Developer, province agree to speed up construction on Little Mountain housing after 'abhorrent' deal exposed

After more than a decade of the property sitting empty, the province, the city and a developer have made a formal agreement to accelerate construction on hundreds of units of social housing on the Little Mountain lands in Vancouver.

The agreement is a commitment by all three groups to speed up construction on non-market housing that was originally promised years ago, with a new deadline to finish the homes no later than Dec. 31, 2024.

"Enough is enough with the Little Mountain tragedy that was orchestrated by the previous government that resulted in a low-income community bulldozed, an interest-free loan of hundreds of millions of dollars and a massive empty lot growing weeds in the middle of a housing crisis," Housing Minister David Eby wrote in a statement Friday.

The move comes days after CBC News revealed the original contract to sell the land to the developer, Holborn Properties, included a $211-million, interest-free loan on an 18-year term at the time of the sale in 2008.

The contract also lacked a timeline or specific details as to when the developer would need to finish hundreds of social housing units it originally promised for the site. 

After the sale, hundreds of existing units on the site were demolished. Around 700 people lost their homes. 

The site remained mostly empty since, surrounded by fencing and overgrown with grass as the city's housing crisis deepened.

Politicians and housing advocates have called for an inquiry into why it was left largely vacant for so long.

Vancouver Coun. Christine Boyle described the sale as either an intentional "sweetheart deal" for the developer or "gross incompetence" on the part of the province. Former resident Ingrid Steenhuisen called it an "abhorrent abomination of how to not do things."

'Planning group' to chaperone progress

The Little Mountain lands sit between Queen Elizabeth Park and Main Street, just south of Nat Bailey Stadium. The six-hectare site was once home to 224 units of social housing, which existed from the 1950s until the land sale in 2008.

The sale price was $334 million. To date, the province said, Holborn has only made its $35-million down payment.

After subtracting that payment, as well as an $88-million credit provided for social housing, the developer still owes the province $211 million.

At the time of the sale, Holborn pledged to build 1,400 market value homes and 234 units of social housing. Only 53 of the replacement social housing units have been completed to date.

"I know the community wants this housing built yesterday," said Eby.

"I hope this announcement gives hope to Little Mountain neighbours ... you were treated unjustly, but hopefully we're turning a corner today."

As part of the memorandum of understanding (MOU) announced Friday, a "planning group" is being established to keep track of progress on the social housing construction and deal with any issues that might slow it down. The province's statement said the group "will meet regularly" with representatives from the developer and both governments.

The MOU did not include a timeline for the market value homes to be finished or for the province's loan to be repaid.

"Our focus is on getting the affordable housing open as quickly as possible," Eby said.

CBC News obtained the purchase and sale agreement between the province and Holborn in late August after protracted efforts through freedom of information processes. Holborn had planned to fight the release in court, but abandoned that effort.

MOU's are generally not legally binding and this one, Eby said, is not enforceable due to the original sale contract.

The minister said it is a good faith effort by all three parties — the province, the city and Holborn — to show they're agreed on how to move forward.

If Holborn doesn't honour the terms, Eby said, "it will just result in more bad press for them."

Read the purchase and sale agreement between the B.C. government and Holborn Properties: