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Realtor Peter Saito stands in front of a heritage house in Vancouver, B.C., on August 24, 2015. Mr. Saito is against a call for a moratorium on demolishing heritage homes saying it devalues the house.Jimmy Jeong/The Globe and Mail

Real estate agent Peter Saito has a problem with the city's proposed ban on the demolition of Vancouver's oldest, most prized collection of heritage houses.

The old Shaughnessy estate houses, he says, aren't worth saving. They just don't bring in the money. As is, they're too small. Mr. Saito says he and his agent partner have sold about $100-million in Shaughnessy property in the past year and a half. But he says home values will drop with a new zoning amendment that would turn First Shaughnessy into Vancouver's first heritage conservation district.

Incredibly, while there are 70 heritage districts throughout the province, Vancouver has none.

"The houses are 5,000 square feet on a 20,000 square foot lot. It's not efficient any more," Mr. Saito says. "Those old houses are half the size of the new houses."

Wealthy people want big houses, not heritage houses, he says.

"If you worked hard all your life and you succeed, and if you want to feel like you made it, you buy a big house."

Heritage advocates would argue that New York wouldn't be New York without its brownstones. San Francisco wouldn't be famous if it weren't for the rows of Victorians lining its hilly streets. And then there are the European cities, where houses are 700 years old. Heritage conservation has kept those structures still standing. A city's character depends on it.

In Vancouver, demolitions have become a fact of life, about 40 per cent of them were houses built prior to 1940. Our best examples of heritage are the remaining 317 stately pre-1940 mansions located in First Shaughnessy, between West 16th and King Edward avenues and Arbutus and Oak streets. Of those 317 homes, only 11 are protected from demolition. The rest are demo bait.

Concerned with the rampant demolition of what remains of Vancouver's best heritage stock, under the recommendation of planning director Brian Jackson, the city put a temporary one-year moratorium on demolitions of those particular houses last year. The moratorium was extended for 120 days on June 15, and the decision to make it permanent goes before council on Sept. 15.

The neighbourhood would become Vancouver's first heritage conservation district. If passed, it would offer the ultimate protection to all pre-1940 houses, which were built with the best craftsmanship and materials that money could buy, circa 1907.

Importantly, the city is offering Shaughnessy homeowners something in return: the opportunity to add infill, coach houses, secondary suites and multiple conversions.

But several homeowners who spoke at a city council hearing on July 28 said they didn't want density. They wanted privacy.

Rich people today care more about space – and they want lots of it, according to Mr. Saito, who also spoke at the hearing. As an agent, Mr. Saito thinks in numbers – specifically price per square foot. With the moratorium, the returns are ridiculously low, he argued.

"This is discrimination against the rich," he said later in an interview. "Guess what? The rich are not stupid. If they feel discriminated against, they will look to the Canadian Charter of Rights. They'll say, 'I don't want density because I don't want to turn my lovely Shaughnessy neighbourhood into Kitsilano No. 2,'" says Mr. Saito, who lives in Kerrisdale.

"I am looking at a massive court case down the road, at a lot of homeowners with very deep pockets hiring good lawyers to fight the city.

"I'm just a lowly realtor. I don't make that much money. But let's say it's a plumber on the east side that barely has enough sustenance for his family of five or six. His property taxes will go up to reimburse all those people living in Shaughnessy."

Mr. Saito isn't the only one fearing lost property values. At the hearing, several people with vested interests in redeveloping First Shaughnessy stood to complain about how the homes were falling apart and had outlived their use. A woman named Pearl Chow said if people wanted the houses preserved, they would last longer if they were completely rebuilt and made new – an argument that defies the point of heritage conservation.

Judging by the response to the city, including letters sent, the majority of Vancouverites do want the old houses preserved.

The ones against it, however, are a vocal group.

The pro-moratorium side did have defenders at the hearing.

"Nobody is holding a gun to your head to live in a historical neighbourhood," Robert McNutt said in his speech to council. Mr. McNutt works in the antiques industry. He advised people who want massive new houses to go to West Vancouver, where subdivisions are being developed.

It's a reasonable point. As well, there isn't overwhelming evidence that a heritage designation significantly impacts a property's value. A Coriolis consulting report commissioned by the city concluded that there would be an insignificant drop in value due to the new zoning – a change of plus or minus five per cent, depending on how the market reacts. That's hardly significant when you consider that this year alone has seen a 20 per cent increase in Vancouver property values. No homeowner could have expected that kind of windfall.

The report also concluded that the conservation of First Shaughnessy could simply create a new buyer for the neighbourhood, one who is willing to pay for the benefit of a steady revenue stream from on-site rental units.

"If there are enough of this type of buyer they will set the market price at a level that reflects the benefit of the extra units," the report says.

I point out to Mr. Saito that the Rosemary mansion – purchased by a man from China last year, who is painstakingly restoring it – clearly illustrates that not every rich person is interested in a new house.

"The Rosemary is the perfect example," he said. "The future office for the planning department should move in there. I bet you in five years they tear it down themselves, because it's not efficient.

"I do have another listing that the city might want to pick up," he added. "It's cheap – 20,000 square feet. at 1453 Laurier. It is on the market for $7.398-million. It can't be torn down, so nobody dares touch it. It's been on the market for three weeks."

The 1912 house, recently renovated, is described in the listing as in excellent condition.

Mr. Saito explained that rich people like Shaughnessy because of its brand more than the actual houses. It's about status, as well as the sizable lots.

"They don't buy in Shaughnessy because the houses are old, but because there are big lots. There's a prestige value attached to that. And the environment is different. You drive down a street in Shaughnessy and it's different from the street in Kitsilano."

For Mr. Saito, Kitsilano is a lost cause from over crowding – the opposite of prestige.

Long-time heritage advocate Anthony Norfolk sat next to me at the city council hearing.

"The Shaughnessy brand is what they're selling," he told me. "But they are then setting out to destroy what the brand consists of."

Mr. Saito says he's only looking out for his rich clients' best interests. And he has his own proof that prices are already dropping. He cited the example of 1338 Matthews. That house, on an 18,500-square-foot lot, sold for $7.38-million. The house is protected by the moratorium, at least for now. It took two months to sell the house, and the new owner is hoping the moratorium ends so that they can rebuild, he says.

The new owners "rented it out for cheap," instead of living there, Mr. Saito says. His tone of voice makes the house sound like a dump.

He compares it to 1341 Matthews, a 1958 house built on a 14,000-square-foot lot. That one is not protected, and it sold for $7.2-million. Mr. Saito marketed the house based on the fact that it was one of the few in First Shaughnessy that could be torn down.

Based on square footage, the protected house should have sold for more, Mr. Saito says.

In the First Shaughnessy case, heritage conservation intersects with the city's critical need for rental stock. It also poses a big picture question for the city. Is it government's role to protect a homeowner's equity? Or is it the duty of government to consider the community good above all else – benefits such as heritage preservation, walkable communities and more rentals?

Allowing the destruction of an old house to build a new, bigger house that won't shelter any more people is counter to everything the city needs, says University of British Columbia professor Penny Gurstein, director of the School of Community and Regional Planning.

"I think it is a good move," she says of the moratorium. "But I'm sure what will happen is [the opposition] will get lawyers involved. These people have their minds made up."

By maintaining the character and also allowing coach houses and basement suites, the Shaughnessy moratorium would be a move toward the greater good, rather than the interests of a few. Added density is not even new to Shaughnessy. In the 1950s, many of the big houses were carved up into rental suites, religious retreats and retirement homes. The historic neighbourhood already has had a Kitsilano moment.

If the rest of the city is learning to accommodate more density, what makes Shaughnessy exempt? It simply doesn't make sense that one of the most central neighbourhoods in Vancouver should be allowed to maintain such ridiculously low density. Mr. Saito may cite Kitsilano as a ghetto for the masses, but its RT-2 zoning has made it one of the most walkable and livable neighbourhoods we have, Ms. Gurstein says.

"If you look at the population [in Shaughnessy], and how many people are actually living in these houses, it's probably shocking," she says. "That is some of the most prime property in the city and the density is incredibly low. That is a problem."