It's a parallel argument, not a straw man.
No, actually. It was a straw man argument.
In my argument the water is an impediment to development and is the cause for high real-estate values in Vancouver. Water parallels heritage districts in that they both serve as limits to growth. Does this mean that the water is the problem? No, the ocean is the draw. Just as historic districts are a draw. Does it make sense to destroy them because they cause scarcity and thus high prices
But, higher structures on Vancouver Island would increase the available space to live downtown. You're dancing around this point and saying it's irrelevant because other factors are more important. I disagree. And your statements to the effect that these other factors are more important are unsubstantiated. But, in the next paragraph you'll attempt to make an argument.
What I see as fundamentally wrong with your argument is that it uses rents/land values as it's sole criteria. But even with this narrow criteria, your argument is flawed. Take Tokyo for example, where the process of demolition and redevelopment to higher densities is almost 'organic' (so is cancer); downtown Tokyo rents are the highest in the world.
What's awesome about this argument is how fundamentally misleading it is. There are a few districts in Tokyo that allow for tall skyscrapers. But most districts impose ridged building height restrictions. But I'm sure you'll just tell me that doesn't matter. Because supply level apparently has no bearing on price level in your version of economics.
If we redevelop Toronto's historical buildings with highrise as you suggest, as long as Toronto remains the financial centre of Canada, rents will still rise, and depending on a multitude of factors, there will be nothing preventing prices from reaching stratospheric levels.
Let's rewrite this in it's logical form to break it down: Financial centers around the world have traditionally been very expensive places to live. Therefore, being a financial center, Toronto should be an expensive place to live. Or, more succinctly:
post hoc ergo propter hoc.
Except perhaps that no-one will actually want to live in the core because it will be so devoid of heart. Retrospectively, in your dystopia one might wonder if the old 'deadwood' buildings might in fact have served to curtail the concentration of density and of wealth.
Or, how about this: the taller buildings could lead to a situation in which their sheer mass and arrangement, warping time and space around them, result in a complete collapse of the universe. Or we could just split the difference and say:
argumentum ad consequentiam. There's some other fallaciousness in there, too. But I'm not going to be a stickler about it.
What is your goal? Is it to reduce rents? Property values? Speculation? Or is it to diminish the richness of the city?
You saved the most horrible (and downright insulting) part of your argument for last! And, I'll just let Wikipedia do the talking for me:
http://en.wikipedia.org/wiki/Appeal_to_motive