The Property Assessment Appeal Board says a $367 million drop in the Oakridge Centre property valuation was not a mistake.
Panel chair Dale Pope and member Bruce Turner agreed in a September 9 written decision with the 2015 reassessment at $500.54 million after South Vancouver Parks Society contested the valuation at a five-day hearing in June.
Landlord Ivanhoe Cambridge Inc. had successfully appealed the original $867.75 million assessment of the 28.3 acre mall and parking lot to the Property Assessment Review Panel, which does not issue reasons for its decisions.
The society claimed that the property should have been valued between $750 million and $1.1 billion, because of the Vision Vancouver majority city council’s March 2014 conditional rezoning to allow 11 condominium towers be built. Society president Glen Chernen argued that the lowered assessment shifted a significant burden from the real estate arm of pension fund Caisse de dépôt et placement du Québec to Vancouver residents, who lost out on tax revenue.
The board accepted the income approach valuation by Vicky Yip of BC Assessment as the “only reliable and supported market evidence and analysis provided.”
Yip estimated a value of $508,604,000, based on capitalizing a net operating income of $29,744,710 at 5.75%.The board said the calculation should result in a value estimate of $517,299,000, but Yip’s estimate was within an acceptable 3% of the roll value.
Chernen’s case relied on a 2014 valuation of 10% of the property at $75 million by accredited appraiser Jason Upton. Ten per cent of the value of the property was to have been paid to the city in lieu of parkland.
“The appellant stated that Mr. Upton’s valuation of a hypothetical 10% interest in an undefined non-existent 2.83 acre property may simply be multiplied by 10 to estimate a value for the entire subject,” the decision said. “However, Mr. Upton agreed, in cross-examination, that one could not simply multiply his hypothetical 10% valuation to arrive at an overall estimate of property value.”
The panel rejected a report by Chernen, because it felt he “did not follow accepted appraisal practice and therefore he was not qualified as an expert capable of giving panel evidence on the subject’s market value.”
Pope and Turner issued an order for the society to pay unspecified costs, because of “frivolous, vexatious and egregious” misconduct during the proceedings, ruling that Chernen was unprepared and mounted no substantive case, among other things. It gave Ivanhoe Cambridge until September 22 to make a submission on the costs issue.
In a prepared statement, the society said it was disappointed by the decision, but it did not indicate its next step.
“Our neighbours, members and supporters believe this is an extremely important matter that deserves a more detailed forensic investigation. We keep being asked why the city didn’t join us and protect South Vancouver residents and why it was left to us?”
