Surrey city council is dissolving its quasi-public real estate corporation, the Surrey City Development Corporation, in favour of in-house transactions, following a secret vote in April that was announced to the public Monday.
SCDC is a for-profit real estate development company and is separate from the City of Surrey with independent finance, operations and governance. But its sole shareholder is the city and it pays annual dividends from the sale and leasing of deemed surplus city-owned land.
Since incorporating in 2007, under direction from former mayor Diane Watts, SCDC was most notably involved in the development of 3 Civic Plaza in the city centre and the Campbell Heights industrial land.
“Council believes the time is right to bring these activities back under the purview of the City and have the work done in house,” said Mayor Doug McCallum in a written statement.
McCallum provided no reason for dissolving SCDC.
The transition to bring all of the corporation’s assets under the direct control of the city is expected to conclude in 2021, but transactions identified in the latest five-year business plan are expected to continue. That business plan has not been made public.
SCDC issues shares to the city in exchange for beneficial ownership of land in trust. It takes that land and partners with private developers.
“On the financial side, SCDC’s business strategy has two primary components; firstly, to generate profits from real estate developments, and secondly, to generate net income from investments and an income-producing portfolio of properties,” states its 2018 annual report.
After construction of a development, as in the case of 3 Civic Plaza, SCDC sells its portion of the project. SCDC reported a net gain of $7.3 million from 3 Civic Plaza. In some instances, as in Campbell Heights, it leases city land to companies. SCDC showed a total net lease income of $605,814 in 2018.
The market value of the SCDC portfolio was appraised at approximately $250 million at the end of 2019, according to the corporation’s website (but this figure is not disclosed in its 2018 financial statements).
SCDC states it has a current cumulative surplus of $46 million. That’s down from $63 million on December 31, 2018, according to the most recent financial statements.
In an online statement, SCDC said it “has provided consistent revenues for the City to support its goals.
“Since 2013, SCDC has paid a $4.5 million annual dividend to the City. By the end of 2019, had paid it a total of $31.5 million.
“The corporation is on track to pay another $4.5 million dividend by the end of 2020, bringing the total of dividends provided by SCDC to the City to $36 million.”
Questions such as, why the surplus dipped so much in the past year; why $1.73 million worth of salaries and benefits is not disclosed in more detail; exactly how much land has been sold in 13 years; and what assets are to be transferred were redirected from senior SCDC management at the direction of city communications manager Oliver Lum, who would then pose the questions back to SCDC management and take the answers and provide them back to Glacier Media. Lum did not reply in time for publication.
Couns. Steven Pettigrew and Linda Annis have both voiced concerns about the transfer of assets to the city, believing they may be absorbed into the police transition budget, particularly as the city faces financial uncertainty and a slough of cancelled capital projects.
No council member may disclose how they vote in an in-camera meeting, said Pettigrew, however they may express their opinions on said vote.
“I am not happy with the decision to dissolve SCDC,” said Pettigrew via email.
“I am concerned about several things regarding the dissolution: the potential loss of our reputation with the business and the developer community; the loss of momentum on SCDC-sponsored projects; the possibility of SCDC assets being absorbed into the City and then being sold off to provide additional funds for the [Surrey Police Department],” added Pettigrew.
Annis said, “SCDC has been an incredibly valuable arms-length agency of the city as we ensure we’re making the best possible use of city land and leveraging it for our community’s future.
“Doug McCallum has a long history and habit of selling off city lands and it worries me that scrapping SCDC will put our land at risk.”
B.C. Real Estate Association releases new rules for open houses – Globalnews.ca
It’s been a long tradition in the real estate industry: Showcasing a home for sale via an open house, where anyone could just walk in.
“In the pre-COVID days, open houses were often a form of Sunday afternoon entertainment,” said Darlene Hyde, CEO of the B.C. Real Estate Association (BCRCA).
“People would just go into a house to see what it looked like.”
Those days are now gone, at least for the foreseeable future, as modifications are underway keep everyone safe during the pandemic.
On Wednesday, the BCRCA released new rules for realtors holding open houses, which are now resuming after being on hold for the past four months.
“This will be safe for the public going through the open house, it will be safe for the occupants, it will be safe for the public and for the realtors,” Hyde told Global News.
The new protocols include limiting open-house attendees to serious buyers by leveraging technology tools and screening for qualifying consumers.
The new guidelines also encourage realtors to pre-register potential buyers before they attend the open house.
“The realtor community is going to a lot of extra lengths to make it safe, so there’s no point in having people on a property or in a place that don’t have to be there,” Hyde said.
Other guidelines include buyers having to wait outside for their turn if numerous people are wanting to go through a home and all parties involved wearing masks and maintaining their social distance inside.
Kelowna realtor Geoff Hayes welcomes the new rules.
“It’s kind of helping us keep the handle on the pandemic, but it’s also helping us do our job,” he told Global News.
Hays said for the past four months, realtors have had to rely on technology to market homes for sale.
“We’re using our phones, we’re going live on social media, Instagram, Facebook,” he said.
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Many realtors have been holding virtual open houses, since traditional ones have not been taking place since mid-March.
“People, they typically want all eyes on their home, so it’s just been one of those things where . . . we had to explain, ‘Well the bad news is we can’t do them, but the good news is we can do them a different way,’” Hayes said.
Hyde said the pandemic has made it tough the last few months to market homes for sale.
“It has been extremely challenging and we have encouraged realtors to use virtual means whenever possible,” she said.
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Despite the new strict guidelines in the industry, Hyde said things are looking promising.
“The market is opening up, and in the Okanagan for example, sales rebounded in June. They are back to pre-COVID levels, so things are really looking good for the Okanagan.”
Hyde added that the supply of homes, however, remains low.
“It’s got to be putting a little bit of pressure on the price,” she said. “There’s a lot of uncertainty ahead but we are cautiously optimistic that the market will remain firm.”
© 2020 Global News, a division of Corus Entertainment Inc.
Victoria Real Estate Market Sees 9.2% Increase In June – Business Examiner
VICTORIA – A total of 808 properties sold in the Victoria Real Estate Board region this June, 9.2 per cent more than the 740 properties sold in June 2019 and 76.8 per cent more than the previous month of May 2020. Sales of condominiums were down 3.2 per cent from June 2019 with 209 units sold. Sales of single-family homes were up 16.8 per cent from June 2019 with 460 sold.
“This June we saw competing factors from all different sides of the real estate equation,” says Victoria Real Estate Board President Sandi-Jo Ayers. “If all we do is look at numbers, we see a fairly normal June, in the midst of a very not normal world. The impact of COVID-19 on our entire economy continues. And while some buyers and sellers are slow to emerge from isolation, others have been highly active since the start of Phase 2 of BC’s Restart Plan. Because of the pandemics, an eviction order that prohibited a landlord from ending a tenancy was introduced. The order may have kept some homes from going to market. The portion of this order that prevented a seller from providing vacant possession of a tenanted home was lifted late this month, which may bring some listings to market that had been stalled. Due to the pandemic alone, we have multiple factors influencing the inventory and sales in our market.”
There were 2,698 active listings for sale on the Victoria Real Estate Board Multiple Listing Service at the end of June 2020, 11.3 percent fewer properties than the total available at the end of June 2019 but a 6.1 per cent increase from the 2,544 active listings for sale at the end of May 2020.
“Additionally, the Canada Mortgage and Housing Corporation announced changes that start July 1 which will reduce the borrowing power of some buyers who insure through CMHC,” adds Ayers. “This may have pushed some demand forward – although there are alternate suppliers of mortgage insurance. Ongoing low inventory levels also mean that we are seeing a fair number of multiple offers. The condo market is slightly softer in terms of sales numbers. This may be in part due to the recent strata insurance issues which caused concern for owners and sellers. The government promised this month to begin to address the insurance issue, so there may be some relief on the horizon. These are not normal days for local real estate, nor is this month a signal of a return to normal, regardless of the numbers. That said, buyers and sellers are successfully navigating our market with the help of local realtors, who know how to implement health and safety protocols and understand the complexities of our current market. As always, I recommend you consult your Realtor to understand what is happening in the moment.”
The Multiple Listing Service Home Price Index benchmark value for a single-family home in the Victoria Core in June 2019 was $861,800. The benchmark value for the same home in June 2020 increased by 4 per cent to $896,200, 1.2 per cent more than May’s value of $885,400. The MLS HPI benchmark value for a condominium in the Victoria Core area in June 2019 was $519,100, while the benchmark value for the same condominium in June 2020 increased by 1.3 per cent to $525,600, 1.6 per cent less than the May value of $534,300.
Fraser Valley Real Estate Board says sales double in June, buyers returning to market – Abbotsford News
Real-estate sales in the Fraser Valley are back on the upward trajectory after COVID-19 slowed the growth of the market for several months.
The Fraser Valley Real Estate Board (FVREB) said they saw 1,718 sales through their multiple-listing service in June, an increase of 113.4 per cent over May’s sales, and an increase of 31.5 per cent over June of last year.
“We’re cautiously optimistic. June’s numbers clearly indicate that the market is functioning in this challenging new environment and we’re returning to more typical activity levels,” said Chris Shields, president of the board. “[Buyers] are getting more comfortable with the new buying and selling process.”
He said that very-low interest rates, high demand over the previous three months when “the market was on hold,” and new Canadian Mortgage and Housing Corporation rules (which came into effect July 1) are all contributing factors.
The board says they had 3,456 new property listings in June, a 56.6 per cent increase compared to May’s 2,207 listings, and a 23 per cent increase over June, 2019.
There were 7,063 active listings by the end of June, an increase of 9.4 per cent from May, but a decrease of 17.1 per cent last year, according to the board.
“We can’t predict how our market will continue to respond during COVID, but what we do know is that historically, over 80 per cent of Fraser Valley buyers move within our region and half purchase within their own community,” Shields said. “People buy and sell for lifestyle reasons and currently, even during this uncertain time, conditions are favourable. The market is balanced, inventory is growing, and prices remain stable.”
The month saw an average sell time of 37 days for the region’s apartments, 30 days for townhouses and 31 days for single-family detached homes, according to the board.
The region’s benchmark price for a single-family detached home was $994,500 (an increase of 3.6 per cent from 2019), $559,600 for townhouses (up 1.9 per cent from 2019) and $435,300 for an apartment (up 3.3 per cent from 2019).
B.C. Real Estate Association releases new rules for open houses – Globalnews.ca
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