New strata rules may trigger wave of redevelopment on older, more affordable buildings
Little-noticed changes to BC’s strata council rules, passed last month by the BC Legislature and scheduled to become effective this spring, may trigger a new wave of redevelopment that targets older, more affordable buildings.
That was certainly the goal of the those who proposed it, predicting a windfall both for developers and strata owners.
The changes were embedded, oddly enough, in Bill 40, the Natural Gas Development Statutes Amendment Act, debated last month. Rich Coleman, the Premier’s point man on LNG, is also the housing minister.
The new rules make it much easier for strata councils to sell out and liquidate by reducing the current 100 percent vote required for approval to only 80 percent, although a court order would be required to finalize the decision.
With developers ready to offer big premiums for desirable sites, that easing of the rules may be enough to trigger a wave of demolition and redevelopment on older buildings in Metro Vancouver. There are reports this has already happened in Vancouver, where individual condo owners are being offered far above their assessed values to approve a sale.
This recent exchange in the Victoria Times Colonist makes it clear that redevelopment pressure is real even with the current requirement for 100 percent approval by strata owners.
Here’s what Coleman said in the Legislature as he introduced the changes on Nov. 5:
“Some strata corporations in British Columbia are more than 50 years old. Many of these strata corporations want or need to be wound up. This may be because the building is at the end of its life cycle or the owners have found a better or, perhaps, more profitable use for the land or want to redevelop it and gain that benefit and stay there.
“Right now in British Columbia, unlike most Canadian jurisdictions, a unanimous vote is needed to voluntarily terminate a strata. It is very difficult to get unanimous agreement. It can also be a challenge getting everyone to vote or locating absentee owners. So what we did with this, when this came to us a couple of years ago, is — at our request — we asked the B.C. Law Institute to review the rules around terminating strata corporations.
“They recommended to us that the vote be changed to…. Eighty percent of all voters must vote in favour to voluntarily terminate a strata rather than 100 percent. They recommended that, after the vote, a court order be required in order to make sure that the courts would give legal precedent with regards to this. This is so the courts can ensure that the interests of any dissenting owners and charge holders are considered.
“There was strong stakeholder support for these recommendations in strata properties and across the strata ownership piece, as we did our consultation.”
Strong support from those hoping to make windfall gains? No doubt. But good housing policy? Not likely.