Condo June 2021

Canada’s Most Widely Read Condominium Magazine

June 2021 • Vol. 36 #2

COST CONUNDRUMS COVID Effect on Finances Procurement Red Flags Price of Poor Communication

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7TH ANNUAL WHO'S WHO A ranking of the Canadian condo industry's major players and portfolios

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Contents FINANCE 11 Condo Finances Feel the COVID Effect

By Stephen Chesney

16 Is Your Communication Style Costing You Money?

By Sonja Hodis

21 A Retrofit Remedy for Rising Maintenance Fees

MAINTENANCE

SPECIAL FEATURE

36 Elevator Repair Legislation Advances

44 The 7th Annual Who's Who survey of the Canadian condo industry's major players and portfolios.

By Rebecca Melnyk

By Chandra Ramadurai

24

Red Flags

By William Stratas

GOVERNANCE 31 Who Plays A Role in Managing Vested Interests?

39

Before A Fire

By Rebecca Melnyk

CONDO MARKET

6

Editor's Note

42 Condos Anchor Affordable Recreational Property

8

Ask the Expert

46

New & Notable

By Val Khomenko

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EDITOR’S NOTE

Associate Publisher Bryan Chong

Red flags

Editor Rebecca Melnyk

As a fourth level of government,

condo corporations are susceptible to the same unethical practices seen at the federal, provincial and municipal levels. Sometimes, condo boards or managers

are directly involved in fraudulent behaviour; other times, they can be oblivious of corruption happening on the sly.

“Corruption is everywhere and nowhere,” as Robert Rotberg, former president of the World Peace Foundation, says in his book, “The Corruption Cure.” Stemming from a rational desire to improve one’s position and earning potential, the nature of corruption is hardwired into the human condition, he asserts.

In this, our annual finance issue, two articles explore how positions of trust give rise to unethical behaviours and how to keep them in check. Red Flags (page 24) dives into lessons learned from the five-year bid-rigging investigation that wrapped up in March. Note: criminal allegations have yet to be proven in court. Conflict of interest among boards and management remains a hot topic, according to some online comments REMI Network readers have posted over this past year. Check out page 31 for more on that.

Also in this issue: condo finances during the pandemic, retrofitting away potential maintenance fee hikes, and recent legal cases that resulted in big costs for corporations and owners due to inappropriate communication. In this age of heightened safety, many condos lag in unsafe territory when it comes to fire code compliance—a topic tackled during a recent CCI Huronia event. On page 39, look for tips on what to do before a fire event or safety inspection occurs—for instance, preventing deficiencies and keeping up-to-date on repairs and records.

Plus, we bring forth our seventh annual Who’s Who, an overview of the major players and portfolios in Canada’s condo industry.

We wish you all a joyful summer, and as always, thank you for reading.

Advertising Sales Bryan Chong Kelly Nicholls Blair Wilson Senior Designer Annette Carlucci Production Manager Rachel Selbie Contributing Writers Stephen Chesney, Tom Gallinger, Sonja Hodis, Val Khomenko, Chandra Ramadurai, William Stratas.

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President Kevin Brown Director & Group Publisher Sean Foley Accounting Anna Kantor 2001 Sheppard Avenue East Suite 500 | Toronto, Ontario M2J 4Z8 (416) 512-8186 Fax: (416) 512-8344 e-mail: info@mediaedge.ca CONDOBUSINESS welcomes letters but accepts no responsibility for unsolicited manuscripts or photographs.

Canadian Publications Mail Product Sales Agreement No. 40063056 ISSN 0849-6714 All contents copyright MediaEdge Communications Inc. Printed in Canada on recycled paper.

Rebecca Melnyk Editor, CondoBusiness rebeccam@mediaedge.ca

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Feeling the Lows of High Deductibles Many condos are likely experiencing the insurance blues—and not just in B.C. A recent report from rate comparison site, LowestRates.ca, found condo insurance prices in Ontario were 8 per cent higher at the end of 2020 than the previous year. As a result, higher deductibles are the new norm. Tom Gallinger, vice-president of Atrens-Counsel Insurance Brokers, answers: "How are higher insurance deductibles affecting condo corporations?

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ASK THE EXPERT

Gone are the days of condominium corporations enjoying low deductibles on their mandatory property insurance policies.

A high frequency of water damage losses, coupled with a hardening of the general insurance marketplace has led most insurers to demand much higher minimum property deductibles. There is typically a separate deductible that applies to water damage claims, which will often start at a minimum of $25,000 for multi-storey buildings. However, it is far more common to see $50,000, $100,000 or higher water damage deductibles where a condo has had claims in the past few years.

How do corporations handle losses that are below their deductible?

If loss or damage occurs that is insurable, the condominium has the same responsibility to repair or replace property, regardless of whether or not they submit an insurance claim.

For insurable losses, the condominium is responsible for the cost to repair the common elements and the units, but not any improvements made to the unit.

U n i t ow n e r s m a y e l e c t to u s e t h e i r ow n p e r s o n a l insurance policies to pick up where the condominium’s repair responsibility leaves off. Unit owner policies cover

damage to their contents, betterments and improvements made to the unit, costs to live elsewhere while the unit is repaired, and possibly the charge-back of the condominium’s applicable insurance deductible. It is common that the condo corporation insurance must work together with unit owner insurers to determine who is paying for what.

If the damage event is below the condo cor poration d e duc tible it w ill b e up to the b o ard of direc tors and property management to handle the situation, work with unit owner insurance adjusters, and determine the proper allocation of costs. It is recommended to speak to your insurance broker, even for losses below the deductible, as they may be able to provide guidance and assistance with these situations.

How has this been affecting unit owners this past year?

With higher condo insurance deductibles, it is critical for condo unit owners to be aware of what their corporation’s proper t y deductibles are and the exp osure that those deductibles could present to them.

The Condominium Act of Ontario allows for corporations to charge an owner up to the corporation insurance deductible for certain property damage situations that are caused by a

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“If a unit owner does not have enough

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unit owner’s act or omission. This can also be further clarified and modified by a n i n su r a n c e d e d u c t i b l e by l aw.

So, even if an accident happens in an owner’s unit that causes damage to corporation proper t y, they could be faced with a charge-back of up to the condo corporation deductible amount.

With larger corporation deductibles, u n i t o w n e r s m u s t m a ke s u re t h a t they align their own unit owner policy with the corporation insurance policy to avoid gaps. If a unit owner does n ot h ave e n o u g h c ove r a g e fo r t h e corporation deductible charge - back , they could face significant out- of pocket- costs. For condo corporations, it is impor tant that the board of directors and proper t y management p ro m ptl y c o mmu ni c ate a ny c h an g e in corporation insurance policy deductibles to unit owners.

For unit owners, it is strongly recommended that they select a broker and insurance c omp any that can provide them with the level of coverage that they need for their particular condominium and minimize t h e ex p o s u re t h ey h ave to o u t - of pocket expenses. 1 Tom Gallinger is the vice-president of Atrens- Counsel Insurance Brokers, a brokerage that specializes in managing insurance programs for condominiums, unit owners and property management professionals. Tom has been in the insurance industry for over 16 years in various underwriting, brokering and management roles. As a specialist in condominium insurance, Tom strives to deliver a high level of service by m a n a g i n g th e l o n g - te rm i n s u ra n c e needs of his clients.

Condo Finances Feel The COVID Effect A s one wou ld i ma g i ne ,

the pandemic has caused condominiums to spend a lot more money than they were expecting in various areas.

BY STEPHEN CHESNEY

FINANCE

First and foremost, condominiums had to buy personal protective equipment for their common areas such as lobbies and security desks. Many condos purchased plexiglass barriers and other equipment to protect their employees, which are not considered major repairs or replacements. Therefore, these items were not eligible to be charged to the reserve fund and had to be taken from the operating fund. This theme will repeat itself whereby many of these COVID-related costs which were unbudgeted will, in turn, cause negative variances in the operating expenses.

Condo boards also had to purchase significant amounts of cleaning supplies, especially hand sanitizer and dispensers, as well as other important disinfectants, to keep common areas clean and safe. Once again, as these were new items or cleaning supplies, they could not be taken from the reserve fund and subsequently inflated the operating expenses.

While the previously mentioned costs were significant, they did not create as much of a financial issue as the following important line items in the budgets, which unfortunately had a very negative impact on

overall expenses during the past year.

Water is absolutely the largest single negative consequence of this pandemic.

Since many residents have stayed home to work over the last year, there has been a tremendous increase in water expenses.

Hundreds of condominium clients revealed increases of anywhere from 10 per cent up to 40 per cent. In a typical high-rise building, the water expenses can be between $100,000 and $200,000 per year. It follows that if those expenses were to increase by approximately 15 to 20 per cent, it would have a significant effect on the budget.

That being said, in some newer condos, the owners pay for their own water consumption. In those cases, it will not affect the condo’s budget but instead each resident’s own monthly water bill.

The other expense category that has been causing financial pressure on condos is cleaning contracts and concierge/security contracts. Many corporations have increased the duties of the cleaners and/or the security staff in order to ensure common areas are safe and sanitized. Given that these contracts are usually fixed monthly amounts in condo

12 CONDOBUSINESS | Part of the REMI Network

budgets, an increase in these services will have an immediate and negative impact on the year-end financial results.

The pandemic has altered an interesting and often overlooked item in the budget, which is not a cost at all, but a loss of revenue. Many condo corporations have guest suites and party rooms that are rented out. This provides a significant amount of revenues that are budgeted for and help offset some of the operating expenses each year. Often these revenues can be budgeted in the range of $20,000 to $50,000 per year.

With varying restrictions on gathering and non-essential travel, these revenues have all but disappeared during the past year, which leaves the budget short once again.

To add insult to injury, there is one more expense that has increased beyond any of the aforementioned items and was not related to COVID-19 but nonetheless could not have come at a worse time. In the past year, insurance increases in many condominiums have been significant, ranging from 10 per cent to as much as 30 per cent in the past year. Adding this on top of cost increases from the pandemic has created significant

FINANCE

“The pandemic has altered an

interesting and often overlooked item in the budget, which is not a cost at all, but a loss of revenue.” headaches for the boards of directors and management when trying to create new budgets for the next year. This is further complicated when considering the ability of the owners to absorb further increases in condo fees during this challenging time.

The pandemic has not affected budgets of commercial condominiums to the same extent as residential. Some expenses have actually decreased due to employees working from home and the unfortunate closing of many businesses. For example, since commercial condos were often empty over the last year, utility expenses have had positive variances from budget and in some instances have actually resulted in some surpluses.

Lessons from Unexpected Changes What lessons can we learn from these

unexpected changes to the revenues and expenses of condo corporations? The important lesson is strategic planning and budgeting. For years, we have consistently supported the concept of the board of directors leaving a “cushion” in the operating fund or creating a contingency fund to leave some money aside for unexpected events, such as this unimaginable pandemic.

Those condo corporations that had saved extra funds have been able to weather this storm without having to increase condo fees in any significant way. However, those condos that have been operating in a deficit or with little to no surplus are now having to figure out how to pay for these significant unbudgeted expenses.

At the end of the day, there is really only one group from whom to obtain the money needed to pay these new bills and that is

the owners. Unfortunately, many boards will now have to increase monthly condo fees by a significant amount or even pass a special assessment onto the owners to cover the deficits. At a time like the one we find ourselves in now, this will not be an easy task, nor will it be well received by the owners.

Consider putting some money aside, whether that be into an operating fund or a contingency fund. If owners question this decision, just remind them of the above unexpected consequences of the COVID-19 pandemic. 1 S t e p h e n C h e s n e y i s a c h a r t e re d accountant and partner with the firm YalePGC , LLP in Richmond Hill and currently specializes in the auditing of Ontario condominium corporations.

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Is Your Communication Style Costing You Money?

Condos a re communities.

In

BY SONJA HODIS order for them to operate efficiently and effectively, good communication is key and, in most cases, economically resolves issues. However, in other condos,

communication channels break down or don’t exist in the first place, causing unnecessary expenditures that corporations and owners must incur.

16 CONDOBUSINESS | Part of the REMI Network

FINANCE

“Instead of meeting with Mr. Amlani to discuss solutions, however, the Corporation got its lawyers involved and demanded that Mr. Amlani stop smoking immediately and warned him of enforcement costs. Its position became intractable. For whatever reason, it appears to have become rigid and motivated by animus towards Mr. Amlani that blinded the Corporation to simple practical solutions.”

At the end of the day, the corporation’s lack of good faith communication with the owner cost the corporation over $100,000 in legal fees, s. 135 oppression damages paid to the owner, and its own legal fees. Had the corporation been willing to communicate in good faith instead of taking a hardline position, the owners of York Condominium Corporation No. 473 would likely not have been saddled with such an economic liability.

Handling Noise Complaints Another important case from 2020 that reinforces the importance for corporations to communicate effectively with all parties involved in a dispute is the MTCC No. 933 v. Lyn case (Lyn), which involved a noise complaint regarding Ms. Lyn’s unit. The

corporation was successful in obtaining an order that the tenant breached the rules by creating excessive noise. The tenant was ordered to comply with the rules and pay $23,250 in costs. The corporation requested costs in the amount of $31,000 even though its actual costs were $34,469.73. The unit owner argued that she should not be responsible for any costs of the corporation in relation to this compliance application, of which the court ordered in her favour.

The court held that the corporation did not properly communicate with the owner regarding the complaints of the neighbour.

The corporation failed to send any notice on two occasions and imposed arbitrary and unreasonable deadlines when it demanded the owner take steps to evict the tenant.

Meanwhile, it failed to provide information that would have facilitated the owner in taking steps to end the tenancy appropriately.

While the corporation was successful in getting a costs award, the success was a hollow victory. First, they did not recover 100 per cent of their costs. As such, the amount not awarded by the court, but incurred by the corporation, is a cost all owners will bear.

Judges, arbitrators and various decision makers who are called upon to resolve condo disputes have clearly sent messages through their decisions that inappropriate communication will subsequently cost the condo and owners money.

Some recent examples include Amlani v.

York Condo Corporation No. 473 (Amlani).

This case from 2020 may look familiar as many have spoken about the indemnification provisions in declarations and the ability to chargeback costs to a unit owner. Yet another important message is that condo boards will face severe cost consequences if they do not communicate with owners appropriately.

In Amlani, the court made a point of highlighting the condo’s own bylaws that require both the corporation and the owner to use best efforts to resolve disputes through good faith negotiations before resorting to mediation, arbitration or legal proceedings.

The court found that the corporation did not behave in accordance with the bylaw; rather, the corporation refused to meet with the owner despite the owner’s attempts to communicate with the board to reach a resolution. The corporation failed to engage in communication that would be considered “good faith” negotiations. As the court stated:

www.REMInetwork.com | June 2021 17

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“Judges, arbitrators and various decision

makers who are called upon to resolve condo disputes have clearly sent messages through their decisions that inappropriate communication will subsequently cost the condo and owners money.”

Second, the costs award was against the tenant and specifically not the owner of the unit, which means that the corporation will likely not be able to add these costs to the common expenses of the unit and collect such costs through the lien procedures in the Condominium Act, which gives condos a super priority over amounts owed to them.

It is unknown from the decision whether the corporation will be able to collect the costs awarded by way of garnishment or seizure of personal or real property of the tenant, and it is possible that the corporation will not be able to collect those amounts

owing at all. As such, Lyn is a good reminder to property managers and boards to make sure that communication always includes both the owner and tenant. If you fail to do so, the corporation will pay the price.

Owners' Communication Style There has also been an increase in the number of cases where owners are harassing condo managers, boards, contractors or other owners. An owner’s failure to communicate effectively also results in costs being borne by the owner and puts their unit in jeopardy of being sold if costs are not paid.

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An example of such a case is Ottawa Carleton Standard Condominium Corporation No. 671 v. Friend (Friend). The court was asked to prohibit the owner from using rude, demeaning and inappropriate comments while engaging with directors. This form of inappropriate communication spanned several years. Friend’s communication involved repetitive, lengthy and insulting emails, telephone calls or knocking on the door to speak to someone directly.

The court found Friend to be verbally assaulting, confrontational and aggressive and severely limited Friend’s ability to communicate with the condominium corporation, its staff, contractors and other residents. The corporation sought full indemnity costs in the amount of $14,321 and the court awarded these costs against the owner and ordered they be added to the common expenses of the unit. This allows the corporation to collect these costs by way of the lien procedures available under s. 85 of the Condominium Act and power of sale proceedings if the owner does not pay.

Cost Decision of Recent Case In a recent similar example from 2021, MTCC No. 580 v. Mills (Mills), the court was asked to determine how an owner can communicate with the condo corporation and third-party contractors. The situation between the owner and the condo corporation had persisted for years, with the corporation seeking many orders to restrict the owner’s ability to communicate with the board, its agents and contractors. Another order was sought to prohibit direct threats to the board and their legal counsel, and from posting unauthorized notices on the property and common elements and playing recordings on the common elements at any time.

The court recognized that the owner’s communication style, which consisted

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mainly of a vast number of emails, was oppressive despite the owner’s claim that his style of communication was required to accommodate his disability. The court stated: “Reading, analysing, and responding to Mr. Mills’ emails represents the vast bulk of the work of the applicant’s staff and vo lunteers. C ounsel fre q uently is required to become involved. Mr. Mills’ emails exceed any reasonable e x p e c t ati o n fo r th e s h e e r v o l u m e of communication without even c onsidering the tone or c ontent.

They are prejudicial in that they have h a d a n e g a t i v e a n d c o s t l y e f fe c t on the applicant and its personnel. I have no hesitation finding the email communication oppressive under the Condominium Act, 1998 and granting the relief sought subject only to the exception referred in para. 31 for Mr. Mills real estate counsel.

As noted previously, I have no doubt that Mr. Mills finds his manner of communication driven by his disabilities. But it is oppressive and undue hardship to force others to endure harassment and oppression by him.”

In May 2021, the court released its decision on costs. The corporation sought costs in the amount of $155,000.00 and the court ordered Mr. Mills to pay $75,000.00.

While the costs award is significant against an owner and a signal from the courts to owners that there are serious consequences for inappropriate communication within a condominium setting, the court also took into account the consequences of s. 134(5).

The result in Mills is not the same as in Friend, where the court ordered all the costs incurred to be paid; however, the court in Mills acknowledged that despite any costs award, the condominium would still have the benefits of s. 134(5) to collect any amounts the court did not award.

When a court decides the issue of costs, it must follow specific principles.

Most times, that does not lead to a costs award that provides full indemnity to the winner. However, because the condominium in Mills obtained a s. 134 compliance order against the owner, they still have the opportunity to add to the unit the reasonable costs incurred, but not awarded by the court. Under s. 134(5), if

a condo obtains a compliance order under s. 134, plus an order for costs or damages, the condo can add the actual reasonable costs incurred to the common expenses of the unit, regardless of the wording in their declaration’s indemnification provisions Unlike the Lyn case, the condominium in Mills will likely be able to recover all reasonable costs incurred and add them to the common expenses of the unit. The court did not find the hours billed unreasonable.

The Mills and Friend cases are an important reminder to owners that inappropriate communication within a condo setting will cost you money and put your unit at risk. 1 Sonja Hodis is a condominium lawyer based in Barrie who practices condominium law in Ontario. She advises condominium boards and owners on their rights and responsibilities under the Condominium Act, 1998 and other legislation that affects condominiums and represents her clients at all levels of court, various Tribunals and in mediation/arbitration proceedings. Sonja can be reached at (705) 737-4403, sonja@hodislaw.com or you can visit her website at www.hodislaw.com.

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A Retrofit Remedy For Rising Maintenance Fees

20 CONDOBUSINESS | Part of the REMI Network

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Ask any condo ow ner in t he GTA or i n a ny major cit y across Canada and they’ ll

BY CHANDRA RAMADURAI

unanimously list astronomical monthly maintenance fees as among their biggest concerns with condo ownership. Add higher vacancy rates as a result of COVID-19 and these high fees also become a major issue for condo boards and building owners, all trying to find a way to reduce or optimize costs that will inevitably be passed down to tenants.

One of the greatest contributors to skyrocketing maintenance fees is inefficient or outdated infrastructure in aging buildings—a preventable expenditure when properly managed. From old boilers providing insufficient heating, to high prices for lighting and bulb replacements, energy inefficiency

is a major—and expensive—problem for building owners, and ultimately tenants.

But fixing these issues isn’t always an easy task. Various studies have indicated three main reasons for condo boards/ b uil d in g ow ner s n ot im p l em entin g these efficiency retrofits: lack of capital,

certainty of return (risk), and capacity to i m p l e m e nt t h e s e ret rof i t s i n a comprehensive way.

The first issue of capital availability is well known – capital is needed to maintain building assets and fund their repair or replacement – something older condo

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Energy Training Delivery Agents Sought Public agencies, not-for-profit organizations and private sector energy services providers are all expected to play a role in developing the workforce that will underpin Canada’s promised home retrofit program, slated to launch in the fall of 2021. The program, announced in the 2020 fall economic statement, aims to reduce greenhouse gas (GHG) emissions, stimulate post-pandemic economic recovery and create green employment through up to 700,000 grants of $5,000 for home energy improvements.

A newly announced $10-million fund will underwrite training and recruitment of approximately 2,000 energy advisors, who will be tasked with performing up to 1 million home energy audits and recommending effective retrofit measures. The Canadian government is now seeking expertise and resources to help build that nationwide team, and is offering grants of up to $100,000 to $200,000 per year to delivery agents of a range of required services.

“There are currently 936 energy advisors in the country who are qualified to use the EnerGuide Rating System v15 to assess home energy performance and make recommendations,” observes Brendan Haley, policy director with the research and advocacy organization, Efficiency Canada. “So this will be a big ramp-up.”

Grants are available in five categories: up to $200,000 per year to train new recruits for energy advisor positions; up to $150,000 per year for mentoring programs; and up to $100,000 per year

for professional development/upskilling support, recruitment of under-represented groups in the energy management sector, and capacity building in underserved or remote communities. Potential delivery agents of any or all such endeavours are invited to submit applications by July 8.

Applications will be considered for either a single year or a multiyear period, but all proposed work must occur between September 2021 and March 31, 2024. Provincial/territorial, local and Indigenous governments, Indigenous and other and not-for-profit organizations can receive funding for 100 per cent of eligible costs, while forprofit organizations qualify for coverage of up to 75 per cent of eligible costs. Applicants from or on behalf of under-represented groups will be prioritized, as will proposals that specifically entail recruiting and developing energy advisors from under-represented groups of the population or in underserved locales of the country.

“I am proud of the impact that this investment will have in getting more women, Indigenous Peoples, persons with disabilities and racialized Canadians into the workforce,” says Carla Qualtrough, Canada’s Minister of Employment, Workforce Development and Disability Inclusion. “This investment takes an inclusive approach in helping us get closer to our climate goals and ensuring that all Canadians have access to the skills training they need to succeed in the labour market.”

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buildings often lack as they prioritize spending on more urgent repairs and immediate tenant needs, leading to a vicious cycle of disrepair and deferred maintenance. The cost to maintain this cycle is subsequently passed down to condo owners and tenants through increased maintenance costs to help raise the required funds.

The second issue of risk is specific to the category of efficiency retrofits. Every condo dweller and building owner can relate to at least one instance of how a retrofit never achieved the savings it was supposed to achieve. This is partly a function of overzealous (and ver y avoidable) selling and partly a function of a common baseline. Savings need to be measured properly and in comparison to savings generated in previous years – if this baseline is not measured correctly, there can be very different interpretations of savings.

The third major issue is capacity. Most condos and other buildings are managed by a property manager who has limited capacity to undertake comprehensive retrofits. While it is common practice to

FINANCE

fix broken equipment or replace a non- per cent, using modern equipment and working bulb, very few buildings even automation to optimize energy usage. think of under taking comprehensive This efficiency leads to lower utility costs retrofits because of this issue. through lower energy consumption, One way to overcome these issues cleaner buildings and increased comfort and prevent increases to maintenance for owners and tenants— all the while fees—or even decrease these costs for reducing greenhouse gas emissions by tenants in some cases—is through energy about 20 per cent or more to support the efficiency retrofits. Condos can generate environment. both immediate and long-term value in By replacing outdated equipment, their buildings, leading to potential savings these investments also reduce the heavy for ever yone involved by par tnering fees needed to increase capital reserves. with a third-party company that invests, Savings can then be passed on to unit develops and maintains efficiency retrofit owners through reduced fees and/or projects. This value generation happens building capital can be reinvested into because these companies invest all the upgrading amenities and shared spaces. capital needed for the retrofit, guarantee Efficiency retrofits can also help condos savings to the condo/building owner and become more competitive in an evercomplete a ready-to-go installation. There shifting market. Upgraded equipment is a natural in-built check and balance creates safer, cleaner and healthier spaces mechanism in this arrangement because through improved ventilation, lighting and the company gets paid only when savings heating/cooling systems, making condos are generated. brighter overall for possible tenants and When managed, implemented and ultimately adding value to the space. measured appropriately, comprehensive Reinventing savings into the building efficiency retrofits can reduce operating can also create a competitive advantage 1 2:44 PM expensesDelProperty_Condo_March_2018_torevise.pdf by anywhere between 15 -40 through a2018-04-13 fresh, modern design upgrade,

Chandra Ramadurai is the CEO of Efficiency Capital. Chandra brings over two decades of experience in sustainable energy, banking and investment management in Canada, the U.S., Europe, the Middle East and India. He has led or been part of various investment deals worth billions of dollars. Previously, he was the CEO at IT Power, one of the world’s oldest clean energy companies based in the UK and has held senior-level positions at Suzlon Energy, a large wind energy company, Cemex, a Fortune 500 company, Standard Chartered Bank and PWC. Efficiency Capital is a performancebased investment solutions provider that upgrades the energy and environmental performance of buildings.

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or the installation of new, coveted amenities. The idea of living in a “green” or environmentally- conscious building has become not only sought after but expected – should buildings forego energy ef ficiency as a priorit y, they risk losing out on environment all y conscious consumers looking to rent or to invest in a new space. 1

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www.REMInetwork.com | June 2021 23

MANAGEMENT

RED FLAGS

24 CONDOBUSINESS | Part of the REMI Network

TECHNOLOGY FEATURE

Recent criminal charges in a five-year long investigation of refurbishment contractors highlights procurement risks.

www.REMInetwork.com | June 2021 25

FEATURE

The federal government’s Competition Bureau served

BY WILLIAM STRATAS production orders on more than 140 condominium corporations in the Greater Toronto Area in 2016, seeking documents related to alleged improprieties in tendering of high-value condo refurbishment projects.

Five years after the launch of this wide -scale investigation, t h e o u tc o m e e m e r g e d t h i s past March as criminal charges under the Competition A c t were file d a g ainst fo ur contractors and two individual d efen d ant s . T hese c r imin al allegations have yet to be proven in court; the outcome of these prosecutions remains unknown.

However, the fa c t th at the fe d er al g over nm ent h as focused on condo procurement for investigative scrutiny should be sufficient reason for diligent condo boards to examine their procurement practices and identify possible red flags that might indicate risks of tendering improprieties and bid cost inflation.

Can you trust referrals from your licensed property manager?

In the perfect world, your condo’s p ro p e r t y m a n a g e r s h o u l d b e a trust wor thy source for referrals to a wide spectrum of suppliers and contractors, including for large - dollar-value projects. In the re al wo r l d , t his t r u s t mi g ht b e questionable. As the phrase goes: if you trust, you first need to verify.

It is routine for property managers, or their supervisors at management companies, to refer business to their preferred suppliers and contractors. In some circumstances these referrals will be merited by performance and worthy of trust.

However, if property management is ethically compromised, these possibly might be deceptive referrals to contractors with kickback payment schemes and overpricing in full operation.

How can condo directors mitigate these ever- present concerns in bid tenders and procurement for high-dollar-value projects? Here are three major red flags for procurement risks: Contractors and suppliers who promote themselves as “specializing in condominiums” Boards should take extra care and caution with contractors for large - sc ale projects who claim specialization in the

26 CONDOBUSINESS | Part of the REMI Network

c o n d o m a r ket . T h i s p o s s i b l y could be contractor language f o r “s p e c i a l i z i n g i n d u p i n g uninformed condo boards to pay above fair- market rates”. T he majorit y of condo board directors are untrained, inexperienced volunteers who may be vulnerable to deceptive proposals when blindly soliciting contractor services for major projects.

Few condo directors have experience in high-dollar-value corporate procurement. Fewer still have the business skills needed to develop rigorous procurement guidelines for their corporations. Many directors also lack the personal skills required to drive asser tive negotiating positions for the benefit of their corporations. These directors risk falling prey to smooth-talking contractor sales representatives who can deftly overprice their proposals or perhaps engage in serious improprieties such as kickback payments offered to ethically compromised parties.

E XPE R T T I P: In order to mitigate these risks, i t is g e ne r all y p refe r a b l e to choose contractors and suppliers with strong experience with commercial properties, not just c o n d o m i n i u m p ro p e r t i e s .

Commercial building owners and their property managers are clients with high professional awareness who understand what fair-market value should be for work proposed.

Suppliers and contractors who ser ve commercial proper ties t ypic ally know their bids and proposals will be ver y closely scrutinized, and any anomalies will be flagged and intensively questioned. Commercial property management generally has strong reporting structures and diligent internal controls, which deter rogue project bidders and corrupt pricing schemes.

Mindful of all these advantages, condo boards should consider seeking suppliers and contractors who have a strong record of servicing commercial buildings, perhaps with secondary focus on condominiums. Generally, it’s probably

FEATURE

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PRACTICAL APPROACHES

best to avoid—or hold to very rigorous and intense scrutiny— suppliers and contractors who serve condos exclusively.

Contractors and suppliers with questionable history of litigation The Ontario Ministry of the Attorney General operates a web por tal that lists all past and ongoing litigation c l aims ac ross the prov inc e. T hese include claims filed in the Superior Cour t as well as the small claims cour t. By obtaining a free Ser vice Ontario “One - Key” login (available at w w w. iaa.gov.on.ca), you can search the litigation history of your condo’s contemplated suppliers and contractors. Examine the dates and types of claims, the names of plaintiffs and defendants; then assess whether there might be risks with doing business with certain suppliers and contractors.

C o n t r a c to r s a n d s u p p l i e r s w i t h questionable relationships on the internet Take time to conduct deep internet searches, social media searches and Facebook searches that might uncover relationships between suppliers and contractors and members of your condo’s property management team. Use deep searches to uncover other questionable flags that may be present, such as fraternization of suppliers and contractors with property managers and their family members. Any sort of flagrant social association uncovered on internet sources possibly could suggest compromised business ethics in tenders and procurement. There are special investigative techniques that can assist in this type of deep research, so it might be more diligent to engage an outside specialist consultant to conduct internet investigations using more sophisticated tools.

Concerns about questionable contractor relationships also extend to condo board members. Procurement schemes that involve a condo corporation’s signing officers are a particularly insidious risk for which any diligent board should be mindful. Suite renovation for a board officer that curiously coincides with a major common-area refurbishment project is an example of a red flag that should be explored. 1

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MAKING ROOM FOR BIKES

The cycling renaissance is here. Is your building ready?

I

t’s a two-wheeler revolution, but is your multifamily building along for the ride? With warmer months ahead and more bikes on the streets, now is the time to consider how your property is catering to cyclists.

“We’ve seen biking become incredibly popular over the years, especially during the pandemic when everyone just wants to be outside getting exercise,” says Wayne Tucker, Owner of Classic Displays. “In particular, more and more young people are using bikes as a cleaner, more active, and cost-effective way of getting around, and they’re looking for places that accommodate their choice of travel.”

The uptick in biking is a result of many factors. And given their positive impact on public health and the environment, municipalities are encouraging this by installing more biking lanes and infrastructure and making bike parking a part of city building codes.

All told, the bicycle resurgence is a movement that multifamily buildings can’t afford to ignore.

“What the record bike sales and evolving bylaws tell us is that biking is gaining in popularity, and that bike parking is more of a ‘need’ rather than a ‘nice to have,’” notes Ryan Demchuk, Sales & Business Development with Classic

Displays. “Because of that, we’re getting a lot of requests from residential property managers asking us to come in and take a look at how we can build or retrofit spaces to cater to their cycling tenants.”

Putting up the wheels It takes more than a corner space and a few metal bars to provide bike parking. Safe and secure bike storage facilities require several considerations, many of which have been outlined by the Association of Pedestrians and Bicycle Professionals (APBP).

Here are a few considerations: • Storage: Buildings may opt for two-tier stacking bike racks to save space, but that is often the least popular option for cyclists. Tiered bike racks can be hard to maneuver, and bikes on the bottom can get dirtier.

“What cyclists really want is the easiest method to park, which is simply a horizontal bike parking space,” says Demchuk.

With this in mind, he adds that Classic Displays offers a “Stacker” bike parking model, which parks bicycles horizontally but are slightly offset vertically, explaining,

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“You can a park eight bikes in the same space that you would have normally only been able to put five bikes.

So, you’re increasing your bike parking capacity by about 37% without needing to have the bikes stacked on top of each other.”

Two points of contact: According to the APBP and other biking advocacy groups, the safest and most secure bike storage options provide two strong contact points for every bike. This makes bikes harder to remove and steal, and prevents them from toppling over.

“There are thousands of bikes stolen every year because bike parking facilities aren’t using multiple points of contact or the pipes they’re connected to aren’t thick and strong enough to stop someone from coming along and dislodging the bike,” adds Tucker.

Lighting: A well-lit bike parking section isn’t just more comfortable; it also adds to the safety and security of the space. And anything a building can do to build that sense of safety will encourage more people to use it.

Aisleway clearance: The APBP recommends a minimum of four feet of aisle space to accommodate multiple users and promote safe entrances and exits.

Amenities: Want to go the extra mile for your tenants?

Consider adding a bike repair station and air pumps within your bike parking area.

“These things aren’t difficult to add, and they make a big difference,” adds Tucker, noting Classic Displays’ bike storage and maintenance solutions have become popular among their clients for this reason.

Easy location: Cyclists don’t want to move down (or up) multiple levels to park their rides. As such, there’s value in placing bike parking spaces at the ground level as it can attract more occupants to your building.

Ramps: If cyclists do need to park above or below ground level, consider including a bike ramp on stairwells to make that journey a bit safer and save cyclists the hassle of hauling their rides up and down stairs.

• Consult a specialist: There are many industry standards and proven techniques to consider when creating a bike parking area, be it in a new construction or as part of a building retrofit. Make the most of your investment by consulting a specialist who will put your project on the right track.

“It’s relatively easy to put in bike parking, but there are best practices you want to make sure you’re following to do so effectively,” adds Demchuk.

Making room Growing demand aside, it’s not uncommon for property managers to be reluctant about expanding space for their cycling tenants. After all, vehicle parking is a prime source of revenue.

Nevertheless, the growing number of cyclists is hard to ignore. And with numbers only expected to climb beyond the pandemic, any steps to make cyclists feel welcome, safe, and secure will go a long way to attracting (and retaining) tenants.

“Not only is bike parking part of many municipalities’ by-laws, it’s just good business,” agrees Tucker.

Classic Displays is a multidivisional company specializing in site furniture, holiday displays, and installation services.

For more, visit classicdisplays.com.

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Who Plays a Part in Managing Vested Interests?

30 CONDOBUSINESS | Part of the REMI Network

GOVERNANCE

Have you ever hea rd the director proclaim at the board

BY VAL KHOMENKO

meeting: “my son is an electrician and can do this job for free” or “I have a cousin who can do this for half price?”

What about situations where it is a little more complicated?

For example, a stepson of the board’s president is a security guard working full time and the president has not disclosed this relationship to the board or otherwise. Should the president have disclosed it at all?

The board of directors for condominium corporations is accountable and responsible for millions of dollars in assets.

Condominiums are lucrative investments, holdings and, for many people, their only homes. As a result, conflict of interest on the board of directors is a topic that often raises ire of many owners and prospective buyers. Stories of the “infamous three” who took control over downtown Toronto condos still plague the industry.

How do you resolve or mitigate such conflicts? Let’s break it down by role.

Seek advice When in doubt, the manager should seek advice of the supervising licensee or the principal condo manager. They can guide the board on their obligations under the Act and instill best industry practices to promote fairness and transparency.

The Role of the Owner Owners must always ask themselves what is in it for the director. Is there a potential direct or perceived conflict?

Does it pass “the sniff test?”

With the amended Condominium Act, 1998 (the Act), owners have the right to request records with prescribed forms and deadlines. By regularly attending annual general meetings, owners are presented with the opportunity to receive updates on major renovation projects and ask questions.

Furthermore, the owners, if in doubt, should request the minutes of the meeting where such “conflicting” transactions were voted on. Has the director in question recused himself/herself from the vote and declared the conflict to the board at a duly called meeting?

Section 40 & 41 of the Act clarifies the disclosure obligations for directors and officers of the corporation.

Lastly, and most importantly, owners should take the time and thoroughly acquaint themselves with the condo’s governing documents. If the conflict of interest on the board persists and the board does not meet the obligations und er the A c t , the ow ners should c onsid er seek ing professional legal advice, preferably from a lawyer wellversed in condo law.

The Role of the Board If a fellow member of the board is in a position of a conflict of

Walk away If the conduct of the board is of egregious nature, the manager should consider resigning and walking away from such conflict.

Ultimately, it is up to the manager to employ any of the above steps necessary to perform their fiduciary responsibility as agents acting in the best interest of the client—as long as they do so in accordance with the code of ethics outlined by Condominium Management Services Act, 2015 O.Reg. 3/18.

The Role of the Condo Manager What If the manager discovers a conflict of interest on the board? What steps can he or she take to facilitate a resolution?

Determine the client Who’s the client? Is it the president who signed the management agreement and has a potential conflict of interest? Or is it the corporation itself?

www.REMInetwork.com | June 2021 31

GOVERNANCE

“Condos are complex entities.

The mix of owners and boards is ripe for conflict and personal agendas.”

interest, remainin g d ire c to r s shoul d feel empowered to address the issue directly at a duly called meeting without p ersonal rep ercussion. A ny and all disclosure obligations must be met and recorded accordingly. If not, failure to do so may raise future accountability and liability issues.

To avoid this, the board should follow three simple guidelines: 1. Adopt a procurement policy for the corporation, which would list the proper bidding requirements.

2. If pos si b l e, e n g a g e a t hird - p a r t y minute taker to ensure that impartial record keeping is done. W hen in d o u bt , t h e b o a rd sh o ul d c o nsul t the cor p oration’s solicitor on the

disclosure obligations and compliance under the Act. 3. Exercise caution and awareness when the fellow director is an “industr y insider” (e.g., regional manager of a major condo management firm, condo lawyer or developer’s affiliate). Setting proper expectations for the “insider,” as well the board in general, reinforces the mandate that the board exists first and foremost to serve the best interest of the corporation and its owners.

In all cases, the mindset of equal vote and participation should be maintained.

Condos are complex entities. The mix of owners and boards is ripe for conflict and personal agendas. Perhaps one of

the most valuable assets in maintaining this delicate balance between self and collective interests is the strength and integrity of the property manager.

A healthy b o ard c an only exist if fundamental practices in disclosures, p ro c u re m e nt a n d t r a n s p a re n c y a re maint ained, and meticulous record keeping is king. 1 Val Khomen ko i s t h e p r i n c i p a l condominium manager for Regional Group, a full-service real-estate investment and management firm, based in Ottawa, Ontario. Val leads Regional’s condo team with 7+ years of experience in the condominium industry. He can be reached at 613-230-2100, Ext. 7409.

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POST-PANDEMIC PROJECTS FOR CONDO BUILDINGS Putting electrical and mechanical projects back on the radar

T

he pandemic caused multifamily building teams to narrow their focus on health and safety. As a result, many electrical and mechanical projects fell under the radar. Now that the world is making a slow return to “normal,” it is time to bring critical maintenance and retrofit activities back into the spotlight.

“The last year-and-a-half has been stressful for multifamily teams, and some electrical and mechanical items had to be put on the back-burner due to COVID-19 transmission concerns, budget, or even time,” says Ed Porasz, Vice President with M & E Consulting Engineers. “The good news is we’re heading to a better place, and it’s a good time to revisit key considerations.”

These considerations include: • Makeup Air: Indoor air quality (IAQ) has always been a critical consideration. Now, it’s a top priority. The ability to bring fresh, outside air into a building in a controlled manner reduces the risk of

cross-contamination, maintains optimal comfort levels, and increases efficiencies. As such, a building’s makeup air system should be reviewed by staff and/or a professional engineer to make sure it is working as intended and that ideal pressure levels within suites, hallways, and public areas are being met. At the same time, it is worth looking into how the building can better dehumidify or cool makeup air to future-proof your building against rising temperatures.

• Kitec pipe failures: If your apartment was constructed between 1995-2005, the suites may have Kitec piping. Unfortunately, these pipes have been found to fail after just 10 to 15 years from the initial installation. If you weren’t already replacing these pipes before the pandemic, now is the moment to revisit this issue.

“Kitec failings are a known concern. It’s not a matter of if they will fail, but when,” explains Porasz. “And since it typically takes a number of

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months to prepare design drawings and go to tender start the project, the best time to get started is yesterday.”

• PEX piping risks: PEX pipes were installed on risers and recirculation lines in buildings built between 2005 and the present. PEX has been known to fail, if the velocity of water within the pipes exceeds manufacturer recommendations.

Herein, it pays to have a professional engineer or service contractor come in to review the velocities within your piping system and take measures to extend their lifespan.

• Energy-smart retrofits: It’s always a good time to revisit HVAC upgrades. Today’s high-efficiency boilers and chillers can dramatically reduce CO2 emissions, smaller environmental footprints, and generate significant energy savings. For example, a high-efficiency condensing boiler can create energy savings to recover your initial investment in as little as four to six years, while an oil-less and bearingless chiller can enable a payback of five to eight years.

Building automation systems (BAS) can also contribute to greater efficiency and operational savings. Moreover, they can help with ease of operation and enable faster responses to equipment failures and repairs. Here again, the initial investment can pay off over the long-term.

• EV charging stations: The electric vehicle revolution started well before the pandemic.

Now? It’s shifted into full gear. With eco-friendly attitudes higher than ever, more and more drivers are moving to cleaner, greener, and electric forms of travel. This is a good opportunity to add value to your building by installing EV charging stations for your residents and visitors.

“EV charging stations are going to be table steaks soon, so you want to consider them now rather than later,” says Porasz, adding, “Step one is working with an engineer to determine what infrastructure you’ll require, the best places for installation, and maintenance requirements.”

Catching up on essential projects It’s been a trying time for multifamily teams.

Between keeping owner and staff safe and productive, it’s understandable that electrical and mechanical initiatives fell by the wayside.

Nevertheless, electrical or mechanical projects can’t be put on hold forever. As we move into the post-pandemic, there are benefits to exploring the upgrades, repairs, and maintenance activities that will keep your building operating at its peak for years to come.

E d Po r a s z i s V i c e P r e s i d e n t w i t h M & E Engineering, a professional and multi-disciplined mechanical and electrical engineering firm serving clients in the GTA and across Canada. For more, visit www.me-eng.com.

MANAGEMENT

Elevator Repair Legislation Advances

Contractors in Ontario await fine-tuning of newly approved regulations

Ontario is kicking the dust off elevator repair legislation that was

BY REBECCA MELNYK

passed in May 2018 during the previous Liberal government’s tenure, but never

proclaimed into law.

In a move that will see better elevator availabilit y and stricter maintenance requirements, recently approved regulatory changes allow the Technical Standards and Safety Authority (TSSA) to impose financial penalties for noncompliance with legal requirements.

Elevator outage data must also be reported to TSSA for online publication. In a statement, the ministry of government and consumer affairs said owners of elevators in a long-term care home or residential building will need to report all prolonged outages (i.e., of 48 hours or longer) to TSSA, along with the cause of the outage and certain characteristics of the building/

elevator via an online form. Potential home buyers would be able to search an address and gather this data.

Both changes take effect on July 1, 2022, following government consultations that began last summer on the previously shelved legislation, which was built on recommendations in the 2018 Value for-Money audit of TSSA by the Auditor General of Ontario, as well as a report by former Superior Court Justice Douglas Cunningham that assessed elevator availability in Ontario. At the time, there was growing concern about prolonged breakdowns in multi-storey residential buildings and long-term care homes.

36 CONDOBUSINESS | Part of the REMI Network

Fine-tuning the legislation While a gain for consumers, the legislation falls short of addressing some challenges elevator contractors face on the job. For instance, data could be collected on elevator contractors servicing a problematic 50-yearold building.

“If it’s older equipment that hasn’t been modernized and the contractor has been advising the owner to upgrade the equipment for the past five years, does this still become the elevator contractor’s responsibility to maintain the equipment in excellent running condition?” says Rob Isabelle, chief operating officer with the elevator specialty firm, KJA Consultants, and

MAINTENANCE

Elevator Costs Full Modernization When: Typically, every 10 to 25 years.

Estimated Cost: $100,000 to $200,000 Downtime: 2 to 10 weeks Can include: Machine and ropes; controller and fixtures; door operators and door lock.

Component Upgrades When: Typically, every 10 to 15 years Estimated Cost: $4,000 to $25,000 Downtime: 2 to 5 days Can include: Door operators or fixture upgrades. *Obsolete parts may lead to longer outage times or earlier modernization.

Preventative maintenance strengthens elevator life cycle.

Courtesy of the Ministry of Government and Consumer Affairs

a member of the TSSA’s elevating devices advisory council.

On the other hand, a contractor might delay repairs if a corporation hasn’t paid their invoices for the past six months. Right now, it’s unclear if contractors will have to repair an elevator in those circumstances.

“There will be some cases where the elevator contractor should be working harder to fix the elevator; there’s other cases where the contractor is probably not responsible to fix the elevator,” says Isabelle. “There are a number of details that will need to be worked out between now and July 1, 2022, and once this gets rolled out, every party will realize this isn’t a simple issue.”

There is also uncertainty about what will happen with the data the TSSA collects. As Isabelle points out, “What is the purpose of the information? Somebody will want to get that data, and that’s why the elevator contractors are concerned.”

Ontario has an estimated 4 5,0 0 0 elevators. “A large contractor might have reported more than 30 elevators shut down for two days, but on a percentage basis of units maintained this number could be much less than that of a contractor who services only 300 elevators,” says Isabelle. “That contractor might only have 10 down, but on

a percentage basis, that contractor could be doing a worse job than the larger ones.”

As it stands, there is little elevator legislation out there. The Cunningham report found there were no regulated standards for the number of elevators required in a residential building to match the number of residents, and no formal obligation from the Ontario Building Code. It was recommended three years ago to develop a new standard, but there hasn’t been any movement on that account since.

“Where a building should really have four elevators, some developers are installing only three,” says Isabelle. “Moving day, you’re down to two elevators, and if one is broken, you’re down to one elevator. That’s a problem out there.”

Rebalancing supply and demand Even in a highly regulated industry, with a small group of elevator mechanics (roughly 3500 in Ontario), the majority of repairs are performed quickly except for a smaller percentage of cases where shutdowns are longer-lasting.

The Cunningham report found in 2017 that TSSA data and expert analysis placed

average availability across residential and institutional buildings at 97 per cent, or 3 per cent non-availability, the equivalent of 10 days out of service. Most buildings with low availability were in the Greater Toronto Area, also the location with the most elevators.

Condos reported the lowest average availability by building type, at 93 per cent out of the year.

Three years ago, when this legislation was drawn-up, the industry faced what Isabelle calls ‘the perfect storm.’ “There was a ridiculous amount of work and not a lot of qualified technicians to address it,” he says. “Work volume has reduced and the union has let more people in; schools have started elevator apprenticeship programs. We’ve been able to rebalance the supply and demand.”

Since COVID-19, elevator modernizations have also shut down, creating fewer call orders.

“Right now, we have the opposite issue; it’s quite slow because a lot of commercial office repairs are delayed,” he adds. “Office building owners are not spending money. Residential building owners have put their modernization work on hold pending the pandemic. PostCOVID, there will be a boom in elevator modernizations.” 1

Tips for Negotiating Contracts • Obtain multiple bids from both large and small-sized providers.

• Inquire about possible discounts (i.e. long-term contract, low occupancy, multiple buildings).

• Pre-negotiate hourly rates and clarify overtime hours.

• Ensure there are a sufficient number of maintenance visits per year to address the needs of the equipment.

• Control non-emergency calls made from the emergency button or phone in the elevator.

Non-critical issues like burnt light bulbs should not be reported as immediate needs; rather, brought to the technician’s attention during a next site visit. This is less costly for the contractor and condo.

• Guide building staff to call in for service only during regular hours for non-emergency calls.

• Have a professional review the contract, if able, to ensure you are only paying for required services.

• Consider whether tests are covered in your contract.

Length of Contract 1. Determine the proper length. Five years is typical.

2. Determine what equipment your contact covers. Contractors may invest more with longer terms.

3. Consider the terms of contract termination. Inquire about automatic renewal clauses, which mean your contract will renew for another term unless you give notice. Note the date at which you are required to give notice of termination/non-renewal.

Courtesy of the Ministry of Government and Consumer Affairs

www.REMInetwork.com | June 2021 37

MAINTENANCE

Before A Fire Many Ontario condo residents are living in buildings with outdated fire

BY REBECCA MELNYK

safety plans, which can be of particular concern in an

aging population. Plans are supposed to include a list of people requiring special assistance — names and locations of residents whose health conditions or disabilities may impede the evacuation process. It’s important to keep this list up to date, but not every condo does so.

38 CONDOBUSINESS | Part of the REMI Network

MAINTENANCE

“There are more fire deaths that have

occurred in corridors due to flammable decorations than people staying in their suites.”

A fire recently occurred in such a building that transformed into a more senior demographic over the years.

Deputy Chief Carrie Clark of the Barrie Fire Department was on the scene. “50 out of 75 units needed assistance in evacuating during an actual fire event,” she said during an online session hosted

by CCI Huronia in March. “That’s pretty significant, resource - heav y for a fire department to actualize.”

To keep up, corporations should be attuned to all types of changes. As Jeff Struewing, vice-president of Shore to Slope Management Services, noted, plans may also need an overhaul if building systems are updated or renovations alter the layout of floors or rooms.

Updating the plan with a reputable fire code consultant who is in-the-know on code changes is key to avoiding liability and staying safe, added Murray Johnson, vice-president of client services Crossbridge Condominium Services.

Communicating fire code compliance to residents is critical, he said, and can be accomplished through the annual distribution of the resident emergency res p o nsib ilit y instr u c tio ns an d the assistance required forms. “Going even further, if you’ve got nothing to put on the bulletin board, do an educational campaign.

Let them know about all the things in their unit they may be responsible for.”

O w ners should o bt ain c o pies of f i re s a fe t y p o l i c i e s t h a t a d d r e s s how to resp ond to deficienc y lists and emergencies, he s aid. For the information to become second nature, managers should also reinforce fire code compliance with staff at regularly

scheduled meetings, and dedicate an ongoing section in the management report to keep the topic at the forefront of a community.

Don’t Just Solve Deficiencies. Prevent Them.

“High - r ise b uil d in g s h ave c o m p l ex systems that both directly and indirectly af fec t fire c o de c ompliance,” s aid Johnson, citing generators, sprinkler systems, fire pumps, doors and soft skills like training as examples. Gather all records into one central binder to hand over when a fire inspector requests it, including proof of repairs.

Going beyond minimum standards, work to address a notice of violation, but also prevent it from recurring. Having processes in place ensures both safety and optics ahead of an inspection. To catch deficiencies ahead of time, one example is creating door logs (doors need to close and latch under their own power) and asking cleaning staf f to check chute and stairwell doors as part of their routine, or HVAC staff and fire inspectors to check and log suite doors when visiting every year.

He also detailed how a manager’s annual plan should include checking the fire safety plan and other related items like inspections. Highlight all fire-related tasks and file a copy of that fire plan into the centralized record-keeping system. “That way, not only will the inspector see what the logs and records show, they’ll also see how you’ve planned out your year,” he said.

“Know your building and know the people in your building,” said Clark.

www.REMInetwork.com | June 2021 39

MAINTENANCE Looking ahead, fire safety plans should be reviewed annually or more often.

When changes are made, corporations might consider sending a copy to the fire department to review. According to her list of “Dos and Don’ts,” a fire d e p a r t m e nt l o c k b ox s h o u l d h a ve c u r r e n t ke y s , e n o u g h t o p r o p e r l y address the building. “A master key is a lot cheaper to cut than the 50 fire doors we are going to tactically demolish when we go in to do our checks,” she said, adding that doors are the easiest things to “write up.”

“There are more fire deaths that have occurred in corridors due to flammable dec orations than p eople st aying in their suites,” she said. “The door’s fire rating is ruined when you attach things to it. This includes mats, shoes and scooters.”

Keeping Up On Repairs and Reports Most corporations complete an annual life safety systems test, yet aren’t as savvy on providing repair reports, said Michele Farley, president and senior code consultant at FCS Fire Consulting

Services, who regularly sees fire alarm records on many notices of violation throughout Ontario.

“T his does not necessarily mean the test wasn’t done; it often means t h e re p a i r s h a ve n’ t b e e n d o n e o r completed, that there is no record of the correction of deficiencies or certificates of completion or, worse, no records at all,” she said. “Part two of the fire code requires condos to keep records for a minimum of two years.”

W hen it c omes to rep airs, some contractors are quick to inspect but slow to hand over a deficiencies list.

“F i n d i n g t h e r i g ht c o nt r a c to r w h o can commit to providing the repor ts quickly is important,” noted Struewing.

“Something to consider is authorizing t h e c o n t r a c to r to c o m p l e te m i n o r repairs during the inspection.” Have an on-site supply of smoke detectors, heat detectors, pull stations or fire extinguishers for instance, or ask the service provider to keep these common items on hand.

During the hir in g p ro c e s s , F ar l ey suggests paper work management

40 CONDOBUSINESS | Part of the REMI Network

be par t of the ser vice - provider contract. There should also be a clear understanding of what the contractor’s responsibilities are during and after system tests, as well as a corporation’s own follow - up actions to f a c i l i t a te a l l n e c e s s a r y re p a i r s , m aint ain c e r ti f i c ate s a n d c l o se - of f records. “Inspections could include multiple documents and contractors,” she noted. “Your fire alarm company might not be the company that tests y o u r p r i v a te f i r e h y d r a n t s , s m o ke control systems or generators. Do your best to streamline annual inspections around the same time or even the same month.”

In-Suite: Knowing Equipment and Gaining Access A ll b o a rd m e m b e r s a n d m a n a g e r s should know what type of life safety equipment is required by the Ontario fire code in suites and whose responsibility it is to have this checked and tested.

This will depend on the building type.

Townhouses, for example, won’t have the same systems as high rises do.

“Make sure you provide residents with a list of what’s in their suites, either in your rules, regulations, declarations o r t h e i r w e l c o m e p a c k a g e ,” s a i d Farley. “Be clear what their fire safety requirements are and remind them at least annually.”

Scheduled suite access can include checking a unit’s fire safety equipment during a yearly inspection, but approaching owners and renters about entering a unit for risk assessment can be tricky. Common concerns are suspected hoarding and balconies used for storage.

“You can be both firm and empathic,” said Farley. “Give as much notice and options of days and times as reasonable an d p o s si b le, b u t yo u sh oul d als o b e cle ar. Includ e a st atement that arrangements have been made, that it is imperative access be granted at that time, and what the access is for so they understand why you’re coming in. Hopefully occupants comply, but if not, you’ve made your intentions clear, your reasons clear and you’re prepared to go to the next step of achieving that access, even if that happens to be calling a lawyer.” 1

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CONDO MARKET

Condos Anchor Affordable Recreational Property More prospective buyers are turning to Canada’s cottages, camps and cabins as an antidote to inflationary urban housing prices and a looming second summer of the COVID-19 pandemic. However, condos are entrenched as the most affordable option in what the newly released RE/MAX 2021 Recreational Property Report defines as a seller’s market almost uniformly across 33 prominent vacation areas nationwide.

42 CONDOBUSINESS | Part of the REMI Network

CONDO MARKET

“There are still many recreational markets

across Canada that are deemed affordable, despite the growing demand and rising prices.”

“There’s intense competition among buyers in Canada’s recreational property markets and inventory is stretched thin,” says Christopher Alexander, chief strategy officer and executive vice president, RE/MA X of Ontario-AtlanticCanada.

A n accompanying sur vey of proper t y - seekers’ preferences and motives, conducted for RE /MA X, finds that 54 per cent of respondents who are planning to buy a vacation property will be doing so for the first time. More than 20 per cent of prospective buyers report they have

been shut out of pricier housing markets in an urban centre, and 22 per cent say low interest rates have increased their ability to buy.

Meanwhile, RE/MA X sales representatives report doubledigit growth in average sale values since 2019 for almost ever y proper t y t ype in the vast majorit y of recreational p ro p er t y m arket s , al o n g w ith m o re th an a h an d ful of average increases exceeding 100 per cent. In Ontario, three rare examples of declining average sale prices are found exclusively in condominium properties, while stand - alone formats in the same markets — Haliburton County, Niagara Region and Barrie-Innisfil — recorded significant gains.

Indeed, Barrie-Innisfil and Niagara Region rank as Canada’s second and third priciest markets for waterfront properties, albeit trailing a chart-topping average sale price of more than $2.4 million thus far in 2021 in British Columbia’s Central Okanagan. And B.C.’s slopes arise as an even more lucrative attraction. Whistler chalets command an average sales price of nearly $3.7 million, taking title as Canada’s most expensive recreational property.

L o ok ing to m ore af ford a b le p ro du c t , C h ar lot tetow n, Manitoba’s Interlake Region and Thunder Bay posted the lowest average sale values for waterfront properties last year — all at less than $426,000. No condo prices are cited for Charlottetown or Thunder Bay, but the popular Manitoba vacation area is one of the rare Canadian markets where average condo prices have slipped since 2019, dropping nearly $20,000 to an average sale value of about $111,000 thus far in 2021.

RE/MA X analysts also underscore less disheartening data for the 44 per cent of prospective buyers who hope to acquire a proper ty for $20 0,0 0 0 to $50 0,0 0 0 during the next 12 months. At least one type of vacation property in that price range is currently available in more than half of the markets.

“There are still many recreational markets across Canada that are deemed affordable, despite the growing demand and rising prices,” Alexander maintains.

In Ontario, these include H alibur ton, Kenora, Rideau Lake, the Thousand Islands, Windsor Essex and Sudbury/ Manitoulin / French River, along with condo proper ties in Collingwood, Parry Sound and Barrie-Innisfil. Looking east and west, lower priced recreational properties can also be found in the St. Andrews and Halifax regions of Nova Scotia and Sylvan Lake, Alberta, along with condo options in Central and North Okanagan.

- REMI Network

www.REMInetwork.com | June 2021 43

CONDOBUSINESS WHO’S WHO 2021

TOP

TEN

IN THE CONDO BUSINESS INDUSTRY

CONDO BUILDINGS

TOTAL

FirstService Residential Management Canada

1,214

CONDO UNITS

TOTAL

FirstService Residential Management Canada

115,315

Pacific Quorum Properties Inc.

687

Crossbridge Condominium Services Ltd.

89,577

Wilson Blanchard Management Inc.

628

Del Property Management Inc.

75,000

Crossbridge Condominium Services Ltd.

476

Rancho Management Services

46,286

Del Property Management Inc.

270

Wilson Blanchard Management Inc.

44,148

AWM-Alliance Real Estate Group

251

Pacific Quorum Properties Inc.

39,552

Gateway Property Management Corporation

246

ICC Property Management Ltd.

ICC Property Management Ltd.

230

Icon Property Management

28,000

KDM Management Inc.

209

AWM-Alliance Real Estate Group

26,553

SolutionCondo/Rentalys Solution

184

Gateway Property Management Corporation

17,999

RANK

UNITS

BUILDINGS

1

FirstService Residential Management Canada

115,315

1,214

2

Crossbridge Condominium Services Ltd.

89,577

476

3

Del Property Management Inc.

75,000

270

4

Rancho Management Services

46,286

0

5

Wilson Blanchard Management Inc.

44,148

6

Pacific Quorum Properties Inc.

39,552

416

BUILDINGS 230

7

ICC Property Management Ltd.

28,235

8

Icon Property Management

28,000

110

AWM-Alliance Real Estate Group

26,553

251

10

Gateway Property Management Corporation

17,999

246

628

11

Percel Inc.

16,101

182

687

12

KDM Management Inc.

16,031

209

13

Apollo Property Management Ltd

15,480

128

14

SolutionCondo/Rentalys Solution

14,962

184

15

GPM Property Management Inc.

14,200

72

16

Goldview Property Management Ltd.

12,000

88

17

Nadlan-Harris Property Management Inc.

12,000

78

18

Comfort Property Management Inc.

8,000

80

19

A.A. Property Management

7,000

45

20

MF Property Management

6,855

103

21

Bayshore Property Management

6,196

108

22

Equium Group

5,286

60

23

Meritus Group Management Inc.

4,708

53

24

Shelter Canadian Properties Limited

4,412

30

25

Canlight Management Inc

4,000

50

3,927

How many licensed condo managers in Ontario as of March 31, 2021, according to the Condominium Management Regulatory Authority of Ontario. They include General Licensees (1,879), Transitional General Licensees (464), and Limited Licensees (1,068).

The average number of new Limited Licence applications per month in the first eight months of the 2020-2021 licensing year.

44 CONDOBUSINESS | Part of the REMI Network

UNITS

9

The number of licensed condominium provider companies in Ontario

68

RANK

28,235

CONDOBUSINESS WHO’S WHO 2021

RANK

UNITS

BUILDINGS

RANK

UNITS

BUILDINGS

26

Berkley Property Management Inc.

3,950

42

44

Huntington Properties Ltd.

465

13

27

Whitehill Residential

3,029

28

45

Summa Property Management

354

31

28

Real Estate 360 Property Advisory Limited

2,842

44

46

Arnon Corp.

281

3

29

SmartCentres REIT

2,767

5

47

Southwest Properties Ltd.

200

2

30

Dove Square Property Management Inc.

2,581

34

48

Glenview Management Limited

163

1

31

Guardian Property Management Services Ltd.

2,200

41

49

Sterling Karamar Property Management

100

1

32

The Enfield Group Inc.

2,200

50

50

Melchior Management 777 Corporation

63

4

33

Brilliant Property Management

2,100

15

51

Regency Group

54

0

34

HighPoint Property Management

2,019

15

52

McCor Management (MB) Inc.

42

1

35

Royal/Kente Property Management

2,000

60

53

Skywater Property Management

41

0

36

Around The Lakes Property Management Limited

1,878

59

54

BentallGreenOak (Canada) Limited Partnership

15

1

37

Lionheart Property Management Inc.

1,700

61

55

Lameer Management

2

0

38

Colliers International

1,600

24

56

Sabjoy Inc.

1

0

39

Taft Management Inc.

1,575

19

40

Warrington PCI Management

1,208

9

41

Downing Street Property Management Inc.

779

22

42

Westcorp Property Management

716

1

43

Condominium Living Management Inc.

576

0

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NEW AND NOTABLE

New Resource for Installing EV Charging Stations A free educational guide for property managers, unit owners and condo boards aims to demystify the complex process of installing electric vehicle (EV) charging stations in multi-unit residential buildings.

Demand for EVs is on the rise. KPMG Canada estimates that 68 per cent of Canadians will consider buying one as their next vehicle purchase. EV advocates say home charging infrastructure will need to keep up with expected demand.

Murbly, an online platform that offers educational resources and tools to simplify EV charging installation in MURBs, produced the nation-wide “EV Ready Planning: A Guide for MURBs,” with financial support from Natural Resources Canada. It contains guidance for making a building “EV ready,” depending on the region. Adding charging equipment in multi-unit dwellings doesn’t only affect EV owners.

“In recent years, we have noticed more and more concerns from multi-unit residential buildings’ residents regarding the charging possibility that their building offers,” says MariePier Corbeil, co-founder of Murbly. “The requests come not only from electric vehicle owners, but also from residents who do not want their property’s value to drop due to lack of access to charging.”

The guide is about thirty pages long and attempts to detail all necessary steps, with a range of resources depending on the region.

Ontario to tweak electricity rebate criteria A proposed regulatory clarification would ensure that all residential customers benefit equally from the Ontario Electricity Rebate (OER). A recent posting on Ontario’s regulatory registry suggests the government will explicitly state that separately metered hydro accounts for common areas of multi-residential buildings will qualify for the rebate, which currently provides an 18.9 per cent discount on the pre-tax costs of electricity consumption, transmission and distribution.

Common area accounts registering more than 250,000 kilowatt-hours (kWh) of consumption annually have been somewhat in limbo since the provincial government introduced the OER in November 2019. They receive the rebate under a grandfathering provision that’s slated to end on October 31, 2021, after which, the Ontario Energy Board (OEB) has determined they do not meet the criteria set out in the enabling regulation. Meanwhile, the rebate does apply on all the same electricity-using elements for any amount of consumption in a bulk-metered building, where a single hydro accounts covers the common areas and all residential suites.

Proposed regulatory amendments would redefine eligibility for the rebate to address the uncertainty around large common area accounts, mobile home parks with year-round residents and multi-residential formats with shared kitchen and bathroom facilities. The Ministry of Energy, Northern Development and Mines is accepting comments until July 26, 2021.

46 CONDOBUSINESS | Part of the REMI Network

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