A typical condo in Vancouver has embedded costs of more than $500,000 before it’s even finished, according to a series of studies of land values, construction costs and municipal fees and levies.
A year ago, the Urban Development Institute (UDI), Pacific region, studied the input costs for a high-quality, highrise concrete tower in Vancouver with 115 condos of 800 square feet each, based on 2013 prices. BIV has updated the numbers to current values to see what it would cost today to deliver each condo in the same hypothetical condo tower.
Based on recent Vancouver multi-family land sales outside of the downtown core, land values equate to an average of $280 per square foot, according to Colliers International’s Metro Vancouver LandShare Report.
The hard construction costs to build a high-quality, highrise condo tower in Vancouver, according to Altus Group’s 2015 Construction Cost Guide,work out to $282 per square foot.
So the land and hard construction costs combined equate to a per-condo price of $449,600, or $562 per square foot.
Then come City of Vancouver development fees and levies. First, the city charges community amenity contributions (CACs) based on 75% of the increase in land value after zoning to higher density. The UDI reckoned that, on this sample building, the CACs would amount to $48,295 per unit. The city also charges development cost levies and demolition fees that add a further $14,427 per unit.
Vancouver requires that all new developments subject to rezoning meet LEED (Leadership in Energy and Environmental Design) Gold sustainability standard, which adds $11,718 to each condo price.
It also has levies to collect money for district energy use, car share programs, electric vehicle charging stations and public art, which tally, in this sample, to an estimated $1,704 per condo unit.
For this sample, Vancouver civic fees and levies pencil out to an average of $76,144 per new condominium unit.
At this point the new concrete apartment has embedded costs of $525,754, or around $657 per square foot.
This price is before any suite finishing or building amenities are complete and before financing costs, marketing and promotion expenses or the developer profit are factored in. •
