Less than three weeks ago, a 2,100 ft² house on a 3,350 ft² lot in east Vancouver sold for $2.2 million though the asking price was $1.6 million.
The Real Estate Board of Greater Vancouver said February sales were 20% above the 10-year sales average for the month and the average price for a single family detached property in Metro Vancouver is over a million dollars. Houses are routinely selling 100 to 200 thousand dollars above asking price.
Two weeks ago, a modest 60-year-old home near my North Vancouver residence sold for $1 million, also above the asking price.
In other words, the residential real estate market in urban British Columbia is hot, hot, hot.
In the Burke Mountain area, small building lots are listed over $600,000. Yet, the Province of British Columbia made a hurried deal to sell vast tracts of residential property at a fraction of appraised values.
The buyer is a company controlled by Hassan Khosrowshahi, a large BC Liberal contributor. The responsible Minister? None other than Amrik Virk who was party to a scheme that demonstrated minimal dedication to protecting taxpayers’ financial interests.
BC Minister Failed to Disclose…, Andrew MacLeod, The Tyee, June 2014:
NDP Advanced Education critic David Eby is questioning why Premier Christy Clark is keeping Amrik Virk as the minister responsible for British Columbia’s post-secondary system after the release of a damning report related to Virk’s actions on the board of Kwantlen Polytechnic University.
Payments scandal at Kwantlen University, Macleans Magazine, June 2014:
B.C.’s Ministry of Finance reprimanded Kwantlen Polytechnic University in suburban Vancouver for flouting rules meant to limit public sector compensation.
The school offered Alan Davis, its current president, and Anne Lavack, a former vice-president, $50,000 each in consulting fees before their terms began, plus more than $100,000 to cover unusual expenses, on top of maximum salaries.
Kwantlen’s board of governors failed to disclose some of those payments to the Public Sector Employers Council Secretariat (PSEC), which acts as a compensation watchdog. Amrik Virk, now minister of advanced education, was part of that board. Opposition politicians have called for his resignation…
Amrik Virk moved…, CBC, December 2014:
Beleaguered B.C. government minister Amrik Virk has been shuffled out of his post as advanced education minister… on the same day that a report into the pay scandal at Kwantlen Polytechnic University was revised to show that Virk was aware of secret bonuses paid…
NDP Leader John Horgan said Virk should be dumped from cabinet.
“Mr. Virk has demonstrated bad judgment not once, not twice, but three times and it’s probably time for him to get out of cabinet,” he said.
Hansard, April 14, 2015:
John Horgan: My question is to the Minister of Citizens’ Services. For some time now, we on this side of the House have been concerned about the government’s haste with selling public lands to meet their budget objectives. In fact, we raised these issues before the election. We raised the issues during the election and we’ve been raising them in this House ever since.
So to the Minister of Citizens’ Services, who is responsible for this through Shared Services B.C.: what steps did he take to ensure that we got fair value for land sold by this government?
Amrik Virk: Property sales are indeed part our government’s ongoing plan to release unused and surplus government properties and assets for new development. There are properties that are indeed surplus that are indeed unused. It’s in the best interests of the British Columbia’s public to re-use, to reinvest that in education, to reinvest that in health. This province is absolutely committed to ensure we get the best value for the land that we sell.
John Horgan: Here I am agreeing that the government should get best value for properties that they sell. In the case of the Burke Mountain lands, recently sold for $85 million, that appears to not be the case.
When we raised this issue, we asked for an evaluation of the properties, and we were told “We can’t have it.” We went through FOI, and we got redacted documents. But we now, with the efforts of the Privacy Commissioner, have access to the appraisal documents, which show that the Burke Mountain lands were appraised at $128 million and sold for $85 million.
My question again to the Minister of Citizens’ Services: what possibly went wrong when we had $128 million worth of property, and to meet your single-year budget objectives, you sold them for $43 million less than they were worth?
Amrik Virk: As I said before, it’s important to ensure that those surplus lands that we have in the assets of government be reassessed, be re-evaluated on a continual basis. We continue to re-evaluate and reassess those lands that we have, and we continue to ensure that we get the best value for the land that we sell.
John Horgan: That border-lines on an outlandish answer to a fairly simple question. The government retained Equity Valuation and Consulting Services, as they should, to assess the value of public properties before they were disposed of. They must have paid a considerable sum for that evaluation. They got a 137-page report appraising the value of the Burke Mountain lands.
The report says in part:
“In determining value, the appraisers considered various sources, including area maps, consulting with the city of Coquitlam, MLS information, land core B.C. Assessment Authority, realtors, developers and other persons knowledgeable to the local marketplace.” They said specifically that to get maximum value for the properties, they should be exposed to the marketplace for six to nine months to get with the city of Coquitlam, MLS information, Land Corp, B.C. Assessment Authority, realtors, developers and other persons knowledgeable to the local marketplace.”
They said, specifically, that to get maximum value for these properties, they should be exposed to the marketplace for six to nine months to get full market value. Even though they hired someone to do the valuation, got a detailed report about how to best maximize the public benefit from this sale, instead of having the properties out for six to nine months, they did it in three. They did it in three, and they gave them away at $43 million less than the appraised value.
Again, to the Minister of Citizens’ Services, if I had something that was worth a whole lot of money, I certainly would not sell it for 33 percent less its value — particularly when it wasn’t mine, it was the people of British Columbia’s.
Can the Minister of Citizens’ Services put aside the speaking notes and explain to the people of B.C. why he gave away public lands when he could have got $43 million to go into health care, to go into education, to go into any number of good public purposes, maybe even an arena in Hazelton? …
Selina Robinson: The minister speaks of best value. Well, one parcel was given a market appraisal of $5.6 million and was sold for $100,000.
Here’s another example of best value. Another parcel was given a market appraisal of $17.5 million and was sold for $6.9 million. Another parcel was given a market appraisal of $20.6 million and was sold for $13.9 million.
To the Minister of Citizens’ Services, why did government ignore its own real estate expert and sell these lands for far below their actual market value?
…To make matters worse, the Coquitlam school district will soon need to buy back some of these lands to build two new schools. So much for planning for the future.
To the Minister of Citizens’ Services, why would government sell public lands to a developer and then force the school district to buy them back to build schools?
Ms. Robinson’s points are important because this is a time when school districts around the province are denied money needed to maintain educational standards. Also, parents are told their children must attend schools that are not safe from earthquake damage because upgrades have been postponed yet again, for financial reasons.
Christy Clark and her BC Liberal associates believe that enriching themselves and political friends is the most important job of government.
In recent times, I have demonstrated that the public share of billions of dollars worth of natural resources extracted from these lands is negligible. If mining exploration tax credits are deducted from mining taxes, resource companies are paid to remove assets from the province. Additionally, companies like Teck and Imperial Metals, major financial supporters of the Liberals, buy electricity from BC Hydro at a fraction of what BC Hydro pays independent power producers, also Liberal contributors, for electricity.
As of March 2014, the Liberal Government had committed to pay $56.5 billion for private power at rates more than three times the average market price in the Mid-Columbia power hub. (The liability is reported on BC Hydro’s audited statements and is in addition to $15.7 billion of term debt. The utility has not publicly updated the amount of the purchase obligation in the past year.)
Liberals plan to bring Site C power on stream and, at the same time, they are negotiating electric power deals with the gas industry at prices less than half of what Site C power will cost. Residential consumers and small businesses will pay extra so foreign companies can be subsidized.
BC Hydro has now deferred over $5 billion in costs. These expenditures, instead of being treated as expenses are deemed to be assets; assets a future government will write off at a future time. Except for the cost deferral, BC Hydro’s 2014 equity would have been in a deficit position of more than $1 billion. However, government didn’t want a deficit shown because that would have precluded transfers of borrowed monies from the utility to the provincial treasury. It is, of course, easier to pretend to balance a provincial budget than to actually balance it in real terms.
Citizens of British Columbia today, and the next generation of this province, are being dispossessed by BC Liberals. This government has ethics equivalent to infamous nations that rank among the world’s most corrupt.
Elections BC report $716,376 in contributions to BC Liberals by Hassan Khosrowshahi and associates. This listing may not be complete.