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Vancouver’s Bayshore Hotel sold for redevelopment potential

Vancouver’s Bayshore Hotel sold for redevelopment potential
 

The Bayshore Inn in the 1960s.

VANCOUVER — The new owners of the Westin Bayshore Hotel will be in for a public fight if they expect to redevelop the site for more than the modest increases already allowed, according to the city's top planner.

Brian Jackson, the director of planning, said Friday he couldn't confirm that Concord Pacific Developments had bought the 2.4 hectare (six acre) site, which includes the elegant 510-room hotel and accompanying marina at 1601 Bayshore Drive. But he said any redevelopment is limited to two modest tower sites, and that he had warned all prospective buyers not to think they could fully redevelop the site and remove the hotel and convention centre. Any idea that the entire site could be converted to much higher density or heights, he said, would be met with "a very long and very contentious zoning process."

Jackson's comments come as Concord Pacific awaits the legal completion of a real estate deal it signed with the hotel's owners in early July. Concord Pacific won't confirm that it bought the complex, saying it was under a legal obligation not to comment on the proceedings. However, Bob Levine, a founding partner of Avison Young, which represented another interested buyer, confirmed the sale Friday.

 

Levine said he didn't know the final price but estimated it to be around $290 million. That is far more than what every other potential buyer thought the property was worth, he said, and indicates that Concord Pacific has hopes of developing it in the future.

Levine said based on the price Concord reportedly paid, the small amount of remaining development potential "is not what is driving that deal."

"No way. None of that makes any sense," he said. "I think what is driving the deal is a wish and a prayer that some time down the road the city will look at a new plan."

Levine said there were only a small handful of interested buyers but the price paid surprised them all.

"I wouldn't call it close," he said. "The bidders that were in it at the end — and I don't know how many there were, maybe three or four — were all way higher than what any of us thought the property was worth."

Jackson said the hotel had been on the market for up to a year, and drew interest from a handful of large development companies, many of whom appeared interested in whether the site could be redeveloped in its entirety. He said the city warned all comers.

"We were very clear that the redevelopment potential of that site is one rental tower and one additional hotel tower," Jackson said. "If they purchased it with the expectation that they could do more with it, that was not based on the advice they received from us."

Jackson said those inquiring also wanted to know whether heights and densities on the site could be increased and he warned them the city would oppose such ideas.

"Other developers came and spoke to us about whether it would be possible for complete redevelopment of the hotel . . . whether it was possible to redevelop the entire site and eliminate the hotel. We were very clear that it would not be our advice to recommend that," he said.

"They also talked to us about increasing height and density and we were very clear that we did not see any major redevelopment opportunity beyond what I've already mentioned. If anybody has any plan for redeveloping the site in a significant way going above and beyond what the existing zoning contemplates, it will be a very long and very contentious zoning process."

When the city rezoned the adjacent land for Bayshore Gardens development, a forest of 10 towers, it also allowed room for two modest buildings on the hotel site, an 18-storey hotel tower on the existing hotel's front courtyard and a 16-storey residential tower on the southwest corner behind the convention facilities. Those sites have yet to be developed and have some restrictions on them.

Ultimately, the city wants to make sure the hotel and convention services remain in the same size they now are, Jackson said.

Peter Webb, the senior vice-president of development for Concord Pacific, said in an email July 24 that he couldn't confirm the purchase.

"We were one of the original bidders for the site. We are under a legal obligation not to comment on these proceedings," he said.

The hotel sits at the entrance to Stanley Park and has long been a premier destination for the demi-royalty, from the International Olympic Committee during the Vancouver 2010 Winter Olympics to FIFA executives during the recent World Women's Cup. The original nine-storey main wing of the hotel also has some heritage potential.

"The hotel was reviewed as part of the recent landmarks study. The original section, completed in 1960, was identified as a candidate to be listed on the heritage register in the 'B' category. So we would ask any applicant to prepare a statement of significance about its heritage value," Jackson said.

The hotel became a centre of attention in March 1972, when reclusive U.S. billionaire Howard Hughes, who was on the run from U.S. tax authorities, phoned up the management and demanded the top four floors of the 20-storey tower on the property's northwest corner. When the hotel resisted, saying many of the rooms were rented, he threatened to buy the hotel outright. Management complied, and for the next four months Hughes made the penthouse his home. His staff occupied the other three floors.

The hotel was refurbished in 2000 for $51 million. It last traded hands in 2013 when Starwood Capital and investors from the Middle East bought it as part of a $765 million deal involving five Westin hotels, including hotels in Ottawa, Toronto, Calgary and Edmonton. The Westin Bayshore was valued in the deal at $150 million, or $295,000 per room, according to a 2014 report by Colliers International Hotels. When it was last sold in 2005, it was valued at $120 million




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