Vancouver city council voted Tuesday to limit residential development in the downtown core. (Mike Laanela/CBC)

The City of Vancouver has voted to limit residential property development in the downtown core in order to allow more office space, reversing a policy that transformed the number of people living downtown over the past decade.

Council voted on Tuesday night to limit residential development within 17 square blocks of what is considered the central business district, centred around the intersection of Burrard Street and West Georgia Street. City staff said there will still be some mixed-use development allowed in about one-third of the space.

The move counters what has been called the livable city model developed by city planners over the past decade to encourage residential condominium construction inside the business district, a model of development that was copied by other cities around the world.

Coun. Raymond Louie said the regulations affect only about 15 per cent of the downtown peninsula and shouldn't change the feeling of life on streets downtown.

"What we've done is stabilize the speculation or reduce the speculation in the central business district, so that office space can be more affordable, because we do need to have a good mix of jobs and people living in the downtown core rather than just having people living or working in the area," said Louie.

Coun. Geoff Meggs said there is no longer a balance between residential and office development.

"We need to ensure that there is space and opportunity for economic activity, whether it is industrial, commercial or retail, [or] any of the other thing that have been set out … and I think it's very important in a period when we see such fundamental changes in the economy," said Meggs.

Over the past year, several high-profile developments that combined residential and commercial space in the downtown core, such as the Ritz-Carlton project, have been cancelled as a result of the global economic downturn.

But architect and developer Michael Geller, who ran against Meggs in the last municipal election, said the city should continue to allow mixed use in the downtown core by promoting options such as building residential units on top of businesses.

"We do have enough capacity in the downtown to anticipate all of the office growth and desired office growth in the next 15 to 20 years, and I still feel there's room for some housing as well to go along with it, to continue the tradition of Vancouver as a vibrant livable city," said Geller.