601-unit MF share deal was completed between existing owners in 2019

Western Investor

The landmark Beach Avenue four-building portfolio in Vancouver’s English Bay has been transferred between existing owners of an investment trust in a $305 million agreement, according to Mark Goodman who brokered the arrangement with fellow Goodman Commercial Inc. principal Cynthia Jagger.

The share deal closed in February of 2019 and, according to RealNET, was valued at $305 million. Goodman announced the deal on April 16, 2020, once restrictions had been lifted.

In December of 2009 the property was purchased by Devonshire Properties (Beach Tower Investment Trusts Inc.) for $117 million, from Liberty Investments. At that time BC Assessment valued the property at $123.9 million.

The February 2, 2019, transfer was between the two partners of Beach Tower Investment Trusts Inc.

The waterfront property sits on 2.7-acres of land and features panoramic water and cityscape views, Goodman noted, who suggests it is the most valuable multi-family portfolio in British Columbia.

The property was valued in 2019 at $295.9 million by BC Assessment.

Copyright © Western Investor

Showings and open houses are not allowed but real estate agents are learning to adapt

John Mackie
The Province

In early April, Rosemary Bartram and Scott Plumbe decided to put their house on the market, in the midst of the worst pandemic in a century.

They had been preparing to put it up for sale this spring when COVID-19 hit. Rather than wait for the pandemic to pass, they decided to go ahead and list it, for $1.8 million.

“We had gone to the trouble to actually finish off the house,” said Bartram. “We got everything really tidy, and our garden looks really great right now, we have a really beautiful spring garden.”

“Towards the end of March everything was pretty much ready, so we thought, ‘We might as well go ahead,’ ” said Plumbe.

Their updated 1974 bungalow at 737 Keefer St. in Strathcona is in immaculate condition, spacious (2,100 square feet) and across the street from a park.

If it had been listed last fall it might have lured a couple-of-hundred people to an open house and sold in a week, like a nearby house at 644 Hawks Ave. that sold for $2.04 million on Nov. 25.

But open houses have been nixed during the pandemic, so now the only way to check out their home is on their realtor Rick Stonehouse’s website.

This Sunday, from 12:30-1 p.m., Stonehouse will be holding a “virtual” open house for 737 Keefer on the video-conferencing app Zoom.

“All the stuff is new, we’re trying to test stuff out,” said Stonehouse. “If it’s not long enough, we’ll do it a little longer. We did (a virtual open house) last week for half-an-hour and it seemed like an eternity.”

He laughs: “Walking around with a camera trying to keep something happening is a little bit different than sitting in an open house, waiting for people to walk in.”

Last week’s virtual open house was on Instagram, and attracted about 80 people.

“Mind you some were my friends, who were curious how it looked,” Stonehouse said. “But there was 20 or 25 realtors, and some other people I don’t know — I assume they were interested. This week will be a little bit more telling of how this works.”

Bartram and Plumbe have lived in their home for 15 years, and feel it’s time to move on.

“We have enough space here in the home, there’s not really an issue with that,” said Plumbe. “It’s more (that) 15 years is a long time in one place. At a certain point you want something a little different.”

Still, they’re not in any rush.

“The house may not sell for months, we’re aware of that,” said Bartram. “But we’re keeping that feeling of motion forward (by listing), rather than being in stasis. If you feel you’ve just made a decision and gone with something, it’s better psychologically than being, ‘We had all these plans and I cancelled them, along with our summer vacation and possibly a move.’

Besides, listing their home in a pandemic has been hassle-free.

“It’s a pretty low-stress thing to put the house on the market right now,” said Bartram. “It’s not like we can do any showings or anything like that. The house is technically on the market, but things are quiet. All we have to do is keep things tidy.”

Normally spring is one of the busiest times of year in real estate. But the coronavirus has had a huge impact on that.

“I would say (listings are) down under 50 per cent,” said Stonehouse. “(For) everybody, the real estate board in general.”

Krystian Thomas of Stonehouse’s office said there were 32 detached listings (for houses) in East Vancouver between April 1 and 15, and nine sales. There were 82 attached listings (condos or townhouses) in East Van over the same period, and nine sales.

This compares with 55 detached listings and 38 sales in East Van between March 16 and 31, and 79 attached listings and 50 sales. Between March 1 and 15, there were 52 detached listings and 52 sales, and 65 attached listings and 95 sales.

The key to selling is finding the right price. Stonehouse just sold a townhouse, twice.

“We’ve got a place up on Commercial Drive, a townhouse, at $1.2 million,” he said. “We’ve had two offers on it. The first one fell apart (because of financing problems). We re-listed it at exactly the same price and we got the second (offer) right away.”

Stonehouse expects there will be more listings coming up.

“People still have to move,” said Stonehouse. “We’ve got one client who works for the government and they’re moving him back to Ottawa, he has a job starting July 1. So they’ve got to move.”

© 2020 Vancouver Sun

Should BC government use hotels and motels for homeless

Lindsay Kline
Western Investor

Victoria Mayor Lisa Helps wants the B.C. government to use its emergency powers to requisition empty hotel and motel rooms for the homeless during the COVID-19 outbreak.

On April 16 Victoria council passed a motion urging the provincial government to use its emergency powers to requisition empty motel and hotel rooms for people without homes. Failing that, the city wants the power to declare a local state of emergency, so it can requisition the rooms.

Helps told reporters that the city has “hit a wall” after working hard on the issue with B.C. Housing and Island Health for the past month.

She said B.C. Housing requires increased powers to secure the rooms, while Island Health needs more resources to provide supports to people once they move off the street.

“It is absolutely naive to think that COVID-19 will not hit the unsheltered population in our city, and when it does, those people are going to be using the same hospital beds and acute-care beds that everybody else will,” she said.

Bill Lewis, who chairs the Hotel Association of Greater Victoria, said his colleagues are sympathetic to the situation in Victoria and the ongoing effort to find homes for hundreds of people now living in tents on Pandora Avenue and in Topaz Park.

He noted that some hoteliers are already leasing space voluntarily to B.C. Housing, and he said the association supports that process.

“But in terms of requisitioning or forcing hotels, we don’t believe that it’s a solution to be forced on us,” he said.

For one thing, the association questions whether a traditional hotel setting is the right place for people without homes, given the extensive health and social supports many of them will require.

Safety and security of staff is also a concern, he said. 

“We’re not in the nature of dealing with that clientele.”

As well, many hotels and motels are still open and trying to generate revenue from essential travel in order to keep people employed, he said. 

“We don’t believe that forcing homeless people into hotel rooms, in hotels that are open to the public, is a solution or a viable solution for both the homeless people and the safety and security of the staff and the buildings themselves.”

Ingrid Jarrett, president of the B.C. Hotel Association, endorsed the position taken by hoteliers in Greater Victoria.

Nearly 200 rooms have been secured to date, but hundreds more are needed, and Helps said many hotel and motel owners have been reluctant to participate.

She acknowledged the concerns of hoteliers, but said that’s why the proper health and mental supports would have to be in place before people move into the rooms.

“What won’t work is taking people from Pandora and Topaz and just putting them in the Empress,” Helps said. “What will work is taking people from Topaz and Pandora and putting them inside the Empress or whatever other hotel with fair compensation to hotel owners [and] with a guarantee the properties will be returned in conditions in which they were leased, and most importantly with health-care supports for people who are moving in.”

Helps has appealed directly to provincial health officer Dr. Bonnie Henry as well, writing that Victoria is in a “crisis situation.”

“Maybe the province should issue an order to all motel owners noting that they must make their facilities available to B.C. Housing for whatever purpose B.C. Housing deems necessary,” she writes.

B.C.’s Ministry of Municipal Affairs and Housing issued a statement that did not directly address the issue of using emergency powers to requisition hotel and motel rooms.

Instead, the ministry said B.C. Housing continues to negotiate with motels and hotels to secure more spaces and expects to finalize additional contracts in the coming weeks.

Copyright © Western Investor

Buyers should beware but for the moment they?re looking good

Peter Hodson
The Vancouver Sun

Many years ago, in the last recession, I penned a column here that set up a ‘survival’ portfolio. It held shares in a water company, a mattress company, a company that makes oxygen tanks and so on. Results were pretty good!

Now that we are back in another recession (not official yet, but who are we kidding?) we thought we would lay out a potential COVID-19 stock portfolio of five stocks whose shares might do well in a long lockdown. Buyers beware: some of these stocks have run hard already, and in a post-COVID world might seriously underperform. But for now, at least, they are looking good. Plus, it is usually a very good sign for a stock to rise while the rest of the world is retrenching, regardless of what’s going on. Here goes:

Netflix (NFLX on Nasdaq)

Of course, sometimes stocks are easier to pick than others. With pretty much the entire world on lockdown, it’s no real surprise that the stuck-at-homes need some entertainment. Myself, I am trapped in a house with four kids and without Netflix, well, it would not be pretty. Against my instincts, we even upgraded our Netflix account so more people could watch different shows at the same time. Netflix shares hit an all-time high this week, up 36 per cent for the year so far.

Zoom Video Communications (ZM on Nasdaq)

Prior to the current virus crisis, we doubt that many of you had ever heard of Zoom. After all, shares have been public only for a year. Now, we bet, you are hosting family and work meetings on the online meeting platform several times a week. The stock is expensive, at 360 times’ earnings, but shares are up 123 per cent this year and up six-fold from last year’s IPO price. From a marketing/awareness point of view, at least, the virus has been golden for Zoom. Its customer base and brand recognition have surged, and it is now a $42-billion company by market cap. As an aside note, Zoom provides free meetings for meetings of 40 minutes or less. We know dozens of people in the business world who would be more than happy to pay MORE if all of their meetings could automatically end after 40 minutes.

Regeneron Pharmaceuticals (REGN on Nasdaq)

Regeneron is a US$56-billion biotech company, trading at 19 times earnings. It has US$6 billion in cash and shares are up 36 per cent this year. Why the outperformance? Well, Regeneron is working with partner Sanofi on two separate trials to see if the drug Kevzara can be effective in treating COVID-19. The drug, a so-called IL-6 inhibitor, may be able to reduce inflammation in the lungs that, in serious COVID-19 cases, can lead to death. Regeneron of course has other products as well, and reported nearly US$8 billion in sales last year. But in the short term a lot of eyes are going to be on its COVID clinical trials.

Loblaw (L on TSX)

Loblaw shares are up nine per cent this year. Not as impressive as the names above, but not so bad considering the TSX index is down 18 per cent in the same period. Loblaw shares also have a 1.7 per cent dividend. Like Netflix, no real surprise here. People gotta eat, and grocery stores are about the only stores open for full business these days. Going to the grocery store might be both the highlight  — and the scariest part — of most consumers’ weekly adventures right now. Shares are only a few dollars off their all-time high set in September last year.

Amazon (AMZN on Nasdaq)

Amazon shares surged to an all-time high this week, on news the company needs to hire another 75,000 employees to meet demand. Of all companies, Amazon was perhaps best positioned to benefit from a shutdown. Business was already mostly all online, and booming, and then billions of people were barred from brick-and-mortar retail stores. The company recently joined the $1-trillion market cap club, with shares up 25 per cent this year. One of investors’ concerns on the company earlier this year was its difficulty in finding employees. Well, with more than 20 million U.S. workers recently laid off, that problem has been clearly and easily solved. As with a trip to the grocery store, getting your Amazon packages delivered just might be the most exciting thing that happens in your house these days.

© 2020 Financial Post

Legal question about buyer failing to close

Shaneka Shaw Taylor & Eugenia Bashura
REM

When a buyer fails to close a real estate transaction and the seller is awarded damages, should the seller credit the deposit to the damages award or should the seller be allowed to keep it in addition to the award? The Court of Appeal dealt with this question in the Azzarello v. Shawqi decision.

The sellers, Mark and Eliza Azzarello, listed their home for sale in March 2017 for $1,398,000 during a very “hot” real estate market in the Greater Toronto Area. Ahmed Sabri Shawqi, the buyer, offered them $1,555,000. The Azzarellos accepted this offer and Shawqi paid a $75,000 deposit. Afterwards, the Azzarellos agreed to buy a new home near Hamilton. They took out a bridge loan to complete that purchase as well as to conduct some renovations on the new home.

On the date set for closing, after receiving several extensions, Shawqi failed to close. The Azzarellos relisted the property and ultimately sold it for $1,280,000. The Azzarellos commenced an action against Shawqi for breach of the Agreement of Purchase and Sale (APS). This action was decided summarily (without a full trial) on a summary judgment motion. The motion judge awarded the Azzarellos $308,688.31 in damages, which consisted of the difference in price ($275,000) and the consequential losses incurred by the Azzarellos (cost of the staging, legal fees, carrying costs of the property and interest on the line of credit).

Importantly, the motion judge also allowed the Azzarellos to keep the deposit and not credit it to the damages award. In other words, the Azzarellos were awarded the total damages of $308,688.31 plus they kept the $75,000 deposit. Shawqi appealed.

The Court of Appeal found that the motion judge erred by holding that the deposit be forfeited and not credited to the Azzarellos’ damages.

The Court of Appeal started the discussion by outlining settled law on what happened to deposits under various circumstances:

• If a real estate transaction was completed according to the terms of the APS, unless the parties contracted otherwise in the APS, the deposit would be credited to the purchase price;
• If the sellers breached the APS, the deposit would be returned to the buyers; and
• If the buyers beached the APS but the sellers suffered no loss, the buyers would forfeit the deposit, without proof of any damage suffered. If the buyers wanted to, they could ask a court for relief against the forfeiture of the deposit.

The circumstances of this case were that the buyer, Shawqi, breached the APS and the sellers, the Azzarellos, suffered a loss entitling them to damages. The law on this issue was not well settled.

The Court of Appeal held that the purpose of the deposit was to compensate the Azzarellos for the lost opportunity in having taken the property off the market as well as the loss in bargaining power resulting from the Azzarellos having revealed to the market the price at which they had been willing to sell. Thus, the Azzarellos were entitled to keep the deposit. The question was whether they were entitled to keep the deposit in addition to their damages award.

The Court of Appeal reviewed the standard terms of the APS signed by the parties and found that the only term mentioning the deposit was the provision stating that the deposit would be credited to the purchase price on completion of the transaction. From this, it could be inferred that the parties intended the deposit would be applied as a credit to the payment obligation owed by Shawqi to the Azzarellos, whether the transaction failed or not. Since Shawqi had already paid the Azzarellos $75,000 as the deposit, the Azzarellos had to credit this amount towards their total damages award of $308,688.31 so that in the end Shawqi owed the Azzarellos a total of $233,688.31.

Due to the standard wording used in the APS, the Azzarellos were not entitled to “double recover” by keeping the deposit in addition to their damages award.

© 1989-2020 REM Real Estate Magazine

Single-family home building down across the nation

Candyd Mendoza
other

With no signs of the coronavirus crisis easing up soon, builder confidence in the market for newly-built single-family homes fell into negative territory in April.

The latest National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), which gauges builders’ perceptions on the housing market, nosedived 42 points in April to 30.

The drastic decline marked the first time the index went below 50 points since 2014, indicating that more builders viewed conditions as poor. This was also the biggest single monthly change in the history of the index and the lowest builder confidence reading since 2012.

“This unprecedented drop in builder confidence is due exclusively to the coronavirus outbreak across the nation, as unemployment has skyrocketed and gaps in the supply chain have hampered construction activities,” said NAHB Chairman Dean Mon.

However, Mon pointed out that homebuilding is still considered an essential business nationwide during the pandemic. He remained positive that buyers would likely return to the marketplace as the outbreak abates.

Among the index components, current sales conditions plunged 43 points to 36, while sales expectations in the next six months went down 39 points to 36, and the part measuring the traffic of prospective buyers plummeted 43 points to 13.

Regionally, monthly HMI scores in the Northeast were down 45 points in April to 19. The Midwest (down 42 points to 25), the South (42 points to 34), and the West (47 points to 32) all posted month-over-month declines as well.

“Before the pandemic hit, the housing market was showing signs of strength with January and February new home sales at their highest pace since the Great Recession,” said NAHB Chief Economist Robert Dietz. “To show how hard and fast this outbreak has hit the housing sector, a recent poll of our members reveals that 96% reported that virus mitigation efforts were hurting buyer traffic. While the virus is severely disrupting residential construction and the overall economy, the need and demand for housing acute. As social distancing and other mitigation efforts show signs of easing this health crisis, we expect that housing will play its traditional role of helping to lead the economy out of a recession later in 2020.”

Copyright © 2020 Key Media Pty Ltd

Home prices predicted to drop only 3%

Ephraim Vecina
Mortgage Broker News

Despite the ravages of the pandemic, Canadian housing prices will prove remarkably robust, according to Royal LePage.

In its recent analysis, Royal LePage projected that the widespread economic weakness brought about by COVID-19 will pull down Canada’s average housing price by just 3% this year, should the slowdown last until late summer.

This will put the nationwide aggregate home price at $627,900. More optimistic estimates place the outbreak’s impact being contained to just the second quarter, which might lead to an annual price increase of 1% to $653,800.

The first quarter saw the aggregate Canadian home price increase by 4.4% year-over-year to $655,276. Last December, Royal LePage predicted prices to grow by 3.2% in 2020.

“From our experience with past recessions and real estate downturns, we are not expecting significant year-over-year price changes in 2020,” Royal LePage President and CEO Phil Soper said.
“Home price declines occur when the market experiences sustained low sales volume while inventory builds. Currently, the inventory of homes for sale in this country is very low, matching low sales volumes as people respect government mandates to stay at home.”

However, Soper cautioned that social distancing policies and lockdowns will be moderating factors that will place “downward pressure on both home sales volumes and prices.”

“Equally, if the collective efforts of Canadians slow the spread of the disease to manageable levels, and if promising science and therapeutic drugs are announced, people will return to their jobs, market confidence will bounce back quickly, and we could see Canada’s real markets roar back to life, with 2020 transactions delayed but not eliminated,” he said.

Copyright © 2020 Key Media

Virtual showcases and livestreaming open houses on social media

Nabil Imani
other

We know the COVID-19 pandemic is severely impacting the way REALTORS® normally do business. That’s why we’re making it a priority to adapt with the ever-changing guidelines and rules set by government officials and healthcare professionals, so REALTORS® have the tools they need.

As virtual showcases and livestreaming open houses on social media become the new normal replacing real-life open houses, we encourage REALTORS® to take advantage of this new feature.

We know change can be difficult and we want to make it easier for you to adopt this new feature. We’ve answered nine of your frequently asked livestreaming questions to help you become a pro. Ready? Set. Action.

What can I use livestreaming for?

You can use livestreaming services to showcase your listings and engage with buyers remotely and in real-time. You can tour the home, walk through the property and neighbourhood, and answer questions directly with buyers.

What streaming platforms does REALTOR.ca support?

REALTOR.ca supports all streaming platforms.

I am new to livestreaming; how do I get started?

Below are some guides that explain how to set up livestreaming on popular platforms. Note, platforms may change their set-up process over time. You can also do a Google search, “How to schedule a live stream on…” to find additional resources.

Tips and guides on livestreaming from the platform           Scheduling live streams/broadcasts

    Live stream on YouTube        Introduction to live streaming      How to Use Facebook Live                        Live Producer

        Instagram Live: A Step-By-StepGuide             How to broadcast on Periscope             How to stream on Twitch    YouNow 101

  How Do I Use the Livestream Mobile App?     How Do I Use the Livestream Mobile App?

      Joining & Starting    Scheduling A Meeting

           Live stream a Google Hangouts meeting

What URL do I use to schedule my live stream on member.REALTOR.ca?

While setting up your live stream on your chosen streaming platform (Facebook, Instagram, etc.), you will be given a direct URL. You must use that direct URL on member.REALTOR.ca to link to your live stream on REALTOR.ca.

How do I know if my board or association is sending my live stream information to REALTOR.ca?

Please check with your board or association to see whether they will send your live stream information to REALTOR.ca. However, if your board or association allows you to input your live stream information at the MLS® system level, and allows CREA visibility to this information, you will see your live stream information on the Listing Input page.

Can buyers watch my live stream on REALTOR.ca?

No, your live stream will not be hosted on REALTOR.ca; therefore, buyers will not be able to watch your live stream on REALTOR.ca. Buyers will be re-directed to the streaming platform of your choice to watch and access your live stream.

How will my scheduled live stream look on REALTOR.ca?

A link to your live stream will be prominently displayed on your REALTOR.ca listing. On desktop, your live stream link will be displayed under the Description section. On mobile, your live stream link will be displayed above the Description section for higher visibility. We cannot control how the live stream option will display on DDF® listings as it is up to the discretion of the partner.

Can I schedule a private live stream for just my clients?

Some live stream platforms allow you to schedule private sessions, however, you should not link private live stream sessions on your REALTOR.ca listings.

Can I use pre-recorded videos?

While some platforms allow you to save previously recorded sessions, it’s not recommended to schedule these as live streams on REALTOR.ca as you cannot interact with your audience in real-time. You can add previously recorded videos and virtual tours to your listing. (Please note: MLS® System fields may vary by board or association).