Credited as one of the fathers of empiricism, Francis Bacon once said, "A prudent question is one-half of wisdom." Thus, rather than add to all the predictions and forecasts that are already out there, we're going to ask some pertinent questions instead.
At any given time, there are numerous storylines and subplots that are unfolding across British Columbia, whether pertaining to the housing crisis, the development industry, or the world of commercial real estate. So, in no particular order, and based in part on conversations with industry sources, here are 10 storylines — in the form of questions — that we will be following closely throughout 2025.
1. Will the Province close the reverse vesting order / share sale loop hole?
The use of reverse vesting orders — share sales — in insolvency proceedings took off in 2024. The tool was recognized by the courts as a legitimate method of maximizing creditor recovery, as it avoids the provincial property transfer tax (PTT). The problem is, however, the Province has a well-publicized budget deficit and this would be an easy way to claw some of it back.
2. Will the NDP-led government introduce more housing-focused legislation?
Most people we've spoken to in the industry have had more of an issue with the roll-out of the various pieces of legislation than their actual intent. There were too many pieces all up in the air at the same time, creating lots of uncertainty for local governments and thus developers (who hate nothing more than uncertainty). After only barely squeaking out a victory in October, however, Premier Eby said he has gotten the message.
3. Is anything going to happen with DCCs?
Despite the letter-writing campaign , the Metro Vancouver Regional District's DCC increases still came into effect on January 1, but there are two more increases set for 2026 and 2027. The MVRD says it is open to changes, while working on expanding waivers at the same time, but it remains to be seen whether we will see concrete changes. The same thing goes for DCCs collected on the municipal level, which typically see inflationary increases every year.
4. Will the Province refill the Rental Protection Fund's purse?
The Rental Protection Fund launched with $500 million in 2023 and has been steadily facilitating acquisitions the past two years. It has made the non-profit sector one of the biggest buyer segments in the province, and has inspired a federal version of the program as well. It has also, however, been criticized for funnelling taxpayer money towards aging properties that will not get any younger. During the election, Premier Eby promised to replenish the Fund. Given the aforementioned deficit, will that happen?
5. Will the Province amend the Real Estate Development Marketing Act (REDMA)?
Under REDMA, developers have to obtain their building permit within 12 months of launching sales, which typically entails hitting the presale target required by their lender. Average project sizes for concrete towers are trending up, while investors have been on the sidelines, resulting in projects facing the possibility of missing their 12-month deadline, which would force them to allow buyers to back out. To adjust, some developers are leaning on discounts so they can get to the construction phase, with the hope of making some of it back on the back end, but they would much prefer the Province make an adjustment.
6. What is going to happen with CURV?
Case in point for the above question is CURV, whose ambition as it relates to sustainability is only matched by its ambition as it relates to pricing. Presales for CURV launched in May 2023, but Brivia Group (with sales managed by BakerWest) was unable to hit their presale target. As we reported in December, a new disclosure statement was filed so they now have until May 2025, and a "guaranteed buyback program" is currently being offered.
7. Will Westbank continue to sell?
In 2024, Westbank sold partial or full stakes in the Deloitte Summit, The Pendrell, The Zephyr, and M2, among others. All of its sales were either office buildings or rental buildings. In 2025, Westbank is set to complete the M4 office building and Joyce II rental tower in Vancouver. What will they do?
8. What is going to happen with Burnaby Lake Village?
The master plan project was placed under creditor protection in late-November after numerous internal conflicts between Peterson Group and Create Properties forced the lenders to step in. The 19-acre property is now set to undergo a sales process and the idea of splitting the parcel up has also been raised. When all is said and done, who is going to walk away happy and what will the project look like?
9. Are developers ready to get back into buying land?
We still saw a decent amount of sizeable transactions last year, but only four of the top 10 involved developers buying land for residential development (and three were court-ordered sales). The bigger developers have plenty of land to keep themselves busy, but sooner or later they will have to get back to buying land. After a year of "price discovery" and interest rates now coming down, maybe it will be sooner rather than later.
10. When will investors return to the market?
Presale investors appear to still be on the sidelines as a result of market sentiment. According to developers who spoke at the Urban Development Institute's forecast event on January 23, institutional investment has also stalled as a result of the looming threat of tariffs. Both need to return, otherwise 2025 may start looking a lot like 2024.
Check back with us at the end of the year, when we will revisit these storylines and see how many of these questions were answered.
