Journal of Commerce | Peter Caufield | July 4, 2025
Vancouver City Council recently approved initiatives it says will support development and help housing projects move forward.
Council says financial measures it has proposed will ease cost pressures and improve cash flow.
The measures include:
- A flexible development cost levy (DCL) payment will allow developers to pay DCLs over $500,000 in three equal instalments (to ease early-stage financial strain);
- the upfront community amenity contribution (CAC) cash payment at rezoning enactment will be reduced from $20 million to $5 million;
- Developers will be able to use pay-on-demand surety bonds instead of letters of credit; and
- the city will forego the scheduled 3.2 per cent inflation adjustments for 2025, as well as the 2024 inflationary adjustment of 5.7 per cent for CAC targets and density bonus contributions.
Josh White, Vancouver’s general manager of planning, urban design and sustainability, says the city is also streamlining the development process to make it faster and more efficient.
- Wait times are being reduced and the application process is being made easier to navigate;
- sewer review is being improved to reduce costs and delays. The city will focus on managing rainwater directly onsite, helping projects avoid costly off-site upgrade requirements; and
- the city is allowing larger floorplates in taller buildings and mass timber projects to make construction more efficient and reduce costs.
“Most of the measures take effect immediately upon council approval, which was June 17, 2025,” says White. “The DCL deferral is expected to take effect on July 22 which is when council enacts the DCL bylaw.”
White says the city’s housing goal is to approve 83,000 new homes across Vancouver in the next 10 years.
He adds what prompted the city to take action now is that it had been hearing a lot from developers about stresses and strains caused by increasing construction costs and market softness.
“We knew we needed to address the cost side,” says White. “The previous work the city did was on enabling policies. The new actions are targeted and more detailed and have deeper application.”
White says he expects the changes to accelerate housing projects in all parts of the city.
“Our initiatives are partly the result of the city’s engagement with a working group of developers,” he says. “We decided to go for rapid and broad changes. There’s no intention to fix everything with a silver bullet.”
Reaction from three Vancouver housing experts interviewed by the Journal of Commerce about the changes was mixed.
Patrick Condon, the James Taylor chair in landscape and liveable environments at the University of British Columbia, says, “I’m sure developers who are anxious about project viability will welcome this relief.”
Condon says council’s changes are an example of the slow abandonment of the development-pays-for-itself principle.
“In the 1990s, the city insisted on capturing for public purposes 80 per cent of the new value of the land after rezoning,” he says. “This financed parks, affordable housing and community centres, while mitigating the land price inflation that would have otherwise occurred.”
Vancouver developer and retired architect Michael Geller says, “What’s been proposed is helpful, but it doesn’t go far enough. However, we shouldn’t look a gift horse in the teeth.”
Geller calls replacing letters of credit with surety bonds “a positive move.”
“They don’t have the same impact on developers as letters of credit, which tie up more of a developer’s capital,” he says.
Geller says the city is not proposing a reduction in CACs, but a deferral.
“My clients had been hoping they would be reduced,” he says. “The amounts of CACs were determined when times were good, but times are not good now.”
Vancouver architect Brian Palmquist also thinks the surety bond idea is a good one, but the city’s changes probably won’t have the desired results.
“A few projects may proceed, but most of them still won’t ‘pencil out,’” says Palmquist. “City staff have been implementing ‘improvements to reduce wait times’ for the last 20 years that I’m aware of, with minimal effect. But thousands of renters will live under an ongoing threat of ‘demoviction,’ even as the replacement projects stall, probably for years.”
Palmquist says most cities that have tried to create affordable housing have failed.
“They didn’t realize that incentivizing development simply drives up land prices,” he says. “A few places have successfully encouraged affordable housing development by mandating a percentage of permanently affordable housing as part of any rezoning, as much as 50 per cent.”