A case for urban renewal: reform strata legislation
Tue, 01/31/2012 - 14:43
An ever growing population in British Columbia’s urban centres, combined with ageing building stock in many areas, has necessitated a need to reconsider provisions of the Strata Property Act (SP Act). The provincial legislation governing strata plans and strata corporations, in its current form, is an impediment to urban renewal.
Particularly, the provisions of the SP Act governing the vote threshold on the winding up of a scheme make it nearly impossible for a majority of owners in an ageing condo development to either undertake significant renovations or redevelop their ownership stake in the land. For example, an old apartment complex with four ownership units that is in severe disrepair - where the cost of maintenance is not financially viable - requires the votes of all four owners and a unanimous decision to terminate the scheme and redevelop the site.
In the context of the current legislation, one dissenting voter or 25% of the owners in this particular building, can effectively prevent the remaining 75% of owners from improving their living and financial arrangements. Likewise, it may make more financial sense to terminate the scheme and sell the consolidated site for redevelopment and renewal in line with modern planning policies.
There is, however, a need for a mechanism to protect dissenting voters should the winding-up threshold be lowered. Whether opposition to winding-up a scheme is a result of personal circumstances, such as a lack of inclination to move or find appropriate accommodation elsewhere, holding out for a better but possibly unrealistic offer from a developer who wishes to redevelop the site, or because the home is close to essential community services. No dissenting voter should end up out on the street and without fair and adequate compensation.
Compensation may include fair market-value for units owned by dissenting voters, ownership in any new development on a site, and adequate compensation incurred for any interim expenses while a site is redeveloped. Whatever the nature of compensation, a system involving mediation between majority and dissenting voters as well as a mechanism for independent arbitration would provide adequate protection to all parties.
As the Province and municipalities continue to struggle with the problem of housing affordability, and in some places urban decay, provisions of the SP Act provide a significant legislative hurdle to urban renewal and the potential for increased housing supply and enhancement of the urban fabric. It is time to for BC to get its strata act together and follow in the footsteps of other places with limited land supply, large stocks of apartment buildings and a more modern approach to strata legislation such as New York, Washington, Singapore, Hong Kong and Japan.
Homeowners demand it, housing affordability demands it, sustainability demands it and a growing population will demand it. Let’s hope the Province will get on board and support important changes to BC’s strata legislation.
An ever growing population in British Columbia’s urban centres, combined with ageing building stock in many areas, has necessitated a need to reconsider provisions of the Strata Property Act (SP Act). The provincial legislation governing strata plans and strata corporations, in its current form, is an impediment to urban renewal.
Particularly, the provisions of the SP Act governing the vote threshold on the winding up of a scheme make it nearly impossible for a majority of owners in an ageing condo development to either undertake significant renovations or redevelop their ownership stake in the land. For example, an old apartment complex with four ownership units that is in severe disrepair - where the cost of maintenance is not financially viable - requires the votes of all four owners and a unanimous decision to terminate the scheme and redevelop the site.
In the context of the current legislation, one dissenting voter or 25% of the owners in this particular building, can effectively prevent the remaining 75% of owners from improving their living and financial arrangements. Likewise, it may make more financial sense to terminate the scheme and sell the consolidated site for redevelopment and renewal in line with modern planning policies.
There is, however, a need for a mechanism to protect dissenting voters should the winding-up threshold be lowered. Whether opposition to winding-up a scheme is a result of personal circumstances, such as a lack of inclination to move or find appropriate accommodation elsewhere, holding out for a better but possibly unrealistic offer from a developer who wishes to redevelop the site, or because the home is close to essential community services. No dissenting voter should end up out on the street and without fair and adequate compensation.
Compensation may include fair market-value for units owned by dissenting voters, ownership in any new development on a site, and adequate compensation incurred for any interim expenses while a site is redeveloped. Whatever the nature of compensation, a system involving mediation between majority and dissenting voters as well as a mechanism for independent arbitration would provide adequate protection to all parties.
As the Province and municipalities continue to struggle with the problem of housing affordability, and in some places urban decay, provisions of the SP Act provide a significant legislative hurdle to urban renewal and the potential for increased housing supply and enhancement of the urban fabric. It is time to for BC to get its strata act together and follow in the footsteps of other places with limited land supply, large stocks of apartment buildings and a more modern approach to strata legislation such as New York, Washington, Singapore, Hong Kong and Japan.
Homeowners demand it, housing affordability demands it, sustainability demands it and a growing population will demand it. Let’s hope the Province will get on board and support important changes to BC’s strata legislation.