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Proposed spot zoning could have negative consequences, critics say

RMOW initiative seeks to tie zoning to key F&B establishments
n-patios - COAST
A Resort Municipality of Whistler proposal to lock key F&B locations down through spot zoning is meeting with stiff opposition from critics. coastphotoimages.com

A Resort Municipality of Whistler (RMOW) initiative to lock key food and beverage establishments into their current zoning is an attempt to address a problem that doesn’t exist, according to three letter writers to council—and one that could have negative consequences in an uncertain time.

The proposal was tacked onto a June 9 report looking at allowing business owners to temporarily extend their patios in light of COVID-19 restrictions (see Pique, June 11: “Whistler council passes temporary patio bylaws”).

Its recommendations stem from a report by Thomas Consultants, completed in 2010, which suggested using spot zoning to protect 40 restaurant locations deemed to be important to vibrancy in the village.

Since then, five of the identified locations have been fully or partially converted while two others sit vacant.

On June 9, council authorized staff to begin preparing new zoning and land-use contract bylaws that would prohibit the remaining key food and beverage locations from changing uses.

“I think they’re making quite a big mistake that would have repercussions for Whistler,” said longtime local developer Steve Bayly, one of the letter writers.

“I think the main danger is, at a time when we’re going to need investment and financial backing and everything, you’re going to turn those people off … if another restaurant is the only use, I think it would be very hard to attract investment.”

Two of the restaurants rated highly in the 2010 report—Zen Sushi and Player’s Chophouse—“were total losers as restaurants,” Bayly added.

“The point is that it’s crazy … if they’d followed their own report 10 years ago, and what they’re going to do today, those would be entrenched as restaurants, and they’d be sitting empty forever.”

For David Dale-Johnson, a real-estate economist and University of Alberta professor who also serves as member-at-large on the RMOW’s Strategic Planning Committee, the proposal doesn’t make sense from the point of view of either landlords or tenants.

“On both sides, they’re professional, they’re smart people, they’re going to do what’s right for the customer and what’s right for them,” Dale-Johnson said.

“So to tie their hands is just a mistake.”

Placing those kinds of restraints on uses would impact the valuation of the asset, “and it would also impact the willingness of lenders to make loans on those properties, because you’re really imposing constraints that potentially could create problems for both landlords and tenants,” Dale-Johnson added.

In the view of Pat Kelly, president of the Whistler Real Estate Company, the proposal represents something of a philosophical conundrum.

“You’re going in a direction that’s ridiculous. It’s social engineering at the highest level, and that’s not how free markets work,” he said.

“Free markets adapt to market demand … we’ll find the solution to what our consumer wants and our client wants; we’re not going to tell our client what they want or what they’re going to get.

“So for me it’s more philosophical. I do understand what they’re saying, but man, there’s got to be a different way that isn’t so restrictive and has so much lack of future flexibility.”

It’s “policy motivated by fear,” Kelly added, and one that may have unintended consequences by removing the flexibility of entrepreneurs.

“I just don’t think the idea of expropriating value by cutting back on the flexibility of use is the way to do it,” he said.

“And is this really a problem?”

If anything, the RMOW should be working to make things easier for businesses by allowing a smoother transition from F&B to retail and so on, Bayly said.

“I think a lot of restaurants and businesses are probably teetering, and probably looking for support from banks, and investment,” he said.

“And we want to encourage that, I would think. If let’s say the Royal Bank or somebody was going to lend a restaurant some additional money to help them through, they’re going to be less likely to do that if the thing can only ever stay as a restaurant.”

Asked for an update on the initiative, and if the letters to council give the RMOW pause, a spokesperson said the work is still ongoing with no timeframe for when it will return to council, and that the correspondence is now part of the rezoning file under consideration by staff. 



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