First Nations hold 5,637 acres across Metro Vancouver – and have recently secured other prime tracts of land – but appear unlikely to provide a safety valve for industrial developers starved for space.
Based on recent transactions, local native bands – like most landowners – are more interested in higher-value developments such as residential and light commercial.
A 2011 Metro Vancouver study cautioned that the region’s 6,634-acre base of vacant industrial land could be used up by 2020. At the pace of current development – 260 acres could be taken up this year – it could disappear even faster. There are fewer than 475 acres of privately owned land zoned for industrial use in the region, according to a NAOIP estimate. The Vancouver chapter of the commercial real estate development association notes that much of the land Metro Vancouver has identified as having industrial potential is either too steep, too small or too poorly situated to be viable.
The largest parcel of industrial land delivered to the market in the past 10 years came from the Tsawwassen First Nation (TFN), which released 335 acres for its Gateway Logistics Centre in South Delta. The site is designated as a warehouse and distribution complex, much of it linked to Port Metro Vancouver’s nearby Deltaport. A 400,000-square-foot warehouse for GWL Realty Advisors and Healthcare of Ontario Pension Plan will open on the site next spring, and Port Metro Vancouver and the Canada Border Services Agency have taken 11.4 acres for a new container examination facility.
“We expect to release sites in our 180-acre Phase 2 in early 2016,” said Chris Hartman, TFN Economic Development Corp. CEO, who estimates total build-out could cover 10 million square feet of industrial space.
But the TFN could be the last native lands released for industrial use. While other First Nations have land that could be designated industrial, the trend has been to develop for higher and best use, such as residential and commercial.
An example is the former provincial liquor distribution centre on East Broadway in Vancouver, which the province sold to a trio of local First Nations in August 2014 for $36.9 million. While the 9.8-acre site is zoned industrial, the Musqueam, Tsleil-Waututh and Squamish nations are said to have other, potentially more profitable plans for the site under a joint venture agreement with a private developer.
Also last year, the three bands entered into a joint venture partnership with Canada Lands Co. (CLC) that included the purchase of the 52-acre Jericho Lands in Vancouver’s West Point Grey from the federal government for $237 million.
The deal allocates 50% of the Jericho land to the trio of First Nations and the other half to Canada Lands. All of the land is subject to redevelopment, but the big payoff potential is for residential.
The average price for a 50-foot residential building lot in West Point Grey is north of $2.5 million, according to the Real Estate Board of Greater Vancouver. The bands and CLC paid Ottawa approximately $4.5 million per acre for the 52-acre Jericho site, which is across from the Point Grey waterfront. •
