British Columbia

B.C. Housing followed rules in buying 9 hotels, auditor general report finds

The province initially took over the properties — five in Vancouver and four in Victoria — for use as temporary housing when it closed tent encampments to prevent the spread of COVID-19, before purchasing them in 2020 and 2021. 

Housing agency spent $221 million in public funds to create 810 shelter spaces

The B.C. government purchased the Patricia Hotel on East Hastings St. in Vancouver in 2021 as part of a plan to house homeless people living during the COVID-19 pandemic. (Google Streetview)

A report by the auditor general of B.C. has found that B.C. Housing did its due diligence in purchasing nine hotels in Vancouver and Victoria to provide housing for people experiencing homelessness during the pandemic.

The province initially took over the properties — five in Vancouver and four in Victoria — for use as temporary housing, when it closed tent encampments at Vancouver's Oppenheimer park and Victoria's Topaz Park and Pandora Avenue to prevent the spread of COVID-19, before purchasing them in 2020 and 2021. 

The report was commissioned by the provincial government to ensure the housing agency acted responsibly in buying the properties for $221 million with public funds.

That amount was below the total market value of the nine properties, according to the audit. It also fell within the budget approved by the B.C. government for property acquisitions in 2020 and 2021. 

Tent encampments in Vancouver's Oppenheimer Park, pictured here, were dismantled in spring 2020 to prevent the spread of COVID-19. (Ben Nelms/CBC)

"These purchases were challenging due to the nature of the pandemic and tight time frame," Auditor General Michael Pickup said in a news release. 

"Our audit found that all of the approval requirements were met and certified, independent appraisals were received."

It also found B.C. Housing did due diligence reviews of potential physical and legal risks from the purchases.

Hundreds housed in hotels

Hundreds of people living in encampments were housed in the hotels starting in April 2020 when the province enacted a public safety order to move homeless people living in tent city encampments into hotels in Vancouver and Victoria.

After initially taking over the spaces, the province moved to purchase the hotels — an acquisition that the B.C. Non-Profit Housing Association had recommended in order to create more long-term shelter spaces while land values were lower due to the pandemic.

B.C. Housing purchased the Howard Johnson Hotel in Vancouver for $56.6 million. (CBC)

Four of the hotels — with 399 shelter spaces in total — were bought in 2020 for $110 million.

The five remaining hotels — with 411 spaces — were purchased in 2021 for $111 million. 

The biggest purchases were of the Patricia Hotel on East Hastings and the Howard Johnson on Granville St., both in Vancouver, for $64.4 million and $56.6 million respectively.

Because those buildings exceeded $35 million in cost, their purchase had to be approved by B.C. Housing's board of commissioners.

According to the auditor's report, B.C. Housing intends "to redevelop many of the properties for permanent, affordable, and supportive housing."

The purchase of the hotels marked a significant jump in B.C. Housing's property acquisition budget. Between 2020 and 2021, it spent $403 million acquiring over 50 properties; the nine hotels made up more than half of that total budget.

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