Learning from Western Canada’s Largest Developer with Qualico & StreetSide

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One surefire way to make money in real estate is to spot the market trends and act on them. StreetSide Developments is doing just that. A division of Qualico, Western Canada’s largest privately owned real estate company, StreetSide is bringing generations of real estate expertise to the Lower Mainland. Jonathan Meads, Vice President of StreetSide, sits down with Matt and Adam to share his thoughts on the Vancouver real estate from his unique vantage point.

Which areas are positioned for explosive growth? What building challenges are unique to Vancouver? And what does Jonathan think the market will do for the balance of 2023 and beyond? This is a great overview of the current state of the market with some juicy insights from one of the largest players in Western Canada. Listen up!

Jonathan Meads, VP of StreetSide Developments, a division of Qualico, sits down to discuss the current state of the Vancouver real estate market. What happens to pricing? Where are the growth areas? And where does Western Canada’s largest developer think you should invest?

Who is Jonathan Meads?

I’m the VP of StreetSide Developments (British Columbia). I started my career in the UK and came to Vancouver 21 years ago. I specialized in project development and moved over to StreetSide six years ago now. I get paid to do something I love, which is a great position to be in. We build a bit of everything – commercial, concrete high rise, wood frame, mixed use, etc.

I met my wife in the UK. She came out with her Canadian company and I was working on a building with them. We were together in the UK for three years and so planned to move to Canada for three years before we decided where to settle. But it’s been 21 years in Canada and we still have never officially decided!

Vancouver offers a much better quality of life. There are bits about the UK I miss but I enjoy being outdoors in a healthy environment. There are more opportunities here. In London, there’s an old school mentality. If your dad knows someone, that’s how you get into the industry. If you work hard in Vancouver, you’re recognized for it.

How did you go from a surveyor to running StreetSide?

I wasn’t a land surveyor but a building surveyor. When I landed in Vancouver, I pitched myself as part project manager, part development manager and part building envelope manager. I started knocking on doors and asking each person for two more contacts.

For the development side, you learn as you go. But the management side is a different story. That has been a bigger learning curve. I also had to learn a lot of the different areas we work in at StreetSide, such as sales and marketing. I owe a lot of that learning to my time at Concert Properties.

What attracted you to StreetSide Developments, a division of Qualico?

I had reached a ceiling at Concert, which isn’t a reflection of the company or anyone there. There just wasn’t anywhere for me to grow at the time.

Qualico offices are based in Surrey and I live in Langley, whereas Concert is downtown. I was starting to get tired of the commute. So I was intrigued by the opportunity with Qualico. It allowed me to reduce my commute, grow in my role and take on a new opportunity in development.

My title is Vice President and I have no issues with it. But it’s a bit of a misnomer. We’re the largest privately owned real estate home builder in Western Canada. Qualico is made up of 40 odd business units ranging from builders to lumber yards. In the Qualico Surrey office, we have a few operations: one dedicated to single family homes, one dedicated to land acquisitions, and one dedicated to multi-family buildings, which is us, StreetSide.

At StreetSide BC, I look over everything. I’m given free reign to make decisions to grow the company. Qualico saw a growth opportunity in BC. We’ve always built townhouses and six-storey wood frame but with my concrete high rise experience, we could expand in new directions.

Density is what we have to look at in the Lower Mainland. We presented a high rise plan in Surrey to our team and they said to go for it. So we did! We got the land and will be launching our first high rise project this fall. It’s called Juno Surrey in Surrey City Centre. It’s an exciting additional direction for StreetSide.

What does a day in the life look like managing StreetSide?

That’s a good question! I’m not into monotony so no two days are the same. We have the opportunity to do so many different things; one morning I’m on the phone discussing financing and the next I’m looking at interior design packages. It’s very dynamic and quite exciting to be involved in so many different things.

Managing our team, managing the pipeline and making sure we stay on schedule are all on-going tasks and very important. Sometimes that means wrestling with different demands. It keeps you on your toes.

Is there a competitive advantage for StreetSide being a part of Qualico?

There is an advantage because we’re able to go outside of just our team for help, information, etc. We have StreetSide business units in BC, Edmonton, Calgary and Winnipeg. We get together a couple of times a year and talk through what we’re doing. That allows us to share ideas and share the brain damage.

Being at the scale that we’re at, we now need 1000 of something instead of 100. That gives us leverage. But each market is different. We have a great pool of trades but we’re wrestling to find enough resources just like everyone else in this industry. Working with the municipalities can be challenging too. Other regions, like Alberta, may not have these same issues.

Why isn’t Alberta facing the same challenges working with municipalities as we are in BC?

I’ve never worked in Alberta but when I talk to my fellow StreetSide VPs in Calgary and Edmonton, they tell me their approval process is quicker, easier and costs them way less.

We have four levels of government in BC and each puts on a level of tax. There are also all of the asks and pieces they need. I understand the need, because we don’t have the ability to grow horizontally in Vancouver like they can in Alberta. For us, the only way to grow is density. But what does density mean? The interpretation can vary.

Land and construction costs are also higher in Vancouver. I haven’t built in other regions but my fellow VPs always remark that building in Vancouver seems to be much harder and more expensive.

How is the Vancouver real estate market?

It’s interesting. We’ve seen an uptick in demand and sales, which is good. There is still some uncertainty around the interest rate and inflation. Buyers want stability. We’ve seen some good signs but I don’t think we’ll get back to the frenzy of early 2022. I just hope the Bank of Canada doesn’t react too quickly. We need certainty around interest rates.

We were in a situation for a long time with interest rates where it was basically free money. Now we’re in a more normal interest rate environment. But people got used to that low interest rate. The stress test is probably overkill at this point, which makes sales harder still.

The other part of the market is the investor market. Everyone is pushing for more rental housing and there is a need. But we have a lot of mom and pop investors who rent out condo units, who had to leave the market because of high interest rates. That means less rentals available and rent prices going up.

I’m not a financial expert. But I feel like something has to give in order for us to meet all of our demands.

The government wants us to build more houses, faster and cheaper. But we can’t do that. I’m worried something is going to break on a bigger scale.

On the challenges of working with government:

When you talk to the municipalities, there’s a lot of pressure on them. And they understand the challenges. But there are other challenges at other levels of government. How do you build these homes cheaper if you can’t reduce commodity pricing?

The one thing governments can address is time, because time is money. So they can make permit approvals go faster. But then you run into a log jam. Now we don’t have enough inspectors and so on.

We’re not going to see more starts, either rental or for-sale. It makes your head spin. The Metro Vancouver Board said a new development needs to pay for itself but by putting all the costs on new homes, it makes them more expensive. I don’t see a quick fix.

With low inventory and the challenges to deliver homes, what happens with pricing in the next 1-5 years?

The population of Vancouver – and the world – is growing. We’re never going to see the price of a home come down because it’s just not feasible. Can we keep prices at their current state? Maybe. But other things come into play like land scarcity, approval times, cost of labour and trades, etc. The inflationary cycle is present and is being driven by the cost of housing.

I appreciate that we’re looking outside of Vancouver for solutions. But at some point we may need to accept that a certain portion of the population here may never own a home. That’s a change we need to accept in North American culture.

In Sweden, over 80% of homes are rentals. They have a different tax structure and rental terms. The homes are also built to last longer and banks offer longer mortgages. We may need to revisit those things in Canada.

I understand why the province is locking rates and trying to preserve pricing. But it doesn’t encourage people to buy rental properties. It’s getting expensive to live here so we need to look at other places in the world to see what they’re doing.

Where do you see areas of growth in BC?

Vancouver Island is in a lot of demand; not just Victoriabut all the way up to Campbell River and Comox. There are still people moving to the Okanagan.

I’ve been following recreational property and it hasn’t come off in the last 12 months of this downturn. Places like Big White, Sun Peak and Whistler haven’t seen any decrease in value. Similarly we’re seeing that in some of the lake regions.

We have seen a drop off of inventory. People who didn’t need to sell didn’t. That’s pushing up the price of what is on the market. That’s a function of demand and supply.

Where do you see areas of growth in the Lower Mainland?

I’m going to be biased because we have projects in Coquitlam, Burke Mountain and in Vancouver. I think the Burke Mountain area is an exciting new community to come. There are many communities in Surrey that are experiencing some exciting growth as well.

Langley still has a lot to come. The mayor is very dynamic and wants to get things going. We have some properties there and I think there are opportunities for growth. The challenge is timing and getting it to market. If we launch a townhouse two years from now, what will the market look like? No one knows but I do think there is future growth.

We also have to look at the Surrey-Langley skytrain corridor. We’re going to see a lot happening in that area.

Where would you advise someone to buy right now in the Lower Mainland?

I would encourage anyone to look in the area that they’re working because I know a long commute can take it out of you. If you work in Surrey, try to buy in Surrey. If you work in Vancouver, try to buy in or near Vancouver.

If I had to pick one place for a young person getting into the market, it’s Surrey City Centre. I don’t think we’ve seen the full potential of Surrey City Centreyet. We just have one tower there but Bosa and Anthem have thousands of homes coming. Once those get built, it will drive inertia to the area, just like we saw in downtown Vancouver. The city will feel alive, day and night.

I think Surrey will become a very dynamic city centre in the next decade. Surrey City Centre is standing the test of time for growth.

Areas around malls like Brentwood, Oakridge and Lougheed will continue to be drivers because people already go there for their shopping. The infrastructure is already there. In Surrey City Centre, the mall isn’t huge yet. But as it grows, Surrey will start to get those one-off, cooler retailers.

How does Surrey compare to Vancouver?

I think we’re seeing more industry and business opportunities outside of Vancouver, especially post-covid with people being able to work from anywhere.

Vancouver is beautiful but in Surrey it’s easier to get on Highway 1, easy to get to the ferry, easy to get to the airport, and easy to get to the border. I think the downtown core of Vancouver has hurt itself by not having a fast way in or out. I understand the history, but it’s hurting the city.

I know Vancouver is trying to get everyone out of their cars but we have to be realistic. Not everyone wants to bike or bus. Some planning decisions are made in a utopian world instead of where we actually live.

We’re seeing that in condos too where each suite is only getting 0.8 parking stalls. Not everyone owns a car but everyone thinks they need a parking stall for future value or for when friends come over.

The 5 Wire: Getting to Know Vice President of StreetSide, Jonathan Meads

What is one book you recommend?

I’m not the world’s best reader but I did start My Biggest Mistake by Terry O’Reilly. I enjoy his podcast and like his perspective on marketing. He explains it in a great way for people who aren’t in marketing.

What new belief, behaviour or habit has most improved your life in the last few years?

Don’t react instantly. Sometimes things come in and just bug the heck out of you. It’s easy to have a quick response that could make things worse. So when something bugs me, I try to sleep on it. I’ll pick it up the next day when a cooler head can prevail.

What have you been binge watching lately? Or share a movie recommendation with us.

I haven’t binged watched anything since the last season of Drive to Survive with my son. But we were in the UK for spring break and I finally watched Interstellar, which was incredible. I wish it hadn’t taken me so long to watch it.

Favourite band or type of music?

I enjoy a range of music. There’s a composer named Ryan Louder who I’ve been enjoying on Spotify. If I had to pick a band, it’d probably be Coldplay.

What is something you’ve purchased recently for under $1500 that has had a positive impact on your life?

We just did a kitchen reno and sadly none of it was under $1500. But I did buy a new barbeque the other week. I upgraded to a nice little Weber and it’s going great.

• Qualico
• StreetSide Developments