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The student role in gentrification

Downtown hotels to be converted to residences

When the Holiday Inn on Sherbrooke and the Delta Centre-Ville hotel on University re-open this fall, they will be home to hundreds of university students, joining the recent trend of converting hotels to student housing in the area around McGill campus and the downtown area.

The making of the ‘McGill Ghetto’

Despite the recent news, the neighbourhood around McGill hasn’t always been so student-laden. Over the years, it morphed from a working-class neighbourhood to a home for hippies, draft dodgers, and counterculture. Finally, in the mid-1990s, it became the expensive, student-filled ‘McGill Ghetto’ that we know today.

According to an interview published in Satellite magazine in 2012, Phyllis Lambert, founder of the Canadian Centre for Architecture, said, “In the [19]70s through the [19]80s, there was a huge not-for-profit cooperative housing project for about 600 to 700 people just to the east of the McGill campus, in the downtown.”

Lucia Kowaluk, president of the Milton Parc Citizens’ Committee, said that she has lived in the neighbourhood since its ‘hippie’ days in the 1960s, when she was a student at McGill’s School of Social Work. “McGill was small at the time,” she said in an interview with The Daily. “Not many students lived there.”

Now, with almost 40,000 students enrolled at McGill as of 2013, student housing has become a central issue in the neighbourhood. Notably, private investors, rather than university residence systems, are currently the most active in the student housing market. Campus Crest Communities Incorporated – one of the investors in both the Holiday Inn and Delta transformations – is a major player, with a 35 per cent stake in the Holiday Inn project and a 20 per cent stake in the Delta project.

In an e-mail to The Daily, Ted Rollins, CEO of Campus Crest, wrote, “We have big plans for Canada. We believe that the Canadian market is in need of this type of project. We have already experienced a tremendous amount of interest from students.”

As the McGill student population continues to grow, the University has also been rapidly expanding its residence network. Three hotels have been converted to residences in less than ten years: New Residence Hall, Carrefour Sherbrooke, and La Citadelle, in that order. In addition, private investors from Toronto and the United States have plans to convert the Quality Inn on Parc to a student residence in the near future.

According to Éric Michaud, coordinator at the Comité logement Ville-Marie, a housing advocacy group in the downtown core, the flood of students into the areas around the McGill campus has made it less accessible for families to live there.

“[The growth of the student population] diminishes the accessibility of housing for families because students can split the costs and pay more than a family could for the same space,” he said in French in an interview with The Daily.

Conversely, Kowaluk isn’t worried about the ongoing hotel-student residence conversions. “That’s fine,” she said. “From the board chatting about it, we’re glad that students are moving into hotels so they don’t take over [the neighbourhood’s] Victorian houses.”

Michaud somewhat agreed, saying, “Unfortunately, there’s not enough student housing built by the universities,” he said. “We think that it’s a good thing to have student residences built by universities because [then] students pay less [for it].”

For an individual student, the average rent for a double room, shared with an assigned roommate, at New Residence Hall, Carrefour Sherbrooke, or La Citadelle, is $1087.67 per month, with La Citadelle the most expensive at $1112 per month.

Rollins declined to specify exactly how expensive the converted Holiday Inn residence would be, writing only, “We aren’t the cheapest, but we believe that students will receive a compelling value.”

“McGill is a terrible landlord. There are things you have to pay for that would never stand up if they had to face a renting board,” said Fred Burrill, community organizer at Projet Organisation Populaire Information et Regroupement (POPIR) of the St. Henri, Petite Bourgogne, Côte-Saint-Paul, and Ville-Émard areas.

Prime real estate

In recent years, McGill has turned to hotels to build cheaper residences, with all three of its most recent residences the product of such renovations. While these residences may take students out of the renting pool for private apartments, it won’t necessarily drive rent down in the apartments they would be leaving behind.

Paule Provencher, a real estate agent in the McGill area for around 25 years, said that after the renovation that turned the former Renaissance Hotel into New Residence Hall several years ago, there were far fewer students looking to rent, but that the dip in demand had little impact on rent prices in the neighbourhood.

“[The prices go down] a little bit, but not that much,” she told The Daily. “You have to understand that people have purchased their condo at a high price and they really cannot just give it away.”

“Families and professional couples don’t want to [live in the McGill area]. When I tell them that it’s in [that] area, they say ‘no thank you.’ They hang up,” she said, adding, “Just a few families live in the area, but really not that much.”

“A trend that has been happening in the last couple years in Montreal, roughly since when McGill opened up Solin Hall [in 1990], is that universities – and McGill is on the forefront of this – are becoming developers, even if not for-profit, making the neighbourhoods more upscale,” said Burrill, adding that, “The university as developer is a phenomenon that McGill started but is no longer the only participant in the process.”
A soon-to-be-released study, conducted by the Comité in conjunction with the Université du Québec à Montréal, indicated that in the borough of Ville-Marie (which includes most of the Golden Square Mile), property prices have soared since 2004.

“They have doubled between 2004 and 2011, which has had an impact on, among other things, [property] taxes and rent [in the neighbourhood],” said Michaud.

It’s not only renters who pay the price of the shift to private investors in the residence market. “I think that as universities like McGill and Université de Montréal are moving increasingly toward the corporate model, they need revenue streams. That comes with increase in tuition, increase in ancillary fees that McGill has students have to pay,” said Burrill.

It’s unclear exactly what impact private investment will have on the situation, but Provencher said that if it will impact rent prices in the neighbourhood, it would most likely drive them up even further.

“If it’s a private [company], of course they’re making an investment; they want money, and [residences] they develop will probably be more expensive than McGill’s,” Provencher said.

The students’ legacy

Despite the dizzying climb of rent prices in the McGill area since the 1990s, a typical feature of gentrification, both Provencher and Kowaluk argued that the neighbourhood hasn’t been gentrified.

“I don’t see students moving in as gentrification,” said Kowaluk, although she wasn’t happy about the change.
Provencher agreed. “I don’t think [of it as gentrification]. Because the families with kids, they don’t want to come [to the neighbourhood], the professionals, they don’t want to come,” she said.

“The number of students is overwhelming the demographic mix,” Kowaluk added. “It’s not the majority of students, but enough who don’t have a sense of living in a neighborhood [and] don’t know how to behave or hold their liquor […] I know people who say their neighbours have left because they were tired of the noise.”

Burrill described McGill’s view on incoming students as a “captive tenant population,” saying that “[The University] is targeting them as a revenue source.” Burrill believes that the conversion of hotels to residences downtown do contribute to a form of gentrification, pushing lower-income tenants out.

“The main way students can not contribute to gentrification is living a certain way, getting to know their neighbours,” he said. “There are certain legal things student[s] can do. You can transfer your lease, insist on having repairs done.”