Tony Gioventu
Province

Dear Condo Smarts: Our strata corporation has hired a consultant to help us with a major construction involving roofing and decks.

We had an engineer set the specifications and the successful bidding contractor submitted a bid that included materials and labour. There were no other costs in the bid that were identified.

Our consultant recommended that we sign the “standard” contract, so we proceeded with the agreement and construction.

The good news is the contractor did a great job and on time. The bad news is we were hit with more than $200,000 in disbursement costs that were not part of our original contract, so we’re disputing the final price.

Have we possibly signed a blank cheque here?

— MO

Dear MO: The devil is in the details. Before anyone signs a major contract, they should have a legal review of the terms and conditions. The devilish details are the definitions of the terms. If you signed a contract that includes disbursements, is that term defined somewhere in the contract?

At this point you need a legal review of the contract terms and conditions along with the bid. Then your lawyer needs to advise whether you have any reasonable grounds to dispute the charges.

Never agree to disbursements unless they are individually defined in the contract and the cost of each disbursement is itemized. You can also negotiate a limit on the total amount of disbursements you will approve.

If you don’t, you may indeed be signing a blank cheque.

Tony Gioventu is executive director of the Condominium Home Owners Association.

E-mail him at [email protected]

© The Vancouver Province 2008

 

Noteworthy on First

Sun

WALL CENTRE FALSE CREEK

Location: Southeast False Creek, Vancouver

Project size: 4 towers, 414 apartments

Residence size: 555 sq. ft. — 1,100 sq. ft.

Prices: $459,000 — $1.4 million

Presentation centre: 130 West First, Vancouver

Telephone: 604-874-9232

Hours: noon — 5 p.m., Sat. — Thur.

Web: wallcentrefalsecreek.com

Developer: Wall Financial Group

Architect: Gomberoff Bell Lyon

Interior designer: BYU Design

Occupancy: Early 2011

– – –

Of all the things that might be said about Wall Centre False Creek, big and small, literal and figurative, let us start here: Those of us who will make our next home there will live in a home from a leading contributor to Vancouver‘s “City of Glass” reputation.

One whole block downtown testifies to the Wall family’s foundational role in the (re-)introduction of a residency purpose to the downtown peninsula: the three-tower Wall Centre, bounded by Burrard and Hornby, and Nelson and Helmcken streets.

The last tower erected there was the city’s tallest, at 48 floors when completed in 2001, a superlative it has had to surrender to the 61-floor Living Shangri-La.

By its room count, in two of the three towers, the Sheraton Wall Centre is the largest hotel in Vancouver and the second largest in Western Canada.

At four towers, Wall Centre False Creek also demonstrates one of the characteristics of a new-home project from the Wall family: It is big.

Inclusion of new facilities for the Vancouver Playhouse Theatre Company demonstrates another characteristic. It is imaginative — or put another way, it imaginatively transforms a public need into a private advantage.

Without the Playhouse commitment to City Hall, the Walls could construct about 265,000 square feet on the Wall Centre False Creek site.

With it, they can construct about 400,000 square feet, about 355,000 of which they can incorporate in the new-home project.

Wall Centre False Creek will rise along West First, Columbia Street on the west and Manitoba Street on the east.

Immediately across the street — West First — the Olympic athletes’ village is under construction. After the Winter Games, the village residences will be occupied.

Let’s see — that makes two adjacencies near at hand (or foot): an Olympic Games legacy and new Playhouse facilities, including a small theatre.

Granville Island is to the west, the evolving retail offerings of Cambie Street are to the south, Chinatown and downtown are to the north and Main Street is to the east.

No wonder the sales campaign touts Wall Centre False Creek as being situated in the “centre of Vancouver‘s newest, most vibrant waterfront neighbourhood.”

Construction will not be completed before the Olympics because of security issues. But the ever-positive Bob Rennie, of Rennie Marketing Systems, points out that today’s buyers will be able to get a superior product at today’s interest rates.

Rennie says buyers will need to put down eight per cent now, eight per cent in six months, another eight per cent in one year, and then not pay again until completion in 2011.

“They are really unbelievable homes with unbelievable views overlooking the new city park called Hinge Park, which spills out to Habitat Island in False Creek,” he say which spills out to Habitat Island in False Creek,” he says.

He adds that the new trolley line being built on First Avenue will whisk residents to Granville Island. The homes will also be an easy walk to the Main Street SkyTrain or the Cambie Street Canada Line.

“People won’t have to be so reliant on their cars,” he says.

Two of the towers are 15-storeys high, one is 14-storeys and the fourth is 12.

A property manager will be on site, as well as two concierges, each of whom will be responsible for the needs of residents in two towers. Each building will share a facility with a gym, meeting room and kitchenette.

Rennie Marketing’s Tracie McTavish points out that the interiors will be outfitted to the highest possible standards.

“They didn’t cut any corners,” says McTavish, noting kitchens comes with Wolfe stoves, Sub-Zero refrigerators and Faber hood fans.

The countertops are either granite or marble and the contemporary style cabinetry is wood veneer, with the fridge hidden behind a wooden door.

There will be hardwood flooring throughout the homes and buyers can choose from three different styles of kitchens.

“The kitchens really are gourmet with all the bells and whistles,” says McTavish.

Bathrooms will feature polished limestone, marble and travertine tile floors, limestone countertops, above-counter sinks, large soaker tubs and frameless glass showers.

© The Vancouver Sun 2008

Developer revitalizes downtown block for 21st century

Michael Sasges
Sun

His usual work the restoration of older commercial and industrial buildings for residential re-use, developer Robert Fung has passed the last two years or so organizing the restoration of an older building for commercial reuse.

The building is the Flack Block. By next year, it will have commanded the northeast corner of Hastings and Cambie in downtown Vancouver for 110 years.

THE REHABILITATION WORK REINTRODUCED OR RESTORED:

– Exterior features damaged or removed over the years, such as an archway

– Exterior features that have survived the decades, such as the sandstone facades and the wood-trimmed windows

– The original lightwell

– The original stairwell and elevator cage

As well as adding a new top floor, the new-construction work brought a 19th-century building up to 21st-century seismic, structural and building-systems standards, and introduced a new elevator and shaft.

The building is a pointer to the growth of the city in the decades after the arrival of the national railways and to the contribution of Edwardian and Victorian architects to Vancouver‘s first-city status in a young British Columbia.

”The Flack Block is a significant landmark component of the early retail and commercial fabric of West Hastings when Hastings Street was one of the most prominent commercial streets in early Vancouver,” city hall staff told council.

”Vancouver was a major supply and transportation centre during the Klondike gold rush, resulting in burgeoning mercantile trade and significant building construction.

”The Flack Block was one of the largest buildings constructed in Vancouver during the Klondike era and provided stimulation for further commercial development in the area.”

The building’s architect was William Blackmore (1842-1904), ”one of Vancouver‘s most accomplished early architects” whose championship of the ”Romanesque Revival” style he used at the Flack Block ”helped to establish the character of Gastown and Victory Square as successful and progressive commercial districts.”

There was, of course, no Victory Square in the years of original erection and immediately after. There was, however, the city courthouse on what would become Victory Square, an institutional presence that lured businesses south from the waterfront and Gastown.

The Flack Block probably cost $90,000 to $100,000 to build. The restoration will probably cost about $19 million, Robert Fung estimates.

Asked to “compare and contrast” the restoration of a building for residential reuse and restoration for commercial reuse, the Salient Group principal said:

“It’s a clichéd answer to say it’s exactly the same and completely different, all of the time.

”It’s exactly the same in that we’re adapting an old structure for modern use, and to a very high level.

“We’re introducing interior design that’s modern, layered in to the historic environment, very high quality historic environment, and utilizing the modern interventions to show off the historic ones, rather than layer in things that are attempting to look old. We wanted this to look very crisp against the older components of the building.

“And then it’s very different because we are also attempting to anticipate what potential tenants may want.

“So we’ve tackled the building and dealt with the common areas in a manner that tried to keep the overall feel and presence of the original building and then left the spaces remaining with a high level of character, but very flexible and fluid.

”We brought in infrastructure, a high level of infrastructure, cooling, heating, that make this building equivalent to most of the downtown triple-A space. We brought in a high-speed elevator, all the things that you would for any office building.

“And the difference in the residential versus the commercial is we need to achieve the feel of the whole building just using the common spaces, as opposed to in each of the residential suites we have the opportunity then to bring that character to each of the suites.

“Here we have the envelope and the tenant will come in and all the stuff they will build will be pretty specific to their taste and their field.”

The Centre for Social Entrepreneurship will lease the office space. Salient is looking for an operator as a bar and restaurant.

© The Vancouver Sun 2008

 

13.5-per-cent drop hits market, B.C. Real Estate Association reports

Bruce Constantineau
Sun

B.C. housing sales lost ground during the first three months of this year — dipping 13.5 per cent below last year’s pace for a total of 18,635 Multiple Listing Service transactions, the B.C. Real Estate Association reported Friday.

The total value of those sales fell 1.8 per cent to $8.9 billion, although the average residential selling price rose by 13.5 per cent to $478,423.

BCREA chief economist Cameron Muir said eroding affordability has squeezed some buyers out of the market, while a 25-per-cent increase in the number of B.C. homes for sale — to around 40,000 — has reduced the chances of competing bids on the same property.

“The signs [of falling sales] have been around for months, but even though sales are off, they’re still relatively high by historical standards,” Muir said in an interview.

He said economic fundamentals in B.C. remain strong and continue to fuel housing demand, despite weakness in the forest sector.

Muir said the strong Canadian dollar has created problems for the B.C. softwood lumber and tourism sectors, but other parts of the provincial economy remain strong — including pulp, retail sales, construction and mining.

He does not expect a “significant” market correction this year, which would mean even sharper sales drops and falling prices.

“Significant corrections like that happen when you have a big increase in mortgage rates and a poorly performing economy. Neither is likely to happen,” Muir said.

“Prices should still climb by single digits this year and a little bit less next year, compared with recent double-digit price gains. A lot of those price gains have already taken place this year.”

BCREA said monthly MLS sales across B.C. fell by 22 per cent in March to 7,128 units, while the average residential price rose by 12.3 per cent to $488,796. The value of March housing sales declined 12.4 per cent to $3.48 billion.

© The Vancouver Sun 2008

Vacation-home sellers in a struggling U.S. market look north of the border for their saving grace

Gillian Shaw
Sun

MAUI, Hawaii – Nine out of 10 visitors to an open house hosted recently by real estate agent Randy Antonio were Canadians.

That might be unremarkable except that this open house was in Maui, more than 4,000 kilometres from the closest city in Canada.

Antonio’s experience reflects a growing trend that is seeing vacation home sellers in the subprime-strapped United States skipping straight across the border seeking buyers from Canada.

“The Canadian market is very strong here right now, especially in the resort areas,” said Antonio of Maui Rainbow Homes. “We are getting a big contingency out of the Calgary area and the Vancouver area.

“A lot of people have been coming to the island for many years, and now they think it is the time to buy.”

There is no doubt the economy here has seen better days. Two airlines serving the Hawaiian Islands went belly up within days of each other recently — leaving passengers stranded and sleeping at the airports while they scrambled to find alternative flights.

That followed the closure of the Molokai Ranch, a resort and key employer on Molokai Island. And local economic conditions are being further exacerbated by the countrywide subprime credit debacle that is stirring fears of recession in the United States.

Faced with such constraints among their traditional customers, sellers are looking further afield to market their properties. Canadians are not disappointing them — arriving on the islands in increasing numbers and offering up a potential market that has developers advertising and opening sales offices in Vancouver and Western Canada.

“We have quite a few Canadians who have used us to purchase properties,” said John Papazian, owner of Haiku Properties. “For realtors, the mantra here all during Christmas when it was slow was, ‘Wait until January and the Canadians will come. They’re going to save us.'”

Vernette O’Neill is among the Canadians answering the siren call of the islands. The president and chief executive officer of Toronto-based Computer Security Products has in the past been renting homes for her stays on Maui, but has decided now is the time to buy.

“It is a really good time for Canadians to buy,” said O’Neill, who has opened a U.S. branch of her company in Hawaii. “I’ve met more Canadians here in the last two years than in the last 14 years.

“I think the market has just about bottomed out. It might go a little lower, but not much.”

West Vancouver‘s Tony Holland is in Maui now overseeing the finishing touches on renovations — including a custom swimming pool that overlooks a panoramic view of the island and the Pacific Ocean — to a home on two acres in Kula he bought for $1.27 million, a $425,000 discount from the initial asking price.

Kula is a district on the slopes of Haleakala crater, above the resort areas of Kihei and Wailea and home to extensive vacation holdings purchased by Oprah Winfrey.

“We went and priced out places in Kaanapali, thinking we wouldn’t mind being down by the waterfront. But we found out it would cost $1.3 million to $1.5 million to get a two-bedroom place, and maintenance fees are about $1,000 a month,” said Holland.

“And then, if you rent it out, you are under the control of the condo administration and have to pay them something like a 45-per-cent fee. So what you are actually doing is financing somebody else’s hotel.”

Instead, Holland‘s vacation home is in an agricultural area, where taxes are lower than the average Vancouver home. Zoning and rental restrictions mean he can’t rent it out to vacationers — a limitation apparently ignored by some neighbours in the area — but Holland said he didn’t count on rental income when he bought.

“We wanted to rent it out on a short-term basis, and we were probably going to put an ad on the Internet. But we no longer have that option. It is not a hardship for us, but it is for a lot of people.”

On Maui, vacation rentals are limited by zoning regulations, rules that weren’t strictly enforced until recent years in a change that has curtailed rentals outside of resort areas.

Holland said that while his taxes are $2,500 a year, a friend who owns a one-bedroom apartment in Wailea, an upscale resort area on the beach half an hour away, pays $7,000 a year in taxes because her condo is registered as a rental and is treated for tax purposes as a hotel.

A highway under design will cut the travel time from Kula to Wailea to about 15 minutes. But Kula’s two-acre residential stipulation on property size means there is not a glut of properties for sale compared to other high-condo-populated areas.

Gary Kai is vice-president of Towne Development of Hawaii, a company that is considering opening an office in Vancouver to court buyers.

“Your [B.C.] property values have gone up so tremendously and your economy is so strong, and the strength of the Canadian dollar has really helped,” said Kai, whose company is currently selling a development in Kihei across the street from Kamaole Beaches.

It’s an area where a lot of Canadians bought in the 1970s, and Kai said there is renewed interest now.

“Mostly what we have seen is the buyers take the equity out of their [Canadian] properties to buy here. They live here for six months and then lock up and go,” he said.

The Kihei condos Kai’s company is selling start at about $700,000 for a two-bedroom, 1,233-square-foot (115 square metres), two-level unit with an enclosed garage.

Prices vary depending on the area and rental restrictions on the property. Peter Slate, a broker with Haiku Properties, said while Hawaii isn’t suffering the high foreclosure rates of many other U.S. states, nonetheless buyers are not as plentiful as they once were.

“We don’t have massive foreclosures, but what we do have is massive inventory and that is translating into downward pressure on pricing,” he said. “If someone is prepared to dig through the listings with an agent and can clearly define his goals, it offers a huge opportunity.”

Slate said two-bedroom, one-bathroom condominiums can be found in north Kihei for between $250,000 and $275,000. Farther south, prices go up to the $400,000 to $500,000 range.

Beach-front homes range upward from $1.6 million in Maui, with prices considerably higher in the sought-after Wailea area where beach-front condos have sold as high as $10 million. In Kihei, a three-bedroom, three-bathroom home with a swimming pool is listed at $1.05 million. Across the street from the ocean, two houses on a single lot are looking a little run down and are listed at $950,000.

“Sellers are faced with this three-pronged spear: They are up against a tremendous amount of inventory; they are up against uncertainty in the market; there is a lot of pessimistic news going around; and there is a certain amount of doom and gloom that exists,” said Slate.

“There is anxiety. Houses are sitting on the market longer.”

© The Vancouver Sun 2008

Eric Beauchesne
Sun

OTTAWA — Canada‘s once-hot housing market is clearly cooling with sales falling and the number of unsold homes on the market hitting record highs in the first quarter of the year.

Despite an uptick in sales in March from a three-year low in February, sales of existing homes were down 7.1 per cent in the first quarter from the final quarter of last year, and 13 per cent from the first quarter of 2007, the Canadian Real Estate Association reported Thursday in its preliminary housing market report for March.

And prices were up only 5.5 per cent from a year earlier to an average of $327,620, the smallest increase since the final quarter of 2001, which followed the Sept. 11 terrorist attacks in the U.S.

“Canada‘s six-year housing market boom is officially over,” said BMO Capital Markets economist Douglas Porter.

But the industry association said there will not be any meltdown in the housing market here as has occurred in the U.S.

“The residential average price continues to increase, unlike conditions in many U.S. markets,” said association president Cal Lindberg. “The size of the increase is returning to what we consider more normal levels for most markets in Canada, reflecting a sound but cooling market for existing homes.”

Sales in the quarter were down in a number of major markets, led by Toronto, which accounts for about one-quarter of all sales in the country. The market softened in Vancouver and Calgary, but remained strong in other markets, hitting record highs in Regina and Saskatoon. Meanwhile, the number of homes listed for sale swelled to a record high.

“The credit crunch has had limited impact on Canadian mortgage lending to date,” said the industry association’s chief economist Gregory Klump. “Resale-housing activity will continue to be supported by rising after-tax incomes, high employment, upbeat consumer sentiment and declining interest rates.”

In March, 26,799 homes traded hands, up 0.9 per cent from February but down 18.7 per cent from the record levels set a year earlier. The average price increased four per cent year-over-year last month to $329,383, with new price records being set in a number of cities, including Saskatoon and Winnipeg.

© The Vancouver Sun 2008