Central City Foundation

Central City Foundation

December 03, 2013 10:38 ET

Rising Real Estate Prices Are Squeezing Vancouver Non-Profits and the People They Help, Says Report from Central City Foundation

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec. 3, 2013) - A community report from Central City Foundation shows how Vancouver's skyrocketing real estate prices are having major implications for non-profit organizations and the lives of people in the inner city they serve. Unaffordable Spaces: How rising real estate prices are squeezing non-profit organizations and the people they help is the result of research and interviews by Central City Foundation that presents a picture of how and where organizations operate in this market, and how they are responding to the changing needs they are seeing from the neighbours they serve.

"We work with dozens of non-profit organizations in the inner city and beyond, and we are in a unique position to explore how non-profit organizations have been forced to adapt to real estate costs that are rising beyond affordability," says Jennifer Johnstone, President and CEO of Central City Foundation (CCF). "We found that rising prices has forced non-profits to get creative about space, reduce or adapt programs, prevents them from expanding and leaves many organizations worrying about their vulnerability to market rents."

For this community report, CCF reviewed management and financial information about 52 community partners who applied for grants from Central City Foundation over the past five years or who are tenants in subsidized space in the buildings CCF owns. Detailed interviews were then held with 29 Vancouver organizations as a purposive sample. Illustrated throughout Unaffordable Spaces are examples of how organizations are forced to deal with unaffordable real estate prices. The full report can be downloaded at http://www.centralcityfoundation.ca.

Not enough room

The report notes that most non-profit organizations don't have enough room for office and program spaces. In recent years, a majority noted an increase in occupancy expenses, forcing them to reduce services and program locations. Facilities used by organizations are older and in need of renovations and upgrades, but there is little revenue to meet this need. Many social enterprises are unable to expand their businesses because they do not have the appropriate space or location.

Owning or leasing from mission-based organizations means security of space

Most non-profit organizations rent one or more of their spaces and more than half of those pay worrisome market rental rates. But those organizations that operate in social purpose real estate, where property or facilities are owned and operated by mission-based and not-for-profit organizations or investors for the purpose of community benefit and to achieve blended value returns, do feel secure about their facilities.

"Central City Foundation is a leader in Canada in social purpose real estate, and our unique model - where we invest our capital in buildings and facilities that provide low income housing and space for community organizations that are improving lives - is working," adds Johnstone. "With real estate unaffordability unlikely to change, social purpose real estate stands as an exemplary model that offers solutions that can help us build a community of hope to help our neighbours in need."

Creative solutions to space crunch

Unaffordable Spaces also notes that more than three quarters of the organizations share space with other non-profits or enter partnerships to acquire program space. Some transform their current facility into a multi-purpose space. And many are forced to rely on temporary structures to relieve their space crunch. More than a third of organizations are challenged to acquire space that is appropriate and affordable in the communities where they need the space.

Increased pressure to fundraise

Nearly two-thirds of organizations report feeling an increasing pressure to fundraise in order to manage occupancy and operational costs. Many of the organizations resort to paying their staff lower salaries or reducing staff to make ends meet.

Housing insecurity affects individuals and organizations serving the community

Unsafe housing or accommodations in poor condition has led to a growing need for support services from non-profit organizations for inner city residents. Such a large portion of an individual's budget has to go towards housing that food budgets suffer, which has led to a greater need for food security programs and other community supports. Some non-profit organizations that do not operate housing are even looking to expand into offering accommodation to help their clients.

"It is our hope that this community report sparks increased dialogue about how all of us - funders, government, non-profits, donors and all neighbours - can address these issues of unaffordable spaces," says Johnstone. "We need to work together to build a community in which people are safe, fed and adequately sheltered, well-educated, employed, healthy and empowered to participate in the decisions that affect their lives."

About Central City Foundation:

Central City Foundation has been bringing neighbours together to build hope in the inner city since 1907. By building housing and other capital projects, investing in social enterprises that create jobs and opportunities as well as funding hundreds of non-profit organizations, Central City Foundation has provided help and hope to the most vulnerable people in our inner city community for 106 years.

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