Kerkhoff Construction is proposing to build a comprehensive apartment complex at the north end of Paddle Road. (Graphic courtesy of North Cowichan)

Kerkhoff Construction is proposing to build a comprehensive apartment complex at the north end of Paddle Road. (Graphic courtesy of North Cowichan)

2 large apartment complexes proposed in North Cowichan

But some councillors take issue with lack of affordable housing and public amenities

Two proposed housing projects in the Paddle Road and Drinkwater Road areas would see seven multi-storey apartment buildings constructed, plus a number of townhouses and duplexes, that would provide up to 628 housing units.

North Cowichan council gave the second reading for both proposals at a recent meeting and now the projects will go to public hearings, at times yet to be announced, before council considers giving the green light to proceed with construction.

The first project that is being proposed by developer Kerkhoff Construction would be built on 5.4 acres of land at the north end of Paddle Road and would include four apartment buildings, three of which would be six storeys while the fourth one would be five storeys, for a total of 358 apartment units.

Kerkhoff Construction’s proposal also calls for eight townhouses and five duplexes with 10 housing units in them.

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Woodsmere Holdings is also proposing another comprehensive residential development on 3.94 acres of land on the corner of Drinkwater Road and Ford Road, just a short distance away from the first proposal.

This project would see three apartment buildings, one of which would be five storeys and two would be four storeys and, altogether, 262 new apartment units would be constructed, with approximately 135 of them dedicated to rental housing.

Spokesmen from both development companies made presentations at the council meeting explaining the difficult economic conditions they are currently working under in the construction industry.

Bruno Jury, the director of development manager for Kerkhoff Construction, said the industry is under a lot of pressure and it’s hard to make the project work when the municipality is asking the company to revisit its proposals for affordability in regards to amenities and the affordable housing components that are being asked for.

He said construction costs have continued to increase at a rate of 2.5 per cent a month, which is unprecedented in the construction industry.

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“On top of that, interest rates have been increasing significantly over the last few months,” he said.

“When we started preparing for this project, interest rates were three to four per cent and now we’re looking at eight per cent for construction loans. We’re in a position where the revenue side has come down and costs are still increasing. It won’t be this way forever, but that’s the current situation so all that puts us under a lot of pressure.”

But Jury said the company thinks it has come with a good formula for its Paddle Road project.

“We’re prepared to offer 10 per cent of our units to be affordable rentals that will be offered at below market prices,” he said.

“This is a difficult point for us because anything beyond that would be hard for us to meet.”

Coun. Christopher Justice said his gut is telling him that despite the region’s need for more housing, the community is not getting an adequate deal from both proposals.

“My sense is that not enough of the enhanced land value that would be released by the rezoning would be used for the benefit of the public, including affordable housing and some of our climate initiatives,” he said.

“I’m willing to be educated but from what I’ve gleaned so far, I’m going to have a hard time supporting these proposals.”

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Coun. Rob Douglas said after the proponents had presented extensive financial information and anticipated profit margins to council that he finds it hard to take some of the numbers seriously.

“We don’t have any relationships with these individuals,” he said.

“We’ve met them twice on a screen and suddenly we’re just thrown slides with a bunch of numbers on them and we’re supposed to take them at their word when we’ve had no prior relationship with them. In the future, I’d prefer that these types of applications have someone independent come in and look at some of the numbers.”

Douglas also said he had a call from Shelley Cook, executive director of the Cowichan Housing Society, who expressed concerns with both proposals.

He said Cook couldn’t attend the meeting.

“She’s concerned about some of the square footage aspects of the Paddle Road proposals and the fact that the Drinkwater Road proposal doesn’t include a commitment for affordable housing,” Douglas said.

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Coun. Tek Manhas took issue with Douglas saying the municipality has no previous relationships with the proponents and he doesn’t trust their financial numbers.

“Any investment in North Cowichan would be forever gone if companies had to submit proprietary financial information that could be shared with competitors,” he said.

“The proponents added changes that were required by council and they did that in good faith. I think it’s pretty cheesy of us to go back to them and say now we want more. If we keep this up, we’re going to end investment in our community forever.”

Manhas added that the proposals meet the municipality’s rental needs and complies with the current official community plan so he sees no reason why they shouldn’t go to a public hearing.

Council voted unanimously for the Paddle Road project to go to a public hearing and voted 5-2, with Douglas and Justice opposed, for the Drinkwater project to go to a public hearing.



robert.barron@cowichanvalleycitizen.com

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