Well, only according to the City of Vancouver. The lot at 88 Pacific Boulevard is a huge piece of land that had a recent assessment value of only $1. Sounds too good to be true, right? It might be if you look at how the land around is typically assessed and taxed.
Prime, Waterfront Real Estate
The 9.46 acre lot is located in one of Vancouver’s nicest neighbourhoods, and surrounded by some pretty pricey real estate. According to BC Assessment, the lot immediately east at 811 Carrall St. is a quarter of the size, and has a land assessment of $29 million with $3,300 worth of buildings on it. East of that, is a lot less than a fifth the size with land assessed at $16,601,400. That’s around $284 per sq ft.. I’m not an appraiser, but that’s an 11,708,539,713.1% difference in valuation per square foot.
Who Owns It?
The 412,271 sq ft. lot is owned by Concord Pacific Developments (CPD). For those that don’t know, they are the people responsible for transforming Vancouver’s False Creek from sleepy industrial waste land to the bustling, urban centre it is today. In fact, the lot is the location of their presentation center in Vancouver.
The lot is also occasionally rented out for events, and is listed by WestPark Parking Services as one of their parking lots. Convenient since it’s just a few blocks away from BC Place Stadium and Rogers Arena. One estimate claimed the lot generated an average of $600,000 per year. Not exactly a worthless piece of land.
Seriously, 88 Pacific Boulevard Is Worth A $1?
Apparently. The property was purchased by Concord when they purchased the former ‘86 Expo lands in the 1990s. In exchange for densifying the area with over 7,500 units, Concord Pacific had to commit to building a few parks to balance things out. This is where one of those parks is suppose to be, so it’s zoned as such. They didn’t get around to building the park ever, but they did get around to building 50% more homes. To date, the developer has delivered over 11,500 units.
The parkland was originally assessed at $192,000, an already heavily discounted rate. It was raised briefly in 2013 to $400k, then dropped to a $1 after an appeal. BC Assessment found the value of the land to be worth $12,046,200, but assigned a nominal value. The reason being Concord estimated it would cost $17 million to build the park, and seawall they had previously committed too. This seems logical, until you look at the numbers and how property like this is normally treated.
BC Assessment doesn’t have to give a criteria (nor did they), as to how they came up with that number. At today’s value, it’s about $100 million dollars short of their neighbours. Even at a quarter of that – it’s still worth more than the land value cited in the assessment. So really, is BC overcharging the neighbours, or undercharging at 88 Pacific Blvd? Either way, sweet for Concord Pacific since they don’t have to commit to a hard deadline to actually build a park. If I were them, I would continue generating income on the near tax-free property until the park paid for itself.
Can I Do That?
Yeah, I know. You’re a developer and you want your land assessed at a $1! Well, it’s not so easy. It turns out even other massive developers like Bosa Properties don’t get to do it.
Bosa had a 7.5 acre plot of land for a park down the street that had an assessed value of $18.569 million. Some back of the napkin math shows that would be $260,000 in taxes per year at that assessment level. Slight motivation to hurry up and build a park if you ask me. It wasn’t until they delivered the park to the City of Vancouver in 2013 that it was reassessed. Once the park was built the land was assigned a nominal value.
If anyone knows what that one strange trick is for having their property assessed at a $1, I’d love to know it. Leave your suggestions below.
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I know this article is meant to be read in a sarcastic tone, but for sure someone is going to give you 10 ways to avoid taxes.
This is Trudeau’s Canada. Most people will read this and go “that’s normal, why should they pay taxes?”
What the hell does this have to do with a PM that’s been in power for a few months?
Deborah, you’re a moron.
So much government corruption in BC. This is unbelievable. So what, they can just use the property for the next 100 years, generate income, and there’s no problem?
Can I skip taxes on my house? I swear I’ll knock it down in 40-50 years.
I think the answer is property transfer. Because this property was a bargaining tool and there was a trade venture involved between the city and concord. You always have to put a $1 amount on any transfer paper work of ownership to complete process. It’s like when you open a corporate account and u have to transfer shares or allow the lawyer to take control until the corporate account is open u have to have a value amount on shares because it’s a empty shell. The contract becomes a legal contract with the almighty 1 dollar in the value box.
Yes, the land outlined on the map is being given to the City as a park. I’m sure the adjoining land to the west that Concord is retaining must be valued more realistically. Sorry, no conspiracy here. Info on viaduct study is here; http://vancouver.ca/home-property-development/northeast-false-creek.aspx
It’s not a conspiracy, it’s preferential treatment. The author pointed out that Bosa didn’t get preferential rates for their park. They committed to building the park 30 years ago, and just used the empty lot for generating revenue this whole time.
Yes, the value needs to be assigned for a property transfer, which the author called a “nominal value.” The key is this isn’t normal to lower it to that rate until the park is done like they did with Bosa. Otherwise they have no actual incentive to complete it.