The End of a Neglected, Dangerous, Once Great Hotel

From the outside, the old brick-and-mortar hotel at 500 Dunsmuir St. looks solid as a rock, a five-storey building built in the shape of an E with decorative cornices prettying up the roofline.

Dunsmuir House has stood on the corner of Dunsmuir and Richards in Vancouver’s downtown for 115 years, serving first as a hotel and then as low-income housing, a student hostel and finally a homeless shelter.

But when city inspectors checked the building twice this year, they found the place was rotten from top to bottom. The building has been vacant since 2013, and for over a decade water has been pouring inside from a leaky roof. Drywall has peeled off ceilings and walls, revealing rusty pipes. Some of the wooden support beams are cracking. Mould is everywhere.

Most concerning for the building inspectors was the floor — it had buckled or collapsed entirely in several places. And the deterioration had increased between a first inspection in February and a second visit in October.

“The last time I went through the building, I took an environmental consultant with me, and she said she would not have any of her people in that building even taking samples,” Saul Schwebs, the city’s chief building official, told councillors during an emergency meeting Wednesday.

“What happens in a building that's in this stage of collapse, essentially, is that we see membranes that weren't intended to be structural become structural. Drywall will help hold up a floor. Roof membrane will help hold up a roof. It's crazy.”

Trying to repair the building is too dangerous, Schwebs said. “When you start poking at it, it's really unpredictable. It could be catastrophic results.”

With no way to salvage the heritage building, councillors voted to order the building demolished. The demolition must be completed 21 days after the property owner is handed a copy of the resolution, which should happen within the next few days.

Hearing that building inspectors had noticed fewer rats than usual in a vacant downtown building, Coun. Adriane Carr quipped that “this building is even recognized as too unsafe to inhabit by rats.”

@jenstdenis 500 Dunsmuir Street has a long history in Vancouver. But it’s been sitting empty for 11 years and a recent building inspection found the building is starting to collapse because of extensive water damage. #vanpoli #heritage #localhistory ♬ original sound - jenstdenis

Dunsmuir House is owned by Holborn Group, a developer that has raised ire in Vancouver with each of its projects.

Principal Joo Kim Tiah’s decision to open a Trump hotel on Georgia Street — a project that was completed as Donald Trump was starting his first term as president — led to one city councillor calling the building a “beacon of racism.”

The sale of a government-owned social housing site to Holborn has also been dogged by controversy.

Fifteen years after the Little Mountain sale, the company has still not completed a promised replacement of all the social housing units that were torn down.

A year ago, Vancouver’s city council voted to relax a requirement that all the social housing must be built before the company can start on the condo portion of the redevelopment.

In a letter to city council about the problems with Dunsmuir House, the Holborn Group said the company had intended to operate the building as student housing but agreed to lease the building to BC Housing in 2009 to house homeless people in the lead-up to the 2010 Vancouver Winter Olympics.

But at the end of the lease in 2013, the company wrote, the building had been damaged and would cost $2.6 million to repair.

The letter goes on to blame subsequent damage to the building on “the homeless,” who the company says frequently broke into the building and caused damage. Holborn said it has tried multiple times to engage the city in a redevelopment process but hasn’t been able to make headway on its plans.

Under those circumstances, Holborn says in the letter, it would have cost between $10 million and $15 million to repair the building, and it simply didn’t make sense to invest any money in it. The company goes on to say it didn’t notice the floors in Dunsmuir House were collapsing until August 2024, five months after Schwebs’ initial inspection. The property is assessed at $8.1 million, with $6.5 million of that based on the land value.

The letter makes no mention of any attempts to keep the roof in good repair, but it does say the company will comply quickly with the city’s order to demolish the building.

Coun. Sarah Kirby-Yung said she was dismayed at the tone of the letter, which made no acknowledgment of the heritage of the building or its importance to the city. Dunsmuir House is listed on the city’s heritage registry, but it is not a protected heritage building.

Demolition “is one thing they’ve been motivated to do, with speed, but not maintain the building,” she observed. “They’re suddenly responsive and enthusiastic about demolishing it?”

“It would appear so,” Schwebs replied.

Schwebs said there are some major gaps in the city’s ability to deal with vacant buildings that may pose a danger to residents. City staff don’t have a full list of all vacant properties and don’t regularly inspect them, relying instead on complaints. Schwebs said he took the initiative to inspect 500 Dunsmuir St. in February because it bothered him that the building continued to sit empty.

He went back in October after he heard from the security guards hired by Holborn to patrol the building that the damage had accelerated and they were afraid to go inside.

One tool the city may be able to use is its Single Room Accommodation bylaw, which is intended to save or replace single-room occupancy housing. SRO hotels — century-old buildings common throughout downtown Vancouver — provide housing for some of the city’s poorest people, but are at risk because of aging buildings, increased costs to operate and real estate speculation.

Under the city’s bylaw, it can levy charges of up to $300,000 per lost SRO room, including for cases like Dunsmuir House where the rooms have been lost due to neglect.

Since Dunsmuir House has 167 rooms, the cost to the Holborn Group could be as much as $50 million, although that would ultimately be decided by city council.

City staff are also planning to convene a task force to look at how other jurisdictions deal with problem properties, Schwebs told city council.

Over the past seven years, Vancouver has dealt with several dire cases of property neglect. The city took the unprecedented step of emptying and then expropriating the Balmoral and Regent hotels in 2017 and 2018. The Balmoral was demolished in 2022 because it was deemed too damaged to salvage.

In 2023, an apartment building at 414 E. 10th Ave. burned down, then sat unsecured for months while the fire department repeatedly responded to more small fires at the property.

The city finally stepped in to demolish the ruined building a year after the initial 2023 fire.