Frank O’Brien
A typical high-rise condo in Vancouver has embedded costs of more than $500,000 before it is 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, Pacific Region studied the input costs for a high-quality, high-rise 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 to deliver each condo in the same hypothetical condo tower today.
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 the Metro Vancouver Land Share report from Colliers International.
The hard construction costs to build a high-quality, high-rise condo tower in Vancouver, according to 2015 Construction Cost Guide from Altus Group, works out to $282 per square foot.
So, the land and hard construction costs combine equate to a per-condo price of $449,600, or $562 per square foot.
Then comes City of Vancouver development fees and levies. First, the city charges community amenity contributions (CAC), based on 75% of the increase in land value after zoning to higher density. The UDI reckoned that, on this sample building, the CAC 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.
The city requires that all new developments subject to rezoning meet LEED Gold, sustainability standard. This adds $11,718 to each condo price. Vancouver 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.
All in, Vancouver carries city fees levies pencil to $76,154 per condominium.
At this point the new concrete apartment has embedded costs of $525,754, or around $657 per square foot.
