A citizens’ group that wants to overturn the BC Assessment Authority’s valuation of Oakridge Centre claims the Crown corporation’s decision costs Vancouver taxpayers millions of dollars a year and benefits the Quebec pension fund that ultimately owns the 28-acre property.
South Vancouver Parks Society president Glen Chernen opened a five-day hearing before the Property Assessment Appeal Board on Monday in Richmond, contesting the July 2014 assessment of $500.54 million.
Chernen testified that there should have been a significant uplift in value to $1 billion because Vancouver city council approved rezoning in principle in March 2014 to allow owner Ivanhoe Cambridge to redevelop the site to include 11 new condominium towers.
Chernen was among the speakers who appeared at public hearings in 2014 to oppose the rezoning, which allows owner Ivanhoe Cambridge to increase total allowable floor area to 4.5 million square feet from the current one million square feet. That would allow the increase in residential units to 2,914 from 32.
“The reason the society is here today, is that according to BC Assessment and Ivanhoe, the 3.5 million square feet of additional floor area does not add a single penny to the market value of the site,” Chernen told the hearing. “We were shocked to find, coincidentally, that BC Assessment and Ivanhoe had submitted valuations that indicate the rezoning results in a decrease in value.”
Chernen said that “for a short time” between January and March 2015, BC Assessment’s roll showed that the property was assessed at a post-rezoning $867.8 million. “At or about April 16, 2015, the society was surprised to learn that the value had been reduced by approximately $367 million, to $500.54 million,” Chernen said.
In July 2015, Oakridge was assessed at $550.3 million, up almost $50 million from a year earlier, but far below what BC Assessment had on its roll in early 2015.
Chernen said Vancouver is a robust real estate market with high demand. He claimed that Ivanhoe Cambridge received an “improperly obtained” tax discount that lowered the city’s tax base used to fund essential services, like police and fire. The tax burden was shifted from an out-of-province fund to local residents.
“This recently approved development is one of the largest in the country, and the consequences of how it proceeds is of great public importance,” he testified. “We have estimated that the lost annual tax revenue associated with a $367 million reduction is approximately $5.5 million a year.”
Ivanhoe Cambridge, which claims $55 billion in assets and a portfolio of 500 properties, is the real estate subsidiary of Caisse de dépôt et placement du Québec.
“For the moment, Ivanhoé Cambridge intends to participate fully in the board proceedings and will not comment while this matter is before the board,” company spokesman Sebastien Theberge told Business in Vancouver.
