Broadway merchants seek compensation for lost business from subway construction

Broadway fights back

Subway construction along Broadway has killed many businesses, is killing many more, and neither the City of Vancouver nor the provincial government has agreed to provide failing businesses compensation.

This so far has led to one lawsuit and calls for compensation from countless business owners as well as city councillors, such as Lisa Dominato. 

Their proposed solution is to have B.C. create a system similar to what Quebec did in 2019 in Montreal. 

The City of Montreal in January of that year launched a financial assistance program to help business owners with operating losses that stemmed from nearby construction projects. Montreal put $5 million into a fund, while the Quebec government added $20 million.

Business owners then filled out forms to prove losses, and were eligible for compensation up to $30,000 per year – a threshold that has since increased to $40,000 per year.

Other cities, such as Edmonton, have investigated launching similar programs, but none yet have.

Dominato said she and other councillors supported former Coun. Colleen Hardwick’s motion last year for city staff to look into ways to potentially compensate Broadway merchants for losses caused by subway construction, including by using the Montreal model.

“I share the concerns of small businesses along the Broadway corridor,” she said. 

Merchants along the corridor say they should not be punished because a needed infrastructure upgrade to the region’s transit system was built in their neighbourhood.

Compensation, however, is a tough sell for the B.C. government.

Minister of Transportation and Infrastructure Rob Fleming declined a request for an interview. 

His ministry sent an email that stated it is aware of the Montreal program, though not its details, and “the province does not provide compensation for temporary disruptions arising from construction.”

Fleming’s ministry then highlighted its instruction to Broadway Subway Project Corp. – the joint-venture partnership between Acciona and Ghella that is building the line – to tunnel underground where possible and install temporary bridges called traffic decks to enable as much access as possible to businesses. 

“This method results in far less above-ground disruption for businesses than the ‘cut-and-cover’ approach used on the Canada Line,” the ministry wrote.

Entire city blocks on Broadway, where stations are being constructed, have been completely torn up with cut-and-cover construction, as have some adjoining blocks. 

The B.C. government maintains that it sufficiently communicated with those who own impacted businesses. It surveyed 2,626 businesses beforehand and alerted 823 owners with briefing packages before construction started, it said in its email. 

Access to businesses strained by construction

Despite what the city and province maintain are genuine efforts to provide access for shoppers who want to visit Broadway merchants, the reality is that the corridor has had significantly less parking during the past two years than it had previously.

Two lanes of parking were removed along the entire corridor in 2021.

The city’s manager of transit integration and projects, Steve Brown, says the province and its subway-building partners have authority for all decisions within the project area, and that this includes all parking decisions on Broadway. 

He said the city tried to mitigate the loss of parking by changing parking rules on side streets.

Mt. Pleasant Business Improvement Area executive director Neil Wyles says he appreciated that the city changed unmetered parking on some side streets to short-term parking to ensure turnover and to keep people from parking their cars there all day. The city also added some new loading zones, he added.

One thing that Wyles calls a “bone of contention” is that the subway builders banned public parking on two curb lanes on some parts of Broadway to provide free parking for workers on the project.

Pylons cordon off those lanes, and the workers’ vehicles are able to park there all day. 

“So Johnny Lunchbox gets to park his car there all day for free and the parking is not available for customers of the businesses,” Wyles said.

Other parts of Broadway still have parking meters with covers that say “no parking,” he added.

“I’m looking for the restoration of some parking,” Wyles said. “The numbers support it.”

The province, however, said in an email that all parking prohibitions on Broadway have been “necessary.”

Subway construction leaves devastation in its wake

Broadway Subway Project Corp. construction not only led to lane closures and parking prohibitions, but temporary bus stop removals and fencing that reduced the width of sidewalks. 

Some stretches of sidewalk closed entirely to allow for work below. 

This, too, hurt Broadway’s vibrancy as a shopping destination, as it forced consumers to endure obstacles in order to patronize local businesses.

Small-business owners along the strip between Main and Arbutus streets have seen their revenues ravaged, forcing many to close permanently and others to bear losses that could take years to finance, unless they declare bankruptcy.

Sandy (Surinder) Sangha says her Subway sandwich store’s sales plunged by about 75 per cent compared with pre-pandemic times. 

In debt by about $50,000, she closed her restaurant – which was between Alberta and Yukon streets – in late January, just before her lease expired.

Surinder [Sandy] Sharma stands in her Subway sandwich shop in January, during her last month of operations. Glen Korstrom, BIV

Mei Gour, who owns the Your Dollar With More at the southeast corner of Yukon and West Broadway, told BIV that she wishes her lease were expiring, instead of being in effect until 2026.

She has to pay monthly lease payments on a store that generates little revenue.

“I’ve lost hope completely,” Gour said. “My rent is more than $20,000 per month.”

Gour said she has remortgaged her home and, when that money runs out, she will consider her options. 

Construction workers closed the sidewalk between Gour’s store and the busy No Frills grocery store to the east. 

Her store entrance opens onto a part of the sidewalk that leads to a dead end.

The result is virtually no foot traffic and less visibility for store. 

Workers long ago removed the crosswalk that was next to her corner store. 

Some Broadway Subway Project signs alert shoppers that stores are open, but the placards can be hard to spot and have not reduced the drop in pedestrian traffic. 

The result is that Gour had to lay off four of her seven employees. 

“In the pandemic, people still had things they needed so they came to buy them as our store was right there,” she said. 

“When the subway construction started, even though people still needed some things, they would not come because they knew the road was not convenient for them. The pandemic didn’t kill us. The construction – that is what is killing us.”

The now-closed Subway franchise on West Broadway is visible past workers constructing the Broadway subway. Chung Chow, BIV

Many Broadway merchants say they remember politicians and government representatives stressing when the subway was being conceived that street disruption would be kept to a minimum.

They say they remember public figures assuring them that there would be no repeat of the 2005-to-2009 fiasco on Cambie Street, when Canada Line builders used disruptive cut-and-cover construction that created noise, dust and fencing that impeded customer access to stores.

Heritage Asian Eatery owner Paul Zhang says he feels misled by politicians.

“It was always, ‘Hey, it’s not going to be like it was on Cambie Street. We’re not going to do cut-and-cover. There are going to be minimal disruptions, and it is going to be for a short duration,’” he said. 

“That was the pitch they were making.”

Business was brisk after Zhang signed his original lease in 2019, and he survived the pandemic thanks in part to government subsidies. But he has since closed his restaurant on West Broadway, because operating an eatery at the end of a dead-end sidewalk is unviable, he said.

Like Gour, Zhang saw no outside foot traffic, and said that it can be difficult for potential customers to read his restaurant’s signage from across the street because it is partly blocked by green fencing.

Indeed, workers in late January could be seen at the bottom of a gaping hole in the street outside Zhang’s restaurant, where they were installing pipes.

Zhang spends more time at his original West Pender Street restaurant, and he has plans to open a new Heritage Asian Eatery location at Lonsdale Quay in North Vancouver later this year.

He remains on the hook, however, for lease payments at his closed West Broadway site.

Court action can be complicated

Greens Market owner Sentheepan Senthivel in August launched a lawsuit in BC Supreme Court against the provincial government because West Broadway subway construction caused what the lawsuit calls a “nuisance.”

His sales were $7.7 million in 2020, and they dropped to $6.8 million in 2021, when construction began. In 2022, his sales fell further – to $5.6 million. 

“We’ve burned through close to $800,000 in cash – just burned through it because we had to try to sustain our business,” he said.

Senthivel said he is speaking with his landlord about whether a rent reduction is possible. 

He is also trying to shift more business online. 

Senthivel knows his lawsuit is a hail-Mary move with little likelihood of success: B.C. has a law that states businesses are not able to sue to get compensation for corporate losses that stem from the effects of infrastructure projects that are in the public interest. 

He has spoken with other merchants about whether it is worth the time and effort to launch a class-action lawsuit similar to the one that 80 Cambie Street property owners and merchants launched in 2009, when they alleged that their property values were diminished during Canada Line construction. 

The merchant won in court only to watch defendants appeal the judgment

They have not yet received so much as a penny in compensation, class-action participant and former Festival Cinemasowner Leonard Schein said.

The Cambie merchants continue to argue in court that the line’s operators should compensate them because the businesses paid more to lease properties than the leases were worth, Schein explained. 

He said that there has been some agreement from TransLink and other defendants that the merchants and property owners are owed some money for a one-year period.

TransLink in 2018 sent a statement saying that it was appealing the BC Supreme Court judgment that awarded damages to Cambie merchant class members, because TransLink disagreed with how land values were being calculated.

It wanted an official assessment from a real-estate appraiser instead of a property value that was estimated using a revenue-loss formula.

Schein is urging the City of Vancouver to provide property-tax discounts for impacted Broadway merchants, and the province to provide compensation to those merchants based on whatever formula is eventually determined in court to compensate Cambie merchants. 

No court date has been set to hear TransLink’s appeal of the Cambie merchants’ class-action lawsuit.

The colossal amount of time and money involved to get the case this far is a deterrent to Broadway merchants thinking about launching a similar lawsuit. 

Zhang says that if he takes part in a class-action lawsuit, he would want to be sure that it has a strong chance of success. 

“If I’m not guaranteed at least a 70-per-cent chance of seeing some kind of return on it, I’m not sure,” he said. “People just don’t want to throw good money and time after this.”

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