A Vancouver neighbourhood group has asked a B.C. Supreme Court judge to review B.C. Assessment’s decision to drastically reduce the appraisal value for Oakridge Centre, a massive redevelopment site.
In 2014, after Vancouver council approved a site rezoning that would conditionally allow developers to build a mixed-use village, including 45-storey towers and about 3,000 condos, the property was assessed at $867 million. Site owner Ivanhoe Cambridge successfully appealed to the Property Assessment Review Panel, and the eight-block Cambie Corridor site was reassessed at $500 million. Under B.C.’s assessment act, land owners and the review panel can come to private agreements on reassessed value, which don’t have to be made public.
The South Vancouver Parks Society believes that B.C. Assessment’s procedures weren’t transparent and didn’t fairly account for the development value of the site. The society is arguing that Vancouver citizens have lost significant property-tax revenue with the reassessment decision. President Glen Chernen said the society estimates the annual tax revenue lost will be about $1.94 million. Chernen said he believes there are a number of similar cases involving reassessments of lucrative development properties in Vancouver.
“This is much more than a single, privately arranged, $367-million value reduction,” Chernen said. “It’s a small piece of a wider B.C. problem, where government-owned land interests are traded, valued and dealt, without public knowledge or involvement.”
The society challenged the Oakridge Centre reassessment with the Property Assessment Appeal Board this summer, asking to know the reasons behind the site’s value reduction. The board rejected the disclosure request, saying the reasons weren’t relevant.
The board upheld the assessor’s decision to revalue Oakridge Centre at $500 million. Now, the society has applied in B.C. Supreme Court for a review of the board’s ruling.
The society’s lawyer in the case, Bob Kasting, said he will argue the board failed to acquire the proper evidence to fulfil its purpose of finding the true value of Oakridge Centre.
“The board is supposed to get the true value of the property. But the assessment act allows for the property owner and the assessor to make a deal that doesn’t go public. And that is really what they’ve done here,” Kasting said. “Somehow the $867 million went down to $500 million. We don’t know why. And in this case, the board said, ‘I don’t even need to know why.’ ”
A central point to the board’s ruling this summer, Kasting said, was the board had two accepted ways of assessing the “highest and best-use” value of Oakridge Centre: either as vacant land with redevelopment potential or in its current commercial usage as a rent-producing mall. Chernen argued to the board that Oakridge Centre should be valued for its maximum rezoning potential. Using the estimate of an independent assessor, Chernen said the site’s true value was between $750 million and $1.1 billon.
Generally, in B.C.’s assessment system, the “theoretical focus of highest and best-use analysis is on the potential uses of the land as though vacant,” the board wrote in its ruling. The board, however, ruled that Chernen and the independent assessor didn’t support their rezoning-value case with reliable evidence, including feasibility studies.
“It may have been helpful to the board to have had a highest and best-use analysis that reflected the subject’s reality as a transitional property that was continuing its successful operation over the course of its planned development,” the board wrote.
The society will argue that the board should have asked for such an analysis or agreed with Chernen’s request for the board to review B.C. Assessment’s original 2014 analysis valuing the Oakridge Centre site at $867 million.
“We’re saying that is not good enough,” Kasting said. “They, the board, have the right to go back and ask the parties to provide that evidence.”
Ivanhoe Cambridge is expected to make applications in early December to have the case tossed out, Kasting said. If the society proves its right to argue the case in B.C. Supreme Court, the case will be heard next spring.
A spokesman for Ivanhoe Cambridge said the company will not comment on the case.
CLICK HERE to report a typo.
Is there more to this story? We’d like to hear from you about this or any other stories you think we should know about. Email firstname.lastname@example.org.