BYLAWS: Some — like age restrictions –don’t apply to everyone

Tony Gioventu
Province

Dear Condo Smarts:

We purchased a townhouse in the Shuswap region for summer family use and as a rental investment.

The strata corporation have now passed a bylaw that prohibits all rentals, and an age restriction of 55 years and over for all owners and visitors.

This is recreation property and the developer told us we would never have any restrictions and could do what we wanted.

Can the strata prevent us from renting our home or restrict the age of visitors?

— Gail and David Sorens, Calgary

Dear Gail and David:

There is no such designation as “recreation property” that sets up special exemptions or exclusions for investors.

If the strata bylaw that has been created is enforceable, you might not be able to rent your unit any more.

However, rental bylaws do not apply to family members who are parents or children of the owner or the owner’s spouse.

Age restrictions apply to residency, so the bylaw that regulates the age of visitors may not be enforceable.

Once a strata is created, it operates under the Strata Property Act, Regulations and Bylaws like any other strata.

There is no special treatment for recreation property, so you may be bound by the strata bylaws with no exemptions.

Exploring this subject further, some unique instances exist that are “resort classifications” where restrictive covenants limit or regulate the periods an owner can use their property. Occasionally, in ski resorts and isolated locations, the covenants also require that the properties must be available for rentals throughout the year to ensure a supply of accommodations.

In this case, rental and age bylaws may be prohibited by previously existing land-use covenants.

Recreation strata properties are a hot investment in B.C., but before investors buy, they should clearly understand what they are buying.

The same recreational investment might also be another owner’s permanent residence, so if you plan on a rental investment, inquire with the strata how many owners are permanent residents and how many people rent their units. That will give you a clue to what the next few years of strata life may look like.

Here are a few critical questions to ask before any deal is signed. Is the strata properly insured? Is there a winter/off season caretaker or manager for security and emergencies? Are the buildings properly winterized? Is waste effectively managed? Does the strata own and operate their own water systems? Who collects the fees and manages the business affairs for the strata? Are there special services, recreational vehicles, a marina, boat storage, moorage, aircraft hangar or snowmobile storage sheds? Who gets to use them? Is there a cost? Who owns and insures them?

Don’t forget, recreation properties may also have different taxation status, including paying GST on strata fees, depending on the type of business operations in the strata.

Tony Gioventu is the executive director of the Condominium Home Owners Association (CHOA). Contact CHOA at 604-584-2462 or toll-free 1-877-353-2462, fax 604-515-9643 or e-mail [email protected].

© The Vancouver Province 2006

 

Ashley Ford
Province

They are the new force in the B.C. housing market.

Armed with assets and better health than their mothers and fathers, retirees are leaving the urban jungle for the fresher climes of smaller towns and communities across the province.

In the process, they are helping create a heated housing market rivaling that of the Lower Mainland and blurring the lines between recreation and conventional housing.

Rudy Nielsen, the 64-year-old founder of Niho Land and Cattle Co. Ltd., which has specialized in recreational property for four decades, describes this new force as “penturbians. People who have owned a property in the Lower Mainland since 1985 and valued at over $350,000.

“They sell up and move to a smaller town, usually within six hours drive of Greater Vancouver. They choose a spot that is near a medical facility or hospital and close to shops.

“Although we think prices are high, they have enough to buy a home, an RV and still have money in the bank,” he says.

David Baxter of Urban Futures, a Vancouver-based think-tank, concludes the next three decades will bring significant changes to the social and economic structure of B.C.’s towns.

Urban’s study on seniors’ housing demand in B.C. in the next 30 years concludes increasing numbers are living in private homes and turning their backs on institutional or group living.

There is absolutely no doubt that retirees and near-retirees are having a major impact on property development and values outside of major urban areas, Baxter says.

The front-end baby boomers, the ones just retired or about to, are able to capitalize on their city properties, move away from the Lower Mainland and maintain their own dwellings.

Those at the tail-end of the baby boom sitting in million-dollar properties are willing to remortgage and buy a recreational property with the longer-term objective of moving there permanently, says Baxter.

Tom Pringle, executive director of the Real Estate Foundation, says, “This phenomenon suggests there are a range of needs and opportunities that communities will have to address more extensively in the next 20 years than has been the case in the past.

“Not only are the number of household heads 65 years and older growing very rapidly, but there is an increasing propensity to live as part of a couple. These seniors are likely to own their own homes and to prefer a ground-oriented dwelling,” he says.

© The Vancouver Province 2006

 

STAYING LOCAL: Majority of B.C. property bought by Lower Mainland retirees

Ashley Ford
Province

So just who is buying up B.C. property?

The simple answer is British Columbians, the bulk of them retirees from the Lower Mainland.

But there are plenty of outsiders who also want their piece of spectacular B.C.

Cash-rich Albertans may be a small percentage of buyers, but they are coming in droves and so are foreign buyers to a much lesser degree.

“Albertans are definitely coming and now so are people from Ontario, who seem to see the West with new appreciation,” said Rudy Nielsen of NIHO Land & Cattle Co., which specializes in charting rural and recreation land and development.

The numbers tell the story, Nielsen said: “Albertans’ share of the B.C. residential property market last year was 2.6 per cent or about $1.1 billion. They are significant players, especially in the East Kootenay region.”

Of the 4,320 property purchases by Albertans last year, 22 per cent were in the East Kootenays. Kelowna was the next most popular location with Albertans, who accounted for 12.5 per cent of properties sold there.

It is estimated that 50 per cent of property around Invermere, Fernie and Radium — a mere three-hours drive from Calgary — is now held by Albertans.

But Vancouver Island has also become a target and the Vancouver Island Real Estate Board says 12 per cent of buyers in the market outside of Victoria are from Alberta.

It helps that WestJet flies to the Comox Valley. It is just an hour’s flight from Calgary and a new airport services Comox, Cumberland, Courtenay and surrounding rural areas that a few years ago were regarded as little more than moose pastures.

Times have changed, and finding cheap property is a thing of the past with prices running well over $200,000.

U.S. purchasers, mainly from the western states of California and Washington, have long discovered B.C., but only comprise a sliver of the market. Californians, for instance, only purchased $239 million worth of B.C. property in 2005.

According to RE/MAX of Western Canada, foreign buyers from Asia, Australia, New Zealand and Europe are fuelling demand for big-ticket recreational properties on Salt Spring Island and at Whistler and Kelowna’s Big White Resort. Nearby areas, such as Vernon, are also attracting more foreign buyers.

“But at the end of the day, by far the largest group buying — 94 per cent — are coming from the Lower Mainland,” Nielsen said.

© The Vancouver Province 2006

 

William Boei
Sun

Rapid transit can transform neighbourhoods. Most often, it brings more development and higher density.

But it can be a painful and bewildering process, starting with the chaos of construction.

All along the Canada Line route, retailers and residents are starting to feel the pain, or wondering when it will hit them.

Most think it will turn their neighbourhoods into better places. But some are not sure whether they can hold out that long and, if they do, whether they will be able to afford the rent.

– – –

Go to Davie Street between Pacific Boulevard and Mainland Street, walk around the high, black-draped scaffolding and peer in through the gaps.

You’ll see, hear and smell two large diesel-powered augers drilling into the ground and hurling a grey slurry of mud, debris and water into the air.

InTransitBC, the company building the Canada Line, found the soil under Davie around Mainland — the site of the future Yaletown-Roundhouse station — was too loose for normal excavation methods.

Just spraying concrete on the excavation walls wouldn’t do the job. A series of small piles had to be driven into the ground.

“The deeper we got, the ground conditions changed and it went from being a fine cohesive material to a looser, coarser material,” said InTransitBC vice-president Steve Crombie.

That meant sinking more piles. Drilling will take four months, to the end of September, perhaps a little longer.

To prevent flying muck from spraying buildings and passers-by, the project put scaffolding over the sidewalks and draped the fences around the site with black cloth.

Shops on either side of Davie are completely hidden from view. Myung Yam’s Dodi Market convenience store is invisible behind the scaffolding.

Across the street, drilling has closed a pedestrian ramp at Mainland and the sidewalk on many weekdays.

“When they close that ramp, I lose all the pedestrian traffic from my side of the street,” said Alex Barker, co-owner of the Obsessions gift boutique. “It’s devastating my sales.”

– – –

Barker and his partner started the Obsessions chain eight years ago after arriving from England.

They remortgaged their home to finance a new outlet in Gastown — they now have four — to make up for lost revenue during construction in Yaletown. Barker worries about whether the business can survive, and he’s upset.

“I just feel so angry that all that hard work and commitment from new immigrants to start a business, which provides 21 employee positions for Canadians, that they can come along and do this without any compensation . . . and take away our business,” he said.

“They’ve completely eradicated the sightlines to my store. We pay premium rent in a premium location because, in retail, it’s about your visibility on the high street.”

Barker said sales are down 30 per cent or more. If Obsessions survives, he expects its location — steps from a rapid transit station — will mean higher rent.

At the Dodi Market, Yam says business is down 30 to 55 per cent, depending on the day.

For the first time in 12 years, the store has suffered a break-in. Someone hidden by the scaffolding broke through the front window, taking cigarettes and lottery tickets.

When Yam asked InTransitBC for compensation — arguing the break-in wouldn’t have happened if the view hadn’t been blocked — the company offered to pay for the window but not for the stolen merchandise, saying it had no way to confirm what was taken.

Retailers and residents worry the lack of visibility will attract drug users and dealers, and that it’s only a matter of time until someone is mugged. Yam has been finding used needles on the sidewalk.

– – –

Compensation is not on the table, say Crombie and Alan Dever, spokesman for Canada Line Rapid Transit Inc., which oversees the project for TransLink.

“No level of government provides compensation for businesses or residents when public infrastructure projects take place,” Crombie said, “on the basis that they’re for the general good of the public.”

Dever adds: “There is no legislation for compensation for infrastructure projects. That’s the environment that we operate in.

“We fully understand there are inconveniences and we really are doing what we can to try to minimize those and support the businesses at the same time.”

The company has set up a business liaison committee and budgeted more than $1 million, mainly for advertising, to help businesses survive.

The message to the public is not to abandon small retailers now that they’re temporarily harder to reach, Dever said.

“We tell everyone, please make that extra little effort to help out your neighbours, especially in the small businesses.

“All of our public notices say, please support your businesses. We are trying to get the message out to people in Vancouver that these businesses need their support as we go through this construction.”

The project has placed hanging flower baskets along the hidden sidewalks in Yaletown to make the passages less daunting, and hired security guards to patrol the area at night.

– – –

Not every business near the Yaletown station site is hurting.

At the Opus Hotel, just outside the construction zone, “things have been pretty good,” says general manager Daniel Craig.

“We’re a hotel and we don’t rely on walk-by traffic,” Craig said. “I think the businesses that rely on that kind of traffic are not faring that well.”

The hotel was built with noisy surroundings in mind and guests haven’t complained, he said.

For Donna Irwin, who lived in the highrise above the Dodi Market, the noise, the dust, the gloom and the prospect of another 21/2 years of construction were too much.

“We ended up moving because of it,” she said. “They work six days a week. They start at 7 a.m. on Saturday. The noise and the dust are just incredible.

“And all the scaffolding, it’s like a dark little tunnel. You have to walk a block and a half out of your way just to get to your front door.”

Irwin decided to pay a penalty to break her lease. She has moved to Fairview Slopes.

“If it was only for a few months, we could handle it,” she said. “But it was going to be for three years. There was no way we could handle that for three years.”

However, Crombie said, once the micro-piling is done, the scaffolding and the black draping will come down and a new fence will be built, covered by a transparent mesh.

“There will be much better visibility and much better light.”

– – –

Across False Creek, in the Cambie Village retail strip between Broadway and 19th Avenue, it is the quiet before the storm.

A few side streets are blocked while crews move utilities to make way for the big trench that will be dug on the east side of Cambie.

That construction method, called “cut and cover,” sparked the biggest controversy in the project’s stormy history. The plan had been for most of the tunnel from Waterfront Station to 37th Avenue to be machine-bored, deep underground. The only surface construction would be at station sites.

But the final contract called for cut and cover from 2nd Avenue past 63rd Avenue, as well as in a three-block stretch of Granville Street from Cordova to south of Pender.

Merchants and residents cried foul.

For Peter Klein, it felt like a bait-and-switch scheme.

Klein is a former producer for the CBS public affairs program 60 Minutes, who now teaches journalism at the University of B.C. He and his wife bought a house on 17th Avenue just off Cambie, having been assured by his real estate agent, the neighbours and city hall that there would be no construction mess; the Canada Line tunnel would be bored underground.

That was a big deal for Klein and his wife, Vancouver native Melody Belkin. Their son Noah has serious health problems and breathes through a tracheotomy tube.

When they found out the tunnel plan had been changed to cut and cover, the prospect of months — even years — of construction dust brought back memories of Sept. 11, 2001, when they lived in New York and Melody was driving Noah and his infant sister, Ava, toward the World Trade Center.

In the chaos that followed, they had to abandon their car and make their way to safety through the dust clouds that enveloped Manhattan after the two towers collapsed.

One of their reasons for moving to Vancouver was cleaner air for Noah to breathe. Two years of construction dust didn’t figure in their plans.

“I would be concerned anyway as a parent,” Klein said, “but as a parent of someone with a tracheotomy, an open airway without any filtering, it’s especially concerning to us.”

He says the family will try to tough it out. They love the neighbourhood: quiet residential side streets and pleasant neighbours; just around the corner a busy, vibrant shopping and entertainment street with live music late into the evening.

“You feel like you’re in New York in a way,” Klein said. “There’s not a lot of places where you have that level of energy on a weeknight that late.”

It concerns him that some of the small shops on Cambie appear to be closing. But he is heartened by the arrival of a Capers supermarket, which seems to point to a bright post-construction future.

Rand Chatterjee, who helped rally neighbourhood opposition to the cut-and-cover plan, says more storefronts than usual between Sixth Avenue and King Edward are vacant.

There is always churn in retail. But at the moment, Chatterjee said, shops are closing and “nobody’s moving in.”

The Vancouver Sun counted 14 empty shops along Cambie between Broadway and King Edward. However, four of them, next to the Park Theatre, were damaged in a fire and are being renovated, and at least one other has posted a sign saying it will reopen following renovations.

To realtor Heather Maclean, Cambie Village is a community whose time is coming.

She recently sold a unit in the new Olive complex, a multi-storey condo development anchored by the Capers supermarket.

The buyer was “someone who thought community was important,” Maclean said. “They want close to downtown and easy access to shopping, so they were quite pleased.”

Another new complex is going up at Cambie and Broadway, and the area appears to be poised for denser development.

“I think it’s going to be very nice when it’s all done,” Maclean said, “and I think it’s going to be a benefit to the area, and to the shops.”

Not everyone agrees.

“I think it’s going to be dreadful,” said Susan Heyes, who owns the Hazel and Co. maternity and women’s wear shop in Cambie Village.

Construction hasn’t reached her shop yet, but she has filed notice of intent to sue the Canada Line project for damages.

She expects that when the trench is dug, traffic is snarled and parking scarce, many of her customers, especially pregnant women, will avoid the stress of shopping on Cambie.

“It’s not looking good for us,” Heyes said. “We’ve already had so many businesses leave the neighbourhood.

“I’ve got three more years on my lease, so I’m stuck.”

If the shop survives the construction period, she’s concerned rising rents will price her shop out of the new Cambie Village.

She expects older one-storey buildings will be bulldozed to make way for new Vancouver-style developments like the Olive building across the street.

“It will be like a tidal wave going down the street. I think a lot of those low-rise apartment buildings are going to go as well,” Heyes said.

Chatterjee agreed. There will be a different mix of shops on Cambie post-Canada Line, he said, probably more like those on Fourth Avenue in Kitsilano.

“Change happens,” he said. “But it’s pretty hard on those that are directly affected.”

– – –

To Leonard Schein, the concerns seem overblown.

Schein owns the Park Theatre and he doesn’t think there has been any significant effect on retail in Cambie Village so far. The restaurants are busy and the shopkeepers he talks to are seeing about the same amount of business as last year.

Schein refers to Chatterjee and Heyes as “the squeaky wheels” and wonders why the minority gets most of the media attention.

He doesn’t believe many shops are closing because of the Canada Line, pointing to the four storefronts that are being renovated and will reopen.

Yes, Schein agreed, once construction begins, there will be some disruption.

“But we have worked with the Canada Line to replace all of the lost parking, we are working with them in terms of advertising to the community that we’re open, and we will be doing a number of initiatives to try to keep people coming who are getting frightened away by people like Rand.”

Vancouver needs rapid transit, Schein said, and underground is the best place to put it.

– – –

At Cambie and 57th, Joseph Lee says business at his Flamingo House Chinese restaurant has gone through the floor since the nearest east-west thoroughfare, 59th Avenue, was closed at Cambie as Canada Line construction approached.

“My business dropped about 40 per cent and now it looks like it will drop further,” Lee said. “My lunch is down to almost a quarter of what I used to have.”

Many of the restaurant’s regulars can no longer get there except by taking long detours, Lee said, and that discourages people on their lunch hours. “If it takes an extra half an hour just to get to my parking space, of course they don’t come.”

His family has operated the Flamingo House for 33 years, but Lee says he’s not sure whether it can survive.

However, InTransitBC has now agreed to build a pedestrian walkway over Cambie at 59th Avenue, Crombie confirmed.

“All I can pray right now is that my regulars will come back after they reopen the road,” Lee said.

WHAT’S WORKING WHERE ON THE LINE

Work is proceeding all up and down the Canada Line route.

– The boring machine digging the deep tunnel under downtown Vancouver is moving about 10 metres a day. It will emerge on Granville north of Pender in March, and will be returned to Second Avenue at Cambie to dig a parallel second tunnel.

– Excavation for the machine’s extraction pit on Granville near Cordova will begin late this month or in September.

– On Granville between Georgia and Robson, digging for the City Centre station will begin any time now. Georgia and Robson will stay open.

– Temporary bridges will be built over Granville at Cordova and Hastings early next year to keep traffic moving during cut-and-cover construction.

– Tunnel sections have been completed from 29th Avenue to nearly 31st Avenue and the Cambie-29th Avenue intersection has been reopened.

– Piles are being driven for the Canada Line crossing of the north arm of the Fraser River.

– Soil compacting is complete at Bridgeport, where the line’s operations and maintenance centre will be built. Guideway columns have been erected along Bridgeport and work will reach No. 3 Road by January.

– At the airport, pile driving is complete for the Fraser’s middle-arm crossing and bridge deck sections are being prefabricated. Guideway columns are being erected and guideway segments will be installed starting about the end of September.

© The Vancouver Sun 2006

 

Organizers of the 2010 Winter Olympics have learned the hard way

Jeff Lee
Sun

Three years ago last month, in a ceremony that sparked celebrations across Canada, International Olympic Committee president Jacques Rogge uttered the memorable words awarding the 2010 Winter Olympic and Paralympic Games to Vancouver.

The award capped a four-year quest to once again bring the Olympics to Canada, and the bidding group had pulled out all the stops.

It promised a jewel of an event, with gleaming new state-of-the-art venues scattered between the Lower Mainland and Whistler.

But since that heady day, much of the original promise has changed. The phrase “on time and on budget” is only relative when you consider that the venues will be on time when the Games start in February 2010. They’ll have to be. But they will hardly be on budget. Or as grandiose.

In fact, the $470-million construction budget, which has now ballooned to $580 million even after many venues were revamped or moved, is hardly the tip of what taxpayers face.

Add in the $175-million Olympics-only security budget, the untold millions that will be spent by local governments for extra policing necessary for indirect Olympic events and traffic, the $600-million Sea to Sky Highway upgrade and the several hundred millions of dollars the federal and provincial governments are spending to orchestrate and promote the Games for economic leverage.

It is not hard to believe that the public tab could one day exceed $1.5 billion.

And to boot, there is hardly a venue that hasn’t changed from when it was first proposed.

So was the public misled? Was the bid really all that accurate, or was it a document designed to woo the IOC, giving it what it wanted to see? Why is it that no Olympics in modern history has ever looked like the one originally proposed? They are almost always smaller and more expensive.

Consider some of what has happened since the bid book was dropped off in Lausanne, Switzerland by then-mayor Larry Campbell, then bid president John Furlong (now Vanoc’s CEO) and then-bid chairman Jack Poole (who is now chairman of Vancouver Organizing Committee):

– A new $60-million speed-skating oval promised for Simon Fraser University has been moved to Richmond and will now cost $178 million (with Richmond picking up most of the remaining $115.3 million).

– The new $55-million bobsled and luge track at Whistler is now billed out at $99.9 million.

– The proposed $102-million Nordic centre in Callaghan Valley will cost $115.7 million, even after it was substantially scaled down, with ski jumps scrapped or made temporary and plans for many trails abandoned, to the detriment of future sport development.

– A new $36-million international-size hockey rink at the University of B.C. will now cost $48-million and has been whittled down to NHL-sized ice.

– That $28-million curling rink promised for a vacant lot in Vancouver will now cost $37.1 million and has been moved to a heritage ball park, which will be destroyed in the process.

– The $35.5-million athletes’ village at the start of the Callaghan Valley was moved closer to Whistler, and will cost closer to $45 million, as part of a $150 million new community subdivision.

– A $15-million international broadcast centre on the former coast guard lands in Richmond was scrapped in favour of moving all the media to the expanded Vancouver Convention and Exhibition Centre.

– A new $20-million arena for Paralympic sledge hockey in Whistler is now estimated at $45 million to $50 million and may well be scrapped, forcing Vanoc to move the event to Vancouver.

And none of that includes other costs B.C. taxpayers didn’t know they would bear when the bid was concocted.

Those include $130 million for Legacies Now (a government-funded program to create sport and community legacies arising from hosting the Games); $26 million for the B.C. Olympic Games Secretariat, the government agency overseeing the province’s commitments; $12 million for a provincial road into the Nordic centre; $6 million for a log show-home at the Turin 2006 Winter Games, and a raft of other tourism and economy-boosting incentives framed around the 2010 Games.

The province says the Sea To Sky Highway upgrade isn’t directly attributable to the Olympic Games. The Auditor General of B.C. says it is.

The feds have their own Olympic secretariat in Ottawa. They also have promotional programs to make sure these are seen as Canada’s Games.

Before you think that’s the final tab, consider this: it doesn’t include the cost of actually operating the Games, pegged at more than $1.7 billion — up from the original estimate of $1.35 billion. One small mercy is that those funds are supposed to come from corporate sponsors, television revenues, lottery proceeds and ticket sales, and not the taxpayers’ pockets.

There are some huge pluses, however, that Vanoc and the IOC have achieved to help soften the blow.

Vanoc craftily negotiated some of the richest marketing deals in Olympic history, raising so far nearly $600 million from a handful of sponsors. It also saved $10 million by folding the Richmond broadcast centre into the downtown Vancouver convention centre, and another $10 million by convincing the International Ice Hockey Federation to play on the existing NHL-size ice at GM Place.

The IOC has also signed record-breaking deals for U.S., Canada and European television broadcast rights. What share of that will go to Vanoc is not yet known, but the optics look good for the organizing committee.

The governments argue the Olympics are creating spinoff opportunities in the form of destination tourism and training facilities; Vancouver Island will have a new cross-country skiing resort, Fort St. John gets a new speed-skating oval and Prince George is building new ice sports facilities at the University of Northern B.C.

Vanoc aggressively reworked all of its venues with a practical eye towards justifying everything that it needs to build. With Montreal’s infamously over-budget billion-dollar stadium built for the 1976 Summer Olympics not too far back in their minds, Vanoc officials have questioned every conceivable expense, to the point that Furlong has taken to video-conferencing with the IOC rather than make expensive flights to Europe.

Yet with all that, the Games Canada was promised still has been substantially altered.

Many of the changes are being blamed on a strong economy and a building boom that started in 2002 in both the residential and non-residential sectors. China’s voracious demand for steel has also pushed prices sky-high. And the Independent Contractors and Businesses Association of B.C. estimates that construction costs in B.C. could rise 50 per cent by 2010.

The falling foreign exchange rate has also hurt Vanoc; the estimates were prepared when the Canadian dollar traded at $1.55 to the US. That’s because a large portion of Vanoc’s operating costs come from the IOC’s television revenues, which are paid in US dollars. Since the bid was won, Vanoc has lost millions of dollars in exchange value, even though it sheltered some money by hedging on foreign currencies.

Most importantly, the bid was prepared in fixed 2002 US dollars as required by the IOC, meaning that with inflation, it was already out of date before construction even began.

By April 2004 — less than two years after the bid budget was built — it was clear to Vanoc that costs were seriously out of whack and that it would need to apply to the province for a “supplementary budget.”

The province at first balked, but now has agreed to chip in $55 million more if the federal Conservative government matches the amount. Prime Minister Stephen Harper’s government hasn’t yet publicly agreed, but a decision is expected this fall.

The organizing committee is, by all accounts, pinching pennies as hard as it can while getting contractors and corporate sponsors to patriotically buy into providing value-added services at little or no cost. After all, these are Canada’s Games. Most sponsors, for example, also contribute to the Own The Podium program, which is supposed to get Olympic-level athletes ready for the Games.

But couldn’t the cost of these Games have been better estimated? If Vanoc’s executive team knew in April 2004 that its costs were escalating, didn’t it have the prescience to construct a more realistic budget for the 2002 bid? After all, many of the bid executives were hired by Vanoc.

“The taxpayers feel like they got snookered,” said Harry Bains, the Olympics critic for the Opposition New Democratic Party. He believes the Vancouver bid corporation deliberately underestimated the impact for taxpayers.

“What I’ve found is that Olympic management teams tend to underestimate costs in order to get the public on side in their respective countries,” he said.

If other businesses, such as mining and construction companies, are capable of building long-term projects on time, so why can’t the Olympics, he asks.

“We’re not reinventing the wheel. We have gone through this before and I think there are businesses of this magnitude all around the world that are planned five, six years ahead of time. You don’t see in most of them the cost overruns as you see in the Olympics.”

Giselle Davies, the IOC’s spokeswoman, said it is unreasonable to expect that there won’t be changes in the evolutionary life of an Olympic bid.

“It is relatively commonplace for a project that spans seven years — nine if you include the bidding phase — to have adjustments that take place,” she said Friday from Switzerland.

In recent years the IOC has insisted on much more detailed bids, and road-tests them with an evaluation commission. It is not in the best interests of the IOC or the international sporting federations to accept bids that are not adequately planned, she said.

“Having said that, the nature is that you are expecting things to change somewhat over nine years. It is natural that there will be changes.”

Vancouver first started its run for the Olympics in 1998, beating out Calgary and Quebec City for the Canadian Olympic Committee endorsement. Then Vancouver ran against an international field, which was shortlisted to itself, Salzburg, Austria and Pyeongchang, South Korea in 2003. In July, 2003 Vancouver won against Pyeongchang by two votes.

George Hirthler, an Atlanta, Georgia communications strategist who worked on the Vancouver bid several years ago, said bidding cities don’t deliberately mislead the public. They can’t afford to, he said.

“There isn’t any deception involved in the process of bidding,” said Hirthler, who has worked on eight Olympic bids and is now working on Salzburg’s bid for the 2016 Winter Games.

“I think it is just reality that it [the bid] gets changed. The community itself may begin to change it. The city may have an agenda on how things are built. And the IOC may see something more favorable in shifting elsewhere. It is extremely natural evolutionary process in the development of a decade-long program.”

Keith Sashaw, president of the Vancouver Regional Construction Association, laughs at that idea that Vanoc could have foreseen or better predicted the costs and changes.

“This is not a unique situation, Anybody who has renovated their kitchen has experienced the same kinds of problems Vanoc has encountered,” he said. “When the bid book was created in 2002, nobody would have anticipated the costs increases we’ve seen.”

Sashaw said private-sector developers have limited choices when costs go up. They either raise the price of their units, scrap the entire project, or engage in cost-cutting exercises by changing materials and scope of work.

“And that is exactly what Vanoc has been doing,” he said. “They’ve been cutting costs wherever they can.”

Sashaw said it is good that Vanoc is aggressively cutting out things it doesn’t think it needs, regardless of what the bid corporation pledged in 2002.

“Vanoc recognizes that they don’t have an open wallet they can be dipping into. I don’t think we’re looking at a Montreal billion-dollar stadium.”

But Bains is unconvinced. He believes the public is fickle about big projects that go over budget.

“I think the public will be paying a lot more money than they expected.”

He pointed out that the late NDP government was tossed out largely as a result of the fast ferries scandal, in which the catamarans, first estimated at $210 million, actually cost $454 million and were eventually auctioned off for $19.8 million.

“Well, [former NDP premier] Glen Clark lost his election on fast ferries overruns, and it wasn’t even close to this,” Bains said.

© The Vancouver Sun 2006

 

Other

A downtown Vancouver residential tower will boast North America’s first automated, non-pallet parking farage.

Jameson House, an exclusive, 37-storey glass tower with a completion date of 2009, will incorporate a European system that automatically parks a car without driving it.

Residents will pull into a transfer station, leave their car and lock it, then swipe a card to activate the system. A mechanized shuttle takes the car and parks it in an open sopot in the five-level, 230-spot garage.

When the driver wishes to leave, the system retrieves the car in as little as 90 seconds. The building will also include two levels of conventional parking. The builders claim the system saves time and space and increases security for both owner and vehicle.

Other

Non-Residents Buying Canadian Real Estate
There are no restrictions for non-residents purchasing real estate in Canada, though they may become subject to Canadian income tax laws, and will certainly encounter the following taxes on their transactions:

Property Transfer Tax (British Columbia) – The tax rate is one per cent on the first $200,000 of the property’s fair market value and two per cent on the remaining fair market value. For more information, visit the Government of British Columbia’s Property Taxation Branch’s website at www.rev.gov.bc.ca/rpt.

Goods and Services Tax (Canada) – The six per cent GST applies to the purchase price of newly constructed and substantially renovated homes.

Property Tax (municipal) – If the seller has already paid the full year’s property taxes to the municipality, the buyer will have to reimburse them for the remainder of the year’s taxes.

Residence Status and Income Tax
If non-residents stay in Canada for more than 182 consecutive days, they may be considered Canadian residents for Canadian income tax purposes.

Non-residents of Canada pay tax on income received from sources in Canada. The type of tax paid, and the requirement to file income tax returns, depends on the type of income received.

Canada has tax treaties with many countries, including the United States. A tax treaty is designed to avoid double taxation for people who would otherwise pay tax on the same income in two countries.

More information:

• Non-Residents, Canada Revenue Agency
  www.cra-arc.gc.ca/tax/nonresidents/individuals/nonres-e.html
• Tax Treaties, Canada Revenue Agency
  www.cra-arc.gc.ca/tax/nonresidents/treaty-e.html
• Cross Border Tax Issues: The Canadian Perspective, Reinhold G. Krahn. Vancouver: Lawson Lundell, December 2000
  www.lawsonlundell.com/resources/CrossBorderTaxIssues.pdf

Non-Resident Sales
When selling or disposing of Canadian real estate, non-residents must notify the Canadian government within ten days of the completion of the transaction to obtain a certificate of compliance. A certificate of compliance will only be issued if the CRA has received either a prepayment on account of the taxes owing or appropriate security for the prepayment.

On January 1, 2004, the CRA will start charging a financial penalty to non-resident owners of taxable property in Canada who sell that property and do not, within ten days, provide notice of the sale to the CRA.

In other words, CRA is tightening its tax reporting condition for non-residents who own Canadian property and will charge them the greater of either $100 or $25 times the number of days beyond the ten that pass before the sales notice is filed with CRA. For example, if a non-resident sells taxable Canadian property and does not notify CRA until 21 days after the ten-day grace period, that individual will be charged a $525 penalty ($25 x 21 days).

There are exceptions to this new policy, though an accountant or lawyer is best suited to interpret their applicability in a given situation. An individual can also apply to waive or cancel the penalty through a government “fairness committee.”

More information:

• Procedures Concerning the Disposition of Taxable Canadian Property by Non-Residents of Canada, Canada Revenue Agency
  www.cra-arc.gc.ca/E/pub/tp/ic72-17r5/README.html
• “Tax Obligations Imposed on Non-Resident Vendors Disposing of Real Property in Canada.” Real Estate Update, Lawson Lundell, Fall 2001
  www.lawsonlundell.com/resources/RealEstateUpdate.pdf

Note: The above is provided for informational purposes only and does not constitute professional advice. For more information, consult legal, financial and real estate professionals, as appropriate.

British Columbia Real Estate Association – December 18, 2003 (updated August 4, 2006)

The money comes from tapping into their home’s equity, but can mean less inheritance for their kids

LuAnn LaSalle
Sun

MONTREAL — Dorothy and Ed wanted to put their three grandchildren through college. In their late 60s, they also wanted to upgrade their home and invest.

Nadir, 82, wanted to give his two sons their inheritance early, while 69-year-old Martin and his wife Tina, 64, wanted to pay off their debts and retain some investment income.

They all turned to reverse mortgages from the Canadian Home Income Plan (CHIP), a wholly owned subsidiary of Home Equity Income Trust, as a solution.

Their stories, last names withheld to protect their privacy, are told on the Canadian Home Income Plan’s website.

Typically, the average age of a couple who applies for a reverse mortgage is about 72-years-old, said Greg Bandler, senior vice-president at CHIP.

“It’s a couple that has been retired for, give or take, about 10 years and essentially they’ve reached the stage in their life where they want to enjoy some additional things in their lives whether it’s travel, or starting to do some estate planning and gifting to their own children,” Bandler said in an interview.

The money that comes from tapping into their home’s equity is also used for renovations, retrofitting or investments to generate income, he said from Toronto.

“It’s really all about maintaining or sustaining or even in fact improving their current lifestyles at the stage that they’re at, but still being able to stay in the home.”

Bandler said he wouldn’t recommend a reverse mortgage, which has higher interest rates, as a short-term financing solution.

“There are other vehicles that should be available to people if that’s what they are looking for.”

He also said he wouldn’t recommend a reverse mortgage if the home is going to be sold in the near future or if the owner is expected to leave the house sooner than anticipated due to failing health. There are pre-payment penalties in the first three years, he added.

The minimum age to qualify is 60 and both spouses must be at that age to apply, Bandler said, adding there are no income, credit or medical qualifications.

The maximum amount on a reverse mortgage is $500,000 and the minimum is $20,000. There’s no repayment until the house is sold or death.

You can never owe more than the fair-market value of the house at the time the loan is repaid, Bandler said.

The interest on a reverse mortgage is cumulative and includes all the cash advances received plus all the interest on them. However, clients have an option of paying down some or all of the interest annually but it’s not a requirement.

Kevin Zakreski, staff lawyer at the British Columbia Law Institute, said seniors should also consider a conventional mortgage or line of credit.

They might be taking on more debt than they want with a reverse mortgage, said Zakreski, who was involved in a report on reverse mortgages and seniors at the B.C. Law Institute.

“They are rising-debt loans,” he said. “It compounds on the whole amount,” he said of the interest.

“These are really loans that you will carry for a long time,” he said.

Zakreski also said seniors’ children need to understand what’s going on with a reverse mortgage.

“Problems can arise when the children become aware of it because that is their inheritance that can be substantially reduced.”

The Canadian Home Income Plan considers itself the leading, national provider of reverse mortgages. They’re available through most major financial institutions, mortgage brokers and financial planning organizations.

It has provided about 11,000 reverse mortgages valued at roughly $700 million since 1986, Bandler said.

Zakreski said the cumulative interest will eat substantially into the home’s equity, but CHIP says on its website that most homeowners have money left over when the reverse mortgage is repaid — on average 50 per cent of the value of the home when it is sold.

Interest rates are higher than those on a conventional mortgage. CHIP’s current rate for six months is 8.25 per cent, 8.6 per cent for one year and 8.9 per cent for three years.

Bandler noted the higher rates but said: “The most important aspect in my mind is that we don’t require any payments from the homeowner during the life of the home income plan.”

The fees involved are about $250 for an appraisal and a $1,285 administration fee, both of which are taken from the proceeds, Bandler said.

The out-of-pocket expense is for independent legal advice.

“We’re very transparent in explaining to people what it is they’re getting into, but we want to make sure that they understand.”

Zakreski said he favours Manitoba’s legal approach, which gives the consumer seven days to think about the transaction.

“They can’t move on the transaction for seven clear days from the time you get the disclosure package to the time you sign it and complete the transaction.”

© The Vancouver Sun 2006

 

The property was bought by an Alberta businessman as a gift to his wife

Brian Morton
Sun

Sleepy little Pender Harbour on the Sunshine Coast has gone upscale.

Very upscale, it seems, after the sale of a new 2,300-square-foot waterfront home to an Edmonton businessman for $1.75 million. He bought the property as a gift for his wife.

But the sale of the house at the Whittakers development to Jay Champigny is not just a reflection of the seaside delights of Pender Harbour. It’s the latest example of a growing trend that is seeing much of B.C.’s best waterfront properties snatched up by wealthy outsiders — especially Albertans cashing in on their province’s oil bonanza.

“I noted an interest immediately from Albertans,” said Sharleen K. Whiteside, who started a website in May devoted to advertising waterfront and waterview properties for sale in B.C. “The majority [of interest] is from B.C., but Alberta is definitely number two.”

Whiteside’s website, called WaterfrontWest.com, gets about 200 hits a day, about 17 per cent from Alberta. The majority are still from B.C., but there is also sizeable interest from other parts of Canada, the U.S. and Europe, mainly Britain and Germany.

“Vancouver Island is number one [on Albertans’ list], but the Kootenays is also growing,” she said in an interview. “The overwhelming number of people buy [waterfront homes] as a vacation place that they can retire to later.”

Whittakers, a luxury oceanfront community on the Sunshine Coast, started sales two weeks ago and is already 50-per-cent sold. Ocean view strata lots start at $300,000 and homes at $875,000.

The development on six hectares features low bank, south-facing views in a protected bay, with each home having its own slip at a private marina.

Strict architectural design guidelines are also part of the package, as well as an optional concierge service that includes property management, rental management, security and service checks, house cleaning, and grocery, laundry, and catering services.

“We’ve been selling recreational real estate for five or six years and we’ve focused on the B.C. area for the last three,” said James Askew, president of rareEarth Project Marketing, the sales and marketing agent for Whittakers, which is being developed by Rockwater Properties.

“Between 1999 and 2003 there were few Alberta buyers. Since then, there’s been a huge change. On the Sunshine Coast, we’ve had about 35 per cent of our buyers from Alberta. In the Okanagan, if it’s prime location, we’re looking at 50 to 60 per cent of our buyers from Alberta, with an increasing number from Edmonton. It’s a huge, growing market.”

Askew believes the $1.75 million paid for their Whittakers home is the most paid on the Sunshine Coast for a similar home. “This is the most expensive one that I know of that’s been part of a new resort community.”

Askew said in an interview that their Watermark Beach Resort in Osoyoos is also getting a huge response from Albertans. “Geographically, it’s far away [from Alberta], but they’ve discovered it.”

But he said there’s far less interest from American buyers these days. “Alberta has replaced Washington as a really strong B.C. market.”

Champigny said that he purchased his Whittakers home as a present for his wife.

“This is a gift of love for my wife and our family,” said Champigny in a statement. “We were looking for a site with low banks and a view of the water. My wife is a writer and scuba diver and this place will inspire her.”

It’s his second waterfront home in B.C., the other is in Vernon.

Despite Askew’s observation that U.S. interest is dwindling, Whiteside said that’s not the case on her website. She said that despite the rising Canadian dollar, more than nine per cent of the traffic to the site is from the U.S., primarily from California, Washington and Texas. Seventy three per cent were from B.C. and 17 per cent from Alberta, she said.

© The Vancouver Sun 2006