Federal crown corporation to sell stake in Indigenous-led housing project in Vancouver

A key partner — perhaps the most important to date — in some of Canada’s largest Indigenous-led off-reserve housing developments will sell its stake in a significant Vancouver project.

Canada Lands Company (CLC), a federal crown corporation, has played an instrumental role in MST Partnership’s early acquisitions of large properties with significant redevelopment potential and long-term revenue prospects.

MST Partnership, also known as MST Development Corporation, is a for-profit real estate development company wholly owned by the Musqueam, Squamish, and Tsleil-Waututh First Nations.

In October 2014, CLC and MST entered a joint partnership to acquire the 21-acre former BC RCMP headquarters campus, now referred to as the Heather Lands, located within the Cambie Corridor just west of Queen Elizabeth Park, and the 52-acre eastern portion of the 90-acre Jericho Lands, previously the Jericho Garrison, in West Point Grey.

Including the separate acquisition of the 38-acre western portion of the Jericho Lands previously owned by the provincial government, the combined total acquisition value of the entirety of the Heather Lands and Jericho Lands about a decade ago was about $720 million.

And now, just over 10 years after the historic acquisition, CLC will be selling its significant stake in the Heather Lands to MST Partnership in two waves. This is expected to occur upon the first enactment of the rezoning, which is expected to occur before the end of this year.

This means the three First Nations will own 100% of the Heather Lands project, where about 2,600 homes will be built, including 1,672 leasehold strata homes, 540 social housing units, 300 secured purpose-built market rental homes, 100 secured purpose-built moderate income rental homes, and retail village co-located with a First Nations cultural centre.

The project’s policy statement was approved by Vancouver City Council in May 2018, and the rezoning application was subsequently approved in a public hearing in June 2022, with the rezoning expected to be enacted before the end of 2024 upon meeting the conditions of the rezoning approval.

And now, development permit applications have just been submitted for two major parcels at the southeast corner of the Heather Lands. Both parcels represent about 37% of the Heather Lands’ permitted floor area of 2.63 million sq ft, and 49% of about 2,600 homes permitted for the entire multi-phased project.

Earlier this year, site preparation and demolition of the former police headquarters buildings began across the site in advance of major construction activities, which are scheduled to begin in 2025.

“The parties have entered into an agreement where Canada Lands Company will sell its interest in the Heather Lands to the MST Nations upon enactment of rezoning for each of two portions of the site. It is anticipated that the first enactment will take place in late 2024, triggering the subdivision and sale of the southern portion of the site,” reads a statement to Daily Hive Urbanized.

Furthermore, MST Partnership has entered into an agreement with Aquilini Development to be the development partner for the building permitting and construction processes of the Heather Lands, with this new partnership now called “MSTA.”

Aquilini Development, owned by the same family that owns the NHL Vancouver Canucks, is also a key partner with MST Partnership on the future 10-acre redevelopment of the former BC Liquor warehouse site next to SkyTrain Rupert Station, where the First Nations are proposing to build Vancouver’s new tallest buildings, and the 40-acre redevelopment of the Willingdon Lands, located just west of the BCIT Burnaby campus.

Whether it be the Heather Lands or Jericho Lands, MST’s general strategy for their projects built on freehold titled land is to sell any strata ownership opportunities as leasehold, not freehold, to enable the First Nations to own the land forever.

“The MST Nations and Aquilini will be selling 99-year pre-paid leasehold interest to end users of the lands. The MST Nations will continue to own the freehold interest in the lands in perpetuity. Following each enactment, MSTA will assume project management responsibility for the permitting and construction phases of that portion of the site,” continues the statement.

In September 2024, the provincial government announced the entire leasehold strata housing component of the Heather Lands will fall under the brand new Attainable Housing Initiative (AHI), which provides first-time homebuyers with the opportunity to buy a leasehold unit at an initial 40% below market value.

This program is specifically intended for middle-income households, with the homebuyers covering 40% of the initial cost and the provincial government covering 60%. Moreover, a buyer under the AHI only needs to provide an initial 5% deposit at pre-sale on 60% of the initial market purchase price.

For example, based on the 60-40 financing formula, a studio-sized leasehold unit with a market price of $620,000 will have an initial price of $372,000 for the homebuyer, with the provincial government initially covering $248,000. With a two-bedroom unit carrying a market price of $1.3 million, the buyer will cover $780,000 and the government with $520,000.

The 40% contribution is repaid by the homeowner when the unit is sold or after 25 years from the purchase date, whichever comes first. The provincial government will provide up to $672 million in repayable financing for the Heather Lands’ AHI.

In a previous interview with Daily Hive Urbanized, federal Minister of Public Services and Procurement Jean-Yves Duclos described CLC’s involvement in MST Partnership’s major projects as a groundbreaking model for federal collaboration with Indigenous groups, helping to advance economic reconciliation to not only rebuild but bring prosperity to Indigenous communities.

“The idea of using this as a motivation for reconciliation and affirmation of the rights of Indigenous peoples in the area, I think is fundamentally strong and encouraging for other places in Canada,” Duclos told Daily Hive Urbanized.

The Heather Lands project began as a 50-50 partnership between MST Partnership and CLC. But Duclos adds that over time, it was always the intention to have CLC’s involvement wind down.

“As MST will be able to gather strength from this project, it will be able to own the whole project and then leverage this opportunity to be demonstrating even greater leadership in other areas in the city and in the province,” said Duclos.

“I think we are ahead of the curve here in the vision of what we can do when Indigenous people are given the opportunity to build on lands, which we know have been used for other purposes in previous generations, and in an environment which is beautiful and central to the city, connected to public transit, and to be developed in a very modern way, protecting the environment.”

Dennis Thomas, a member and an elected councillor of the Tsleil-Waututh Nation and a former liaison for MST Partnership, says their close relationship with CLC has achieved just that.

Not only did CLC provide financing, but they also provided the First Nations with immense experience in handling and developing real estate assets.

“It is a beautiful thing as we try to rebuild our Indigenous economies, while acquiring our land and then for the future development of Vancouverites, but also long-term revenue generation for our three communities, and also just building professional Indigenous real estate peoples through new education models and pathways. This is really the future of all of our projects,” Thomas previously told Daily Hive Urbanized.

To date, it is publicly known that MST Partnership owns a total of six properties in Metro Vancouver for redevelopment purposes, including the Heather Lands, Jericho Lands, Willingdon Lands, former BC Liquor site, and a former Department of Fisheries and Oceans property in West Vancouver.

Thomas says they have “many decades of development” ahead with all of these acquired properties.

“The amount of growth and potential within our three communities, while supporting other urban Indigenous peoples and creating like-minded partnerships that share the same values of the three nations, will be very foundational and as we grow our Indigenous economy with these development parcels that we have,” added Thomas.

“I raise my hands to CLC for coming along with us in this reconciliation journey, seeing our Indigenous value system being imprinted in some of the things that how they speak and talk, and how they kind of view development projects now.”

Such a model with other Indigenous communities could potentially be replicated elsewhere in Canada, emphasized Duclos.

In November 2023, Duclos announced an initial federal strategy to build 29,200 homes on federal properties across Canada by 2029, which includes the 2,600 homes of the Heather Lands.

Then in August 2024, Duclos joined federal Minister of Housing Sean Fraser to announce a substantially expanded strategy, called the “Public Land for Homes Plan,” which aims to build 250,000 new homes on federal lands by 2031. This exponentially more ambitious strategy also includes the creation of the “Canada Public Land Bank,” which is a new interactive online tool that identifies federal properties that are suitable for residential uses through redevelopment.

At least for the time being, CLC still has a stake in the far larger Jericho Lands development site, which is by far the largest redevelopment asset held by the MST Partnership.

In January 2024, Vancouver City Council approved the policy statement to guide the Jericho Lands’ forthcoming rezoning application. A rezoning application has yet to be submitted.

As outlined in the policy statement, the plans for the Jericho Lands are far more ambitious, with about 13.5 million sq ft of residential floor area for about 13,000 homes accommodating up to 24,000 residents, with strata leasehold homes being the primary use, followed by secured purpose-built rental housing and social housing. There will also be 750,000 sq ft of office, hotel, retail, restaurant, and institutional uses. Dozens of high-rise towers up to 49 storeys are envisioned.

But these very significant uses planned for the Jericho Lands are entirely dependent on the completion of SkyTrain Millennium Line’s westward extension from the 2027-built terminus of Arbutus Station to the University of British Columbia’s (UBC) campus. Without this SkyTrain extension to help handle the expected transportation demand, it could force a revision of the policy statement to decrease the project’s scope.

The UBC SkyTrain extension would serve the Jericho Lands with two stations. This includes an on-site subway station within the western half of the Jericho Lands, and the off-site Alma Street Station (at the intersection with West Broadway), which would be particularly close to the areas within the eastern half of the site.

Earlier this year, the provincial government told Daily Hive Urbanized the next key step toward advancing the UBC SkyTrain extension is the completion of the business case at a cost of about $40 million, with the federal government covering $14 million. This includes performing geotechnical testing — such as borehole drilling to obtain soil condition samples for analysis — to support the project’s detailed design.

In the 2024 provincial election campaign, the BC NDP included completing the UBC SkyTrain extension as a platform promise.

As for what makes the Heather Lands a transit-oriented development, the new neighbourhood’s southeast corner (the first phase) is about a 10-minute walk from SkyTrain Oakridge-41st Avenue Station — which is currently undergoing a major expansion to increase its capacity — and the Cambie Street stops for the R4 41st Avenue RapidBus. This walking time grows to over 15 minutes for the northern areas of the Heather Lands fronting West 33rd Avenue.

When SkyTrain Canada Line was built, it was designed and engineered in a way to enable the construction of four future additional infill stations — two additional subway stations at West 33rd Avenue (Queen Elizabeth Park) and West 57th Avenue in Vancouver, and two additional elevated stations at Capstan Way (Capstan Station), which is now finally reaching completion and set to open soon, and at Vancouver International Airport.

An additional Canada Line station at West 33rd Avenue would more directly serve the Heather Lands, adjacent development sites, BC Children’s Hospital, and Queen Elizabeth Park very well. But future stations, especially those that are underground, appear increasingly highly unlikely due to the extensive delays, challenges, and service disruptions of achieving the far simpler elevated station of Capstan Station.

The cost of West 33rd Avenue Station would likely be a major obstacle as well. For example, a 2014 preliminary cost estimate by TransLink pegged the construction cost of the underground West 57th Avenue Station at $90 million, which would support the high-density residential developments of Pearson Dogwood and Langara Gardens.

Under rezoning requirements, Onni Group has set aside $20 million toward the cost of potentially building West 57th Avenue at some point in the future. For Capstan Station, which had a $52 million budget when construction first began in September 2021, the City of Richmond provided $32 million — collected from area developers over the span of about a decade — and TransLink covered $20 million.

But with the steep cost inflationary trend seen over the past decade, especially since the pandemic, the real cost today for West 57th Avenue is likely exponentially higher than $90 million. Moreover, TransLink estimated the construction timeline may take at least 10 years to ensure disruptions to passengers on one of the busiest segments of the Canada Line are kept at a relative minimum. The costs and challenges for West 33rd Avenue Station are likely similar.

When asked whether West 33rd Avenue Station should have been constructed from the get-go in the 2000s during the Canada Line’s construction, Taleeb Noormohamed, the federal MP for Vancouver-Granville, suggested its existence would be ideal, but also noted that the Heather Lands are within relatively close walking proximity to Oakridge-41st Avenue Station.

“If we could go back and do things differently… [but] I think you’ve got pretty good proximity here to Oakridge station, and to be able to get people there within under 10 minutes, I think is great,” Noormohamed told Daily Hive Urbanized.

“I think that we should be looking at every opportunity available and that’s obviously the purview of the provincial government. Every opportunity available to increase accessibility for people, particularly where we’re densifying and how important it is for transit to be part of the greening of the city, is critical.”

CLC is best known for operating the federally owned attractions of Toronto’s CN Tower, Toronto’s Downsview Park, and Montreal’s vibrant cultural and event-friendly downtown waterfront — the Old Port of Montreal and Montreal Science Centre. But they are also an emerging major real estate player, tasked with maximizing the value of under-utilized federal properties.

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