities. The units are approximately 133 square feet in size, with the exception of the

accessible rooms comprising 130 square feet. The second to eighth floors will each include 22

rooming units, with one accessible unit and two units with two-piece insuite washrooms on each

floor. The subject’s average rooming unit size equates to ±132.9 square feet.

Each unit will contain a small kitchenette area with a mini-fridge, and microwave, a single bed and

bed stand, metal wardrobe, and table and chair. The building will include residential amenity space

on the ground floor comprising a common kitchen with a full-size fridge, oven and range hood,

dishwasher, microwave and table and chairs, a common lounge/dining area with a table and chairs,

sofa and/or loveseat, wall-mounted flat screen television and DVD player. Residential amenity

space will also include a storage room with storage lockers and a bed bug sauna. The building will

include coin-operated laundry machines and the building and units will have access to free wifi and

basic cable with free electricity and heat.

Security will include FOB entry and security cameras at the front entrance and throughout the

interior public areas. There will be some form of 24-hour, on-site property management and weekly

janitorial services to common areas. A single elevator will service the building.




Rooming units are rented on a “gross” basis with the landlord paying property taxes, building

insurance, structural repairs, maintenance expenses, management fees and all operating expenses.

To establish a projected market rental rate for the Regent’s rooming units, assuming completion of

the renovations, we reviewed current achieved and asking rents for recently renovated SRO

buildings within the Downtown and Downtown Eastside markets.

A comparable map and comparable rental rates for renovated micro-units in rooming houses,

hotels and mixed-use buildings are provided on the following pages. The accommodation offered by

the majority of the comparables is similar to the subject with either shared washrooms and

kitchenettes or in-suite washrooms and kitchenettes. However, the location of the subject is

generally inferior to the majority of the comparables. We note the subject will offer basic

furnishings which include a single-bed, bed stand and table and chair, whereas the unfurnished

comparables generally do not include all these items.

The data indicates that similar rooming units with shared washrooms within recently renovated

buildings in the subject’s immediate area and other areas of the east side of Vancouver have rental

rates from approximately $700 to $1,250 per month. The self-contained units with private

washrooms and full kitchens or kitchenettes have rental rates ranging from approximately $950 to

$1,500 per month.

This wide range is due to a number of factors, which include location (quality and

trendiness/gentrification of area or block), size and finish of units, target rental market, furnished

versus unfurnished, in-suite washrooms and kitchenettes, building amenities including laundry,

storage and free wifi and cable, and if the unit is single-occupancy only or there is potential for

double occupancy. Our discussions with building owners of recently renovated micro-units suggest

certain buildings command higher rents because of the financial position of tenants and because

the buildings have their own community of people who enjoy living with like-minded people.


Re: Regent Hotel – 160 East Hastings Street, Vancouver, BC


ROOMING UNIT COMPARABLES LOCATION MAP




Unit Unit Size Approximate Rent per

Type (sq.ft.) Monthly Rent sq.ft.

1 228 Micro-units w/ - $925 -

E Pender Street kitchens and Unfurnished

shared washrooms

2 55 Micro-units w/ 110 $825 $7.50

Powell Street shared washrooms 119 $825 $6.93

and shared kitchen Unfurnished

3 90 Micro-units w/ 139 $700 $5.04

Alexander Street kitchenettes to to to

and shared bath 212 $950 $4.48

Unfurnished

4 635 Micro-units w/ 99 $700 $7.07

E Hastings Street kitchenettes to to to

and shared 118 $720 $6.10

washrooms Unfurnished

5 956 Micro-units w/ - $800 -

Main Street kitchenettes and Unfurnished

shared washrooms

One-bedroom unit in a renovated (2012)

three-storey building in Chinatown. Each

unit has an exterior entrance. Heat, hydro,

internet and WiFi are included. The

building has shared laundry and 5

bathrooms per 20 units. Bathrooms are

recently renovated. One unit is available

immediately for $925 per month.

Renovated SRO and Micro-Residential Unit Rental Data

No. Address Comments

SHARED WASHROOMS

Four-storey renovated building in

Gastown. Interiors are fully renovated and

the common areas (large common kitchen

facilities and laundry) are updated.

Includes heat, power, water and WiFi.

Two units are available for August 1st.

Asking rent is $825 for 110 sq.ft. or 119

sq.ft.

Micro-units in a 58-suite heritage mixed-

use building at the corner of Alexander

and Columbia Streets in Gastown. The

building has shared laundry and wife and

utilities are included. There is a manager

onsite. Five units were available for Jan

1st. Asking $700 for 139 sq.ft. and $950 for

212 sq.ft.

Micro-units in the Shamrock Hotel, a three-

storey renovated commercial/SRO

building on East Hastings Street. The

building has shared laundry. Utilities

including cable and internet are provided.

Four units were available as of February

1st and asking rents were $700 to $720.

Micro-units with kitchenettes and shared

washrooms in a three-storey building just

south of the Viaducts. The 22-unit

heritage building has shared laundry and

WiFi and utilities are included. One unit is

available as of November 1st and asking

rent is $800.






6 1012 Micro-units w/ - $750 -

Main Street kitchenettes and to

shared washrooms $850

Unfurnished

7 406 Micro-units w/ $700 to -

Union Street shared washrooms $900

and kitchens Unfurnished

8 1895 Micro-units w/ 180 $1,025 $5.69

Powell Street kitchenettes 235 $1,150 $4.89

and shared baths Unfurnished

140 $1,000 $7.14

to to to

198 $1,250 $6.31

Furnished

9 228 Micro-units w/ - $900 -

East Georgia Street full kitchen Unfurnished

and shared baths



SHARED WASHROOMS

Hamilton Bank Building is on the north

side of Powell Street in Port Town. The

building was fully renovated in 2015/2016

and has security cameras, free WiFi, free

utilities and onsite laundry. The building

has shared bathrooms. Asking rent for one

unfurnished unit is $1,025 for 180 sq.ft on

November 1st. Asking rent for one

unfurnished unit is $1,150 for 235 sq.ft.

(the largest in the building) for October

1st. Three furnished units are available at

$1,000 for 140 sq.ft. on October 15th or

November 1st. Asking rent for one

furnished unit is $1,250 for 198 sq.ft. on

October 1st. A 6 month lease is required.

Three-storey plus basement building

located in Chinatown on the south side of

East Georgia Street, east of Main Street.

Asking rent is $900 and includes heat, hot

water, hydro and WiFi. The building has

shared laundry.

Micro-units in a 32-unit renovated

heritage SRO with kitchenettes and newly

renovated shared washrooms. The

building has shared laundry and WiFi and

utilities are included. Five units are

available as of October 1st, asking rent is

$750 to $850, and a 6 month lease is

required.

The Hip-o, a three-storey renovated SRO

building with 15 units at the southeast

corner of Union Street and Dunlevy

Avenue in Strathcona. The 12 upper floor

units have either bunkbeds or murphy

beds and share a full kitchen on each of

the floors and two washrooms. The rate

for the smaller shared-washroom units

range from $700 to $900, with the majority

of these units at $900.






10 455 Micro-units w/ 200 $1,195 $5.98

Abbott Street washrooms and to Unfurnished to

kitchenettes 250 $1,500 $7.50

Furnished

11 320 Micro-units w/ 200 $950 $4.75

Abbott Street washrooms and to to to

kitchenettes 220 $1,170 $5.32

approx. Unfurnished

12 928 Micro-units w/ 252 $1,200 $4.76

Main Street private washrooms 281 $1,100 $3.91

and kitchenettes Unfurnished

13 249 Micro-units w/ 100 $1,200 $12.00

East Georgia Street private washrooms Unfurnished

and kitchenettes



Building contains 20 micro-units and is

located on the north side of East Georgia

Street, west of Gore Avenue. This building

has shared laundry and utilities are not

included in the rent. One 100 sq.ft. unit

was available Jan 1st, and the asking rent

was $1,200. A one-year lease is required.

SELF-CONTAINED

Renovated (2015) self-contained micro-

units in the Lotus, a six-storey heritage

building at Pender and Abbott Streets in

Gastown. The building has security

cameras, FOB entry and shared laundry.

The units have a full washroom and

kitchenettes. Hot water, heat, electricity,

and cable TV are included. The asking rent

for one unfurnished unit available

November 1st is $1,195, and one furnished

unit available for December 1st is $1,500.

A six month lease is required for a single

person only.

Self-contained micro-units in the

Metropole Hotel on Abbott Street just

south of West Cordova Street in Gastown.

The building has shared laundry and

utilities are included. One year leases are

preferred. Three units were available in

January and February 2019 ranging from

$950 to $1,170.

Building contains 42 micro-units and is

located on the east side of Main Street,

south of Prior Street. This building has

shared laundry, keyless entry, and video

security. Two units are available as of

November 1st, a 252 sq.ft. unit at $1,200

and a 281 sq.ft. unit at $1,100. WiFi and

utilities are included in the rent, and a

one year lease is required.




Comparables No. 1 to No. 9 comprise micro units with shared washrooms and indicate a monthly

rental range of $700 to $1,250. Recently renovated SRO buildings that set a narrower range of rents

for the subject’s shared washroom units are Comparable No. 3 (90 Alexander Street), Comparable

No. 4 (635 East Hastings), Comparable No. 5 (956 Main Street) and Comparable No. 6 (1012 Main

Street).

Comparable No. 3 (90 Alexander Street) is a 58-suite renovated heritage building at the corner of

Alexander and Columbia Streets in Gastown. The building has a mix of micro, bachelor, one and

two-bedroom suites, includes shared laundry and the micro-units have kitchenettes with shared

washrooms. There is a manager on-site. Five micro-units ranging from 129 to 212 square feet were

listed for rent in early 2019 with asking monthly rents from $700 to $950. The lower end of the

rental range reflected a 139-square-foot unit. Although the comparable has a superior Gastown

location, the subject building will offer newly renovated rooms and common space. Overall, an

average monthly rent just above the lower end of the comparable’s asking rental range is supported

for the subject’s units.

Comparable No. 4 (635 East Hastings Street) is a 26-room SRO that was renovated in 2011 located

in Strathcona. As of February 2018 asking rents in the building were $700 to $720 per month for

units ranging from 99 to 118 square feet. The building has shared washrooms with kitchenettes in

each of the units. The comparable has a slightly superior location as the 600 block of East Hastings

Street is becoming trendier. However, a generally offsetting adjustment is warranted for the smaller

size of the comparable units.

Comparable No. 5 (956 Main Street) and Comparable No. 6 (1012 Main Street) are smaller

renovated heritage SRO buildings located just south of the viaducts. The units have kitchenettes

and shared washrooms, and the current asking rents range from $750 to $850 per month,

respectively. The sizes of the comparable units could not be confirmed. The buildings have shared

laundry and wifi and utilities are included. The location is slightly superior as the area is also

becoming trendier. Overall, a monthly rent towards the lower end of the comparables’ rental range

would be warranted for the subject’s units.




Comparables No. 10 to No. 13 comprise micro units with in-suite washrooms and kitchenettes in

renovated buildings in the subject’s immediate area and adjacent Gastown area. The comparables

indicate a monthly rental range of $950 to $1,500.

The lower end of the rental range is illustrated by Comparable No. 11 (320 Abbott Street), which

comprises early 2019 listings of two micro-units units (±200 square feet and ±220 square feet) in

the Metropole Hotel in Gastown, each with a private washroom and kitchenette, at $950 and

$1,170 per month. Although the subject’s location is considered slightly inferior and the units are

slightly smaller, the building will offer newly renovated space. The comparable also includes a full

in-suite washroom whereas the subject will include units with two-piece washrooms. However, the

subject building will have a higher shared washroom to unit ratio than comparable buildings in the

area. Consideration has also been given to the early 2019 listing date. Overall, a rental rate towards

$950 per month is supported for the subject’s units with two-piece washrooms. The upper end of

the rental range is illustrated by Comparable No. 10 (455 Abbott Street), which comprises recent

listings of ±200-square-foot and ±250 square-foot furnished micro-units in the Lotus, a six-storey

heritage building at Pender and Abbott Streets in Gastown. The asking rents are $1,195 per month

for the smaller unit and $1,500 per month for the larger unit. The comparable’s superior location,

larger sizes and full insuite washrooms support a lower rent for the subject’s units with two-piece

washrooms.

After considering the subject building offers rooms with only two-piece insuite washrooms and not

full insuite washrooms, and after further considerations for size, location and furnishings, a monthly

rent towards the lower end of the above range is supported.

In addition to the comparable data, we also considered a rental market survey conducted by

Canada Mortgage and Housing Corporation in October 2017 and October 2018. The rental survey

indicates that bachelor suites in the East Hastings area were achieving rents of $1,108 per month in

2017 and $1,156 per month in 2018. The typical bachelor accommodation included in this survey is

superior to the rooming accommodation offered by the subject as the units are generally larger in

size and self-contained with a full kitchen and in-suite washroom. The subject is assumed to have

units with kitchenettes and only two units per floor with in-suite two-piece washrooms.




Rooming Unit Rental Summary

Discussions with real estate agents familiar with the Vancouver rooming house market indicate that

higher rents can be achieved for larger rooming units, given they can accommodate multiple

tenants. However, we have assumed single occupancy for the subject units. Higher rents are also

typically obtained for units with kitchens or in-suite washrooms.

Based on our discussions and comparable analysis, it is our opinion a rental rate range of $725 to

$775 per month would be achievable for the subject’s units with shared washrooms. An average

rent of $750 per month has been projected for the subject’s 138 rooming units with shared

washrooms. The subject’s 18 units with two-piece in-suite washrooms would command a higher

rental rate in the range of $925 to $975 per month, concluding at $950 per month.

Laundry Income

The subject building is assumed to have common laundry facilities available to the residential

tenants with the laundry machines owned by the building. Based on our research and appraisals of

other rooming house properties, the price per wash and per dry is projected at $2.00. The monthly

laundry income is projected at $2,464, which equates to $16.00 per tenant per month (based on

154 units), or four loads per tenant per month. Based on our experience appraising similar

residential properties, the projected laundry income appears to be reasonable.

VACANCY AND COLLECTION LOSS ALLOWANCE

Potential income reflects the property’s income at full occupancy. However, income properties may

not be fully occupied over their economic lives and vacancy and collection losses must be

considered. This factor, the “vacancy rate”, is normally expressed as a percentage and reflects

conditions in the current market. Vacancy and collection loss allowance have been deducted from

the subject’s gross annual income.

Rooming Component

It is difficult to obtain vacancy rates for rooming house/micro-residential unit rental

accommodation. Our discussions with agents and owners reported very low vacancy rates for this

type of accommodation.




There is a high level of turnover for rooming properties; however, vacancies are typically filled

within a short time. Based on our research, there is good demand for recently renovated micro-

residential units in the Downtown area within close proximity to commercial services and public

transportation.

The most recent published residential rental market report by the Canada Mortgage and Housing

Corporation indicated that in East Hastings, the vacancy rate for bachelor suites as of October 2018

averaged 1.4%; up from the previous rate of 0.1% in October 2017.

Commercial Component

Our review of Colliers International’s National Retail Report (Spring 2018) indicates that

neighbourhood retail vacancy within Vancouver ranged from 0.5% to 2.0%. According to the most

recent CB Richard Ellis (CBRE) Vancouver Retail Marketview Report (H2 2018), “Vancouver’s retail

market remained strong and steady through 2018” and the overall 2018 downtown Vancouver

retail vacancy rate was 2.4%.

Although the retail market in Downtown Vancouver is strong, the subject’s location along the

Hastings Corridor is affected by a number of social issues and consequently, commercial vacancies

appear to be higher in the area than the downtown core. Our discussions with retail leasing agents

active in the area support this.

Vacancy and Collection Loss Summary

After consideration of all relevant factors, it is our opinion that an overall vacancy and collection

loss allowance of 2.0% of the gross income is appropriate for the subject's residential

accommodation and commercial space over the long term. We note this assumes the building is

properly managed with regular upkeep and repairs completed. The rate for the residential

component is slightly less, but higher for the commercial component.




OPERATING EXPENSES

The commercial and residential leases are on a gross basis with the landlord responsible for all

operating costs, as well as property taxes.

Based on our experience appraising similar commercial/SRO properties, the total operating

expenses for the subject building are estimated and projected at approximately 30% of the subject’s

effective gross income, which equates to $466,182. Our experience with similar properties is that

operating expense ratios typically range from approximately 30% to 45% of the building’s effective

gross income. Given the subject’s large size and assumed newly renovated condition, we expect its

operating expense ratio to be at the lower end of this range, and have utilized 30%. Furthermore,

the subject property may qualify for relief from the City on property taxes in exchange for a

heritage upgrade.

In addition to the operating expenses reported above, the owner will generally set-up a reserve

fund for structural repairs. Given the subject's size and assumed renovation condition, we used a

rate of $0.10 per square foot of Gross Building Area to cover structural repairs on an average annual

basis.

NET INCOME SUMMARY

Net income has therefore been stabilized after allowing for a vacancy and collection loss allowance

and deducting all expenses and structural repairs. In conclusion, utilizing the preceding

methodology, the stabilized net income (Year 1), based on projected rental income and operating

expenses, is provided on the following page.




*Our net income is based on projected market rent for the ground floor commercial pub space

and does not include any business income associated with a pub operation. Furthermore, it is

assumed a pub use would be permitted on the ground floor and the building’s existing Liquor

Primary Licence (#5041) will be reinstated and provided to a third-party lessee.

Area (sq.ft.) Rate (Gross)

Ground Floor Commercial Pub 2,106 $60.00 $126,360

Basement storage space for Pub tenant 1,065 $5.00 $5,325

Blended Rate per Ground Floor Area $62.53

Total Rent from Commercial Space $131,685

S.R.O. Units (assume 154 rooms)

Shared washroom rooms at a market rate (Projected at $750) 138 $750.00 $1,242,000

Rooms with insuite washrooms at a market rate (Projected at $950) 16 $950.00 $182,400

Laundry Income $29,568

Total Rent from Residential Space $1,453,968

Gross Income: $1,585,653

2.00% $31,713

$1,553,940

Operating Expenses at a % of Gross Income 30% $466,182

Structural Allowance at a $0.10 per Sq.ft. of GBA $0.10 $5,008

STABILIZED NET INCOME (based on projected rents/op expenses):* $1,082,750

REGENT HOTEL - 160 EAST HASTINGS STREETSTABILIZED NET INCOME

AS IF RENOVATEDAS AT OCTOBER 1, 2019

GROSS INCOME

Less: Vacancy and Collection Loss Allowance @

Effective Gross Income:

Less: Non-Recoverable Operating Expenses



13.0 THE CAPITALIZATION PROCESS

INTRODUCTION

Capitalization is defined in "Introduction to Real Estate Appraising", published by the Appraisal

Institute of Canada, as follows:

"Capitalization, in the appraisal of real estate, may be defined as the process of

converting into a present worth a series of anticipated future installments of income by

the application of a factor, referred to either as a capitalization rate or a present worth

factor, depending upon the process used."

A capitalization rate is a conversion factor, appropriate to the property being appraised that is

applied to the income stream to convert it into an indication of the market value of a property.

The capitalization process requires the following steps:

• Selection of a method of deriving the capitalization rate;

• Selection of an appropriate method of capitalization;

• Analysis of the market for the factors involved.

SELECTION OF A CAPITALIZATION RATE

THE COMPARATIVE METHOD

Through the analysis of comparable sales, ratios between selling prices in the marketplace and the

net operating income of the property being sold can be derived. With consideration given to the

degree of comparability in each instance, these ratios can provide an indication of the overall rate

that is applicable. Where comparable sales exist, this method is widely accepted and used in the

appraisal of income producing properties since it is considered reliable, objective and easily

supported.

METHOD OF CAPITALIZATION

THE DIRECT CAPITALIZATION METHOD

Direct capitalization is calculated by dividing the net operating income of the property by the

above-described "overall rate" derived by the Comparative Method. This is a commonly used and

highly regarded method of capitalization where sufficient comparables are available to derive a

reliable overall rate. Following are the improved rooming house comparables considered in our

analysis.



THE CAPITALIZATION PROCESS (continued)

1 71-77 Sale Price # of Rooms SNOI Cap Rate Comments

E Hastings Street $4,650,000 19 $242,165 5.21%

Vancouver Sale Date Building (sq.ft.) $/Room

Jul-15 15,618 $244,737

Site Area (sq.ft.) $/Sq.Ft.

6,101 $298

2 259 Sale Price # of Rooms SNOI Cap Rate Comments

Powell Street $3,715,000 36 $195,000 5.25%


Oct-15 13,200 $103,194

(Reported Site Area (sq.ft.) $/Sq.Ft.

Close) 3,050 $281

RENOVATED BUILDINGS

CAPITALIZATION RATE COMPARABLES

"B.C. Collateral & Loan Co." building located on the north side of E Hastings St.

between Carrall and Columbia St. Improvements comprise a three-storey plus

basement commercial/residential SRO building with a Class "C" heritage

designation. Prior to the sale, the building was fully renovated and included two

main floor commercial units and 19 micro-residential units with insuite

kitchens and washrooms. Renovations included a new roof, third floor addition,

renovated facade, new electrical service, new life safety and sprinkler systems,

new HVAC units for the residential and commercial space and seismic upgrades.

The residential units range in size from 239 to 369 sq.ft. and included new

appliances. There is common laundry on the third floor. Secure surface parking

is at the rear of the building. At the time of sale one of the commercial units

was vacant. Five of the residential units are SAFER designated units as agreed

with the City. The estimated net income includes projections for vacant units

and was stabilized with a vacancy and collection loss allowance. The asking

price was reported at $5,450,000. We note BC Assessment does not report the

sale; however, the selling agent confirmed the sale price and date.

Located on the north side of Powell between Gore and Main in Strathcona.

Improvements comprise a four storey plus basement SRO building constructed

circa 1907. The building has one ground floor commercial unit. The selling agent

reported the vendor had spent close to $1.4M in renovations including a

seismic upgrade. The ground floor commercial space was leased to a restaurant

for a 10 year term with 3 years remaining on the lease. The agent reported

there was regular turnover with the residential units. The net income has been

estimated at $195,000. The property was listed in April 2015 and the asking

price was $3.8M. The agent reported the sale closed in early October. BC

Assessment does not report the October sale and indicates a "Reject" $0 sale of

the property in December 2015.






401-419 Sale Date Building (sq.ft.) $/Room

Heatley Avenue Nov-15 - $243,810


9,150 -

4 635 Asking Price # of Rooms SNOI Cap Rate Comments


Vancouver Building (sq.ft.) $/Room

- $134,538


3,050 -


RENOVATED BUILDINGS

"Heatley Block" located at the SW corner of Heatley Avenue and E Hastings St.

in Strathcona. Improvements comprise a two-storey plus basement

commercial/ residential SRO building with an attached two-storey house and

one detached two-storey house. The commercial/SRO building has four ground

floor retail units and sixteen SRO units on the second floor. The houses contain

a total of five residential units. The selling agent indicated the gross income at

the time of sale was $317,000 and projected expenses were approximately

$80,000 indicating a net income of $237,000. At the time of sale the building

was reported by the agent to be fully occupied and the commercial units were

rented at market rates with several years remaining on the lease terms.

"Shamrock Hotel" located on the north side of E Hastings St., east of Princess

Ave in Strathcona. Improvements comprise a three-storey plus basement SRO

building. The listing agent reported the building had a light renovation in 2011.

The building includes 26 rooming units on the second and third floors finished

with a mixture of hardwood and laminate flooring, a personal sink, and a mini

fridge. Residents have access to common washrooms and coin laundry on each

floor. The building is secured via intercom and fob access, and equipped with

internal and external security cameras. The commercial unit is approved for

Retail - Limited Food Service and is improved with large character windows,

restored hardwood flooring, and exposed brick feature walls. The agent

reported the commercial unit (2,639 sq.ft.) and basement space (2,412 sq.ft)

are currently vacant and the net income includes projections of $20.00 per

sq.ft. for the commercial unit and $500 per month for the basement space.

Prior to a reduction in the asking price from $3,689,000 to $3,498,000 in

March 2019, the listing agent reported there were several offers below the

asking price and interest from potential purchasers looking to also occupy the

retail space. However, there have been no official offers since the price

reduction. The original asking price was reported to be slightly above market,

and the property has been listed since February 2018. The net income has been

stabilized with a vacancy and collection loss allowance.





Heatley Avenue $3,725,000 12 $138,607 3.72%


Jun-18 7,577 $310,417

(Bare Trust) Site Area (sq.ft.) $/Sq.Ft.

6,100 $491.62


Carrall Street $9,200,000 96 $468,223 5.09%


Jun-16 35,000 $95,833


4,337 $263


RENOVATED BUILDINGS

Located at the SW corner of Heatley Ave and Powell St. in the Japantown

neighbourhood. Improvements comprise a two storey plus basement

commercial/SRO building with gated surface parking at the rear and a Pattison

sign that generates income. The listing agent reported the building has been

substantially renovated with future rental upside as the rents are significantly

below market. The main floor commercial space is improved with large

character windows, modern finishes and a commercial kitchen venting system.

Vancouver Cocktail and Canapes Catering and Events leases the main floor and

a portion of the basement. The second floor has ten micro units and one

dwelling unit. The micro units are finished with hardwood and laminate flooring

and each has a sink. The units have access to three upgraded common

washrooms and a laundry room with a coin-operated washer and dryer. The

dwelling unit is a two bedroom apartment with a living room, kitchen and an

enclosed deck. The building includes a new sprinkler system on the main floor,

new water service and hot water tanks with hot water heating to the second

floor, upgraded electrical supply, intercom access to the second floor, security

camera system and Wifi for the residential. The sale was reported by the

purchaser's agent to have been negotiated in mid-April, firm as of May 8, 2017

and closed at the end of June. The completion was also confirmed by the listing

agent. The asking price was $3.999M. The net income has been stabilized with a

vacancy and collection loss allowance.

NON-RENOVATED BUILDINGS

"West Hotel" located on the east side of Carrall St. between E Hastings and

Pender St. Improvements comprise an eight-storey commercial/residential SRO

building of concrete construction. The building has a Class "B" heritage

designation, and there is a 150-seat pub on the ground floor. The building has

had some updates but has not been renovated. The property was not listed for

sale. The owner reported there were multiple offers for the property. The net

income has been stabilized and includes the actual rent paid for the rooms and

the bar lease.






Vancouver Sale Date Building (sq.ft.) $/Room (Includes

May-15 27,450 $101,316 bar income)


3,050 $280.51


E Pender Street $2,800,000 30 $150,000 5.36%

Vancouver Sale Date Building (sq.ft.) $/Room (Estimated)

Jan-19 - $93,333


3,050 -



"Empress Hotel" located on the north side of E Hastings between Gore and

Main St. in Strathcona. The site benefits from both side and rear lanes.

Improvements comprise an eight storey plus basement SRO building with

concrete construction. The building was constructed circa 1913 and has a

Heritage "C" classification. Twenty-nine of the residential units have in-suite

washrooms. A new elevator was installed in 2008. The property has a liquor

primary licence and the sale included the bar business. The selling agent

indicated the property was listed for several years as it was challenging to find a

purchaser since the sale included the bar operations. The gross income for the

residential was reported at $399K. The building also has cell site income at

$24K per annum. The revenue from the bar operations was reported at

$1.171M with costs at 892K.

"Arlington Rooms" located on the north side of E Pender St. between Jackson

and Princess Ave in Strathcona. Improvements comprise a three-storey

commercial/SRO building constructed circa 1912 with a Class B heritage

designation. There is one ground floor commercial unit that is non-conforming,

and is occupied by a non-profit library. Thirty non-renovated rooming units are

located on the upper floors. The listing agent reported the rents are

considerably low in the building and there would be potential in the future to

increase them. The asking price for the property was reduced in late 2017 from

$3,600,000 to $3,380,000 and in mid-June to $2,990,000. The agent previously

indicated the cap rate for the building would be approximately 5.0% based on a

$3M sale price, and reported an offer was received when the building was

initially listed; however, it was significantly below market. In summer 2018, the

agent reported there was more serious interest subsequent to the price

decrease. The selling agent reported the deal was firm in mid-October 2018

with a closing date at the end of January 2019.





Keefer Street $4,535,000 46 $195,005 4.30%

Vancouver Sale Date Building (sq.ft.) $/Room (Estimated)

Aug-18 - $98,587


3,050 -


E Cordova Street $4,120,000 44 $148,320 3.60%


Jun-19 - $93,636


3,050 -



Four-storey SRO building located on East Cordova Street between Main and

Columbia Streets in Gastown. The property contains 44 SRO units over four

levels with common washrooms on each floor. The selling agent reported there

is no ground floor commercial space and the main floor was previously used by

the vendor for their own residence and office use. The selling agent also

reported there is potential for four additional rooming units that could be

converted from the vendor's office use. The agent reported the building has not

been renovated, but has been well maintained. The agent indicated that the

actual income provided by the vendor indicated a 3.6% capitalization rate;

however, there is potential to increase the income upon converting the four

empty office rooms to rooming units. The sale was an off-market transaction.

"Keefer Rooms" located on the south side of Keefer Street, just east of Main

Street, with frontage to a side lane. Improvements comprise a four-storey plus

basement commercial/SRO constructed circa 1918 with a Class C heritage

designation. The building includes ground floor restaurant space and 46

rooming units on the upper floor. The selling agent reported the ground floor

unit has been under long-term lease to an Asian restaurant tenant for a

reported $3,600 per month, net, which includes a portion of the basement

space. The rent is reported to be below market. The agent reported the listing

agent indicates the ground floor unit to be 2,388 sq.ft. and the rented

basement space is 1,720 sq.ft. However, the agent indicated he believes the

space is larger. The agent also reported the rooming units have not been

renovated and are currently rented to a party currently managing all the units.

The property was listed in April 2018 and the asking price was reported at

$4,500,000. The agent indicated there were reportedly multiple offers. The

agent reported the rent for the building at the time of sale indicated a cap rate

of approximately 4.30%; however, there is considerable rental upside.




11 507 Asking Price # of Rooms NOI Cap Rate Comments

Main Street $4,300,000 35 $111,836 2.60%

Vancouver Building (sq.ft.) $/Room (Approx)

- $122,857


3,120 -



Three-storey commercial/SRO building on the west side of Main Street between

Pender and Keefer Streets in Chinatown. The building includes one ground floor

commercial unit leased to a new restaurant tenant that reportedly completed

extensive tenant improvements and 35 rooms with shared washrooms on the

upper two floors. The listing agent reported that the building has been well-

maintained and the roof was replaced in 2014. The site is being marketed with

redevelopment potential and a density up to 5.35 FSR as per the current HA-1A

zoning, and in accordance with the Chinatown Neighbourhood Plan. However,

the existing SRO units would need to be replaced (or a penalty paid) upon

redevelopment. The building's reported year end 2018 income indicated an

actual NOI of $111,836; however, the rent roll appeared to only include 30

rooms. The property was listed in early March and the asking price was reduced

from $4,500,000 in September 2019. The listing agent indicated there has been

significant interest with verbal offers in the high $3 million range, but no official

offers. The agent also indicated the property has considerable rental upside and

the asking price is still slightly above market.




CAPITALIZATION RATE ANALYSIS

Comparable No. 1 (71-77 East Hastings Street) at 5.21%, is the reported July 2015 sale of the "B.C.

Collateral & Loan Co." building, a fully renovated, three-storey

plus basement commercial/residential SRO located one block

west of the subject on East Hastings Street. The building has a

Class "C" heritage designation and includes two ground floor

commercial units and 19 micro-residential units with in-suite

kitchens and washrooms. The renovations included a new roof,

third-floor addition, renovated facade, new electrical service,

new life safety and sprinkler systems, new HVAC units for the

residential and commercial space and seismic upgrades. There

is secure surface parking at the rear of the building. At the time of sale one of the commercial units

was vacant. The estimated net income includes projections for vacant units and was stabilized with

a vacancy and collection loss allowance. We note BC Assessment does not report the sale; however,

the selling agent confirmed the sale information. Although upward adjustments are warranted for

the comparable’s smaller investment size and entirely self-contained suites, offsetting downward

adjustments are supported for the improvement in the market since summer 2015, the

comparable’s vacant units and the subject’s assumed pub space.

Comparable No. 2 (259 Powell Street) at 5.25%, is the reported October 2015 sale of a 36-room

commercial/rooming house building located on Powell Street just

east of Main Street in Strathcona. BC Assessment lists the

transaction as a December 2015 reject sale; however, our

discussion with the selling agent suggests the sale was arm’s

length and at market. The agent reported that the vendor spent

close to $1.4 million in renovations, including a seismic upgrade.

At the time of sale, the ground floor commercial space was leased

to a good quality restaurant tenant for a ten-year term with three

years remaining on the lease. The agent reported there is regular

turnover with the residential units.




The comparable’s area has benefited from recent rehabilitation and an influx of trendy restaurants

and coffee shops and is considered slightly superior to the subject. A further upward adjustment is

supported for the subject’s larger investment size; however, slightly greater downward adjustments

are indicated for the subject’s slightly superior quality and the improvement in the market since the

comparable’s sale in fall 2015.

Comparable No. 3 (688-694 East Hastings Street & 401-419 Heatley Avenue) at 4.63%, is the

November 2015 sale of the "Heatley

Block", located at the southwest

corner of Heatley Avenue and East

Hastings Street in Strathcona.

Improvements comprise a two-

storey plus basement commercial/

residential SRO building with an

attached two-storey house and one

detached two-storey house. The commercial/SRO building has four ground floor retail units and

sixteen SRO units on the second floor. The houses contain a total of five residential units. The selling

agent indicated the gross income at the time of sale was $317,000 and projected expenses at

approximately $80,000, indicating a net income of $237,000. At the time of sale the building was

reported to be fully occupied and the commercial units were reported to be rented at market rates

with several years remaining on their lease terms. Although the comparable is located further east,

it is situated just east of the 700 and 800 blocks of East Hastings Street, which are experiencing a

rise in commercial development. Downward adjustments are indicated for the improvement in the

market since fall 2015 and the comparable’s slightly below average operating expense ratio;

however, larger upward adjustments are warranted for the subject’s larger investment size and the

comparable’s slightly superior location and corner exposure.

Comparable No. 4 (635 East Hastings Street) at 5.67%, is the current listing of the “Shamrock

Hotel”, located on the north side of East Hastings Street, east of Princess Avenue in Strathcona.

Improvements comprise a three-storey plus basement SRO building. The listing agent reported the

building had a light renovation in 2011.




The building includes 26 rooming units on the second and third

floors finished with a mixture of hardwood and laminate

flooring, a personal sink, and a mini fridge. Residents have

access to common washrooms and coin laundry on each floor.

The building is secured via intercom and fob access, and

equipped with internal and external security cameras. The

commercial unit is currently approved for Retail - Limited Food

Service and is improved with large character windows,

restored hardwood flooring, and exposed brick feature walls.

The agent reported the commercial unit and basement space

are currently vacant. The net income includes projections for

the vacant space. The original asking price of $3,689,000 was reported to be slightly above market,

and the property has been listed since February 2018. Prior to a reduction in the asking price to

$3,498,000 in March 2019, the listing agent reported there were several offers below the asking

price and interest from potential purchasers looking to also occupy the retail space. However, there

have been no official offers since the price reduction. Although upward adjustments are indicated

for the comparable’s smaller investment size and current listing status, larger downward

adjustments are supported for the comparable’s vacant commercial space and slightly inferior

building condition.

Comparable No. 5 (209 Heatley Avenue) at 3.72%, is the June 2018 bare trust sale of a two-storey

plus basement commercial/SRO building

located at the southwest corner of Heatley

Avenue and Powell Street in the Japantown

neighbourhood. The property has gated

surface parking at the rear and a Pattison

sign that generates income. The listing agent

reported the building has been substantially

renovated with potential future rental

upside. The main floor commercial space is

improved with large character windows, modern finishes and a commercial kitchen venting system.




Vancouver Cocktail and Canapes Catering and Events occupies the main floor and a portion of the

basement. The second floor has ten micro units and one self-contained, two-bedroom dwelling unit

with an enclosed deck. The units have a good level of finish and the building includes a new

sprinkler system on the main floor, new water service and hot water tanks with hot water heating

to the second floor, upgraded electrical supply, intercom access to the second floor, security

camera system and wifi for the residential. Upward adjustments are indicated for the comparable’s

smaller investment size, superior corner exposure and future rental upside.

Comparable No. 6 (488 Carrall Street) at 5.09%, is the June 2016 sale of the “West Hotel”, an eight-

storey commercial/residential SRO building located on Carrall Street

between East Hastings and Pender Streets at the northern edge of

Chinatown. The building has a Class "C" heritage designation, and

there is a 150-seat pub on the ground floor. The building has had

some updates, but has not been renovated. The property was not

actively listed for sale; however, it is our understanding that there

were several offers to purchase it. The net income has been

stabilized and includes the actual rooming rents and the actual rent

paid for the bar lease, which appeared to be slightly above market.

Although the comparable has a slightly superior location with

potential residential rental upside, these adjustments are offset by

the comparable’s above market pub rent and the subject’s superior quality.

Comparable No. 7 (235 East Hastings Street) at 5.69%, is the

May 2015 sale of the "Empress Hotel", located on the north

side of East Hastings Street between Gore and Main Streets,

approximately one block east of the subject. The site benefits

from both a side and rear lane. Improvements comprise an

eight-storey plus basement SRO building with concrete

construction. The building was constructed circa 1913 and

has a Heritage "C" classification. Approximately 40 percent of

the residential units have in-suite washrooms.




A new elevator was installed in 2008. The property has a Liquor Primary licence and the sale

included the bar business. The selling agent indicated the property was listed for several years as it

was challenging to find a purchaser, since the sale included the bar operation. Although the

comparable has potential rental upside and a greater percentage of the units have in-suite

washrooms, a lower return is supported for the subject based on the improvement in the market

since spring 2015, the comparable’s included bar operation and the subject’s superior condition.

Comparable No. 8 (575 East Pender Street) estimated at 5.36%, is the January 2019 sale of

"Arlington Rooms" located on the north side of East Pender

Street between Jackson and Princess Avenues in

Strathcona. Improvements comprise a three-storey

commercial/SRO building constructed circa 1912 with a

Class B heritage designation. The listing agent reported the

building is not renovated, but well maintained. There is one

ground floor commercial unit that is non-conforming, and

is occupied by a non-profit library. Thirty non-renovated

rooming units are located on the upper floors. The listing

agent reported the rents are considerably low in the

building and there would be potential in the future to

increase them. The asking price for the property was

reduced in late 2017 from $3,600,000 to $3,380,000 and in mid-June to $2,990,000. The agent

previously indicated the cap rate for the building would be approximately 5.0%, based on a

$3,000,000 sale price. The agent representing the purchaser reported the deal was firm in mid-

October 2018. Upward adjustments are warranted for the comparable’s smaller investment size

and rental upside; however, larger downward adjustments are indicated for the comparable’s

inferior non-conforming commercial space and condition.

Comparable No. 9 (218-222 Keefer Street) at 4.30%, is the August 2018 sale of "Keefer Rooms"

located on the south side of Keefer Street, just east of Main Street, with frontage to a side lane. The

improvements comprise a four-storey plus basement commercial/SRO constructed circa 1918 with

a Class C heritage designation.




The building includes ground floor restaurant space and 46

rooming units on the upper floor. The selling agent reported

the ground floor unit has been under long-term lease to an

Asian restaurant tenant for a reported $3,600 per month, net,

which includes a portion of the basement space. The rent is

reported to be below market. The ground floor unit is

reported to be 2,388 square feet and the rented basement

space is 1,720 square feet. However, the selling agent believes

the space is larger in size. The selling agent also reported the

rooming units have not been renovated and are currently

rented to a third party currently managing all the units. The

property was listed in April 2018 and the asking price was reported at $4,500,000. The selling agent

indicated there were reportedly multiple offers and that the rent for the building at the time of sale

indicated a cap rate of approximately 4.30%; however, there is considerable rental upside. Upward

adjustments for the comparable’s smaller investment size and rental upside support a higher return

for the subject, although these adjustments are partially offset by the subject’s superior condition.

Comparable No. 10 (139 East Cordova Street) at 3.60%, is the June 2019 sale of a four-storey SRO

building located one block north of the subject on

East Cordova Street between Main and Columbia

Streets in Gastown. The property contains 44 SRO

units over four levels with common washrooms on

each floor. The selling agent reported there is no

ground floor commercial space and the main floor

was previously used by the vendor for their own

residence and office use. The selling agent also

reported there is potential for four additional rooming units that could be converted from the

vendor's office use. The agent reported the building has not been renovated, but has been well

maintained. The agent indicated that the actual income provided by the vendor indicated a 3.60%

capitalization rate; however, there is potential to increase the income upon converting the four

empty office rooms to rooming units.




The sale was an off-market transaction. Although the comparable is inferior in condition, upward

adjustments for the comparable’s significant rental upside, slightly superior Gastown location and

smaller investment size support a higher return for the subject.

Comparable No. 11 (507 Main Street), at 2.60%, is the current listing of a three-storey

commercial/SRO building on the west side of Main Street

between Pender and Keefer Streets in Chinatown,

approximately three blocks southeast of the subject. The

building includes one ground floor commercial unit leased

to a new restaurant tenant that reportedly completed

extensive tenant improvements and 35 rooms with shared

washrooms on the upper two floors. The listing agent

reported that the building has been well-maintained and

the roof was replaced in 2014. The site is being marketed

with redevelopment potential and a density up to 5.35 FSR

as per the current HA-1A zoning, and in accordance with

the Chinatown Neighbourhood Plan. However, I note the existing SRO units would need to be

replaced (or a penalty paid) upon redevelopment. The building's reported year end 2018 income

indicated an actual NOI of $111,836; however, the rent roll appeared to only include 30 rooms. The

property was listed in early March and the asking price was reduced from $4,500,000 in September

2019. The listing agent indicated there has been significant interest with verbal offers in the high $3

million range, but no official offers. The agent also indicated the property has considerable rental

upside and the asking price is still slightly above market. Based on the comparable’s slightly superior

location, current listing status, smaller investment size and rental upside, a higher capitalization

rate is supported for the subject.

SUMMARY AND CONCLUSION

From an investment perspective, a number of factors influence the market appeal of the subject.

• The area has experienced some revitalization and gentrification; however, the general area

continues to suffer from social problems, including on-street drug use, mental illness, and

homelessness;




• The improvements will offer good quality newly renovated micro-residential units with

kitchenettes, shared washrooms for 138 units and two-piece insuite washrooms for 16 units

and ground floor commercial and basement storage space;

• There is a good level of demand from tenants for affordable, newly renovated micro-

residential units and vacancy rates are low;

• Although the subject will not have rental upside like several of the comparables, the building

will be newly renovated without the need to temporarily relocate tenants to complete

renovations;

• The subject is a considerably larger investment than most SRO properties in the market;

however, it will have appeal to the not-for-profit segment of the market, which is not as

sensitive to market returns as a private investor;

• To successfully run these operations, a landlord must provide daily management and further

requires day and night managers and staff. Given the requirement for hands-on management,

investors in these properties typically require a higher rate of return, when compared to

typical rental apartment properties.

The comparables indicate capitalization rates ranging from 2.60% to 5.69%. The lower end of the

range is illustrated by the current listing of a smaller commercial/SRO building with residential

rental upside located southeast of the subject on Main Street. A higher return is warranted for the

subject given the comparable’s smaller investment size, rental upside and current listing status. The

higher end of the range is illustrated by the dated 2015 sale of the “Empress”, located

approximately one block east of the subject. Although the comparable is considered to have rental

upside, the comparable’s included bar operation income and improvement in the market since

spring 2015 support a lower return for the subject.

Our discussions with brokers who are active in the subject’s rooming house market suggest that

fully renovated commercial/rooming house properties with limited rental upside would trade in the

5.0% to 5.5% range, and non-renovated properties with rental upside would trade in the 4.5% to

5.0% range.




Our discussions also indicate there is limited recent capitalization rate evidence for rooming house

properties, however, rates of return for this property class experienced a decrease in 2015 and the

first quarter of 2016, but have generally remained flat over the past three years. Our most recent

discussions in February 2019 and October 2019 suggest that an upward capitalization rate

adjustment of approximately one quarter point may be required as of the second half of 2018 when

the overall mixed-use property investment market began to slow; however, there are limited recent

sales to confirm this adjustment.

We have valued the subject property on the assumption that a pub licence is in place, however,

with no firm details on the type of licence that will be issued, or income and expense projections,

together with a proposal on how the pub will be paid for and operated, it is difficult to provide an

independent value for the license, or value these premises as a going concern. Based on discussions

in the market place, and particularly with numerous SRO Hotel owners nearby, it is our opinion that

value can be attributed to the pub business, in addition to the net income being generated from the

lease. However, the opinions vary. This additional contributory value or consideration has been

internalized within an adjustment to our capitalization rate conclusion.

After considering the previous investment criteria, and based on the preceding analysis, an

appropriate return for the subject would lie towards the upper middle of the comparable range,

between 5.00% and 5.25%. Based on the subject’s assumed renovated condition, appeal to a not-

for-profit purchaser, location, investment size, any going concern pub value and income

characteristics, a capitalization rate of 5.00% has been selected for the subject property.




The subject’s estimated Value as if Renovated as indicated by the Direct Capitalization method, as

of October 1, 2019 is calculated as follows:

NET OPERATING INCOME = $1,082,750

OVERALL RATE 5.0%

= $21,655,000

Rounded to:

TWENTY-ONE MILLION SIX HUNDRED SIXTY THOUSAND DOLLARS

($21,660,000)*

*Our net income is based on the projected market rent for the ground floor commercial space

and does not include income associated with a pub operation. A discussion of the value of a

Liquor Primary licence is below.

VALUE DISCUSSION – PUB AND LIQUOR PRIMARY LICENCE

The subject building’s assumed Liquor Primary licence and previous long standing pub business,

“The Regent Pub”, is a unique investment characteristic, particularly in the subject’s Downtown

Eastside area. Our investigation with market participants suggests that Liquor Primary Licenses have

become scarce and more difficult to obtain over the past several years. We note there is a

moratorium on new Liquor Primary Licenses in the Downtown Eastside.

The Liquor Control and Licensing Branch (LCLB) Head Office reported the subject’s Licence (#5041)

allows for 227 seats; however, the LCLB was unable to provide any further details regarding the

Licence or the permit. The City reported that the Licence permits hours of operation from 11:00am

to 12:00am on Sunday to Thursday and 11:00am to 1:00am on Friday and Saturday. For the

purposes of this appraisal, we assume the Licence includes a permit for the off premises sale of

beer, packaged coolers, cider and wine; however, we note were unable to confirm this. We assume

the off-sales permit could not be separately transferred to a different location, consistent with our

enquiries.




Previously there were reports that the Province had intended to phase out Liquor Primary and Food

Primary licenses and issue one licence, due to the difficulties of regulating these licenses. In 2016,

discussion with the Acting Manager of Stakeholder Relations and Communications with the BC

Liquor Control and Licensing Branch (LCLB) confirmed the Province did intend to phase out these

separate licenses. However, the Acting Manager indicated it was not approved. The Acting Manager

reported that ultimately the approval of the licenses is up to the individual municipality, since

municipal approval is required as part of the application, and local zoning and bylaws govern

permitted uses in the area.

The LCLB indicated that a liquor license does not automatically transfer to a new owner and instead,

an application for transfer must be approved. In the majority of cases, these transfers are approved;

however, the Acting Manager reported that applications have been rejected when the applicant

was deemed not “fit and proper” or the establishment had a history of serving patrons who were

convicted of impaired driving.

The Acting Manager stated there is no value in the liquor license itself, but rather the value is in the

business. However, the Acting Manager did acknowledge it is easier to have an application for a

liquor license transfer approved, rather than a new liquor license application.

Our discussions with market participants also indicated the value to be more with the pub business

and not necessarily the liquor licence. We note from our discussions there may be value to a Retail

Store (LRS) licence, which allows for the sale of beer, wine, coolers, cider, and a full range of spirits

for private consumption. However, given the type of license that the subject has, we assume this

potential does not exist.

The dated May 2015 sale of the “Empress Hotel” at 5.69%, a similar commercial/rooming house

property with a Liquor Primary licence, provides a good capitalization rate guide if we were to

incorporate the bar’s projected income in our net income. However, our net income is based on the

contractual market rent for the ground floor commercial space and does not include any business

income associated with the bar operations.




The June 2016 sale of the “West Hotel” at 5.09%, is also a similar commercial/rooming house

property with a Liquor Primary licence, but provides better capitalization rate evidence for the

subject party, after adjustments, given the comparable’s third-party lease at the time of sale.

In conclusion, given the pub is not in operation, it is difficult and speculative to provide an

independent value for the license or business. However, based on discussions in the market

place, it is our opinion that some value can be attributed to the pub business, in addition to the

net income being generated from the lease. This additional contributory value or consideration

has already been internalized within an adjustment to our capitalization rate conclusion.



14.0 THE DIRECT COMPARISON APPROACH

The Direct Comparison Approach involves the process of comparing the subject property with

others of similar character that have recently sold. This approach implies the Principle of

Substitution, which affirms that a prudent person will not pay more for a property than the cost to

buy an equally desirable substitute. In analyzing the preceding sales data, various adjustments have

to be made to reflect some, or all, of the following considerations: time, location, building size

(number of units), commercial space, quality and age.

Under the Direct Comparison Approach, we utilized the Price per Room method of comparison (also

commonly referred to as the Price per Unit method). The majority of the comparables, like the

subject property, are older buildings and we were not able to confirm the exact size of each

comparable building. Given the latter, we excluded the Price per Square Foot method. Furthermore,

commercial/rooming house properties like the subject typically trade on a Price per Room basis and

not a Price per Square Foot basis.

While the Price per Room method is somewhat unsophisticated, it nevertheless it is a method

commonly used in the marketplace and often referred to when determining value for SRO

properties.

PRICE PER ROOM ANALYSIS

The first 11 comparables were previously analyzed in the Capitalization Rate section of the report.

Four additional comparable sales are analyzed in our Price Per Room analysis. The comparables

illustrate a wide price per room range from $81,667 to $310,417. The subject is assumed to be a

newly renovated building comprised of ground floor commercial space and 154 rooming units with

kitchenettes and shared washrooms for 138 units and two-piece in-suite washrooms for 16 units.

We note that the subject’s rooming units will include standard furnishings considered to be

generally similar to what is offered by many rooming house properties in the area, including the

majority of the comparables. However, the subject building will offer a higher shared washroom to

unit ratio than typical SRO buildings in the area. Based on the previous analysis, we would expect a

price per room for the subject within this range.

A comparable location map is provided on the following page.



THE DIRECT COMPARISON APPROACH (continued)

COMPARABLE LOCATION MAP

Comparable No. 1 (71-77 East Hastings Street), at $244,737 per room, is the July 2015 sale of the

"B.C. Collateral & Loan Co." building, a recently renovated commercial/residential SRO building with

19 self-contained suites and two ground floor commercial units. Although the market has improved

since summer 2015, larger downward adjustments are indicated for the comparable’s fewer

number of rooms and unit mix of entirely self-contained suites. Overall, a lower price per room is

supported for the subject property.

Comparable No. 2 (259 Powell Street), at $103,194 per room, is the reported October 2015 sale of

a renovated commercial/residential SRO building with 36 rooming units and one ground floor

commercial unit. Although a downward adjustment is indicated for the comparable’s fewer number

of rooms, larger upward adjustments are warranted for the subject’s newly renovated condition,

insuite washrooms in a portion of the units and the improvement in the market since fall 2015.

Comparable No. 3 (688-694 East Hastings Street & 401-419 Heatley Avenue), at $243,810 per

room, is the November 2015 sale of the "Heatley Block", a two-storey plus basement

commercial/residential SRO building with an attached two-storey house and one detached two-

storey house.




The commercial/SRO building has four ground floor commercial retail units and sixteen rooming

units on the second floor. The houses contain a total of five residential units. Although the market

has improved since fall 2015, larger downward adjustments are warranted for the comparable’s

larger site area, fewer rooms and superior corner exposure.

Comparable No. 4 (635 East Hastings Street), at $134,538 per room, is the current listing of the

“Shamrock Hotel”, a three-storey plus basement commercial/SRO building with 26 rooming units

and one ground floor commercial unit. The listing agent reported the building had a light renovation

in 2011, and the commercial unit, basement space are currently vacant. Downward adjustments are

indicated for the comparable’s current listing status and fewer rooms; however, slightly greater

offsetting adjustments are supported for the subject’s newly renovated condition and portion of

rooms with insuite washrooms.

Comparable No. 5 (209 Heatley Avenue), at $310,417 per room, is the June 2018 sale of a two-

storey plus basement commercial/SRO building with gated surface parking at the rear. The second

floor has ten micro units and one two-bedroom dwelling unit. Downward adjustments are indicated

for the comparable’s fewer rooms and superior corner exposure; however, these adjustments are

partially offset by the subject’s slightly superior building condition.

Comparable No. 6 (488 Carrall Street), at $95,833 per room, is the June 2016 sale of the “West

Hotel”, an eight-storey concrete commercial/residential SRO building with 96 rooming units and

ground floor commercial space that was leased to the “West” pub at the time of sale. Although the

comparable has a slightly superior location further west, greater upward adjustments are indicated

for the subject’s newly renovated condition and portion of rooms with insuite washrooms.

Comparable No. 7 (235 East Hastings Street) at $101,316 per room, is the May 2015 sale of the

"Empress Hotel" with 76 rooming units and a pub on the ground floor. The comparable’s slightly

superior location and fewer rooms warrant downward adjustments; however, a greater upward

adjustment is supported for the subject’s newly renovated condition and the improvement in the

market since 2015.




Comparable No. 8 (575 East Pender Street), at $112,667 per room, is the January 2019 sale of

“Arlington Rooms”, a three-storey commercial/SRO building with 30 rooming units and one non-

conforming commercial unit. A downward adjustment is indicated for the comparable’s fewer

rooms; however, greater upward adjustments are supported for the subject’s newly renovated

condition, portion of rooms with insuite washrooms and superior commercial component.

Comparable No. 9 (218-222 Keefer Street), at $98,587 per room, is the August 2018 sale of “Keefer

Rooms”, a four-storey plus basement commercial/SRO building with 46 rooming units and one

ground floor commercial unit leased to an established Asian restaurant. A downward adjustment is

warranted for the comparable’s fewer rooms; however, the subject’s newly renovated condition

and portion of rooms with insuite washrooms support a higher price per room.

Comparable No. 10 (139 East Cordova Street), at $93,636 per room, is the June 2019 sale of a four-

storey SRO building with 44 rooming units. The ground floor was previously used by the vendor for

their own residence and office use. There is potential for four additional rooming units that could

be converted from the vendor's office use. Although downward adjustments are indicated for the

comparable’s slightly superior Gastown location and fewer rooms, larger upward adjustments are

required for the subject’s newly renovated condition, portion of rooms with insuite washrooms and

commercial space.

Comparable No. 11 (509 Main Street), at $122,857 per room, is the current listing of a three-storey

commercial/SRO building with 35 rooming units and one ground floor commercial unit leased to a

restaurant tenant. Although downward adjustments are indicated for the comparable’s slightly

superior location and fewer rooms, larger upward adjustments are required for the subject’s newly

renovated condition and portion of rooms with insuite washrooms.

One additional renovated and three additional non-renovated commercial/rooming house property

sales were considered in our price per room analysis. These comparables are summarized in the

chart on the following page.




12 233 -237 Sale Price # of Rooms Price Per Room Comments

Main Street $12,490,000 78 160,128$

Vancouver Sale Date Building (sq.ft.)

May-18 -

Site Area (sq.ft.)

6,000

13 233 -237 Sale Price # of Rooms Price Per Room Comments

Main Street $7,500,000 78 96,154$


Sep-17 -

Site Area (sq.ft.)

6,000

ADDITIONAL PRICE PER ROOM COMPARABLES

RENOVATED BUILDINGS

"Jubilee Rooms" located on the west side of Main St. north of E Cordova St.

The improvements comprise two adjacent four-storey commercial/SRO

buildings constructed circa 1911. The southern building has a Class B

heritage designation. The vendor (Living Balance Property Investment

Group) had acquired the buildings fully vacant in September 2017 and

subsequently completed significant renovations. The purchaser (the

Provincial Rental Housing Corporation) acquired the building to relocate

tenants from 160 East Hastings Street (Regent Hotel). BC Housing reported

that the purchase price was above market as it required additional SRO

space in a short period of time.


"Jubilee Rooms" located on the west side of Main St. north of E Cordova St.

The improvements comprise two adjacent four-storey commercial/SRO

buildings constructed circa 1911. The southern building has a Class B

heritage designation. The selling agent reported the sale price was slightly

above market as the deal required the vendor (a non-profit) to relocate

approximately 80 tenants from the buildings as the purchaser (Living

Balance Property Investment Group) intended to renovate the entire

building.




14 254-262 Sale Price # of Rooms Price Per Room Comments

E Pender Street $9,800,000 120 81,667$


Feb-17 43,500

Site Area (sq.ft.)

9,150

15 103 Sale Price # of Rooms Price Per Room Comments

E Hastings Street $2,750,000 19 144,737$


Sep-18 -

Site Area (sq.ft.)

3,072

ADDITIONAL PRICE PER ROOM COMPARABLES


"May Wah Hotel" is located on the south side of E Pender St., west of Gore

Avenue. The improvements comprise a four-storey commercial/SRO building

constructed circa 1912 with a Class B heritage designation. The building has

four ground floor commercial units and basement commercial space.

Reportedly, at the time of sale the commercial units were occupied by

various local tenants. The property was purchased by the Chinatown

Foundation in conjunction with funding from BC Housing. The vendor Shon

Yee Benevolent Association had listed the property for sale in mid-2016 for

$12,000,000 with the asking price later reduced to $9,999,000. The building

had not been renovated and the purchaser reportedly did not acquire the

property for investment purposes. Reportedly, the purchaser intends to

complete renovations to the building including seismic upgrades.

Three-storey plus basement commercial/SRO building on the north side of

East Hastings Street between Main and Columbia Streets. There is one

ground floor commercial unit and 14 rooming units on the second and third

levels with common washrooms and a common living area and kitchen on

the third level. The listing agent reported that the rooming component was

vacant and the commercial space was owner-occupied. The space had some

updates and was clean and average in condition. The listing agent indicated

there are currently 14 rooms but indicated the number of rooms can easily

be converted to 19 (what it is licensed for). The building had been on the

market since 2017 as the vendor was firm with the asking price

($2,890,000); they are a non-profit church group that was not overly

motivated to sell. The agent reported the property was under contract in

March 2018 with the closing extended to September 22, 2018. The

purchaser is reportedly intending to do some minor cosmetic updates.




Comparable No. 12 (233-237 Main Street), at $160,128 per room, is the May 2018 sale of "Jubilee

Rooms", two adjacent four-storey commercial/SRO

buildings with 74 rooming units and two ground floor

commercial units. The southern building has a Class B

heritage designation. The property is located on the west

side of Main Street, north of East Cordova Street. The

vendor (Living Balance Property Investment Group) had

acquired the buildings fully vacant in September 2017 and

subsequently completed significant renovations. The

purchaser (the Provincial Rental Housing Corporation)

acquired the building to relocate tenants from 160 East

Hastings Street (Regent Hotel). Discussion with BC Housing indicates the deal was negotiated in

March/April 2018, shortly before the closing date. BC Housing indicated that the purchase price was

above market as there was urgency for additional SRO space. Although the building had substantial

renovations completed by the vendor, BC Housing also indicated that a significant amount of

money was spent to further renovate the building to meet the needs of the relocated residents.

Consideration was given to the subject’s portion of rooms with insuite washrooms; however, the

comparable’s above market purchase price, fewer rooms and slightly superior location support a

lower price per room for the subject property.

Comparable No. 13 (233-237 Main Street), at $96,154 per room, is the previous September 2017

sale of Comparable No. 12. The selling agent reported the sale price was slightly above market as

the deal required the vendor, a non-profit, to relocate approximately 80 tenants from the buildings

as the purchaser intended to renovate the entire building. Although the price was reported to be

slightly above market, a higher price per room is warranted for the subject property given its

portion of units with insuite washrooms and renovated condition.

Comparable No. 14 (254 to 262 East Pender Street) at 81,667 per room, is the February 2017 sale

of the "May Wah Hotel", a four-storey commercial/SRO building constructed circa 1912 with a Class

B heritage designation. The property is located on the south side of East Pender Street, west of

Gore Avenue.




The building has 120 rooming units and four ground floor commercial units. Reportedly, at the time

of sale the commercial units were occupied by various local

tenants. The property was purchased by the Chinatown

Foundation in conjunction with funding from BC Housing.

The building had not been renovated and the purchaser

reportedly did not acquire the property for investment

purposes. Reportedly, the purchaser intended to complete

renovations to the building, including seismic upgrades.

Although the comparable has a slightly superior Chinatown

location, a higher price per room is supported for the

subject given its renovated condition and portion of rooms with insuite washrooms.

Comparable No. 15 (103 East Hastings Street), at $144,737 per room, is the September 2018 sale

of a three-storey plus basement commercial/ residential

SRO building on the north side of East Hastings Street

between Main and Columbia Streets within the same block

as the subject property. There is one ground floor

commercial unit and 14 rooming units on the second and

third levels with common washrooms and a common living

area and kitchen on the third level. The listing agent

indicated there are currently 14 rooms, but indicated the

number of rooms can easily be converted to 19 (what it is

licensed for). The listing agent reported that the rooming

component is vacant, the commercial space is owner-occupied and the building has had some

updates and is clean and average in condition. The agent reported the property was under contract

in March 2018 and the sale closed in late September 2018. The purchaser is reportedly intending to

do some minor cosmetic updates and lease out the building including the commercial space. A

downward adjustment is required for the comparable’s fewer rooms; however, this adjustment is

generally offset by the subject’s newly renovated condition, superior commercial space and a

portion of rooms having insuite washrooms.




PRICE PER ROOM SUMMARY

As mentioned previously, the comparables illustrate a wide price per room range from $81,667 to

$310,417. Comparables No. 1 to No. 5 and Comparable No. 12 comprise recently renovated

commercial/SRO buildings with asking and sale prices ranging from $103,194 to $310,417 per room.

The upper end of the range, at $244,737 per room and $310,417 per room, reflects renovated

buildings with self-contained suites.

Given the subject’s assumed renovated condition, number of rooms, and primarily shared

washrooms, a price per room towards the lower end of this renovated range is warranted.

Comparables No. 6 to No. 11 and Comparables No. 13 to No. 15 comprise non-renovated

commercial/SRO buildings with sale prices ranging from $81,667 to $144,737 per room. If

Comparable No. 15, a September 2018 sale of a commercial/SRO building with far fewer rooms, is

excluded, the range narrows to $81,667 to $122,857 per room. A price per room above these

comparables is supported for the subject given its newly renovated condition and portion of rooms

with insuite washrooms. However, we note that a potential purchaser of the subject indicated that

upon renovation the property could be worth approximately $100,000 per room.

For adjustments previously discussed, a value above the range illustrated by Comparable No. 4 at

$134,538 per room and Comparable No. 11 at $122,857 per room, but just below Comparable No.

13 at $144,737 per room, is supported. After adjustments for location, building and room

characteristics and date of sale, a price per room range of $140,000 to $145,000 is supported. We

selected a value at the middle of the narrower range at $142,500 per room, as our estimate of

Value as if Renovated using the Price Per Room method.

Number of Units X Price / Room = Estimate of Value

154 X $142,500 = $21,945,000

Rounded to:

TWENTY-ONE MILLION NINE FORTY-FIVE THOUSAND DOLLARS

($21,945,000)



15.0 VALUE AS IF RENOVATED AND ESTIMATE OF CURRENT MARKET VALUE

In estimating the Value as if Renovated for the subject, two methods of valuation were considered.

The value indications by each approach are summarized as follows:

Values upon Completion of Renovation

Income Approach: $21,660,000

Direct Comparison Approach: $21,945,000

VALUE AS IF RENOVATED

In our opinion, a value derived between both the Income and Direct Comparison Approaches

reflects the subject’s estimated Value as if Renovated, and we have concluded at the approximate

mid-point of $21,800,000, as of October 1, 2019. The next step in the analysis is to deduct hard and

soft construction costs and a developer’s profit allowance. However, we have not used a

conventional market developer’s profit allowance that would typically be in the range of at least

15% of development costs. We have allowed for a margin of 7.5% to account for risk and also the

potential interest in the subject property from not-for-profit groups, not motivated by profit but

rather motivated by other considerations such as the provision of affordable safe housing.

RENOVATION COSTS AND CURRENT MARKET VALUE OF SUBJECT PROPERTY

Under the Value as if Renovated approach, it is assumed that the interior and exterior of the

building has been renovated to a good standard, comparable to other recently renovated micro-

unit buildings in the general area and the 13 SRO buildings recently renovated as part of BC

Housing’s SRO Renewal Initiative. We have relied upon the cost management report (Regent Hotel

Regeneration Schematic Design Class C Estimate) prepared by BTY Group, dated February 25, 2019.

BTY has estimated the total renovation costs of the subject building at $33,518,500, which

comprises hard costs of $22,163,800, soft costs of $3,870,700, furnishings, fittings and equipment

of $107,500 and contingencies of $7,376,500 (22.0%). The estimated renovation costs equate to

$669 per square foot, based on the building’s gross floor area of 50,080 square feet.



VALUE AS IF RENOVATED AND ESTIMATE OF CURRENT MARKET VALUE (continued)

Excluding the contingencies, the costs equate to $26,142,000. As a percentage of total costs, the

contingencies are high compared to a renovation project of a typical mixed-use building; however,

the renovation of the subject property is considered complex given the building’s existing condition

including hazardous materials, heritage components, and location.

To help evaluate the reasonableness of the costs projected by BTY, the appraisers inspected the

Hazelwood Hotel at 344 East Hastings Street, which is one of BC Housing’s 13 SROs that were

recently renovated as part of the SRO Renewal Initiative (SRI). The inspection was completed on

February 14, 2019. The appraisers also inspected the exteriors of the other 12 buildings renovated

under the SRI. The renovations to the Hazelwood Hotel were reportedly completed in January 2017

with completion of the entire project in February 2017.

Discussion with BC Housing indicates the renovations completed to each of the 13 buildings were

similar, although there were some differences in the level of code compliancy. BC Housing indicated

the overall SRO Renewal Initiative costs equated to approximately $400 per square foot of building

area. These costs included heritage considerations, environmental remediation, which included

contaminated soils and hazmat material, and certain soft costs such as design fees. As for the

Hazelwood, significant attention was paid to upgrading all the plumbing, electrical, heating,

sprinklers, smoke detectors, windows, heritage façade and interiors works, accessible showers etc.

The elevator was also upgraded but not to code. The construction timeframe for the Hazelwood

Hotel was approximately two years with a similar timeframe for the other 13 buildings.

However, these costs reflect the time period of 2012 (when the project was initially tendered) to

2016 (when change orders were completed). Given current construction costs, BC Housing suggests

the cost to complete the same project today may be up to be double these costs (approximately

$800 per square foot). A lower price per square foot is supported for the subject property as there

would likely be construction economies given its larger size and greater number of units than the

typical SRO building under the SRI.




VALUE CONCLUSIONS

To determine the value of the subject property, we first estimated the value assuming completion

of all renovations and upgrades and ready for occupancy. On this basis we concluded with an as if

renovated value of $21,800,000. However, we need to deduct construction costs which equate to

$22,163,800 or $436 per square foot. In addition, soft costs including professional fees, connection

fees and permits, and management and overhead, need to be deducted and BTY has estimated

these costs at an additional $3,870,700. With furnishings, fittings and equipment and contingencies

the total BTY costs amount to $33,518,500.

BTY’s cost estimate includes all direct and indirect construction costs; however, further soft costs

including financing, legal, property tax and property transfer tax are not included. Therefore, to

account for these costs, we have estimated an additional 10% of the BTY costs. We caution the

reader that this may be low considering the complexity and timeframe of the project. A further

7.5% margin for risk and profit has also been included, which is considered to be at the low end for

similar developments. Based on these additional costs and BTY’s costs, the value of the subject

property is summarized as follows.

BTY Renovation Costs

Construction 22,163,800$

Design Contingency (Design and Program Changes) 3,340,700$

Post Tender Change Order Contingency 3,841,800$

Professional Fees 2,373,800$

Municipal & Connection Fees 103,000$

Management & Overhead 1,393,900$

Project Contingency 194,000$

Furnishing, Fittings & Equipment 107,500$

Total BTY Renovation Cost (Feb 2019 Dollars) 33,518,500$

Further Soft Costs Including Financing, Legal, Property Tax, PPT, etc. (10% of BTY Costs) 3,351,850$

Total BTY and Further Soft Costs 36,870,350$

Developer's Profit (7.5% of Total Costs) 2,765,276$

Total Project Costs (Including Developer's Profit) 39,635,626$

Value Upon Completion of Renovations (Final Estimate) 21,800,000$

Net Value of Subject Property (17,835,626)$

Net Value of Subject Property (Rounded) (17,840,000)$




On this basis the estimated renovation costs far exceed the value upon completion of the assumed

renovation, indicating that the renovation project is not currently economically feasible.

We note that on March 13, 2019, the City approved new grant programs for heritage conservation.

According to the City’s website, “The Heritage Incentive Program provides grants up to a maximum

of $4-million per building for heritage conservation and seismic upgrades of buildings that are:

• Listed on the Vancouver Heritage Register and legally protected by a heritage designation

bylaw

• Privately owned commercial and non-commercial buildings, including by non-profits

• Constructed primarily of unreinforced masonry, including when combined with heavy-timber

post-and-beam, structural steel, unreinforced concrete, or other historic period structural

assemblies”

“The Heritage Façade Rehabilitation Program provides grants of up to $50,000 for the rehabilitation

and seismic stabilization of the façades of registered heritage buildings.” Buildings eligible for

funding must be:

• Listed on the Vancouver Heritage Register

• Privately owned commercial and non-commercial buildings, including by non-profits

• Constructed primarily of unreinforced masonry”

BTY’s cost estimate does not appear to consider this potential funding. Although there may be

some funding from the City available for heritage upgrades to the subject building through the

programs described above; it is speculative, as an application is required and there is a limited

amount of funding available. Therefore, this potential funding has not been reflected in our

estimate of the subject’s current market value.

Our estimate of land value as if vacant and available for development to its most economic and

legally permitted use is $3,050,000. However, after deducting demolition costs of $3,152,787

comprising hazardous materials removal of $2,551,827 and additional costs of $600,960 ($12.00 per

square foot of gross building area), the estimated land value less demolition costs is concluded at a

negative value of -$100,000. However, at this time there is no definitive direction from the City

whether the subject building can be demolished.




The land value estimate above is based on the current zoning and redevelopment potential of the

subject property. However, the City reported that a new building would likely not be permitted to

be rebuilt to the existing 8.21 FSR and would need to meet new SRO building code requirements,

which would also likely decrease the number of existing rooms. On this basis, it will not be possible

to rebuild the existing 161 or 158 licensed SRO rooms. The City typically requires a fee of $125,000

be paid for the loss of each room, in order to protect the rental housing stock in the area. However,

we have assumed in our appraisal that this penalty will not be payable for a loss of any units beyond

what could be reconstructed.

The two approaches both produced negative values. The value as if renovated less all costs of

renovations indicated a negative value of -$17,840,000. The land value less demolition and hazmat

removal costs also indicated a negative value of -$100,000. These results are consistent with the

opinions of a potential purchaser, who toured the buildings in 2018 with a listing agent and

considered making an offer for both the Regent Hotel and Balmoral Hotel properties. The potential

purchaser owned a number of existing hotels in the area. Following that due diligence, the potential

purchaser indicated to us that they would not pay even one dollar for either property.

It is uncertain as to what the current market value for the Regent is at the present time. It may be

reasonable to assume that a potential purchaser would pay $1.00 for the property with the

intention to hold until such time that changes or improvements in the market would make

renovation or redevelopment economically feasible. However the holding costs including property

taxes and building insurance, risk and other considerations will likely deter most private market

participants.

We are unaware of any instances of property being transferred with a negative value. Therefore, a

value of $1.00 is concluded for the subject property with the knowledge that a purchaser would be

required to assume the financial obligations with either holding or demolishing and redeveloping

the property. In light of these risks and significant costs of both demolition or renovation provided

to us and on which we have relied, we consider the most likely purchaser would be a government

or non-profit group where the benefits of providing social or low cost housing might be considered

to offset the costs.



16.0 CERTIFICATION

October 28, 2019

RE: REGENT HOTEL - 160 EAST HASTINGS STREET, VANCOUVER, BC

We hereby certify that except as otherwise noted in the preceding analysis, to the best of our

knowledge and belief:

1. The statements of fact contained in this report are true and correct;

2. The reported analyses, opinions, and conclusions are unbiased, and subject to the reported

assumptions and limiting conditions;

3. We have no present or prospective interest in the property that is the subject of this report,

and no personal interest with respect to the parties involved;

4. We have no bias with respect to the property that is the subject of this report or to the

parties involved with this assignment;

5. Our engagement in, and compensation for, this assignment was not contingent upon

developing or reporting predetermined results, the amount of the value estimate, or a

conclusion favouring the client;

6. Our analyses, opinions, and conclusions were developed, and this report has been prepared

in conformity with the Canadian Uniform Standards;

7. We have the knowledge and experience to complete the assignment competently;

8. As of the date of this report the undersigned have fulfilled the requirements of The

Appraisal Institute of Canada Continuing Professional Development Program for designated

members and candidate members;

9. Reagan Stinson personally inspected the subject property on May 29, 2018. Stuart

Carmichael personally inspected the subject property on March 8, 2018, and completed an

exterior inspection of the subject property on July 4, 2018. Both appraisers re-inspected the

subject property on November 1, 2018 and completed cursory exterior re-inspections of the

subject property on February 25, 2019 and October 1, 2019 (the date of valuation);



CERTIFICATION (continued)

10. Rule 11-2 — Duty of Expert Witnesses

(1) In giving an opinion to the court, an expert appointed under this Part by one or more

parties or by the court has a duty to assist the court and is not to be an advocate for any

party.

Advice and certification:

(2) If an expert is appointed under this Part by one or more parties or by the court, the

expert must, in any report he or she prepares under this Part, certify that he or she

(a) is aware of the duty referred to in sub rule (1),

(b) has made the report in conformity with that duty, and

(c) will, if called on to give oral or written testimony, give that testimony in conformity with

that duty;

11. We are aware of our duty to assist the court and not assume the role of advocate for any

party. We certify that this report was made in conformity with that duty, and that if called

upon to give testimony, we will do so in conformity with that duty;

12. Based upon the data, analyses and conclusions contained herein, the current market value

of the subject property described herein, as at October 1, 2019, subject to the assumptions

and limiting conditions contained herein, is estimated at $1.00*.

*The value as if renovated less all costs of renovations indicated a negative value of -$17,840,000.

The land value less demolition and hazardous material removal costs also indicated a negative value

of -$100,000. However, at this time there is no definitive direction from the City whether the

subject building can be demolished. We are unaware of any instances of property being transferred

with a negative value. Therefore, a value of $1.00 is concluded for the subject property with the

knowledge that a purchaser would be required to assume the financial obligations with either

holding or demolishing and redeveloping the property. In light of these risks and significant costs of

both demolition or renovation provided to us and on which we have relied, we consider the most

likely purchaser would be a government or non-profit group where the benefits of providing social

or low cost housing might be considered to offset the costs.

CWPC Property Consultants Ltd.

Per: Reagan Stinson Stuart Carmichael B.Com (hons), AACI, P.App, MBA B.Bus. (L.Econ.), AACI, P.App



17.0 ASSUMPTIONS AND LIMITING CONDITIONS

The estimate of market value contained in this report is based on an analysis of information obtained from various sources. Some of this data has required subjective interpretation and our terms of reference have, in some instances, required us to make assumptions in arriving at our value conclusions. As a result, the opinions and conclusions contained in this report are subject to the following Assumptions and Limiting Conditions: Exposure Time: The estimate of market value of the subject property is based on an

exposure time of three to nine months immediately prior to the date of appraisal.

Payment Terms: The estimated market value for the subject property is based on the

assumption that it would be sold on payment terms consistent with common practices in the real estate market and subject to the encumbrances outlined in this report, unless otherwise stated.

Legal: We are not qualified and do not purport to give legal advice. It is

assumed that:

a) the legal description of the property appraised, confirmed by the Certificates of Title, is correct;

b) the title is good and if there are any liens or encumbrances, they

have been disregarded and the Property appraised as though free and clear of all encumbrances, except as otherwise discussed herein;

c) the proposed use is a legally conforming use, which may be

continued by any purchaser from the existing owner;

d) property rights appraised exclude mineral rights, if any;

e) there are no encroachments, encumbrances, restrictions, leases or covenants that would in any way affect the valuation, except as expressly noted herein. It is assumed that no encroachments exist with regard to positioning of any of the subject improvements;

f) rights-of-way, easements or encroachments over other real

property and leases or other covenants noted herein are legally enforceable.



ASSUMPTIONS AND LIMITING CONDITIONS (continued)

Surveys: The appraisers are not qualified surveyors and the client has provided

no legal survey concerning the property. The appraisers have not surveyed the property. The area and dimensions of the site are based on measurements obtained from the City of Vancouver and verified with BC Assessment Records and Legal Plan VAP 184. It is assumed that the area of the property is correct and no responsibility is accepted for any errors contained herein. Maps, plans, drawings, and photographs appearing in this report are included for the sole purpose of visual reference and should not be construed as legal surveys and the appraiser assumes no responsibility for their accuracy.

Engineering: We are not qualified to give engineering advice and we have not given

opinions with regard to the actual soil bearing capacity of the Property. We have assumed that the overall site does not suffer from any soil stabilization problems.

Environmental: We were provided with a copy of the Limited Phase I Environmental

Site Assessment and Liability Assessment dated November 28, 2018 for the subject property prepared by Hemmera Envirochem Inc. The Phase I report identified a possible underground storage tank and unknown fill. Based on Hemmera’s previous experience at similar SROs, they provided an estimate of total remaining environmental liability ranging from $80,000 to $125,000. We assume the environmental information and cost estimates provided by Hemmera are accurate and we reserve the right to modify our value conclusions upon receipt of a detailed estimate of remediation costs, if any.

Government Regulations: No investigation has been undertaken with the local fire department,

building inspector, health department, or any other government regulatory agency, unless such investigations are expressly represented to have been made in this report. The Property must comply with government regulations and, if it does not comply, its non-compliance may affect market value. To be certain of compliance, further investigations may be necessary. Unless otherwise stated, we assume that there are no governmental orders or directives outstanding, which require upgrading of the Subject Building or limiting their occupancy.




Building Areas: Building plans indicating the subject’s total area were not available;

however, however, a typical floor plan for the residential floors was provided by the City of Vancouver. The subject’s individual gross floor areas and estimated gross building area were provided by Merrick Architecture, which was measured from CAD files based on available drawings dimensions. We assume these areas are correct; however, a professional survey is recommended.

Improvements: Assuming completion of the assumed renovations, all structural and

mechanical components are assumed to be sound and in good working order, but their condition cannot be guaranteed. It is assumed that the equipment, heat and ventilation, drainage and drain tile, septic, electrical, plumbing and other systems and services are adequate and in good working order.

Possession: Possession of this appraisal report or a copy hereof does not carry with

it the right of publication. In addition, this report or a copy hereof may not be used by any entity other than the Client or for any purposes other than that intended by the Client, without the prior written consent of the appraiser and the Client. The report is valid only if it bears the original signatures of the authors. All copyrights are reserved to the authors. This report is considered confidential between the authors and the Client. It shall not be disclosed, quoted from or referred to, in whole or in part, or published in any manner, without the express written consent of the appraisers.

Information Sources: Documented and hearsay evidence of market transactions and other

data contained in this report have been obtained from sources considered reliable and have been verified where possible. Where verification has not been possible, it has been assumed that the information obtained is correct.

Compensation: The appraisers are not required to give testimony in court by reason of

this appraisal because the fee, as accepted for the preparation of this report, does not include participation in any court proceedings, arbitration hearings, or professional consultations that may occur at a later date.




Client: This report has been prepared at the request of the Client for the

purpose of an appraisal of market value for the Property for expropriation purposes. It is not reasonable for any other person to rely upon this appraisal without first obtaining written authorization from the Client and the appraisers. There may be qualifications, assumptions or limiting conditions, in addition to those set out previously, relevant to that person’s identity or intended use. This report is prepared on the assumption that no other person will rely on it for any other purpose and that all liability to all such persons is denied.

Unforeseeable Events: The values reported herein are based upon data collected and reviewed up to and as of the effective date of appraisal. The appraisers assume no responsibility for unforeseeable events that may alter market conditions after the effective date of this report.

Appendix "A"

Copy of the Subject’s Regeneration Schematic Design

Class C Estimate prepared by BTY Group

2288 Manitoba St., Vancouver, BC, V5Y 4B5

T 604 734 3126

COST MANAGEMENT REPORT

Regent Hotel Regeneration Schematic Design Class C Estimate

R E POR T NUMBER 1 . 0 ( R E V 1 . 0 )

F E B RUAR Y 2 5 , 2 0 1 9

PREPARED FOR:

CWPC

CWPC | Regent Hotel Regeneration ‐ Schematic Design Class C Estimate Report Number 1.0 (Rev 1.0) | February 25, 2019

T:\1 ‐ Vcr\1 ‐ CP\Commercial\1‐10470 ‐ Regent Hotel\3 ‐ Estimates\1 ‐ Renovation Estimate Nov 18\2 ‐ Report\1 ‐ Word\Regent Hotel Class C Estiamte ‐ Feb 22, 2019.docx

Contents 1.0 Introduction 1

2.0 Executive Summary 2

3.0 Development Cost Summary 4

4.0 Basis & Assumptions 5

5.0 Exclusions 5

6.0 Project Cost Summary 6

7.0 Construction Cost Summary 7

8.0 Areas 8

9.0 Taxes 8

10.0 Project Schedule & Escalation 8

11.0 Pricing 9

12.0 Risk Mitigation 9

13.0 Contingencies 9

14.0 Documents Reviewed 10

APPENDICES:

APPENDIX I Elemental Summary 2 pages

APPENDIX II Cost Plan 40 pages

APPENDIX III Floor Plans (Proposed) 4 pages

Prepared By Reviewed By Date

Keith Leung Anthony Chan 2/25/2019


2288 Manitoba St., Vancouver, BC, V5Y 4B5 |604 734 3126 This report has been prepared at the request of CWPC and is the exclusive property of BTY Group. The information must be treated as confidential and not to be disclosed, reproduced or permitted to be disclosed to any party without the prior consent of BTY Group.

1

1.0 Introduction

1.1 Instructions Received

This report has been prepared by BTY Group (“BTY”) at the request of CWPC (the “Client”).

CWPC has appointed BTY to provide a Class C estimate for the project – The Regent Hotel at 160 East Hastings

Street, Vancouver, B.C. (the “Project”). The Project delivery model has yet to be determined and, therefore,

BTY strongly recommends that estimates are prepared at each of the key design milestones.

Information related to the Project for the purposes of this report was received by BTY since January 16, 2019.

Please refer to Section 14.0 for a list of information received in producing this report.

1.2 Report Reliance

This report has been prepared in accordance with the scope of our Fee Proposal, dated September 24, 2018,

which was prepared in response to the Client’s request, and is subject to the terms of that appointment. This

report is for the sole and confidential use and reliance of City of Vancouver and the Client. BTY Group, its

Directors, staff or agents do not make any representation or warranty as to the factual accuracy of the

information provided to us on behalf of the Client or other third‐party consultants or agents. BTY Group will

not be liable for the result of any information not received which, if produced, could have materially changed

the opinions or conclusions stated in this report. This report shall not be reproduced or distributed to any

party without the express permission of BTY Group.

Any advice, opinions, or recommendations within this document should be read and relied upon only in the

context of the report as a whole. The contents do not provide legal, insurance or tax advice or opinion.

Opinions in this report do not an advocate for any party and if called upon to give oral or written testimony it

will be given on the same assumption.

1.3 Contacts

Should you have any queries regarding the content of this report, please do not hesitate to contact either of

the following:

Keith Leung Neill McGowan

Senior Cost Consultant Partner

Tel: 604‐734‐3126 Email: [email protected]

Tel: 604‐734‐3126Email: [email protected]



2

2.0 Executive Summary

2.1 Report Purpose

The purpose of this report is to provide a realistic estimate of the Project cost based on the information

available at the time of writing.

The opinion expressed in this report has been prepared without the benefit of detailed architectural,

structural, mechanical and electrical drawings and should, therefore, be considered a Schematic Design (Class

C) estimate. Based on the documents reviewed, our estimate should be correct within a range of

approximately +/‐ 15% to 20%.

In order to provide an accurate cost estimate for the Project, BTY Group strongly recommends that a

professional Quantity Surveying organization, such as BTY Group, be retained to provide a detailed analysis of

any design information produced on behalf of the Client during the remaining stages of design.

2.2 Project Background and Description

The existing Regent Hotel has fallen into disrepair and has become the subject of much controversy due to lack

of maintenance and life safety concerns. The City of Vancouver has recently expropriated the Hotel and all

tenants have been relocated so that the building is now vacant. BTY’s role is to ascertain a cost assessment for

the client to appraise a fair market value for the Property

The existing building is an eight‐storey structure with a single‐storey basement licensed to provide 158 SRO

(single residential occupancy) units. Floors are solid laminated timber that span to a mix of wood stud load

bearing walls and the basement exterior walls are concrete with wood and steel joists and infill on edge

laminated wood for the floors above. The above‐grade structure is board formed concrete to the West

lightwell with brick walls to South and North ends.

The Regent Hotel has been placed on the Heritage Register is listed as a Class “B” heritage building.

Rehabilitation, recreation and remediation techniques are to follow the standards and guidelines for the

conservation of historic places in Canada. The works to restore the hotel include:

structural and seismic upgrading;

bringing to code compliance and current COV requirements and standards in so far as is possible;

re‐installation of the original storefront design;

removal of existing “Regent Hotel” sign;

re‐pointing or brick replacement to all facades;

re‐roofing on main roof and lightwell roofs, skylight replacement;

replacement of windows;

seismically anchoring of decorative upper cornice;

demolition of all existing interior drywall, dropped ceilings, plaster and laminate flooring to expose

studs and floor joists;

re‐configuration of floor layout to include residential rooms, accessibility suites, kitchens, bathrooms,

amenity areas;

upgrading interior stairs;

reinforcing and replacement of all decayed structural framing members;

upgrading existing elevator;



3

upgrading mechanical and plumbing (ventilation, heating, water, sprinklers and fire protection);

upgrading electrical (lighting, communications, amenities, security‐ new, new unit substation);

upgrading security (new);

upgrading fire alarm system;

upgrading sprinkler system to NFPA standard.



4

Executive Summary (Cont’d)

2.3 Project Overview

Construction Budget Status Details

Budget Not available

Current Estimate $33,518,500

Variance from previous report Not applicable

Current Cost / m² $669 /ft²

GFA 50,080 ft²

Construction Start Not available

Construction Completion Not available

Duration 24 months

Escalation 0.00%

Design Contingency 15.00%

Construction Contingency 15.00%

Project Specifics

3.0 Development Cost Summary

The current estimated cost of the project may be summarized as follows:

Item Estimated Costs ($)

A Land Cost (Excluded) 0

B Construction 22,163,800

C Contingencies 7,182,500

D Professional Fees 2,373,800

E Municipal & Connection Fees 103,000

F Management & Overhead 1,393,900

G Project Contingency 194,000

H Furnishing, Fittings & Equipment 107,500

I Financing Costs 0

J Goods & Services Tax 0

Total Project Cost (Feb 2019 Dollars) $33,518,500

K Escalation (Excluded) 0

Escalated Project Cost (Feb 2019 Dollars) $33,518,500

Please note that, where zero‐dollar values are stated, BTY has excluded these costs and the values should be carried in a separate budget (if applicable).



5

4.0 Basis & Assumptions

The construction estimate is based on the following list of assumptions and allowances:

1. 70% of total basement slab‐on‐grade area to be demolished and replaced

2. Allowance of $30,000 for alternate solution to north stair to make it code compliant

3. Allowance of $10,000 for upgrading roof structure to accommodate new rooftop mechanical units

4. Allowance of $30,000 for amelioration of water ingress in the lower floors

5. Allowances of $10,000 to add louvres at the top and steel beam / columns for the garbage door, exit doors and gas meter enclosure below

6. Cash allowance for BC Hydro Connection fee of $200,000

7. Cash allowance for Telus/Shaw connection fee of 50,000

8. Allowance of scaffolding for 18 months for envelope upgrading

9. Allowance of $9,800 for clearing rooms of debris

10. Pub fit‐out to be done by others

Please note that BTY is not qualified to act as a design consultant. The assumptions in our estimate should be

reviewed and corrected by the design team.

5.0 Exclusions

The construction estimate includes all direct and indirect construction costs derived from the drawings and

other information provided by the Consultants, with the exception of the following:

1. Land costs

2. Financing costs

3. Legal fees and agreement costs / conditions

4. Temporary facilities for user groups during construction

5. Loose furnishings and equipment unless otherwise included in the Appendix II Cost Plan

6. Pub fit‐out: Base building works only included in the estimate

7. Unforeseen ground conditions and associated extras

8. Servicing outside the project site boundary

9. Phasing of the works and accelerated schedule

10. Project commissioning

11. Erratic market conditions, such as lack of bidders, proprietary specifications

12. Cost escalation past February 2019.

Regent Hotel Regeneration ProjectSchematic Design Class C Estimate #1.0 (Rev #1)

6.0 Project Cost SummaryThe estimated project capital cost is summarized as follows:

Total

A. LAND COST $0A1 Land 0A2 Legal Fees 0

B. CONSTRUCTION $22,163,800B1 Building 22,163,800

C. CONTINGENCIES $7,182,500C1 Design Contingency (Design & Program Changes) 3,340,700C2 Post Tender Change Order Contingency 3,841,800

D. PROFESSIONAL FEES $2,373,800D1 Programming 0D2 Architectural * 1,500,000D3 Structural * 171,000D4 Mechanical * 90,000D5 Electrical * 125,000D6 Quantity Surveying 173,700D7 Acoustic 34,700D8 Envelope * 35,000D9 Code Consultant 19,400D10 Geotechnical Consultant * 125,000D11 Environmental Consultant * 100,000

E. CONNECTION FEES & PERMITS $103,000E1 Development Cost ChargesE2 Building Permits (DP & BP) 103,000

F. MANAGEMENT & OVERHEAD $1,393,900F1 Project Management Fee 733,700F2 Owners Planning and Administrative Cost 366,800F3 Project Insurance 146,700F4 Project Commissioning, Move‐In 146,700

G. PROJECT CONTINGENCY (5% of Items D to F) $194,000

SUB‐TOTAL $33,411,000

H. FURNISHINGS, FITTINGS & EQUIPMENT (Included in B) $107,500

SUB‐TOTAL $33,518,500

J. TAXES $0

TOTAL PROJECT COST (Feb 2019 Dollars) $33,518,500

K. ESCALATION $0K1 Escalation Reserve (0% of Item A to G) 0K2 FF & E Escalation (0% of item H) 0

ESCALATED PROJECT COST (Feb 2019 Dollars) $33,518,500

* Estimated fee advised by the Consultant Team

February 25, 2019

6



7

7.0 Construction Cost Summary

The estimated construction cost of the project may be summarized as follows:

Estimated Cost Cost/GFA

$ $/ft²

1,998,000 40 9%

6,962,600 139 31%

2,800,100 56 13%

1,773,700 35 8%

2,436,200 49 11%

$15,970,600 $319 /ft² 72%

286,000 6 1%

5,053,600 101 23%

961,100 19 4%

$22,271,300 $445 /ft² 100%

3,340,700 67

3,841,800 77

$29,453,800 $588 /ft²

0 0

$29,453,800 $588 /ft²

50,080 ft²

$319 /ft²

$445 /ft²

$588 /ft²

$588 /ft²

Escalated Construction Cost

Design Contingency (15%)

Site Work

Ancillary Work (Demolition, environmental & Hazmat

abatment)

General Requirements & Fees

Escalation Allowance (0%)

Construction Contingency (15%)

Description %

Net Building Cost

Net Construction Cost

Total Construction Cost

Structural

Architectural

Mechanical

Electrical

General Requirements & Fees

Escalated Construction Cost /ft²

Gross Floor Area (ft²)

Net Building Cost /ft²

Net Construction Cost /ft²

Total Construction Cost /ft²



8

8.0 Areas

The gross floor area of the project, measured in accordance with the guidelines established by the Canadian

Institute of Quantity Surveyors, is:

Location GFA (ft²)

Basement 6100

Ground Level 5953

2/F 5385

3/F 5385

4/F 5385

5/F 5385

6/F 5385

7/F 5385

8/F 5385

Roof 332

Total Gross Floor Area 50,080 ft²

9.0 Taxes

The estimate includes the Provincial Sales Tax (P.S.T.) where applicable.

The estimate excludes the Goods & Services Tax (G.S.T.).

10.0 Project Schedule & Escalation

No cost escalation allowance has been included in the estimate. BTY strongly recommends that the client

establish a separate budget to cover the escalation cost from the date of this estimate to the mid‐point of

construction for the project.

Our current projected escalation rates are shown below:

2019 2020

6% ‐ 8% 4% ‐ 6%

Current BTY

Group Forecast



9

11.0 Pricing

The estimate has been priced at current rates taking into account the size, location and nature of the project.

The unit rates utilized are considered competitive for a project of this type, bid under a stipulated lump‐sum

form of tender in an open market, with a minimum of three (3) bids, supported by the requisite number of

sub‐contractors.

The estimate allows for labour, material, equipment and other input costs at current rates and levels of

productivity. It does not take into account extraordinary market conditions, where bidders may be few and

may include in their tenders disproportionate contingencies and profit margins.

12.0 Risk Mitigation

BTY Group recommends that the Owner, Project Manager and Design Team carefully review this document,

including exclusions, inclusions and assumptions, contingencies, escalation and mark‐ups. If the project is over

budget, or if there are unresolved budgeting issues, alternative systems/schemes should be evaluated before

proceeding into the next design phase.

Requests for modifications of any apparent errors or omissions to this document must be made to BTY Group

within ten (10) days of receipt of this estimate. Otherwise, it will be understood that the contents have been

concurred with and accepted.

It is recommended that BTY Group design and propose a cost management framework for implementation.

This framework would require that a series of further estimates be undertaken at key design stage milestones

and a final update estimate be produced which is representative of the completed tender documents, project

delivery model and schedule. The final updated estimate will address changes and additions to the documents,

as well as addenda issued during the bidding process. BTY Group is unable to reconcile bid results to any

estimate not produced from bid documents including all addenda.

13.0 Contingencies

13.1 Design Contingency

A design contingency of Fifteen Percent (15%) has been included in the estimate to cover modifications to the

program, drawings and specifications during the design.

13.2 Construction Contingency

An allowance of Fifteen Percent (15%) has been included in the estimate for changes occurring during the

construction period of the project. This amount may be expended due to site conditions or if there are

modifications to the drawings and specifications.



10

14.0 Documents Reviewed

The list below confirms the information reviewed in preparing this report:

Description Date

Regent Hotel Regeneration Report January 16, 2019

Drawings & Specifications

2288 Manitoba St., Vancouver, BC, V5Y 4B5

T 604 734 3126

COST MANAGEMENT REPORT

Regent Hotel Regeneration

APPENDICES

APPENDIX I Elemental Summary 2 pages

APPENDIX II Cost Plan 40 pages

APPENDIX III Floor Plans (Proposed) 4 pages

APPENDIX I Elemental Summary 2 PAG E S


GFA: 50,080 ft²

TOTALRatio Average Amount Total Cost

Element G.F.A. Quantity Unit Unit Cost $ $ $/ ft² %

A1 SUBSTRUCTURE 738,500 14.75 4.6%

A11.1 Standard Foundations 0.04 2,043 ft² 110.40 225,500 4.50A11.2 Special Foundations 1.00 50,080 ft² 9.94 498,000 9.94A12 Basement Excavation 0.00 1 sum 15,000.00 15,000 0.30

A2 STRUCTURE 381,500 7.62 2.4%

A21 Lowest Floor Construction 0.09 4,270 ft² 12.62 53,900 1.08A22.1 Upper Floor Construction 0.86 43,080 ft² 5.30 228,400 4.56A22.2 Stair Construction 0.01 370 risr 240.93 89,200 1.78A23 Roof Construction 0.11 5,750 ft² 1.74 10,000 0.20

A3 EXTERIOR ENCLOSURE 2,037,300 40.68 12.8%

A31 Structural Walls Below Grade 0.08 4,100 ft² 21.63 88,700 1.77A32.1 Walls Above Grade 0.47 23,623 ft² 37.01 874,400 17.46A32.2 Structural Walls Above Grade 0.00 ft² 0.00 0 0.00A32.3 Curtain Walls 0.00 ft² 0.00 0 0.00A33.1 Windows & Louvres 0.16 7,773 ft² 114.23 887,900 17.73A33.2 Glazed Screens 0.00 ft² 0.00 0 0.00A33.3 Doors 0.00 6 lvs. 2,583.33 15,500 0.31A34.1 Roof Covering 0.11 5,750 ft² 18.00 103,500 2.07A34.2 Skylights 0.00 246 ft² 120.00 29,500 0.59A35 Projections 0.11 5,750 ft² 6.57 37,800 0.75

B1 PARTITIONS & DOORS 2,515,400 50.23 15.8%

B11.1 Fixed Partitions 1.41 70,627 ft² 15.27 1,078,500 21.54B11.2 Moveable Partitions 0.00 ft² 0.00 0 0.00B11.3 Structural Partitions 0.35 17,394 ft² 45.38 789,300 15.76B12 Doors 0.01 310 lvs. 2,089.03 647,600 12.93

B2 FINISHES 1,160,000 23.16 7.3%

B21 Floor Finishes 0.81 40,323 ft² 7.69 310,100 6.19B22 Ceiling Finishes 0.81 40,657 ft² 10.91 443,700 8.86B23 Wall Finishes 3.53 176,704 ft² 2.30 406,200 8.11

B3 FITTINGS & EQUIPMENT 2,127,900 42.49 13.3%

B31.1 Metals 1.00 50,080 ft² 27.72 1,388,000 27.72B31.2 Millwork 1.00 50,080 ft² 1.81 90,500 1.81B31.3 Specialties 1.00 50,080 ft² 7.59 379,900 7.59B32 Equipment 1.00 50,080 ft² 2.15 107,500 2.15B33.1 Elevators 0.00 9 stop 18,000.00 162,000 3.23B33.2 Escalators & Moving Walkways 0.00 0 no. 0.00 0 0.00B33.3 Material Handling Systems 0.00 0 no. 0.00 0 0.00

C1 MECHANICAL 2,800,100 55.91 17.5%

C11 Plumbing and Drainage 1.00 50,080 ft² 20.69 1,036,400 20.69C12 Fire Protection 1.00 50,080 ft² 5.80 290,500 5.80C13 HVAC 1.00 50,080 ft² 26.27 1,315,400 26.27C14 Controls 1.00 50,080 ft² 3.15 157,800 3.15

C2 ELECTRICAL 1,773,700 35.42 11.1%

C21 Service & Distribution 1.00 50,080 ft² 15.62 782,200 15.62C22 Lighting, Devices & Heating 1.00 50,080 ft² 10.10 505,800 10.10C23 Systems & Ancillaries 1.00 50,080 ft² 9.70 485,700 9.70

Z1 GENERAL REQUIREMENTS & FEES 2,436,200 48.65 15.3%

Z11 General Requirements 15.0% 2,030,200 40.54Z12 Fee 3.0% 406,000 8.11

NET BUILDING COST 15,970,600 318.90 100%

COST CONSULTANTS A1‐1

Cost/Floor Area

February 25, 2019

Element


GFA: 50,080 ft²

TOTALRatio Average Amount Total Cost

Element G.F.A. Quantity Unit Unit Cost $ $ $/ ft² %

Cost/Floor Area

February 25, 2019

Element

NET BUILDING COST 15,970,600 318.90D1 SITE WORK 286,000 5.71

D11.1 Site Preparation 0.00 0 ft² 0.00 0 0.00D11.2 Hard Surfaces 0.00 0 ft² 0.00 0 0.00D11.3 Site Improvements 0.00 0 ft² 0.00 0 0.00D11.4 Landscaping 0.00 0 ft² 0.00 0 0.00D12 Mechanical Site Services 1.00 50,080 ft² 0.58 29,000 0.58D13 Electrical Site Services 1.00 50,080 ft² 5.13 257,000 5.13

D2 ANCILLARY WORK 5,053,600 100.91D21.1 Demolition 1.00 50,080 ft² 14.49 725,800 14.49D21.2 Hazardous Materials 1.00 50,080 ft² 53.45 2,676,800 53.45D22 Alteration 1.00 50,080 ft² 32.97 1,651,000 32.97

Z1 GENERAL REQUIREMENTS & FEES 961,100 19.19Z11 General Requirements 15.0% 800,900 15.99Z12 Fee 3.0% 160,200 3.20

NET CONSTRUCTION COST 22,271,300 444.71Z2 ALLOWANCES 7,182,500 143.42

Z21 Design Allowance 15.0% 3,340,700 66.71Z23 Construction Allowance 15.0% 3,841,800 76.71

SUBTOTAL CONSTRUCTION COST 29,453,800 588.13Goods & Services Tax 0.0% 0 0.00

TOTAL CONSTRUCTION COST 29,453,800 588.13Z22 Escalation Allowance 0 0.00

ESCALATED CONSTRUCTION COST 29,453,800 588.13

Notes:

T:\1 ‐ Vcr\1 ‐ CP\Commercial\1‐10470 ‐ Regent Hotel

COST CONSULTANTS A1‐2

APPENDIX I I Cost Plan 4 0 PAGE S


Description Quantity Unit Rate Amount

A1 SUBSTRUCTURE

A11.1 Standard Foundations

Allowance for grade beams to new shear walls 2,043 ft² 110.40 225,500

February 25, 2019

$225,500Total Standard Foundations

_____________________________________________________________________________________________________

BTY GROUP A2‐1



February 25, 2019

A1 SUBSTRUCTURE

A11.2 Special Foundations

DYWIDAG micro pile 10'‐10" long (5/S102) 60 no. 8,300.00 498,000(Reinstatement of affected areas included in A21)

Total Special Foundations $498,000

_____________________________________________________________________________________________________

BTY GROUP A2‐2



February 25, 2019

A1 SUBSTRUCTURE

A12 Basement Excavation

Allowance for excavation for unit sub‐station 1 sum 15,000.00 15,000

Removal of contaminated soils ‐ Included in Hazmat

Abatement D21.2

Total Basement Excavation $15,000

_____________________________________________________________________________________________________

BTY GROUP A2‐3



February 25, 2019

A2 STRUCTURE

A21 Lowest Floor Construction

Replace damaged slab‐on‐grade with 4" reinforced concrete

slab on 10mil poly on 6" well compacted granular material

and reinforced with 10M@12" each way (70% of basement

slab)

4,270 ft² 12.00 51,200

Allowance for insulation underneath Bed Bud Sauna Room

(removal of slab‐on‐grade included in above)

334 ft² 8.00 2,700

Total Lowest Floor Construction $53,900

_____________________________________________________________________________________________________

BTY GROUP A2‐4



February 25, 2019

A2 STRUCTURE

A22.1 Upper Floor Construction

Connect mass brick to floor diaphragm ‐ Note 1 (1/S100) 192 loc 244.00 46,800

L4x4x1/4" x 38" c/w 4‐5/8" Ø threaded rod drilled and

grouted 6" into the existing walls c/w Hilti C100 H1T

adhesive

2‐1/2 x 36" strap anchors c/w 12‐ #14 Ga fasteners and

screws

3/4" plywood sheathing throughout ‐ Note 3 43,080 ft² 3.50 150,800

Allowances for restraints of beam/beam or beam/column

connections (6/S100)

1 sum 18,000.00 18,000

F1a Floor above Bedbug sauna6" wood joists at 18" centres 272.00 ft 6.00 1,600

F2 New framed floor (above CRU)2x10 wood joists at 2'‐0" centres 1,600.00 ft 7.00 11,200

Total Upper Floor Construction $228,400

_____________________________________________________________________________________________________

BTY GROUP A2‐5



February 25, 2019

A2 STRUCTURE

A22.2 Stair Construction

Replacement stairs 370 risers 160.00 59,200

Allowance for alternate solution 1 sum 30,000.00 30,000

Total Stair Construction $89,200

_____________________________________________________________________________________________________

BTY GROUP A2‐6



February 25, 2019

A2 STRUCTURE

A23 Roof Construction

Allowance for adding wood sleepers and locally strengthen

roof for roof top mechanical units. Unit to be seismically

restrained

1 sum 10,000.00 10,000

Total Roof Construction $10,000

_____________________________________________________________________________________________________

BTY GROUP A2‐7



February 25, 2019

A3 EXTERIOR ENCLOSURE

A31 Structural Walls Below Grade

EX1 Below grade wall 3,835 ft² 14.00 53,700Remove existing interior plaster wall (incl in D21.1)Replace with water resistive stucco skim coat (incl in B23)

5/8" GWB furring wall3‐5/8" steel studsSpray foam insulation in stud cavity

EX1a Bedbug sauna outside wall 266 ft² 19.00 5,000Skim coat (incl in B23)6" semi‐rigid insulation5/8" GWB furring wall3‐5/8" steel studsReflective foil5/8" cementitious boardCaulking to all joints

Allowance for amelioration of water ingress in the lower

floors. (we assumed no water ingress to upper floors when

the envelope (repointing and new windows) are done.)

1 sum 30,000.00 30,000

Total Structural Walls Below Grade $88,700

_____________________________________________________________________________________________________

BTY GROUP A2‐8



February 25, 2019


A32.1 Walls Above Grade

EX1b Walls at Level 1 where there is an adjacent building 3,612 ft² 14.00 50,600

Remove existing interior plaster wall (incl in D21.1)5/8" GWB furring wall3‐5/8" steel studsSpray foam insulation in stud cavity

EX2 Typical existing exterior brick wythe walls 8,028 ft² 14.00 112,400Remove existing interior plaster wall (incl in D21.1)5/8" GWB furring wall3‐5/8" steel studsSpray foam insulation in stud cavity

EX3 For light court walls with existing cementitious stucco

siding

7,553 ft² 45.00 339,900

New rainscreen wall assembly for new corrugated metal

cladding

EX4 For lightcourt walls with existing board‐formed concrete 2,898 ft² 14.00 40,600

Remove paint and add elastomeric paint (incl in D22)

Remove existing interior plaster wall (incl in D21.1)5/8" GWB furring wall3‐5/8" steel studsSpray foam insulation in stud cavity

EX5a New wall to rooftop exit 413 ft² 29.50 12,200New metal rain‐screen wallWaterproof membrane5/8" ply3‐5/8" steel stud framing4" rigid insulation

EX7 New infill wall at lane 1,118 ft² 45.00 50,300New metal rain‐screen infill wall8" block wall, fully grouted

Tie back brick veneer ‐ Note 8 (3/S100)3/8" threaded rod wall ties (assumed qty) 1,265 no. 80.00 101,200

L8x8x3/8" angle bolt to external wall using 1/2" Ø threaded

rod 16" c/c embedded 4" and fasten w/ Hilti HY‐70 epoxy

adhesive ‐ Note 12

1,967 no. 85.00 167,200

Total Walls Above Grade $874,400

_____________________________________________________________________________________________________

BTY GROUP A2‐9



February 25, 2019


A33.1 Windows & Louvres

Window Replacement

South elevation (Lane)‐ 100% remove and replace with double glazed aluminum

windows in double hung configuration

1,095 ft² 95.00 104,000

North elevation (Hastings Street)‐ 100% remove and replace with double glazed aluminum


1,944 ft² 95.00 184,700

West elevation‐ 100% remove and replace with double glazed aluminum


1,920 ft² 95.00 182,400

East elevation‐ 100% remove and replace with double glazed aluminum


2,000 ft² 95.00 190,000

Interior window trimSouth façade (Hastings Street)‐ 100% refurbish/recreate wood trim and sills 1,117 ft 12.00 13,400

North façade (Laneway)‐ 100% refurbish/recreate wood trim and sills 979 ft 12.00 11,700

West elevation‐ 100% refurbish/recreate wood trim and sills 1,568 ft 12.00 18,800

East elevation‐ 100% refurbish/recreate wood trim and sills 1,520 ft 12.00 18,200

New raised panel wood storefront c/w 1/2" thick laminated

single glazing units. New exterior and interior wood

sills/jambs and headers

814 ft² 190.00 154,700

Allowances to add louvres at the top and steel beam /

columns for the garbage door, exit doors and gas meter

enclosure below

1 sum 10,000.00 10,000

Total Windows & Louvres $887,900

_____________________________________________________________________________________________________

BTY GROUP A2‐10



February 25, 2019


A33.3 Exterior Doors

Hollow metal fire‐rated single door with pressed steel frame,

vison panel complete with ironmongery

3 lvs 1,650.00 5,000

Glazed storefront single door ‐ 1 no. (included in A33.1) included

Glazed storefront double door ‐ 2 pairs (included in A33.1) included

Fire‐rated insulated overhead door 1 no. 9,100.00 9,100

Gas meter closet double door 1 pair 1,350.00 1,400

Total Exterior Doors $15,500

_____________________________________________________________________________________________________

BTY GROUP A2‐11



February 25, 2019


A34.1 Roof Covering

R1 Roofing to main roof and skylight areas on Level 2

assembly

5,750 ft² 18.00 103,500

New 2‐ply SBS membrane roof assembly Rigid insulationPlywood deckingExisting roof structure to remain1 layer 1/2" gypsum wallboard (incl in B22)Dropped ceiling with steel stud framing at 2'‐0" c/c (incl in

B22)Batt insulation (incl in B22)

Total Roof Covering $103,500

_____________________________________________________________________________________________________

BTY GROUP A2‐12



February 25, 2019


A34.2 Skylights

Replace metal skylights over each side of the lighwell (8 nos

@ plan area = 6'‐7" x 4'‐8")

246 ft² 120.00 29,500

Total Skylights $29,500

_____________________________________________________________________________________________________

BTY GROUP A2‐13



February 25, 2019


A35 Projections

Full length gutter (steel channel) complete c/w 2 RWL 50 ft 15.00 800

Refurbish as required existing sheet metal cornice and

brackets ‐ seismically anchored sheet metal cornice

51 ft 400.00 20,200

Stabilize parapet using diagonal braces ‐ Note 2 (4B/S101)

HSS 3" x 3" x 3/16" at 8'‐0" o/c 46 no. 315.00 14,600Allowance for miscellaneous metals 1 sum 2,190.00 2,200

Total Projections $37,800

_____________________________________________________________________________________________________

BTY GROUP A2‐14



February 25, 2019

B1 PARTITIONS & DOORS

B11.1 Fixed Partitions

IN1 Typical existing corridor to suite wall & existing walls to

exits

2,051 ft² 10.20 20,900

Stripped off finishes leaving the bare existing wood studs

(incl in D21.1)1 layer 5/8" type "X" gypsum wallboardBatt insulation1 layer 5/8" type "X" gypsum wallboard

IN2 Existing suite to suite wall 4,199 ft² 7.70 32,3001 layer 5/8" type "X" abuse‐resistance gypsum wallboard

1 layer 5/8" type "X" gypsum wallboard

IN2a Existing wall to elevator 635 ft² 7.70 4,900Stripped off finishes leaving the bare existing wood studs

(incl in D21.1)1 layer 5/8" type "X" abuse‐resistance gypsum wallboard

1 layer 5/8" type "X" gypsum wallboard

IN3 New suite to suite wall 13,755 ft² 15.70 216,0001 layer 5/8" type "X" gypsum wallboard3‐5/8" steel studs @ 2'‐0" c/cBatt insulation1 layer 5/8" type "X" abuse‐resistance gypsum wallboard

IN3a New suite to corridor wall 1,260 ft² 15.70 19,8001 layer 5/8" type "X" gypsum wallboard3‐5/8" steel studs @ 2'‐0" c/cBatt insulation1 layer 5/8" type "X" abuse‐resistance gypsum wallboard

IN4 New plumbing wall 9,994 ft² 17.20 171,9001 layer 5/8" type "X" gypsum wallboard6" steel studs @ 16" c/cBatt insulation1 layer 5/8" type "X" abuse and moisture‐resistance

gypsum wallboard

IN5 New furring to concrete shear wall 17,988 ft² 10.00 179,9002‐1/2" metal studs1 layer 5/8" type "X" abuse‐resistance gypsum wallboard

_____________________________________________________________________________________________________

BTY GROUP A2‐15



February 25, 2019

IN5a New furring to concrete shear wall (to accommodate

plumbing)

2,517 ft² 10.50 26,400

6" metal studs1 layer 5/8" type "X" abuse‐resistance gypsum wallboard

IN6 New shaft walls 1,309 ft² 18.00 23,600

IN7 Bedbug sauna inside wall 645 ft² 25.50 16,4001 layer 5/8" type "X" gypsum wallboard6" steel studs6" semi‐rigid insulation1 layer 5/8" type "X" gypsum wallboard1 layer 5/8" cementitious board with 4" battens

IN8 New framed wall (non‐combustible construction) 9,160 ft² 16.20 148,4001 layer 5/8" type "X" gypsum wallboard3‐5/8" steel studs @ 2" c/cBatt insulation1 layer 5/8" type "X" abuse‐resistance gypsum wallboard

IN9 New framed wall between CRU & SRO 4,151 ft² 31.10 129,1001 layer 5/8" type "X" abuse‐resistance gypsum wallboard

2 layers 5/8" type "X" gypsum wallboard6" steel studs @ 2" c/c2 layers 5/8" type "X" gypsum wallboardBatt insulation1 layer 5/8" type "X" abuse‐resistance gypsum wallboard

IN10 New CMU wall 2,964 ft² 30.00 88,9008" block wall, fully grouted and reinforced

Total Fixed Partitions $1,078,500

_____________________________________________________________________________________________________

BTY GROUP A2‐16



February 25, 2019


B11.3 Structural Partitions

14" thick concrete shear wallType 1 1,260 ft² 42.00 52,900Type 2 1,590 ft² 42.00 66,800Type 3 1,905 ft² 42.00 80,000Type 4 1,332 ft² 42.00 55,900Type 5 1,312 ft² 42.00 55,100Type 6 x 2 nos 2,057 ft² 42.00 86,400Type 7 1,516 ft² 42.00 63,700Type 8 x 2 nos 4,134 ft² 42.00 173,600

16" thick concrete shear wallType 6 1,268 ft² 48.00 60,900Type 7 1,021 ft² 48.00 49,000

Cut out floor deck for shear wall construction and

subsequent making good

9 floor 5,000.00 45,000

Total Structural Partitions $789,300

_____________________________________________________________________________________________________

BTY GROUP A2‐17



February 25, 2019


B12 Interior Doors

Hollow metal fire‐rated single door with pressed steel frame

complete with ironmongery

242 lvs 1,500.00 363,000

Hollow metal fire‐rated single door with pressed steel frame,

vison panel complete with ironmongery

14 lvs 1,650.00 23,100

Hollow metal fire‐rated double door with pressed steel

frame complete with ironmongery

6 pair 3,000.00 18,000

Electrical closet double door 7 pair 2,000.00 14,000

Glazed double door 14 pair 3,500.00 49,000

Allowance for door trim 269 no. 100.00 26,900

Wireless suite door lock 256 no. 600.00 153,600

Total Interior Doors $647,600

_____________________________________________________________________________________________________

BTY GROUP A2‐18



February 25, 2019

B2 FINISHES

B21 Floor Finishes

Tactile warning strips to top of interior stairways 240 ft 30.00 7,200

Sheet vinyl floor covering ‐ most areas 34,781 ft² 5.50 191,300

Slip‐resistance sheet vinyl floor covering with waterproof

membrane beneath vinyl to height of cove base ‐ shower

rooms and bathrooms

3,129 ft² 6.00 18,800

Sealer to building services areas, garbage room 2,413 ft² 2.00 4,800

Flash coved base w/butterfly corners, top cap & taper strips

at all doorways

14,504 ft 4.00 58,000

Allowance for rehabilitation of the original balusters,

wainscotting, handrail, damaged marble stair treads and

risers of the existing heritage stair

1 sum 30,000.00 30,000

Total Floor Finishes $310,100

_____________________________________________________________________________________________________

BTY GROUP A2‐19



February 25, 2019

B2 FINISHES

B22 Ceiling Finishes

Most areas 37,767 ft² 10.80 407,9002 layers 5/8" gypsum wallboard for fire rating1 layer 5/8" gypsum wallboard for finishingPaint (1 prime coat and 2 finish coats)

Bathrooms and Shower Rooms 2,556 ft² 12.30 31,4002 layers 5/8" moisture resistant gypsum wallboard for fire

rating1 layer 5/8" moisture resistant gypsum wallboard for

finishingPaint (1 prime coat and 2 finish coats)

Bedbug sauna 334 ft² 13.20 4,4002 layers 5/8" gypsum wallboard for fire ratingBatt Insulation1 layer 5/8" gypsum wallboard for finishing

Total Ceiling Finishes $443,700

_____________________________________________________________________________________________________

BTY GROUP A2‐20



February 25, 2019

B2 FINISHES

B23 Wall Finishes

Paint (1 prime coat and 2 finish coats) ‐ most areas 154,830 ft² 1.30 201,300

Ceramic tile (6' high) ‐ Bathrooms & Shower Rooms 3,528 ft² 8.50 30,000

Crystalline waterproofing slurry coat to existing perimeter

basement concrete wall below grade

4,100 ft² 2.50 10,300

Closed cell spray foam insulation to existing perimeter

basement concrete wall below grade

4,100 ft² 5.50 22,600

Wainscoting in corridor 10,146 ft² 14.00 142,000

Total Wall Finishes $406,200

_____________________________________________________________________________________________________

BTY GROUP A2‐21



February 25, 2019

B3 FITTINGS & EQUIPMENT

B31.1 Metals

4'‐5" long stainless steel counter unit with integral single

compartment basin complete with integral stainless steel

backsplash & stainless steel door front

148 no. 2,000.00 296,000

Stainless steel wall mounted shelves, with raised edges, 4'

width

308 no. 800.00 246,400

Single bed solid steel frame, powder coated complete with

plastic, non‐marking guides

154 no. 800.00 123,200

Metal wardrobe complete with shelves and hanger bar 154 no. 800.00 123,200

Steel topped table with arborite finish complete with metal

shelf and square tube legs, powder coated ‐ 36" x 24"

161 no. 1,500.00 241,500

Stackable chromed steel‐welded chair 161 no. 200.00 32,200

Steel topped night stand table with arborite finish complete

with metal shelf and square tube legs, powder coated ‐ 20" x

20"

161 no. 600.00 96,600

Metal coat hooks, wall mounted on base plate and attached

with vandal resistant wall anchors

644 no. 35.00 22,500

Metal stair handrail 860 ft 100.00 86,000

Allowance for miscellaneous metals 50,080 ft² 1.50 75,100

Allowance for maintenance tie‐offs & engineering on roof 7 no. 900.00 6,300

Allowance for new canopy @ north elevation for full length

of fascade including glass & structural attachment

50 ft 780.00 39,000

Total Metals $1,388,000

_____________________________________________________________________________________________________

BTY GROUP A2‐22



February 25, 2019


B31.2 Millwork

4'‐5" long P‐lam millwork counter unit with single

compartment basin (basin included in plumbing) complete

with P‐lam backsplash in accessible suites

32 ft 340.00 10,700

Kitchen P‐lam millwork counter unit with single

compartment basin (basin included in plumbing) and lower

cabinet complete with P‐lam backsplash

34 ft 340.00 11,400

Kitchen upper cabinet 34 ft 250.00 8,400

P‐lam millwork counter unit for folding clothes with stainless

steel legs

5 ft 350.00 1,800

P‐lam millwork counter ‐ Admin Office 14 ft 210.00 2,900

P‐lam vanity counter 84 ft 230.00 19,300

Allowance for rough carpentry 9 floor 4,000.00 36,000

Total Millwork $90,500

_____________________________________________________________________________________________________

BTY GROUP A2‐23



February 25, 2019


B31.3 Specialties

Bird lines/cables on all light court window sills 784 ft 3.50 2,700

Allowance for interior wayfinding and signage 9 floor 2,800.00 25,200

Allowance for fire stopping 9 floor 5,000.00 45,000

Horizontal vinyl window blinds 7,113 ft² 7.00 49,800

Single mattress with bed bug mattress encasement 154 no. 650.00 100,100

Wall‐mounted folding seat 35 no. 450.00 15,800

Stainless steel grab bars 70 no. 100.00 7,000

Stainless steel tilt mirror 84 no. 350.00 29,400

Soap dispenser 70 no. 55.00 3,900

Wall‐mounted waste receptacle 77 no. 120.00 9,200

Surface mounted napkin disposal receptacle 56 no. 150.00 8,400

Shower rod with curtain 25 no. 100.00 2,500

Soap dish 42 no. 35.00 1,500

Stainless steel coat hook 49 no. 35.00 1,700

Lockable needle disposal bin in all washrooms and nurse's

office

57 no. 350.00 20,000

Office desk and chair 2 set 2,000.00 4,000

Visitor chairs 4 no. 250.00 1,000

Filing cabinets 2 no. 500.00 1,000

Bookcases 2 no. 400.00 800

Toilet compartments ‐ regular 35 no. 350.00 12,300

Kitchen table 1 no. 900.00 900

Kitchen chairs 6 no. 150.00 900

Folding table top 1 no. 450.00 500

_____________________________________________________________________________________________________

BTY GROUP A2‐24



February 25, 2019

Sofa & loveseat 1 set 5,000.00 5,000

Tables & chairs for dinning 1 sum 3,050.00 3,100

Wire cages for storage 2 rooms 2,500.00 5,000

Heavy duty shelving for storage 2 rooms 2,500.00 5,000

Code compliance/fire safety plan 1 sum 5,000.00 5,000

Allowance for entrance mats 1 sum 2,000.00 2,000

Allowance for non‐structural seismic restraints to non

electrical and mechanical equipment

50,080 ft² 0.15 7,500

Partition stops in each room 247 rooms 15.00 3,700

$379,900Total Specialties

_____________________________________________________________________________________________________

BTY GROUP A2‐25



February 25, 2019


B32 Equipment

Residential rooms

Bar fridge 154 no. 450.00 66,600

Microwave oven ‐ residential rooms 154 no. 120.00 18,500

Common Areas

Microwave oven ‐ kitchen 1 no. 350.00 400

Full‐size fridge 1 no. 1,200.00 1,200

Stove unit 1 no. 1,200.00 1,200

Dishwasher 1 no. 800.00 800

Instant hot water pot 1 no. 450.00 500

Range hood 1 no. 500.00 500

Washer & dryer 8 set 2,000.00 16,000

TV 1 no. 1,500.00 1,500

DVD player 1 no. 250.00 300

Total Equipment $107,500

_____________________________________________________________________________________________________

BTY GROUP A2‐26



February 25, 2019


B33.1 Elevators

Full upgrade of the existing elevator to current standards 9 stop 18,000.00 162,000

Total Elevators $162,000

_____________________________________________________________________________________________________

BTY GROUP A2‐27



February 25, 2019

C1 MECHANICAL

C11 Plumbing and Drainage

Plumbing FixturesWater closet 84 no 1,300.00 109,200Shower set 42 no 1,150.00 48,300Lavatory 84 no 1,300.00 109,200Kitchen / laundry sinks 2 no 1,350.00 2,700Connection to suite integral sink (sink included in B31.1

Metal)

147 no 500.00 73,500

Janitor sink 7 no 1,350.00 9,500Funnel floor drains 5 no 500.00 2,500Floor drains 50 no 450.00 22,500Hose bibb 2 no 350.00 700Roof drains 2 no 450.00 900Hook up to washer 8 no 250.00 2,000Hook up dishwasher 1 no 250.00 300

No allowance for dishwasher to rooms excluded

Domestic piping 50,080 ft² 3.90 195,300Domestic cold water pipingDomestic hot water pipingDomestic water recirculation pipingInsulation

Plumbing equipment 50,080 ft² 1.40 70,100Domestic hot water tanksExpansion tanksRecirculation pumpsMixing valvesNew water entry assembly

Sanitary and drainage 50,080 ft² 3.60 180,300Underground sanitary pipingAbove grade sanitary pipingVent pipingInsulation if requiredConnection to CRUConnection to suite unitsDuplex sanitary sump pumpsElevator sump pump

_____________________________________________________________________________________________________

BTY GROUP A2‐28



February 25, 2019

Storm drainage 50,080 ft² 2.20 110,200Underground storm pipngAbove grade storm pipingInsulation to above pipesSediment sumpDuplex storm sump pumpCapped connection c/w clean out Pull pit to electrical room

Gas 50,080 ft² 1.30 65,100Gas distribution pipesShut off valves for connection

MiscellaneousTesting, balancing and commissioning 1 sum 12,000.00 12,000Seismic Restraint 1 sum 1,500.00 1,500

Allowance for fire stops in each room 1 sum 20,580.00 20,600

Total Plumbing and Drainage $1,036,400

_____________________________________________________________________________________________________

BTY GROUP A2‐29



February 25, 2019

C1 MECHANICAL

C12 Fire Protection

Allowance for fire sprinkler system 50,080 sf 5.80 290,500Minimum fire protection to CRUFire hose connectionWet sprinkler heads Jockey pump connected to emergency powerDual check valveSiamese connection 2.5" fire hose valvesFire extinguishesDry sidewall sprinkler headsDry sprinkler system to attic

Total Fire Protection $290,500

_____________________________________________________________________________________________________

BTY GROUP A2‐30



February 25, 2019

C1 MECHANICAL

C13 HVAC

Heating 50,080 ft² 13.00 651,000HRV‐1, 2,000lps90% efficient gas condensing boilerHydronic pumps c/w variable speed drivesFan coil units1200 cfm HRV c/w hot water heating coilCeiling mounted radiant panelHydronic piping

Ventilation 50,080 ft² 11.80 590,900Smoke exhaust fans to basement7700 cm Air handling unitExhaust fansFan coils to ground floorPremium for future kitchen exhaustDuctworksThermal InsulationAcoustic liningMotorised damperAllow for diffusers/grilles, fire dampers to corridorsIsolated exhaust system to bed bug treatment room 1 sum 8,000.00 8,000Allowance for generator exhaust system 1 sum 12,000.00 12,000

Air ConditioningAllowance for air‐conditioning to administration area 1 sum 30,000.00 30,000

MiscellaneousNoise and vibration isolation 1 sum 2,000.00 2,000Seismic restraint 1 sum 4,500.00 4,500Firestop and smoke sealing 1 sum 3,000.00 3,000Chemical treatment and cleaning 1 sum 5,000.00 5,000As‐built drawings 1 sum 2,500.00 2,500Testing, balancing & commissioning 1 sum 6,500.00 6,500

Total HVAC $1,315,400

_____________________________________________________________________________________________________

BTY GROUP A2‐31



February 25, 2019

C1 MECHANICAL

C14 Controls

Allowance for DDC controls 1 sum 157,848.00 157,800Heat recovery unitFan coil unitInterface to fire alarmAir handling unit Base building DDC system to common areaWeb based DDC system to central heating plant and

domestic hot water heating plant

Total Controls $157,800

_____________________________________________________________________________________________________

BTY GROUP A2‐32



February 25, 2019

C2 ELECTRICAL

C21 Service & Distribution

Equipment 50,080 ft² 6.50 325,500New unit substation c/w 500kVA step down transformer,

dual rated for future 25kV serviceMain Distribution panel MDP‐A 1200A 600VDistribution panels100A Elevator splitter 600VCRU branch circuit breaker

Emergency power 1 sum 250,000.00 250,000150kW generatorTransfer switchesEmergency distribution panels

Feeders 50,080 ft² 3.00 150,200

Grounding 1 sum 25,000.00 25,000

Miscellaneous 1 sum 31,529.40 31,500Noise and vibration isolationSeismic restraintFirestop and smoke sealingAs‐built drawingsArc flash studyTesting, balancing & commissioning

Total Service & Distribution $782,200

_____________________________________________________________________________________________________

BTY GROUP A2‐33



February 25, 2019

C2 ELECTRICAL

C22 Lighting, Devices & Heating

Lighting 50,080 ft² 4.70 235,400Base building lighting to CRULED Lighting to administration spaceLED Lighting to residential spaceConduit/cableAll lightings are tamper‐proof

Lighting control including wiring 50,080 ft² 0.50 25,000Occupancy sensorComb. line voltage switch and occ. sensorSingle pole line voltage switchThree way switchSingle point line voltage switch WPConduit/cable

Emergency 50,080 ft² 0.90 45,100Exit light w/ two emergency lightExit lightEmergency battery pack w/ lighting headsConduit/cable

Branch Devices including wiring 50,080 ft² 1.80 90,10015A duplex receptacle15A duplex receptacle GFI (above counter)15A duplex receptacle GFCI15A duplex GFI WP20A T slot duplex receptacleConduit/cable

Mechanical power 50,080 ft² 2.20 110,200Heat recovery ventilatorsFan coil unitsAir handling unitsHydronic pumpsDomestic pumpsBoilerDomestic hot water tank Sump pumpsExhaust fansElevatorsConnection to bed bug saunas

Total Lighting, Devices & Heating $505,800

_____________________________________________________________________________________________________

BTY GROUP A2‐34



February 25, 2019

C2 ELECTRICAL

C23 Systems & Ancillaries

Fire Alarm System 50,080 sf 4.20 210,300Combi smoke/heat detectors to each sleeping roomFire alarm wall mounted strobe lightFire alarm wall mounted strobe light / horn unitFire alarm hornSprinkler flow switchSprinkler tamper switchFire alarm addressable moduleFire alarm panel with annunciatorSecond annunciator panelMonitoring of generator fire pump Connection to sprinkler system flow, tamper and pressure

valvesConduit and wiring

Communications 50,080 sf 2.50 125,200Tel/data outletReplace backboneWiring and conduit2" conduit

Security and access control 50,080 sf 3.00 150,200Card readerSecurity cameraIntrusion alarm systemConduit/cable

Total Systems & Ancillaries $485,700

_____________________________________________________________________________________________________

BTY GROUP A2‐35



February 25, 2019

D1 SITE WORK

D12 Mechanical Site Services

Combined water150mm below ground 10 m 300.00 3,000Excavation and backfilling 20 m 100.00 2,000Connection to city main 1 sum 5,000.00 5,000

Sanitary and drainage pipes200mm Incoming sanitary pipes, below ground 10 m 250.00 2,500200mm Incoming storm drainage pipes, below ground 10 m 250.00 2,500

Excavation and backfilling 20 m 50.00 1,000Connection to city main 1 sum 5,000.00 5,000

Gas pipesAllowance for Incoming gas pipes 1 sum 5,000.00 5,000

Irrigation Allowance for stub out in the roof 1 sum 3,000.00 3,000

Total Mechanical Site Services $29,000

_____________________________________________________________________________________________________

BTY GROUP A2‐36



February 25, 2019

D1 SITE WORK

D13 Electrical Site Services

Electrical3x4" + 1‐2" conduit for Incoming power 10 m 400.00 4,000

Communication3x4" conduit for telecom 10 m 300.00 3,000

Allowance for BC Hydro civil and connection fees 1 sum 200,000.00 200,000

Allowance for Telus/Shaw civil and connection fees 1 sum 50,000.00 50,000

Total Electrical Site Services $257,000

_____________________________________________________________________________________________________

BTY GROUP A2‐37



February 25, 2019

D2 ANCILLARY WORK

D21.1 Demolition

Removal of all existing drywalls, dropped ceilings, plaster

and laminate flooring to expose studs and CLT flooring, stair

handrail, electrical and mechanical services, etc

50,080 ft² 13.00 651,000

Saw cut existing damaged slab on‐grade 592 ft 7.50 4,400

Removal of existing damaged slab‐on‐grade 4,270 ft² 6.00 25,600

Removal of existing exterior fire escape 1 sum 35,000.00 35,000

Allowance for clearing rooms of debris 1 sum 9,828.00 9,800

Total Demolition $725,800

_____________________________________________________________________________________________________

BTY GROUP A2‐38



February 25, 2019

D2 ANCILLARY WORK

D21.2 Hazardous Materials

Hazmat abatement (as per Pinchin estimate dated

December 13, 2019)

1 sum 2,551,827.00 2,551,800

Allowance of environmental liability 1 sum 125,000.00 125,000

Total Hazardous Materials $2,676,800

_____________________________________________________________________________________________________

BTY GROUP A2‐39



February 25, 2019

D2 ANCILLARY WORK

D22 Alteration

Allowance for making good all façades

North façade (Hastings Street)‐ Thorough cleaning 1,556 ft² 2.00 3,100‐ Remove and patch all steel hooks 1 sum 5,000.00 5,000

South façade (Laneway)‐ Thorough cleaning 2,976 ft² 2.00 6,000

West elevation‐ Thorough cleaning 4,153 ft² 2.00 8,300‐ 100% re‐pointing 3,500 ft² 146.31 512,100

East elevation‐ Thorough cleaning 5,655 ft² 2.00 11,300‐ 100% re‐pointing 3,500 ft² 146.31 512,100

Steel lintels & sills (assume percentage)‐ 10% lintels replacement on north façade 30 ft 1,000.00 29,500‐ 90% lintels repairing on north façade 266 ft 500.00 132,900‐ 50% concrete sills replacement to north façade 148 ft 1,200.00 177,200‐ 50% sills patching to north façade 148 ft 300.00 44,300‐ Concrete sills at south, east and west elevations to be

stripped of paint

1,016 ft 20.00 20,300

Repaint existing metal attachments on facade 1 sum 3,000.00 3,000

Remove existing Regent's sign and not to be replaced 1 sum 3,000.00 3,000

Remove original cast iron radiators 1 sum 1,000.00 1,000

Refurbish and re‐install radiators in common/amenity areas

as displays

2 no. 2,000.00 4,000

Remove existing roofing assembly of the main roof and

skylight areas on Level 2

5,750 ft² 2.50 14,400

Remove and replace existing flashing with new standing

seam cap flashing

356 ft 20.00 7,100

Remove and replace existing brick chimney ‐ Note 7 1 no. 3,350.00 3,400

Allowance of scaffolding for 18 months for envelope

upgrading

1 sum 153,000.00 153,000

Total Alteration $1,651,000

_____________________________________________________________________________________________________

BTY GROUP A2‐40

APPENDIX I I I Floor Plans (Proposed) 4 PAG E S

27

RECOMMENDATIONSBasement

28

RECOMMENDATIONSGround Floor

29

RECOMMENDATIONSRoof

30

RECOMMENDATIONSTypical

Appendix "B"

Copies of the Subject’s Title Information and Easement

Indemnity Agreement

**CURRENT INFORMATION ONLY - NO CANCELLED INFORMATION SHOWN**

Land Title District VANCOUVERLand Title Office VANCOUVER

Title Number BE173214From Title Number GC27274

Application Received 1991-07-31

Application Entered 1991-08-26

Registered Owner in Fee SimpleRegistered Owner/Mailing Address: TRIVILLE ENTERPRISES LTD., INC.NO. 353575

159 EAST HASTINGS STREETVANCOUVER, BCV6A 1N6

Taxation Authority Vancouver, City of

Description of LandParcel Identifier: 013-263-111Legal Description:

LOT 40 BLOCK 12 DISTRICT LOT 196 PLAN 184

Legal NotationsEXPROPRIATION ACT NOTICE, SEE CA6954759, JULY 25TH, 2018- DEALINGSRESTRICTED

Charges, Liens and InterestsNature: EASEMENT AND INDEMNITY AGREEMENTRegistration Number: A31840Registration Date and Time: 1973-05-23 14:00Registered Owner: CITY OF VANCOUVERRemarks: INTER ALIA

Nature: MORTGAGERegistration Number: BE193891Registration Date and Time: 1991-08-16 12:37Registered Owner: AETNA TRUST COMPANYRemarks: INTER ALIA

TITLE SEARCH PRINT 2019-10-04, 12:02:28

File Reference: reagan Requestor: Nichola McMenamin

Declared Value $N/A

Title Number: BE173214 TITLE SEARCH PRINT Page 1 of 2

Nature: ASSIGNMENT OF RENTSRegistration Number: BE193892Registration Date and Time: 1991-08-16 12:37Registered Owner: AETNA TRUST COMPANYRemarks: INTER ALIA

SEE BE193891;



SEE BE193893;

Nature: CLAIM OF BUILDERS LIENRegistration Number: CA6921963Registration Date and Time: 2018-07-10 17:33Registered Owner: DARREL DUNLOPRemarks: INTER ALIA

Nature: CERTIFICATE OF PENDING LITIGATIONRegistration Number: CA7467377Registration Date and Time: 2019-04-26 14:38Registered Owner: DARRELL DUNLOPRemarks: INTER ALIA

Duplicate Indefeasible Title NONE OUTSTANDING

Transfers NONE

Pending Applications NONE



Declared Value $N/A


**CURRENT INFORMATION ONLY - NO CANCELLED INFORMATION SHOWN**

Land Title District VANCOUVERLand Title Office VANCOUVER

Title Number BE173213From Title Number GC27273

Application Received 1991-07-31

Application Entered 1991-08-26

Registered Owner in Fee SimpleRegistered Owner/Mailing Address: TRIVILLE ENTERPRISES LTD., INC.NO. 353575

159 EAST HASTINGS STREETVANCOUVER, BCV6A 1N6

Taxation Authority Vancouver, City of

Description of LandParcel Identifier: 013-263-072Legal Description:

LOT 39 BLOCK 12 DISTRICT LOT 196 PLAN 184

Legal NotationsEXPROPRIATION ACT NOTICE, SEE CA6954759, JULY 25TH, 2018- DEALINGSRESTRICTED

Charges, Liens and InterestsNature: EASEMENT AND INDEMNITY AGREEMENTRegistration Number: A31840Registration Date and Time: 1973-05-23 14:00Registered Owner: CITY OF VANCOUVERRemarks: INTER ALIA




Declared Value $N/A



SEE BE193891;



SEE BE193893;

Nature: CLAIM OF BUILDERS LIENRegistration Number: CA6921963Registration Date and Time: 2018-07-10 17:33Registered Owner: DARREL DUNLOPRemarks: INTER ALIA

Nature: CERTIFICATE OF PENDING LITIGATIONRegistration Number: CA7467377Registration Date and Time: 2019-04-26 14:38Registered Owner: DARRELL DUNLOPRemarks: INTER ALIA

Duplicate Indefeasible Title NONE OUTSTANDING

Transfers NONE

Pending Applications NONE



Declared Value $N/A


Status: Registered Doc #: A31840 RCVD: 1973-05-23 RQST: 2019-04-1009.35.50

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Appendix "C"

Copies of the Subject’s and Balmoral Hotel’s

Marketing Brochures

For Sale Regent Hotel

160 E. Hastings Street, Vancouver B.C V6A 1N5

REMAX CITY REALTY For Further information please contact

Sunil Rekhi : 604—318-3430 Email: [email protected] or [email protected]

Feroz Dean: 604-454-4242



Property Information:

The Regent Hotel is an eight-storey Chicago-style early skyscraper on the south side of East Hastings Street in Vancouver.

At the turn of the twentieth century, this area of Vancouver developed as a shopping area as commercial activity spread outward from its early roots in Gastown. As the young city grew, so did its commercial district. It was the home of several hotels, lodgings, and small retail outlets, which were estab-lished to serve the growing blue-collar population. Built in 1913 for Art Clemes by architect Emil G. Guenther, the building is sig-nificant because it is one of two adjacent buildings from the same era with arched windows. Art Clemes was a partner in Alexander Pantages' theatre next door, which explains the similarities in their construction and some of the window design. The Regent Hotel's fine finishes would indicate that it ca-tered to tourists and business travelers, who were expected to arrive after the completion of the Canadian Northern Railway and the Panama Canal. In addi-tion to providing accommodation, the Regent also offered services, including a barber shop, cigar store, and shoe shine stand, all catering to the largely male travelling public. The Chicago-style grid - including the Louis Sullivan-inspired decorated span-drels - presents a symmetrical face to the street, while the pilasters empha-size the verticality of the structure. The building illustrates the increasing use of technology; buildings of this height were only possible with the use of steel frames, concrete and the development of the elevator.

The owners have recently renovated approximately $1 million into the prop-erty and currently is shut down, also vacant.



Feroz Dean: 604-454-4242



Property Information: Address: 160 E. Hastings Street, Vancouver, B.C Area: Vancouver East Property ID: 013-263-111 Neighborhood: 026-Downtown Gross Taxes: $37,729.13 Legal Full Description:

PL VAP184 LT 40 BLK 12 DL 196 LD 36. GROUP 1, LOT 39, BLOCK 12, PLAN VAP184, DISTRICT LOT 196, GROUP 1, NEW WESTMINSTER LAND DISTRICT, REGENT HOTEL.

Width : 50 ft Depth 122 ft Actual Use Multi-Family (Residential Hotel BCA Description: Beer Parlour / Hotel Zoning : DEOP Comprehensive Development Total Rooms: 170 Total Renovations spent: $1 million



Feroz Dean: 604-454-4242



Property Maps:



Feroz Dean: 604-454-4242

For Sale Balmoral Hotel




Feroz Dean: 604-454-4242



Property Information: Balmoral Hotel, a nine storey hotel, located at 159 E. Hastings, Van-couver B.C, just west of Main Street, that opened in 1912. At the time, the hotel targeted a decidedly upscale clientele. The City of Vancou-ver’s Heritage Conservation Program notes that “This type of high-class establishment would have accommodated commercial busi-nessmen and wealthy travellers to the area, rather than the seasonal workers who lived in less elaborate hotels and lodgings. Designed by Parr & Fee, the same architectural firm responsible for Gas-town’s Hotel Europe, the Balmoral was noted for its Chicago-style cornice and Edwardian detailing. Its neon sign-one of the most fa-mous in the city-was installed in the ’40s.

As the Hastings and Main area slowly slid from being one of Van-couver’s major retail hubs into the rundown skid road it is today, the Balmoral Hotel pub became just another Downtown Eastside flophouse bar. The recent overhaul-coupled with the fact that Van-couver isn’t exactly flooded with live-music venues-bodes well for the spot’s rebirth. Currently shut down by the City of Vancouver, that had occupied SRO style of living with poor living conditions. That order resulted in a scramble by the city, B.C. Housing and com-munity activists to find new homes for about 143 people who had been living in the 180-room hotel, one of dozens of SROs in the city's Downtown Eastside that provide housing of last resort to low-income people in the neighbourhood.



Feroz Dean: 604-454-4242



Property Information: Address: 159 E. Hastings Street, Vancouver, B.C Area: Vancouver East Property ID: 015-685-951 Neighborhood: 026-Downtown Gross Taxes: $36,459.61 Legal Full Description: PL VAP184 LT 15 BLK 9 DL 196 LD 36. GROUP 1, LOT 13, BLOCK 9, PLAN VAP184, DISTRICT LOT 196, GROUP 1, NEW WESTMINSTER LAND DISTRICT, W 0.5', LOT 14, BLOCK 9, PLAN VAP184, DISTRICT LOT 196, GROUP 1, NEW WESTMINSTER LAND DISTRICT, BALMORAL HOTEL Width : 50.5 Depth 122 Actual Use Multi-Family (Residential Hotel BCA Description: Beer Parlour / Hotel Zoning : DEOP Comprehensive Development Total Rooms: 180 Total Renovations spent: $3 million



Feroz Dean: 604-454-4242



Property Maps:



Feroz Dean: 604-454-4242

Appendix "D"

Copies of the Subject’s Floor Plan

Appendix "E"

Copies of the Zoning Bylaw and Official

Development Plan Excerpts

DEOD

City of Vancouver DEOD Zoning and Development By-law 1 July 2019

(DEOD) Downtown-Eastside/Oppenheimer District By-Law No. 5529 A By-law to Amend By-law No. 3575, being the Zoning and Development By-law. THE COUNCIL OF THE CITY OF VANCOUVER in open meeting assembled, enacts as follows: 1. The “Zoning and District Plan” annexed to By-law No. 3575 as Schedule “D” is hereby

amended accordingly to the plan marginally numbered Z-256 and attached to this By-law as Schedule “A”, and in accordance with the explanatory legends, notations and references inscribed thereon, so that the boundaries and districts shown on the Zoning District Plan are varied, amended or substituted to the extent shown on Schedule “A” of this By-law and Schedule “A” of this By-law is hereby incorporated as an integral part of Schedule “D” of By-law No. 3575.

2. The area shown outlined in black on the said plan is rezoned to a Comprehensive Development

District to be known and described as “Downtown-Eastside/Oppenheimer District (DEOD)”. 3. The only uses permitted with in the said area and the only uses for which development permits

may be issued are set out in the Downtown-Eastside/Oppenheimer Official Development Plan and generally include: (a) residential uses; (b) commercial uses; (c) industrial uses (light); (d) parks and open spaces; (e) public uses and facilities; (f) Urban Farm - Class B; and (g) other uses comparable or accessory to such uses;

subject to the form, location and any special characteristics being in conformity with any Official Development Plan, By-law or applicable policies and guidelines adopted by Council, and subject to such other conditions not inconsistent therewith which the Development Permit Board in its discretion may prescribe.

4. Any person wishing to carry out any development in the said district shall submit such plans

and specifications as may be required by the Director of Planning. 5. No development permit shall be issued for any development unless such permit shall have

received the approval of the Development Permit Board, unless otherwise approved by the Director of Planning pursuant to section 3.3 of the Zoning and Development By-law.

6. This By-law comes into force and takes effect on the date of its passing. DONE AND PASSED in open Council this 20th day of April, 1982.

(Sgd) Ald. May Brown, Deputy Mayor (Sgd) R. Henry, City Clerk

See also Downtown Eastside/Oppenheimer Official Development Plan

Downtown-Eastside/Oppenheimer

City of Vancouver DEOD Official Development Plan By-laws 1 September 2017

DOWNTOWN-EASTSIDE/OPPENHEIMER OFFICIAL DEVELOPMENT PLAN

(Adopted by By-law No. 5532, April 20, 1982)

Table of Contents

Page

Preamble ....................................................................................................................................................... 4

Section 1 Application and Intent ............................................................................................................... 4

Section 2 Definitions ................................................................................................................................. 8

Section 3 Sub-area Development Guidelines (General) ........................................................................... 9

Section 4 Sub-area 1 Main/Hastings ..................................................................................................... 10

Section 5 Sub-area 2 Cordova Street .................................................................................................... 18

Section 6 Sub-area 3 Powell Street/Japantown ..................................................................................... 22

Section 7 Sub-area 4 Alexander/Powell ................................................................................................ 28


City of Vancouver DEOD Official Development Plan By-laws 2 November 1996


City of Vancouver DEOD Official Development Plan By-laws 3 April 2014

Downtown-Eastside/Oppenheimer Official Development Plan A By-law to regulate the development of that part of the City of Vancouver for which the zoning district is described as “Downtown-Eastside/Oppenheimer District (DEOD)”.

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City of Vancouver DEOD Official Development Plan By-laws 4 January 2019

Preamble The Downtown-Eastside/Oppenheimer area, a small downtown neighbourhood surrounding Oppenheimer Park, is unique for its historic character, its ethnic diversity and its wide range and mix of land uses and buildings. It is bounded on the west by Gastown, on the south by Chinatown and Strathcona, on the north by the waterfront and on the east by an industrial district (see map above). On March 15, 2014, Vancouver City Council adopted the Downtown Eastside Local Area Plan, which contains additional goals and policies addressing the social, physical, historical and economic issues pertaining to this area and neighbouring areas. To implement those policies in the Policy Plan related to land use and development, Council agreed that the zoning should be changed to an Official Development Plan in order to provide a decision-making process which permits greater citizen involvement, while recognizing the significance and uniqueness of the area in the overall city context. This document, the Downtown-Eastside/Oppenheimer Official Development Plan, along with a companion document on character area guidelines, will provide the guidance necessary for the development of specific sites in this area. Section 1 Application and Intent 1.1 Goals

The following goals, established to form the basis for the planning and development of the Downtown-Eastside/Oppenheimer District, have been adopted by City Council as part of the Downtown-Eastside/Oppenheimer Policy Plan (1982) and as part of the Downtown Eastside Local Area Plan (2014):


City of Vancouver DEOD Official Development Plan By-laws 5 April 2014

Housing 1) Retain existing and provide new affordable housing for the population of the

Downtown-Eastside Oppenheimer area. 2) Upgrade the quality of the existing housing stock to City standards. 3) Increase the proportion of self-contained dwelling units, through rehabilitation and new

construction. Commercial Uses 4) Improve the viability of commercial activity by encouraging the upgrading of existing

commercial uses and the development of new local commercial uses which provide a wide range of goods and services to serve the diverse residents and workers in the Downtown Eastside Oppenheimer District.

Industrial Uses 5) Retain existing industrial operations and establish co-operative and positive liaison with

industrial firms to encourage a high standard of physical maintenance, general amenity, and compatibility with nearby residential and other uses without detrimentally affecting the continued economic viability of the industrial operation.

6) Encourage new industries which are compatible with the mixed-use character of the area. Non-Conforming Uses and Buildings 7) Reduce the negative effects of non-conforming uses and buildings, and phase them out

over the long term. Public Open Space/Views 8) Increase the amount of public open space and provide more outdoor recreation

opportunities. 9) Enhance the public enjoyment of the waterfront and views to the North Shore and

mountains. Community Services/Facilities 10) Provide preventative health care and treatment services that meet the specialized

neighbourhood needs. 11) Increase the level of public safety for residents, workers and visitors to the area. 12) Curtail the availability of alcoholic beverages, in view of the intimate connection

between alcohol and violence in this area. 13) Encourage the provision of indoor recreation services. 14) Prohibit institutional uses and social service facilities which do not serve the immediate

needs of the neighbourhood population. Traffic, Transportation and Parking 15) Ensure a pattern of traffic movement within, through and adjacent to the

Downtown-Eastside/Oppenheimer area that improves the character, pedestrian safety and quality of life in the area.

16) Encourage greater use of public transit by workers and local shoppers from outlying areas.

17) Discourage commuter parking. Japanese-Canadian Community 18) Recognize the cultural contribution of the Japanese-Canadian community to the City of

Vancouver and reinforce their historic identification with the Oppenheimer area.



Heritage Conservation 19) Preserve and enhance the heritage character of the Downtown-Eastside/Oppenheimer

area and recognize its historical significance in the evolution of Vancouver. Community Involvement 20) Ensure that Downtown-Eastside/Oppenheimer area residents, property owners, merchants

and workers are consulted on local planning and development matters and on the implementation of capital improvement projects.

Aboriginal Community 21) Recognize the historical, cultural and contemporary connection of the Aboriginal people

to the Downtown Eastside area and reinforce this through place-making opportunities and other initiatives.

Local Economic Development 22) Create employment, especially low barrier jobs, through inclusive, social impact hiring

and local employment opportunities.

23) Encourage enterprises operating as social enterprises or co-operatives that create jobs, job space and opportunities for services and training. • Social enterprises are businesses with a formal, mission-based, and direct

relationship to a non-profit or charity (i.e. owned by a non-profit, or formally partnered with a non-profit to ensure profits from the venture support the mission of that organization). Social enterprises can also be a non-profit or charity directly engaging in fee for service or the making and selling of goods itself, or a Community Contribution Company if registered as such with the Province.

• Co-operatives are a form of business ownership where the consumers, producers or workers of a company are also the owners. Often times Co-ops are formed to serve a specific community need. In British Columbia Co-operatives that are pursuing mission-based impacts similar to charities and non-profits can be specifically registered as Community Services Co-ops. Community Services Co-ops cannot issue investment shares and are formed explicitly to provide health, social or educational and other community services.

1.2 The Official Development Plan

The Official Development Plan for the Downtown-Eastside/Oppenheimer area is intended to control and guide the development of all uses in that part of the City of Vancouver for which the Zoning District is described as “Downtown-Eastside/Oppenheimer District (DEOD)”. The Official Development Plan is intended to be used in conjunction with any policies and guidelines which Council may from time to time determine. In order to provide effective guidance for the long-term development of the Downtown-Eastside/Oppenheimer area, the Plan should be reviewed from time to time to ensure that it accurately reflects the current public objectives. Such review should occur at least once every five years. Section 1, Application and Intent, contains goals and describes the procedure for using this Development Plan for the Downtown-Eastside/Oppenheimer District.



Section 2, Definitions, contains definitions specific to this Development Plan. Section 3, Sub-area Development Guidelines (General), identifies four sub-areas within the Downtown-Eastside/Oppenheimer District. Sections 4, 5, 6 and 7 are the specific Sub-Area Development Guidelines. These sections provide detailed guidance with respect to the four sub-areas which have been identified within the Downtown-Eastside/Oppenheimer District. These development guidelines, together with the overall goals in section 1, and all applicable policies and guidelines adopted by Council, provide the necessary guidance for the preparation of a development proposal within the various sub-areas.

1.3 Interpretation

The Official Development Plan is subject to the interpretation of the Development Permit Board. The goals as contained in section 1 represent the basic philosophy in planning the Downtown-Eastside/Oppenheimer District. Further, Council has also adopted the Downtown-Eastside/Oppenheimer Policy Plan which contains those goals and expands them into more descriptive policies. The Sub-Area Development Guidelines, as contained in sections 4, 5, 6 and 7, represent the intent as to how the different sub-areas of the Downtown-Eastside/Oppenheimer District should be developed. The Development Permit Board, in the exercise of its jurisdiction, may relax the provisions of this Plan in any case where literal enforcement would result in unnecessary hardship. In granting any relaxation, the Board shall have regard to the intent and policies of this Plan, and such other applicable policies and guidelines adopted by Council. The Director of Planning or the Development Permit Board, as the case may be, may relax any of the provisions of this Plan where literal enforcement would result in unnecessary hardship in carrying out any restoration or renovation of buildings or sites on the Vancouver Heritage Register adopted by Council and in effect at the time of application for relaxation under this section. Any development permit issued shall specify the heritage aspects of the building or site that merit the relaxation authorized by this section. Before granting any relaxation, the Director of Planning or the Development Permit Board shall: (a) consider any advice from the Vancouver Heritage Commission or any other body

established by Council for this purpose defining the aspects of the building or site that give it heritage merit and advising on the proposed conservation work;

(b) notify such adjacent property owners and tenants as deemed necessary, consider the responses received, and if there is significant objection, refer the matter to Council for advice; and

(c) consider the provisions of this Plan and all applicable policies and guidelines adopted by Council.

1.4 Development Permit Application

Development permit applications shall be made in compliance with the provisions set out in the Zoning and Development By-law, No. 3575.


City of Vancouver DEOD Official Development Plan By-laws 8 March 2018

The Development Permit Board may at its discretion either approve, approve subject to conditions, or refuse development permit applications based on a review against the related goals, sub-area development guidelines, all applicable policies and guidelines adopted by Council, and the submission of any advisory group, property owner or tenant.

Section 2 Definitions The definitions contained in section 2 of the Zoning and Development By-law, No. 3575 shall apply to this Plan. The following definitions, extracted from section 2 of the Zoning and Development By-law, No. 3575 are of particular relevance to this Plan.

2.1 Floor Space Ratio means the figure obtained when the area of all floors of all buildings on the

site (measured to the extreme outer limits of the building) is divided by the area of the site. 2.2 Hotel means premises providing temporary accommodation by way of furnished sleeping,

housekeeping or dwelling units.

The following definitions refer to terms used in this Official Development Plan and supplement definitions included in the Zoning and Development By-law.

2.3 Habitable Room means any room in a dwelling unit used or intended to be used for living,

sleeping, cooking or eating purposes. 2.4 Micro dwelling means a self contained residential unit which is no less than 23.2 m2 and no

more than 29.7 m2. 2.5 Residential means sleeping units, housekeeping units, one or two family dwellings,

apartments, townhouses, seniors supportive or assisted housing, residential units associated with and forming an integral part of artist studios, boarding houses, rooming houses and temporary modular housing, but excludes a Community Care Facility – Class B, and Group Residence.

2.6 Retail Continuity means the provision and permanent maintenance of continuous pedestrian

oriented retail store type display windows or other equal and suitable display as may be approved by the Development Permit Board.

2.7 Secured Market Rental Housing means a development or part of a development, used only as

market rental housing, which has a covenant or housing agreement registered against title restricting its use to market rental housing, for the longer of 60 years or the life of the building, or for such other term as may be agreed upon by the city and the owner.

2.8 Social Housing means rental housing:

(a) in which at least 30% of the dwelling units are occupied by households with incomes below housing income limits, as set out in the current “Housing Income Limits” table published by the British Columbia Housing Management Commission, or equivalent publication;

(b) which is owned by a non-profit corporation, by a non-profit co-operative association, or

by or on behalf of the city, the Province of British Columbia, or Canada; and



(c) in respect of which the registered owner or ground lessee of the freehold or leasehold title to the land on which the housing is situate has granted to the city a section 219 covenant, housing agreement, or other security for the housing commitments required by the city, registered against the freehold or leasehold title, with such priority of registration as the city may require;

except that in the HA-2 district; in the area of the FC-1 district located north of National Avenue; in the area of the M-1, I-2, RT-3 and RM-3A districts located north of Venables Street, Malkin Avenue and Prior Street, south of Hastings Street, east of Gore Avenue and west of Clark Drive; in the Downtown-Eastside Oppenheimer district; and in the area of the Downtown district denoted as C2 on Map 1 of the Downtown Official Development Plan; social housing means rental housing: (d) in which at least one third of the dwelling units are occupied by persons eligible for either

Income Assistance or a combination of basic Old Age Security pension and Guaranteed Income Supplement and are rented at rates no higher than the shelter component of Income Assistance;

(e) which is owned by a non-profit corporation, by a non-profit co-operative association, or

by or on behalf of the city, the Province of British Columbia, or Canada; and (f) in respect of which the registered owner or ground lessee of the freehold or leasehold title

to the land on which the housing is situate has granted to the city a section 219 covenant, housing agreement, or other security for the housing commitments required by the city, registered against the freehold or leasehold title, with such priority of registration as the city may require.

Section 3 Sub-area Development Guidelines (General)

3.1 Intent

The Sub-Area Development Guidelines provide more detailed guidance with respect to the development of the four sub-areas which have been identified within the Downtown-Eastside/Oppenheimer District. Sub-area 1: Main/Hastings Sub-area 2: Cordova Street Sub-area 3: Powell Street/Japanese Village Sub-area 4: Alexander/Powell The sub-areas are shown on the following map. Identification of these four sub-areas is based on: (a) existing land uses; (b) relationship to existing nearby character areas of Downtown, Gastown, Chinatown and

the Strathcona neighbourhood; (c) projected future land uses.



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Sub Area 3POWELL ST. /

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Sub Area 2CORDOVA STREET

Sub Area 1MAIN / HASTINGS

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POWELL

KEY PLAN showing DEOD and sub-areas

3.2 Interpretation

The Sub-Area Development Guidelines are all mandatory in the sense that any development permit application shall be measured against them. Flexibility and innovation are encouraged in the preparation of development proposals, and a significant degree of discretion is hereby given to the Development Permit Board in the interpretation of policies. In all instances, approval of a development permit application shall be subject to the form, location and any special characteristics being in conformity with the intent of this Plan, all applicable policies and guidelines adopted by Council, and to such other conditions and regulations not inconsistent therewith which the Development Permit Board in its discretion may prescribe.

3.3 General Conditions of Use

All regulations and conditions of use set out in the Zoning and Development By-law that affect uses set out in this Plan apply.

Section 4 Sub-area 1 Main/Hastings

4.1 Intent

The development of the Main/Hastings sub-area, outlined on Map 1, should further establish its importance as a gateway to the Downtown, and help to clarify the functions of the adjacent Historic Areas of Gastown and Chinatown and the Oppenheimer and Strathcona residential neighbourhoods. Therefore, this area is intended to be a high-density, mixed commercial and residential area, appropriate for a mix of office, retail, local social services, and other similar uses.


City of Vancouver DEOD Official Development Plan By-laws 11 July 2019

Residential uses are also permitted. Pedestrian-oriented uses, primarily retail and restaurant, are encouraged at ground level with an emphasis on continuity of facade and narrow frontages for individual uses on Main Street from Hastings to Cordova and along Hastings Street from Carrall to approximately Dunlevy. The retention and upgrading of existing multi-unit residential buildings is encouraged. The development of new residential units on upper floors of buildings is encouraged through a floor space bonus system. Special design measures, however, should be undertaken to mitigate the air and noise pollution problems.

4.2 Uses

4.2.1 The following uses, and others accessory thereto, may be permitted, subject to the CONDITIONS OF USE and to such conditions or regulations as may be prescribed by the Development Permit Board: (a) Office commercial, except that:

(i) on the ground floor, any office commercial use shall be limited to a financial, law, insurance, travel agency, medical-dental or real estate office; and

(ii) on floors above the ground floor, construction for office commercial use shall only be permitted if a minimum of 50 percent of the floor area created after April 20, 1982 is developed for residential purposes.

(b) Retail commercial, including class 1 restaurants but not including a liquor store. (c) Other commercial, including, but not necessarily limited to, a business or vocational

school, a drama or dance academy, a billiard hall, bowling alley, steam bath, photography studio, theatre, artist studio, or sign or showcard painting, but not including a hotel, restaurant - class 2, cabaret or neighbourhood public house.

(d) Residential, with an emphasis on self-contained units. (e) Micro dwelling, subject to section 11 of the Zoning and Development By-law. (f) Community Care Facility – Class B and Group Residence. (g) Light industrial, including, but not necessarily limited to the following, provided that all

manufacturing and storage takes place within a wholly enclosed building, and provided that the Development Permit Board is satisfied that the use is compatible with the mixed use character of the area:

Lithography; printing; publishing; warehousing; wholesaling; food or beverage product manufacturing (but not involving the milling of grain, rice, malt; the refining of sugar; the refining of vegetable oil or fat; the brewing or distilling of alcoholic beverages; the processing of fats, bones, hides, skins, offal, or animal products of a like nature; the use of fish; or the use of live animals or live poultry); manufacturing of miscellaneous light products, including brooms or brushes; jewelry or silverware; musical instruments; novelties, decorations or ornaments; scientific or professional equipment; signs or displays; stationery supplies or office supplies; toys; window shades or blinds.

(h) Live-Work Use, subject to section 11 of the Zoning and Development By-law. (i) Building or uses required to serve the educational, cultural, health, social, recreational or

local economic development needs of the local community and not otherwise permitted. (j) Cannabis Store, subject to section 11of the Zoning and Development By-law. (k) Any other use which is not specifically listed herein, but which the Development Permit

Board considers comparable in nature, having regard to the intent, goals and policies of this Plan.

4.2.2 Temporary Modular Housing may be permitted, subject to the provisions of section 11 of the

Zoning and Development By-law. Temporary Modular Housing is not subject to any of the use or design provisions of this Official Development Plan, including the CONDITIONS OF USE.



Downtown-Eastside/Oppenheimer District Map 1

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Sub-Area 1 Main/Hastings

4.3 Conditions of Use

The following conditions of use, in addition to such other conditions as the Development Permit Board may decide, shall apply: (a) a person must not convert all or part of a hotel or other residential use, existing as of

April 20, 1982, to an office, other commercial, or live-work use; and (b) any development permit issued for live-work use must stipulate as permitted uses:

(i) dwelling unit; (ii) beauty and wellness centre, general office, health care office, barber shop or beauty

salon, photofinishing or photography studio, or artist studio – class A; and (iii) dwelling unit combined with any use set out in clause (ii).

4.4 Retail Continuity

Where indicated on Map 2, only retail and similar uses, and lawyers’ offices, shall be permitted on the ground floor along the street frontage so identified; and retail and similar uses shall be encouraged on the other street frontages so identified.


City of Vancouver DEOD Official Development Plan By-laws 13 January 2019

4.4A Exception to retail continuity

Despite anything to the contrary in this Downtown-Eastside/Oppenheimer Official Development Plan, the Development Permit Board or Director of Planning may permit social service centre, general office, or health care office uses on the ground floors of buildings having street frontages on Hastings Street subject to development permits limited in time as required by the Development Permit Board or Director of Planning.

4.5 Density

4.5.1 Subject to the provisions of subsection 4.5.2, the maximum density for any development shall be a floor space ratio of 1.0, except that the Development Permit Board may permit an increase in the maximum density: (a) to a maximum floor space ratio of 5.0, if at least 60% of the residential units comprising

not less than 40% of the gross floor area above a floor space ratio of 1.0 are developed as social housing and the remaining 40% of the residential units comprising not more than 60% of the gross floor area above a floor space ratio of 1.0 are developed as secured market rental housing; or

(b) to a maximum floor space ratio of 7.0 on corner sites, if: (i) a maximum of 2.5 floor space ratio above a floor space ratio of 1.0 is developed as

uses listed in 4.2.1 (i), Community Care Facility – Class B and Group Residence, Health Care Office and Health Enhancement Centre and accessory uses,

(ii) no less than 50% of the total gross floor area is developed as residential; where at least 60% of the residential units comprising not less than 40% of the gross residential floor area are developed as social housing and the remaining 40% of the residential units comprising not more than 60% of the gross residential floor area are developed as secured market rental housing,

(iii) the corner site has a frontage no greater than 30.5 m, and (iv) the Development Permit Board first considers:

(a) the intent of this Official Development By-law and all applicable Council policies and guidelines; and

(b) height, bulk, location and overall design of the building and its effect on the site and on surrounding buildings and streets and existing views, with an emphasis on preserving and strengthening prevailing context and mitigating the impact on the liveability of adjacent residential areas and the impact on public areas such as parks and plazas.

4.5.2 Despite the provisions of subsection 4.5.1, the Director of Planning or the Development Permit

Board may permit an increase in the maximum floor space ratio to 1.5 for retail, service, manufacturing, or wholesale uses, and uses listed in 4.2.1 (i) and accessory uses, if: (a) the uses are existing as of April 29, 2014; (b) the uses are located on a site existing as of April 29, 2014; and (c) there is no conversion of existing residential floor area.

4.5.3 Despite the provisions of subsection 4.5.1, the Director of Planning or the Development Permit Board may relax the site frontage maximum of 30.5 m, if: (a) all residential units are social housing; (b) enforcement will result in unnecessary hardship; (c) the Director of Planning or the Development Permit Board first considers all the

applicable policies and guidelines adopted by Council; and (d) the Director of Planning or the Development Permit Board considers the submission of

any advisory group, property owner or tenant.



4.5.4 The following shall be excluded in the computation of floor area: (a) open residential balconies or sundecks and any other appurtenances which, in the opinion

of the Development Permit Board, are similar to the foregoing and contribute to the amenity or environment of the Downtown-Eastside/Oppenheimer District, provided that the total area of all exclusions does not exceed eight percent of the provided residential floor area;

(b) where floors are used for off-street parking and loading, the taking on or discharging of passengers, bicycle storage, heating and mechanical equipment, or uses which, in the opinion of the Director of Planning, are similar to the foregoing, those floors or portions thereof so used, which are at or below the base surface, provided that the maximum exclusion for a parking space shall not exceed 24 feet in length;

(c) patios or roof gardens provided that any sunroofs or walls are approved by Director of Planning;

(d) all residential storage space above or below base surface, except that if the residential storage space above base surface exceeds 3.7 m² per dwelling unit, there will be no exclusion for any of the residential storage space above base surface for that unit;

(e) for exterior walls in laneway houses and in one and two-family dwellings of three storeys or less with or without secondary suites, an area equal to the area occupied by the insulation thickness that exceeds the performance of the prescriptive thermal resistance (RSI value) requirement for exterior walls in the Building By-law, as verified by a Building Envelope Professional, to a maximum exclusion of 330 mm;

(f) for exterior walls in residential buildings that are three storeys or less and classified as Group C buildings under the Building By-law, other than those buildings referred to in subsection (e): (i) an area equal to the area occupied by the insulation thickness that exceeds the

performance of the prescriptive thermal resistance (RSI value) requirement for exterior walls in the Building By-law, as verified by a Building Envelope Professional, to a maximum exclusion of 179 mm, and

(ii) an area equal to the area occupied by a rain screen system in a wall that exceeds 203 mm, as verified by a Building Envelope Professional, to a maximum exclusion of 152 mm;

(g) for exterior walls in all buildings other than those referred to in subsections (e) and (f): (i) an area equal to the area occupied by the insulation thickness that exceeds the

performance of the prescriptive maximum effective thermal transmittance (U factor) requirement for exterior walls in the Building By-law, as verified by a Building Envelope Professional, to a maximum exclusion of 179 mm, and

(ii) an area equal to the area occupied by a rain screen system in a wall that exceeds 203 mm, as verified by a Building Envelope Professional, to a maximum exclusion of 152 mm; and

(h) in buildings with commercial, retail or service use at grade, the area occupied by interior commercial kitchen exhaust shafts, to a maximum exclusion of 3.7 m² for each floor above the commercial, retail or service use.

4.5.5 The following may be excluded in the computation of floor area:

(a) enclosed residential balconies, provided that the Director of Planning first considers all applicable policies and guidelines adopted by Council and approves the design of any balcony enclosure subject to the following: (i) the total area of all open and enclosed balcony or sundeck exclusions does not

exceed eight percent of the residential floor area being provided; and (ii) no more than fifty percent of the excluded balcony floor area may be enclosed.

4.5.6 Floor area excluded pursuant to sections 4.5.4 and 4.5.5 pursuant to section 2.1 shall not be put

to any use other than that which justified the exclusion.



4.6 Physical Form

4.6.1 Height The minimum height of a building within the area denoted by the letter “A” on Map 3 shall be 11 meters (approximately 36 feet; approximately 3 storeys). The maximum height of a building within the total Main/Hastings sub-area shall be 30 meters (approximately 98 feet; approximately eight storeys). The Development Permit Board may permit an increase in the maximum height of a building to a maximum of 36.6 m for a development on a corner site in Sub-area 1 Main/Hastings, if: (a) the corner site has a frontage no greater than 30.5 m; and (b) the Development Permit Board first considers:

(i) the intent of this Official Development By-law and all applicable Council policies and guidelines, and

(ii) height, bulk, location and overall design of the building and its effect on the site and on surrounding buildings and streets and existing views, with an emphasis on preserving and strengthening prevailing context and mitigating the impact on the liveability of adjacent residential areas and the impact on public areas such as parks and plazas.

4.6.2 Frontage -- Not Applicable.

4.6.3 Front Yard -- Not Applicable.

4.6.4 Side Yard

No side yard shall be required, except that where a site abuts an existing residential building with any window lighting a habitable room, any facing wall of a new building shall be set back an adequate distance to ensure light and ventilation to the existing habitable rooms, in accordance with all applicable policies and guidelines adopted by Council.

4.7 [Deleted -- see Parking By-law.]

4.8 Social, Cultural and Recreational Facilities

4.8.1 It is the purpose of this section to provide in the Downtown-Eastside/Oppenheimer area the following social, cultural and recreational amenities for the enjoyment of Downtown-Eastside/Oppenheimer residents and employees: (a) facilities which provide opportunities for physical fitness; (b) facilities for general recreation; (c) facilities which provide a service to the public; and (d) facilities for arts and culture. Facilities or areas which contribute to physical amenity, such as parks, plazas, arcades or ornamental elements in the landscape, are not included in this section. Provision of these items and others of a similar nature may be required by the Development Permit Board where appropriate, as part of the design of the building.




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Only retail and similar uses and lawyers' offices subject

to section 4.4A permitted on the ground floor

Retail and similar uses encouraged on the ground floor

4.8.2 Amenities Excluded from Floor Space Ratio The following amenities and facilities are excluded from the FSR limitation provided that their area does not exceed 20 percent of the allowable FSR or 929 square meters (approximately 10,000 square feet) whichever is the lesser: (a) saunas; (b) tennis courts; (c) swimming pools; (d) squash or racquet courts; (e) gymnasiums and workout rooms; (f) games rooms and hobby rooms; (g) day care centres; (h) other similar or related indoor uses of a social or recreational nature which in the opinion

of the Development Permit Board are a type which contribute to social amenity.




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Sub-Area 1 Main/Hastings: Minimum Building Heights

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4.8.3 Bonuses for Provision of Social, Cultural and Recreational Amenities Where a need for any public, social, cultural or recreational facility has been demonstrated to the satisfaction of the Development Permit Board, the Board may authorize, for any building which includes one or more of such facilities, an increase in the permitted floor space ratio or density of a building, subject to prior approval by City Council. In determining the increase in floor area or density that may be authorized, the Development Permit Board shall consider: (a) the construction cost of the facility; (b) any costs to the developer of continuing maintenance required for the facility; (c) the rental value of the increased floor area; and (d) the value of any authorized relaxations of other restrictions. If appropriate, such facilities shall be preserved in the public domain by way of a registered agreement and operated by the City or its delegates.

Appendix "F"

Qualifications of the Appraisers

Reagan Stinson, B.Com. (hons), AACI, P.App, MBA PROFESSIONAL EXPERIENCE CWPC Property Consultants Ltd. Vancouver, BC 2015 to Present

Director of Consulting Services at CWPC Property Consultants Ltd. (formerly Carmichael Wilson Property Consultants Ltd.). Experience in diverse properties related roles. Strong background in management, negotiations and valuation including: property leasing, acquisition and sales, property portfolio management, property negotiations and consultation, and commercial property valuation.

BC Hydro Vancouver, BC 2012-2015

Manager, Property Leasing & Sales Services. Responsible for leading and managing a team of 16 employees and contractors. The team negotiated major facility leases, licenses and acquisitions, telecommunication agreements and surplus property dispositions throughout BC.

BC Hydro Vancouver, BC 2009-2012

Senior Property Negotiator, Transmission Acquisition Services. Responsible for the negotiation and acquisition of statutory rights-of-way, fee-simple land and other property interests.

Carmichael Wilson Property Consultants Vancouver, BC 2004-2009

Senior Appraisal Consultant. Involved in all aspects of commercial appraisal and consulting work in British Columbia, with a specialization in office, retail and single-room occupancy properties in Downtown Vancouver and the Downtown Eastside.

PROFESSIONAL LIABILITY INSURANCE Since 2005 Appraisal Institute of Canada (Claim Free) PROFESSIONAL QUALIFICATIONS 2012 Completed Master’s in Business Administration at Queens University,

Kingston, Ontario 2006 Co-instructed Real Estate Investment Analysis and Advanced Income

Appraisal at Langara College 2005 Awarded use of the professional designations AACI (Accredited

Appraiser Canadian Institute) and P.App (Professional Appraiser) in December 2005 by the Appraisal Institute of Canada

2004 Completed Bachelor of Commerce (Urban Land Economics) degree at

University of British Columbia VOLUNTEERING & MEMBERSHIPS Since 2012 Vancouver CREW - Commercial Real Estate Women Since 2010

Salvation Army Harbour Light – Lunchtime Volunteer

2009-2011

Appraisal Institute of Canada - Vancouver Chapter Executive

Stuart H. Carmichael, B.BUS. (L.Econ.), AACI, P.App

PROFESSIONAL EXPERIENCE CWPC Property Consultants Ltd. Vancouver, BC 2001 to Present

Partner in CWPC Property Consultants Ltd. (formerly Carmichael Wilson Property Consultants Ltd.). Involved in all aspects of commercial appraisal and consulting work in British Columbia and Seniors Housing and special assignments across Canada.

1991 to 2001 Partner in Hooker Carmichael Property Consultants Ltd. in Surrey. 1990 to 1991 Owner of Carmichael Appraisal and Investments Ltd. in Vancouver. 1988 to 1990 Senior Manager, Commercial Appraisal Division at Canada Springfield

Appraisal Consultants in Vancouver. 1985 to 1987 Employed by the Totalizator Agency Board (TAB), a crown Corporation

in Sydney, Australia. Focus on market studies for new store locations, rental disputes and lease renewals, overseeing construction of new facilities and upgrading existing premises, new lease negotiations and the acquisition of development sites and commercial properties.

LITIGATION EXPERIENCE 1988 to Present Appeared as an expert witness before the Supreme Court of British

Columbia and Federal Court of Canada. Appraisal reports used regularly for expropriation compensation settlement and other litigation proceedings for both government authorities and property owners. Prepared reports and appeared at Arbitration and Assessment Appeal proceedings.

PROFESSIONAL LIABILITY INSURANCE Since 1988 Appraisal Institute of Canada: Practice: Fee Appraiser (Claim Free)

PROFESSIONAL QUALIFICATIONS AND MEMBERSHIPS 2010 2010

Completed the 5-year re-certification requirements (Continuing Professional Development) with the Appraisal Institute of Canada Presented at the 2010 BC Expropriation Conference on Valuation issues with Subsurface and Aerial Volumetric Right of Ways

2007 and 2008 Creating and instructing a course on development land acquisitions,

Langara College, Vancouver 2006 to 2007 Presented at the 2006 and 2007 BC Expropriation Conference on Right

of First Refusals, Speculative Holding Properties and Special Use Properties

2006 and 2008 Creating and instructing the new Real Estate Development, Site

Selection and Feasibility course at Langara College, Vancouver 2001 and 2006 Completed the 5-year re-certification requirements (Continuing

Professional Development) with the Appraisal Institute of Canada 1997 Awarded use of the professional designation P.App (Professional

Appraiser) by the Appraisal Institute of Canada (AIC) 1992 Charter Member of the BC Expropriation Association 1991 and 1992 Lectured appraisal subjects at UBC Real Estate Division 1991 U.B.C./C.L.E. Trial Advocacy Workshop for the Law Society of BC 1989 Awarded AACI (Accredited Appraiser Canadian Institute - Certificate #

3035) by the Appraisal Institute of Canada

1987 Awarded AVLE designation (Australian Institute of Valuers and Land

Economists - Certificate Number 9262) 1985 Completed Bachelor of Business (Land Economics) degree at Sydney

Western University, Sydney, Australia VOLUNTEER MEMBERSHIP 2014 to 2015

Board of Directors,

2014 to 2015

Board of Directors, BC Thoroughbred Owners & Breeders Association

2011 to 2012 Director, Southlands Riding Club 1995 to 1996 President, Kiwanis Club of Chinatown 1995 to 1996 Club Captain, Vancouver Rowing Club Rugby 1993 to 1994 Director and Vice President, Kiwanis Club of Chinatown