The owner of Vancouver's biggest digital-tech company, Hootsuite, and one of the city's most successful developers have joined forces to buy a block of land in the city's hottest industrial zone just as zoning changes are being considered that could benefit the new partnership.
Vancouver's assistant director of planning, Kent Munro, confirmed this week that planners are looking at changes to zoning in the area near the Olympic Village that might allow higher densities in a few restricted spots on the periphery.
The Hootsuite site was purchased for $40.5-million on Sept. 15 by a corporation formed in August. Its directors are Westbank Corp. developer Ian Gillespie and Hootsuite chief executive officer Ryan Holmes. The property, bounded by Main and Quebec streets and Fourth and Fifth avenues, straddles the eastern boundary of the industrial zone.
Mr. Munro didn't rule out Hootsuite as a candidate for inclusion in that high-density zone. "It hasn't gone public yet, so I'm not going to disclose the final thinking," he said. "But there is a little mini-tech hub there and we're looking at [whether there are] further ways to intensify the employment uses."
As part of that, planners are also examining new definitions of "industrial" that might include "digital-tech" businesses as a kind of production or manufacturing that would be eligible to be in restricted industrial zones.
If that was approved by the city, it would mean tech businesses operating in the area would no longer be restricted to the few sites permitted as offices or to occupying only two-thirds of any building designated industrial.
But there are concerns that any zoning changes – besides potentially providing a benefit to Hootsuite that not everyone in the zone would receive – would damage the city's ability to preserve the land for real industrial uses.
"It is certainly not news that someone aspires to flip industrial lands to much more profitable office uses. What would be news is if city council, after over 20 years of protecting their industrial land base, decides to cave to this pressure," said Christina DeMarco, a former industrial planner for the city and former head of regional planning at Metro Vancouver.
"I understand that this is only an inquiry at this stage, and I am hopeful that the city can work with the proponent to find a way to combine industrial and office uses on this site and play by the existing rules."
Hootsuite, which moved to a former police-operations site in Mount Pleasant two years ago, now occupies three buildings in the area – two of them on the block just purchased – but all of those buildings are designated for office use. The company, which creates virtual computer dashboards to help manage social media, doesn't currently qualify as industrial.
The news about the land purchase and potential rezoning has created a buzz in the small circle of people who know the area, which is now an attractive, eclectic mix of early 20th-century houses and apartments, breweries, film-servicing operations, clothing manufacturers, commissaries, architect offices, warehouses and more.
Mr. Gillespie said he has wanted to buy in the area for years and the opportunity came up as he got to know Mr. Holmes, who had a long-standing option to buy the block.
He thought it was a good asset for his company, given the impending changes.
"If you believe the Broadway line is going to happen and if you believe the city is going to update its zoning, it's a natural," he said.
Although Mr. Holmes has talked for a long time about wanting to create a single campus for his company, Mr. Gillespie said it's not yet clear whether that's what the property will be used for or whether he will develop on the vacant parts of the block for a cluster of smaller tech companies.
Ms. DeMarco noted that the Metro Vancouver plan designates the area as industrial and that there is plenty of office space nearby that could easily be used by tech companies instead.
In fact, the city rezoned parts of the False Creek Flats, only a few blocks from Mount Pleasant, in order to allow for tech uses on industrial land back in the late 1990s to accommodate what was then viewed as the inevitable rise of the dot-com economy. The land has sat mostly unused after the dot-com bubble burst in the early 2000s.
Digital tech has seen a resurgence, but companies have instead gravitated to Mount Pleasant since Hootsuite moved there in 2013, and since the city adjusted zoning then to allow some office uses. At the time, political opponents of Mayor Gregor Robertson accused the city of giving Hootsuite an overly favourable deal.
One owner of a property sitting empty in the flats while everyone rushes to Mount Pleasant is resigned to that phenomenon and to what new changes the city might bring in.
"I could talk myself into being a bit disappointed [with the city's possible changes]," said Jon Stovell, the president of Reliance Properties Ltd., which owns a vacant site that sits in the zone designed for tech businesses. "But they're probably succumbing to the desires of where the tenants want to be. And certain companies are darlings and I can see how they can have more influence on planning policy."
The Mount Pleasant industrial zone has been under intense pressure for several years, said Mr. Munro, with many people banging on the door to get in.
Two years ago, the city amended zoning as a way of trying to preserve industry in the area – while creating new job space – by permitting office uses on some floors, as long as one-third of any of the taller buildings was occupied by industrial uses.
Mr. Munro said the area had become a "poster child" for the region, showing how to preserve industrial zones while adding new work spaces.
He acknowledged the city needs to tread carefully in allowing new uses in the area so that the industry and eclectic mix are preserved.