What Will An Extra $300 A Month Get You?

A piece of angle iron. But I'll get back to that in a minute.

Several months ago prairie dog ran a story about the Viva Apartments. In case you didn't read it, the Viva was another of those three-story walk-up apartments that was up for condo conversion. Thanks in large part to dogged activism of one of its tenants, Christina Luberti, that condo conversion was stopped. The only condo conversion to have been denied by city council in... well... ever, despite the city's vacancy rate plunging from 1.5 percent to 0.5 percent in the last year. And despite the fact that city policy states that condo coversions are supposed to be denied if the citywide vacancy rate drops below 3 percent unless 75 per cent of tenants support the conversion and none of them indicate they will face substantial hardship as a result of it.

The Viva conversion was halted not because of the vacancy rate being 0.5 percent, by the way. Council has passed several condo conversions while the rate was that low, both before and after and the Viva controversy. No, the conversion was halted because Luberti was able to demonstrate to council that there was not 75 percent support for it among Viva residents.

Throughout the process, representatives for Viva's property manager, Nicor, warned that rents in the building were below market and that to finance the substantial renovations the Viva needed, rents would have to go up dramatically if the conversion was not approved. Some saw this as a threat. On more than one occasion, I even heard it described as the developer was holding city council hostage.

To soften things, Nicor came forward with a seven-point tenancy agreement for residents in their apartment buildings that were facing condo conversion. It guaranteed them multi-year tenancy along with rent controls. And while Nicor was lauded repeatedly for coming forth with such a generous agreement, it's worth noting that the agreement council saw is very different from Nicor's original offer to tenants. It was thanks to negotiations and pressure from the city and thanks to tenant activism and the threat that several Nicor-managed conversions were imperiled that the property manager relented.

Anyway, around the time Viva was being considered, Nicor had four other buildings up for conversion. All were passed and those tenants were protected by some version of the seven-point agreement. As the Viva conversion was denied, those tenants are not protected at all.

And I had a chance to talk to Christina Luberti recently and found out that her rent will rise from the low-$500 range when Nicor took over management of the Viva to the mid $800 range.

"It feels kind of punitive," she remarked.

She says that in her discussions with the Nicor-employed building manager the rent hike is to finance work on the facade and the common areas. She says she doesn't know what kind of work the building needs that's so expensive it would require such a substantial hike in tenants' rents.

I asked her what work had been done so far. She pointed to a piece of angle iron bolted to a post alongside the front steps -- the piece of angle iron in the picture above. Several of the buildings tenants are elderly, she says -- one being in her 80s -- and they've been asking for a railing out front for years. That angle iron is Nicor's solution. You'll note that it is only secured on one end and waves freely at the other. The ends were left cut sharp until Luberti wrapped them in electrician's tape so none of the neighbourhood kids would get injured on them.

The lesson to developers in the Viva should have been that the city's condo conversion policy had teeth -- if a conversion didn't meet city standards then it could get turned down. It could be argued that the example of the Viva is why so few conversions were brought to council in its immediate wake, and why developers have been so ready of late to accept a restriction included with the latest wave of conversion approvals that any building converted to condos must remain 75 percent rental.

But the example of the Viva also shows that in the absence of any provincial rent-control scheme or some kind of independent tenants' rights group, the developers really do hold all the cards in this game.

As reported earlier on Dog Blog, city council approved three more condo conversions on Hamilton Street.


observer said...

Paul, thank you for bring this to the attention of people who follow your blog. This should be an election issue.

i find it interesting that the owner of this building has so little capital that piecemeal improvments must be funded by raising rents. i'm not surprised though .... i agree with the tenant, it seems punitive. surely, with the low vacancy rate, the suites are all occupied. What is being done with the rent money? What did the previous owner do with teh rent money? Has the hourly rate for iron bar installers gone up so much that the rents need to go up so much?

These questions should be put to Ross keith of Nicor, and the owner of the building that is employing Nicor. Last time I looked, the owner of the building D.R. Real Estate Ltd of Edmonton. Director of D.R. Real Estate Ltd is a guy called Dedric Robinson. D.R. Real Estate Ltd's nature of business is "buying and selling real esate". Surely, this company is not so ignorant or poorly run that they need such a huge rent increase to fund such piecemeal improvements.

Has Fred Clipsham contacted you about this? i ask has "he-contacted-you" because i am of a mind that he is not aware of it, or doesn't care about it. He needs to be reminded that this is an election year and people in his ward are hurting. He needs to be reminded that he is meant to represent people in his ward. I want to see in writing what Clipsham has to say about this. And i've heard enough of his moratorium on condo conversions, and enough about his being regina's best council a-la prairie dog's best-of.

What do the losing candidates of Ward 3 last time think about this? Don Young, Tim Haynes etc? What about CCFR people?

No doubt Ross Keith and Nicor have their point of view well-explained elsewhere. Nonetheless, i don't think it does any good for Prairie Dog to report the tenant's observations about the iron bar etc - and then have no response from the building's owner or the owner's agent.

And the man whose business is "buying and selling real estate" - Dedric Robinson - what about him? How about some word from him about the iron bar and the rents?

thsoe rent increases .. .yes, they seem punitive. i think they would appear punitive to most people.

Ross Keith and Dedric Robinson need to appear in print in Prairie Dog to explain why they are not punitive. I'm open to explanation. And Dedric could tell us how much he's paying Ross Keith and Nicor to organise these rent increase and the iron bar installations.

And I'm open to any candidate willing to show that he/she is interested in Ward 3 and cares about the welfare of Ward 3 residents.

Stephen Whitworth said...

Thanks for the comments and for your high expectations for our coverage. There will be more on this in next week's prairie dog, as well as ongoing coverage on Dog Blog.


Editor Steve