Condo Spring 2025

Decarbonization meets comfort at The Well

BUILDING THE FUTURE RESTORING THE PAST

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Solar Innovation

Rebecca Melnyk

Editor, CondoBusiness

rebeccam@mediaedge.ca

EENERGY. AIR. LIGHT. One condo developer has reimagined these three elements of the daily living experience at a new suite in downtown Toronto. The space uses renewable energy, responds to circadian rhythms, and lowers carbon emissions to create a healthy climate impact. The clean-tech features are also said to cut energy costs and save money in the long run.

Speaking of finances, condos across Canada are currently navigating a complex and uncertain trade environment with many moving parts. On top of unpredictable tariff policies, corporations are already facing inflation challenges with capital project planning and daily operational expenses. Luckily, the industry is filled to the brim with sound advice. Check out page 16 for tips about price escalations, reserve funds, day-to-day costs, and financing options for condos dealing with insufficient funds.

Our first issue of the year coincides with spring, a great time to think about gardening. See page 14 for a look at the legalities of volunteer committees. You will also find a crop of other articles—from nuisances to energy rebates.

And since this time of year is all about rejuvenating, we usher in a fresh new design for the magazine!

Happy spring!

Rebecca MeInyk

Editor Rebecca Melnyk

Art Director Annette Carlucci

Graphic Designer Thuy Huynh-Guinane

Production Coordinator Ines Louis

Advertising Sales

Jake Blanchard, Sean Foley, Ron Guerra, Andrea Almeida

Contributing Writers

Thomas Beattie, Simon Brick, Barbara Carss, Ryan Haley, Paul Kealey, David Rames and Ashley Winberg.

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Bill Powell, M.Sc., P.Eng., President & CEO

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Mark Dahmer, P.Eng., PMP Mechanical Engineering Principal

Peter LaForme, Executive Vice President

Andre Lebedev, P.Eng., Director of Electrical Engineering

Robert Borovina, P.Eng., Director of Mechanical Engineering

Tribunal Weighs

Case Involving Motion-Activated Light

BY SIMON BRICK

Subsection 117(2) of the Condominium Act prohibits condominium corporations and unit owners alike from carrying on activities that create a nuisance, annoyance or disruption to individuals in a unit or the common elements. Read together with Section 26 of Regulation 48/01, a source of “light” may qualify as a nuisance, but only where it is “unreasonable”.

So, would it be unreasonable for a condominium corporation to install and maintain a motion-activated light in the hallway outside a unit if the owner is sometimes disturbed by this light?

SThe Condominium Authority Tribunal (CAT) considered this question in its recent decision, Grimes, Courrier v. Metropolitan Toronto Condominium Corporation No. 864, and found that a motion-activated light was not unreasonable under the circumstances.

In this case, two unit owners (the applicants) claimed that new energy-efficient lighting installed outside their unit door created a nuisance that unreasonably interfered with their use and enjoyment of their home. The motion-activated lights were designed to illuminate the building’s garbage room and stairwell doors only when activated (by motion). As a result, the applicants were met with a bright light several times a day as they exited and entered their unit.

To determine whether the new motion lights were unreasonable,

the CAT asked whether a reasonable owner of MTCC 864 would consider the motion-activated light in the corridor adjacent to the applicants’ unit to be unreasonable. Importantly, the CAT stressed that the test for reasonableness is an objective one and not based on the subjective experience of a particular unit owner.

In reaching its decision that the motion-activated lights were not unreasonable, the CAT considered the following factors:

• The intensity of light;

• How the light fits with other lighting;

• Whether the motion activation is disruptive or abrupt;

• The frequency with which the light shines in the applicants’ hallway; and

• The circumstances surrounding the installation of the light.

Here, the fact MTCC 864 installed the light to reduce energy costs and increase safety for residents weighed in favour of reasonableness. Moreover, the CAT found that MTCC 864 took reasonable steps to address the applicants’ concerns by, for example, pointing the light more directly at the garbage chute and switching the lights to a softer intensity and warmer tone to fit with other lights in the corridor. This case highlights that in nuisance matters, the CAT will consider all relevant circumstances to determine whether an activity is objectively reasonable. Condominium living seeks to balance the rights of individual unit owners with that of the condominium community as a whole. When a condominium corporation or unit owner alleges a nuisance, all parties should strive to take reasonable steps to assess and resolve it before taking legal action.

Simon Brick is an associate lawyer at Davidson Houle Allen LLP in Ottawa. This article originally appeared on Davidson Houle Allen’s Condo Law Blog in February 2025.

Leveraging Ontario’s

New Rebate

Program in

Townhomes

BY DAVID RAMES

With energy costs continuing to rise, Ontario townhome owners are searching for ways to upgrade efficiency and reduce monthly expenses. The Ontario Home Renovation Savings Program, launched earlier this year, provides an opportunity on both fronts. Unlike other programs that require a home energy assessment, certain rebates under this initiative, such as those for heat pumps, solar panels and smart thermostats, are available without this additional step, making it more accessible.

HEAT PUMPS, SMART THERMOSTATS, SOLAR PANELS AND BATTERY STORAGE

AA key component of this shift toward energy efficiency is the adoption of inverter heat pumps, which provide both heating and cooling in a single system. As a highly efficient alternative to traditional gas furnaces and air conditioning, heat pumps reduce household energy consumption while maintaining indoor comfort year-round. Cold-climate air source and groundsource heat pumps are particularly wellsuited for Ontario winters.

Recent advancements in heat pump technology are dispelling the myth that heat pumps aren’t suitable for extremely cold climates. Federal and local governments have taken notice and are propagating the adoption of heat pumps by offering incentives for homeowners to make the upgrade.

The Ontario Home Renovation Savings Program offers rebates that vary based

on a home’s heating source: homeowners who primarily heat with electricity can receive up to $7,500 for upgrading to a cold-climate air source heat pump, while those who heat with natural gas can receive up to $2,000. By switching to an energy-efficient heat pump, townhome owners could potentially reduce their energy consumption and lower their monthly utility costs.

Beyond heating and cooling, the program covers modern energy efficiency solutions, including solar panels and battery storage. When solar panels are paired with battery storage, excess solar energy can be stored for later use, ensuring a reliable power supply even during outages or peak demand periods.

Ontario’s rebate program provides financial incentives for homeowners

who install solar and storage solutions, with rebates calculated at $1,000 per kilowatt (kW) of installed solar capacity, up to a maximum of $5,000. Battery storage systems qualify for a rebate of $300 per kilowatt-hour (kWh) of storage capacity, also capped at $5,000, but only when installed in combination with a new solar panel system. Standalone battery installations are not eligible for rebates under this program.

Smart thermostats also play a crucial role in enhancing home efficiency by complementing heat pumps. Owners can receive a $75 rebate on the purchase of a qualifying smart thermostat, which optimizes energy use. These devices enable automated temperature adjustments and remote access, allowing users to tailor heating and cooling schedules to their needs. By integrating features such as real-time energy tracking and compatibility with home automation platforms, smart thermostats ensure that heating and cooling systems operate at peak efficiency.

OWNER ELIGIBILITY AND VERIFYING CONTRACTOR CREDENTIALS

The Ontario Home Renovation Savings

Program is particularly advantageous for townhomes owners. Many of those built in the surge of multi-family housing structures following the Great Recession are due for an HVAC upgrade, making the timing of this rebate program ideal.

To qualify for a heat pump rebate, homeowners must meet specific eligibility criteria, including being an Enbridge Gas customer who primarily heats their home with natural gas or is connected to the Ontario electricity grid and uses electric heating. Additionally, the property must be a single detached, semi-detached, row house, townhouse or mobile home on a permanent foundation. New-build homes, condos, and multi-unit residential buildings do not qualify, and the rebate is applicable only to first-time heat pump installations.

While the financial incentives are compelling, successfully implementing an energy-efficient heat pump system requires careful planning and expertise. Townhome owners should work with certified and experienced contractors to ensure compliance with program requirements and optimal system performance.

Contractors must be registered with the Home Renovation Savings Program

By switching to an energy-efficient heat pump, townhome owners could potentially reduce their energy consumption and lower their monthly utility costs.

to facilitate rebate eligibility for their customers, and owners should verify their contractor’s credentials before proceeding with installation — particularly for older homes with outdated HVAC infrastructure. Also, be sure that the heat pump you select adheres to Natural Resources Canada product lists and guidelines.

Although the Canada Greener Homes Grant has ended, the Ontario Home Renovation

Savings Program ensures that residents still have access to energy efficiency incentives. Both programs align with Canada’s broader sustainability objectives by promoting the adoption of energy-efficient technologies, such as insulation, heat pumps, and solar panels. As energy costs continue to rise, these programs provide a practical and costeffective pathway toward a more sustainable future.

David Rames is the senior product manager for Midea, a global innovator in HVAC solutions. He is responsible for strategy and growth in the unitary system product category. This includes serving as the primary consultant to advise specific products, SKUs and offerings within the North American ducted and ductless HVAC markets.

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SALTO’S SMART INTERCOM SYSTEM SIMPLIFIES CONDO COMMUNICATION & ACCESS

The XS4 Com iGO provides an elevated experience for property managers and condo owners

Today’s crowded real estate market relies on strategic solutions to elevate guest experiences and simplify operations for property managers, owners, and tenants. As technology continues to revolutionize so much of the condo experience, modern intercom systems, like Salto’s XS4 Com iGO leverage new tech like smartphones and QR codes to allow for convenient two-way communication and simplified access. As a hardware-free solution, XS4 Com iGO facilitates secure visitor access and communication for a seamless, superior resident and guest experience.

Along with improving day-to-day condo living, modern tools like this one provide a tech-forward impression of the building that can raise perceived value, save time, and attract a greater number of tenants.

“XS4 Com iGO is a practical solution for properties looking to enhance visitor access without the need for costly video panels or new cabling infrastructure,” explains Preston Grutzmacher, Residential Business Leader, Salto North America. “ Visitors use their smartphones, while residents have the XS4 Com iGO app, ensuring an incredible and secure access experience.”

HOW DOES XS4 COM IGO BETTER SERVE CONDO OWNERS? By integrating a video door intercom system with the latest in access control technology, XS4 Com iGO makes life easier for owners.

• Convenience: The system makes communication e ortless with hassle-free access. Using your smartphone instead of a dedicated intercom panel inside your unit means that no physical installation is required. There’s also no need to pay for replacement keys, fobs, or a locksmith fee for emergency lockouts, so it’s simpler all around.

• Remote access management: Managing access to your unit is easy, even when you’re not home. This system allows owners

to answer door calls, receive notifications when someone is at the door, let in visitors for package deliveries, cleaning services, or maintenance workers, and share temporary access with guests without needing physical keys or fobs.

• Enhanced security: Rather than relying on the traditional intercom voice access, video verification is complete before allowing access, granting you complete control over who is coming and going into the building as approved guests. Not only can you see guests, but historical data is available for your reference with a complete audit trail showing who accessed the building and when.

XS4 COM IGO SAVES PROPERTY MANAGERS TIME AND MONEY

Modernizing your building with smart solutions like the XS4 Com iGO means simplifying your life, increasing perceived value, and saving time and money. Here’s how:

• Simplified management: Along with easily adding or removing residents through the cloud platform, this system streamlines managing multiple entrances from a single system and configuring di erent access levels for various users (residents, sta , visitors), saving property managers precious time.

• Reduced infrastructure costs: Without expensive wiring required throughout the building and no need to maintain traditional intercom hardware in each unit, XS4 Com iGO requires significantly lower installation costs compared to traditional systems.

• Professional appearance: The condo market is competitive and first impressions matter. Modern technology like XS4 Com iGO creates an upscale impression and a clean, minimalist entrance without bulky hardware.

• Enhanced building security: The system o ers heightened security by eliminating unauthorized key duplication and a complete digital audit trail of all visitors, along with swift and simple deactivation of access for moved-out residents.

• Emergency services access: Emergencies happen, and property managers want to be able to act swiftly and e ciently. This system allows property managers to grant immediate access to emergency responders remotely for critical situations where quick entry is needed.

HOW DOES XS4 COM IGO SIMPLIFY SHORT-TERM RENTALS?

XS4 Com iGO is particularly valuable for condos used as shortterm rentals by speeding up check-ins, making management easier and limiting the time it typically takes for administration with features like:

• Seamless check-in: Eliminating the need for physical key hando s and easily sending digital access credentials directly to guests enhances the experience for everyone. To further simplify the operations, time-limited access can be controlled after the rental period, o ering a worry-free way to manage the process.

• Remote management: Managing rentals can be demanding when you need to oversee guest access and

monitor entry on-site. This system is accessible remotely, even allowing managers to provide assistance via video call if guests have trouble entering. And with the audit trail that monitors exit and entry, all bases are covered for seamless remote management.

• Operational e ciency: Saving time benefits all parties and eliminating key management between guest stays, remotely coordinating check-ins, and preventing lockouts reduces the amount of sta required, allowing better time management and labour allocation.

Technology is vital to today’s condo living. The XS4 Com iGO system transforms condo building entry from an outdated, hardware-dependent process to a modern, smartphoneenabled solution that benefits managers, owners, and tenants while enhancing security and convenience.

Salto is a leading global access solutions provider, developing facility access, identity management, and electronic locking technology providing seamless, reliable, and secure experiences. For more information about Salto’s XS4 Com iGO, please visit saltosystems.ca

Risk & Reward Gardening Committees:

BY ASHLEY WINBERG

Condominium corporations are often seeking innovative ways to enhance the aesthetic appeal of their properties and foster community engagement among residents.

OOne effective approach is the implementation of volunteer garden committees; however, it is imperative that corporations balance the benefits with effective risk management strategies to ensure a safe environment for all volunteers and to limit the corporation’s exposure to potential liability.

1. Garden Committee Policy

To ensure that a volunteer garden

committee operates effectively and within their authority, it is imperative that a corporation first create a garden committee policy.

This policy should outline the scope of the committee’s responsibilities, including specific tasks they are authorized to perform and areas they are allowed to work on. It should also detail the process for selecting committee members and the duration of their service. The policy

should also stipulate that every committee member must provide the corporation with an executed copy of the related waiver and acknowledgement, which should be included as a schedule to the policy, prior to engaging in any committee-related activities.

2. Waiver

Corporations owe a duty of care under the Occupiers’ Liability Act, 1990, R.S.O. 1990 c. O.2 to take reasonable steps to protect people from foreseeable harm while on the corporation’s common elements. Corporations, however, can restrict, modify and exclude this duty of care vis-a-vie waivers of liability.

To mitigate potential liability, corporations should require volunteers to sign a waiver and acknowledgement that clearly outlines the risks involved in the committee-related activities to be undertaken and state that volunteers assume responsibility for any and all injuries or damage that may occur in relation to the committee-related activities that they take part in.

3. Committee Chair

By appointing a member of the board to act as the chair of the committee, the corporation will be better equipped to oversee committee activities, ensure that it is complying with the related policy, and promote effective communication between the board and the committee.

4. Insurance

Acts and omissions of volunteers may not be covered by insurance policies that a corporation maintains. To get around this issue, a corporation could appoint individual committee members as officers of the corporation vis-vis a board resolution, in which case their acts and omissions would thereafter likely be

covered by the corporation’s directors’ and officers’ liability insurance.

To ensure that a corporation’s insurer does not deny any potential claims under the corporation’s general liability and property insurance, it would be wise for a corporation to notify its insurer of the gardening tasks that the committee has been granted the authority to perform, as well as the policies implemented by the corporation to manage the activities of the committee and action taken to limit the corporation’s exposure to potential liability.

By implementing the risk management strategies discussed above, corporations will be able to limit their risk exposure while at the same time promoting community engagement and improving the aesthetic appeal of their property.

Ashley Winberg is one of the leading condominium lawyers in Ontario and is the head of corporate practice at Pulver on Condos, which is a boutique condominium law firm that provides specialized legal services to condominium corporations and unit owners throughout Ontario. Ashley can be reached at ashley@pulveroncondos.com.

in

without compromise.

When security demands a higher standard, Crest

Condo Industry Braces for Increased Costs

Tariffs bring another layer of volatility for boards

BY REBECCA MELNYK

Higher inflation has impacted operational expenses, insurance, reserve fund planning and capital projects, but the ongoing threat of tariffs is beginning to incite additional concerns within condo corporations.

I“It’s triggered a new wave of tensions set to disrupt supply chains again and fuel inflation, particularly in construction and materials—right where it hits your reserve fund planning,” said Will MacKay, an investment advisor and portfolio manager with CIBC Wood Gund.

With more volatility, condo boards will need to balance rising costs against long-term capital needs to ensure financial stability for owners, he advised. Many

reserve fund studies already underestimate the true cost of major repairs and replacements due to material shortages, labour constraints and construction inflation. This concern was echoed across a panel of speakers during an event hosted by CCI Huronia on March 21.

“We may see some price escalations in tendering; a recession could delay some projects. Contributions may need to increase sooner than planned, ” MacKay

added. “When inflation is above expectations, your reserve fund planner is going to put some increases in there to get you back to that cost program you should be on. This may mean you need to accelerate your reserve fund study update if you have a large project.”

Since the pandemic, many condo corporations have already seen higher prices for capital projects. Omar Khan, market development manager at Normac,

particularly noted how inflation has impacted insurance premiums and reserve fund contributions.

Condos corporations should be insured to full replacement cost. However, the growth of these costs has exceeded inflation.

He advises that condo declarations have a clause in their insurance sections about obtaining appraisals every year to three years to guarantee they are properly insured.

Capital project planning must also account for inflationary pressures as labour and material cost hikes continue.

“The challenge for condo corporations is how to responsibly save for repair and replacement of common elements and systems, while setting up adequate reserve fund contributions,” he said. “Expenses coming out of these funds may incur over a year and sometimes decades, which means planning ahead to ensure the right amount is contributed annually is imperative.”

The availability of construction labour is expected to decline for another decade, creating a supply and demand issue. BuildForce Canada estimates nearly 300,000 skilled trade workers will need to enter the industry by 2032 to meet demand amid a looming wave of

“It’s not a time to panic, but it is a time for discipline.”

retirement. In Ontario, the average trade worker is now more than 50 years old.

Demand for skilled labour will drive up wages and, ultimately, the cost of projects. Meanwhile, construction material expenses are another impact.

“We routinely see month-to-month fluctuations on a variety of prices; however, what is most impactful when communicating to your boards about the role material prices play in construction cost increases is the long-term trends,” noted Khan.

According to Statistics Canada, between February 2020 and December 2024, there have been price increases of between 25 and 45 per cent for materials that condos use to a significant degree. For instance, concrete, glass and other non-metallic mineral products increased by 37.7 per cent.

The total cost of projects, such as window replacements, can drastically increase when accounting for both high

levels of labour and materials. Condos also use materials that contain petroleum, such as asphalt shingles on roofing, which adds more to the end cost.

Cement makers are already expecting large increases over time. Tariffs may add further pressure. “Every material is going to be slightly different. We haven’t seen a lot of price increases coming through yet,” he said. “Right now, we’re seeing a slight decrease in order of materials from the U.S., but nothing at scale yet.”

To anticipate changes, condos can obtain annual material-related costs guides and forecasts from vendors and share with board members.

“Ask your vendors and providers what they’re doing to be proactively ready for it and what impacts could be on a variety of areas,” he advised. “We may be back in the area of heightened inflation, which has been on a reprieve over the last few years.”

FINANCING OPTIONS

Some condos are either deferring work, imposing special assessments or undertaking commercial loans.

“More and more in today’s market we are seeing shortfalls in amounts that condominium corporations have already saved toward their capital repair projects and an escalation in the rate at which they have to save for future projects,” warned Lyndsey McNally, director at Condominium Lending Group and president of the Toronto & Area Chapter of the Canadian Condominium Institute.

If condos choose to defer a current project, she suggests doing so very carefully. “Sometimes, in order to push projects further into the future, you might have to make interim or emergency repairs that come at a cost. How does that impact your overall savings plan if you’re introducing new costs into your reserve fund study that weren’t already there?”

Condos should also review how the cost of that project will inflate over time and consider potential effects on unit values. “The board really needs to be mindful that they’re not making decisions that limit the owner’s ability to get the best value in resale and to protect and preserve the investment they’ve put towards their home.”

Phasing projects over several years is another strategy, one that comes with surprising costs, while special assessments can also manage financial shortfalls. “Boards of directors have authority already built into by-laws to levy assessment for extraordinary expenditures,” she said. “They are

able to collect it just like a condo fee with the same protocols.”

However, boards are struggling to unexpectedly impose this onto their communities due to higher dollar values attached to special assessments in today’s economy. McNally finds this isn’t the fairest approach when considering reserve fund legislation in Ontario.

“The whole purpose of the way we plan reserve funding is that every condo owner in the corporation pays their fair share of capital repair costs over time,” she noted. “A special assessment creates an imbalance where the current owner becomes responsible for all these costs because of past underfunding.”

Commercial loans could be a more affordable option. “A loan can be taken out on behalf of the condominium corporation and not individual unit owners,” McNally advised. Doing so doesn’t impact owners’ personal credit, the equity in their homes, or their ability to borrow for other personal reasons.

“The owners today in a condo corporation can choose to allocate the costs of the project over its useful lifespan,” she added. “This allows the owner, now, to share some of the costs with the future owners who also benefit from the work done by the condo corporation.”

There are two loan structures to consider, the first being a loan on behalf of all owners. “With this structure we’re able to take advantage of some of the cash flow in the reserve fund and slow down the rate that condo fees need to increase, which minimizes the impact of the loan repayment

through the condo fees, thereby reducing the burden on the individual unit owner.”

In such a case, it’s important to consider whether the condo fees will stay reasonably competitive when compared to fees of similar available real estate on the market.

Secondly, with a hybrid or opt-in-opt-out loan, the condo levies a special assessment, yet each owner can choose to pay the sum upfront or participate in long-term loan repayments through the condo corporation and future condo fees.

This approach drops a significant administration burden onto condo corporations and creates risk in the long-term management of prepayment.

As McNally explained, if the participating owner wanted to sell the unit while the term is locked in, they may want to pay out their obligation rather than pass the loan payments onto the future owners. The condo corporation will then hold that as a liability to be paid out in the future. The funds, however, must be managed correctly to make sure they are still available to cover the loan when it matures.

As well, there is no way to minimize the impact of the loan repayment on the condo fees. Participating owners would see immediate increases in their fees.

BORROWING BY-LAWS

In order to borrow money, a condo corporation has to pass a borrowing by-law, which requires the consent of a majority of all units in the condo. In this case, the board of directors won’t feel as much burden from financial decision-making.

“The board doesn’t have to impose what they believe to be the right strategy for their community,” said McNally, adding that due diligence is crucial when facing shortfalls for capital projects. Boards should understand and consider all options and be prepared with the accompanying rationale.

STAYING ON TOP OF OPERATING EXPENSES

Maryann Barrie, property manager with York Simcoe Management Services, has been helping boards navigate higher operating costs, particularly with utility rate increases, insurance premiums and labour costs for skilled trades.

“Over the past years, we’ve all seen increases in operating expenses with some that have had significant impact on annual budgets,” she said. “As a property manager, I specifically work towards ensuring the best value for the operating cost through negotiation and bulk servicing tactics, which is my main goal. I also work towards proactive scheduling to support costsavings measures, which help manage and optimize expenses for my portfolio.”

She advises that condos actively negotiate contracts with vendors to secure multiple-year terms and lock in rates that protect against price increases, as well as consolidate contracts for landscaping, security and maintenance to reduce overhead costs.

“One of the contracts I’ve implemented recently is to include salt and sand winter maintenance as opposed to a per-use application, she said. “By doing this, over the last few years, it’s significantly decreased the operating budget and gives a set budget for my clients as well.”

A preventative maintenance program can include maintenance schedules to avoid unnecessary and unexpected emergency repairs, regular inspections, which include reporting within vendor contracts, crack repair in asphalt to prolong the life of common elements, and reminders and educational tips in newsletters, which also extends to seasonal matters like air conditioning units and hot water tanks.

To reduce the cost of energy-efficiency upgrades and audits that identify opportunities in lighting, heating and cooling systems, condos can stay on top of incentives and programs by building healthy vendor relationships. To reduce facility consumption, owner education is key for items like smart thermostats or irrigation timer systems.

Condos are advised to update insurance appraisals to avoid surprise increases in annual insurance policy renewals and to add volunteer

and legal expense insurance coverages. Condos can create volunteer committees, jumpstart community events like “garbage bin days” for waste management savings and introduce condo management software to streamline processes and reduce administration costs.

THE ROAD AHEAD

When integrating the impact of tariffs into operating costs, there are many components creating uncertainty, such as what will be affected and how long tariffs will endure. According to

CCI B.C., tariffs are expected to have a minimal impact in the next year, with general costs ramping up for corporations later on in 2025 and at the beginning of 2026.

“It’s not a time to panic, but it is a time for discipline, MacKay cautioned. “The economic road ahead may include rate cuts, recession risk, international volatility, but with a thoughtful approach to investing and reserve fund planning, your condominium corporation can remain financially healthy and well positioned.”

CCI TORONTO AND AREA CHAPTER EDUCATIONAL SESSIONS FOR BOARDS AND OWNERS REGAINING CONTROL:

Board members feeling the pressure of explaining increasing common element fees may feel an extra pinch this year. Looming tariffs affecting labour and material costs along with unpredictable inflation rates are already a source of tension for communities.

One of the most diff icult aspects of being a condominium board member is explaining why a special assessment or significant budget increase is necessary. Transparency around financial planning requires a thorough understanding of the complex decisions the board is making, and the confidence to then be able to communicate those details to owners — either at the next Annual General Meeting (AGM) or on the common elements — is an integral role of a Board member. Directors who can articulate the specific factors driving costs reflect positively on the board, build trust, and show proactive leadership.

BUILDING STRENGTH

It’s impossible to predict external events that could impact your building, but internal preparation through constructive education is key. Many condominium owners, especially first-time buyers, can experience unexpected surprises about the costs and responsibilities of condominium living. That’s why it’s essential for both board members and owners to educate themselves. Learning about condos doesn’t mean you’re a geek, it means you are invested.

By joining organizations like the Canadian Condominium Institute (CCI) Toronto, all unit owners benefit from exclusive membership discounts and access to educational sessions (both virtual and in-person) on condominium operation and management. This is a valuable resource which many owners are not aware of.

CCI Toronto’s educational sessions help boards and owners understand the unique challenges facing condominiums in the current fluctuating climate.

SMARTER FOR BOTH INSIDE AND OUT

Board members walk the tight line of not wanting to increase fees but needing more money to fund the same projects which are already budgeted for. As of the time of writing, there is a very real uncertainty about how much everything’s going to cost. Condominiums operate on a zero-based budget, theoretically

only collecting the funds needed to support the condominium throughout any fiscal year. When there are financial restraints outside of a board’s control which cannot be planned for, how do you anticipate these challenges?

Boards are trying to balance their fiduciary duties while keeping the fees affordable for owners, yet Reserve fund Studies are calling for more funding than when the last study was completed three years ago. Not only that, but last winter took a significant toll on buildings in terms of water damage. The harshness of the season resulted in repairs above and beyond what the corporation was likely predicting and hence planned for in the year’s budget.

The Toronto and Area Chapter of CCI hosts a range of in person and virtual events to accommodate all members.

The Toronto and Area Chapter of CCI was created to help boards and owners make conscious, insight-driven decisions through education and discussion sessions, built to increase awareness regarding the condominium industry and condo living. For over 35 years, CCI Toronto has worked for the betterment of condominium owners and those serving on the boards of the many varied condos throughout the GTA.

MEMBERSHIP RENEWALS

CCI Toronto’s annual membership renewals run from July 1 to July 30. This year, they are offering a 10% discount per year on a 3-year membership. The chapter’s sessions for 2025 include how to make the most of reserve fund studies, the inflation impact, and long-term financial planning through loans and investments.

Scheduled so far this year are:

• April 24 - Managing Major Changes - Pickleball event: merging practical knowledge with a fun activity (In Person)

• May 21 - DC 108 - Repair, Maintenance and Change Fundamentals (virtual) and in person on June 25: Looking at the differences between the Act’s definition of “maintain,” “repair” and “repair after damage” and owner versus corporation responsibility.

• September 25 - Coffee with the Experts (accounting) (Virtual)

• October TBD - Condo Horror Stories with Annual General Meeting (In Person)

• November 21/22 – Condo Conference (In Person)

• December 5 – Holiday Event (In Person)

Board members and owners are encouraged to attend these educational events, developed to help owners understand the broader economic factors affecting condominium costs.

CCI educational resources transform financial communication from a potential source of tension to an opportunity for collaborative understanding. For more information, visit www.ccitoronto.org

Condo Builds Face Tough Loan Conditions

Development land also inspiring lender hesitancy

BY BARBARA CARSS Loan

conditions are expected to be onerous for residential condominium developments again in 2025, following a year when many lenders pulled back on construction financing. Newly released results from CBRE Canada’s annual survey of Canadian lenders finds them generally readying to bid actively on commercial real estate deals in the coming months, but with somewhat less enthusiasm for development land and condo construction.

TThe survey draws insight from questions posed to 37 organizations — including domestic and foreign banks, credit unions, insurance companies, pension funds and private debt capital — that collectively have more than $200 billion in commercial real estate loans under management. Three quarters of respondents plan to originate more loans this year; a majority intends to increase allocations to purpose-built rental housing (both existing and new construction), singlefamily housing and data centres; and some quotient, ranging from 10 to 48 per cent, has a larger budget than last year for eight other asset classes.

“Lenders are feeling increasingly good about every asset class with the exception of the condo and land market,” Jessica Harland, a senior vice president with CBRE Capital, reiterated as she presented some of the survey findings earlier this week in conjunction with the RealCapital conference in Toronto. “What is really notable, is that many lenders express significant appetite for rental construction, but very few of them noted intentions to increase the exposure to the land loans needed for the underlying rental construction to happen.”

“Lenders are feeling increasingly good about every asset class with the exception of the condo and land market.”

Nearly 60 per cent of survey respondents now categorize development land as an asset class with cause for concern, up from 35 per cent heading into 2024. More than 40 per cent also deem high-rise condo to be an asset of concern, up from about 10 per cent in the previous survey.

For 2025, 32 per cent of surveyed lenders intend to increase their loan budgets for high-rise condo, while 11 per cent say they’ll reduce condo loan volume. No lenders plan to increase their budgets for development land, but 26 per cent expect to shrink them. Meanwhile, deals for purpose-built

rental projects are more eagerly sought, with 86 per cent of lenders looking to extend more financing for CMHC-insured construction loans and 74 per cent preparing to offer more funds for conventional construction loans.

The upward adjustment is partly reflective of last year’s experience when more than half of surveyed lenders exceeded their original 2024 targets for CMHC-insured deals. In contrast, 59 per cent of lenders fell below their targets for condo construction loans in 2024.

“This is particularly troubling given that high-rise condos are historically, in recent

years, accounting for much of our housing supply,” observed Joshua Sonshine, senior vice president with CBRE Toronto.

When surveyed in the fall of 2023, 72 per cent of lenders gave notice that they’d be requiring more upfront equity on condo construction loans in 2024. For 2025, 52 per cent indicate they’ll ratchet that requirement up further. As well, 36 per cent of lenders say they’ll be looking for higher deposits and shorter payment schedules to secure the loan, and 68 per cent will want to see the pre-sale of 60 to 79 per cent of units. That latter condition is seen as

a growing challenge for financing, given the year-over-year drop in sales levels in the new condo market.

Meanwhile, falling land values have lenders wary, with more than three quarters of survey respondents suggesting that development land poses an elevated or significantly elevated credit risk. To illustrate, Harland noted that land purchased at $200 per buildable square foot in 2021, carrying $100 per buildable square foot of debt, might now be worth about half of its original value.

“That puts the original land loan at risk so the lending community’s hesitation is not

unwarranted. The risk that a lender may be caught holding the bag is there,” she said. “Land financing trends across Canada have been significantly influenced by higher interest rates, economic uncertainties and evolving government policies. Lenders are hesitant to mortgage development land due to factors like uncertainty of the underlying value, risk of non-completion of the project, zoning and permitting issues, cashflow or lack thereof, longer timelines and complexity of development plans.”

VACILLATING DEVELOPMENT COST FACTORS

Developers point to some factors that should help improve the economics of some kinds or new development and/or help cushion the blow of tariffs the Canadian government may be forced to impose on various building products imported from the United States in response to that country’s recent aggressiveness around tariffs.

However, participants in an associated industry panel discussion remain largely focused on purpose-built rental projects in the current market. Indeed, the slowdown in condo production is seen as a major differentiator

from 2018-19 when the U.S. government triggered a slate of retaliatory tariffs after it imposed a 25 per cent tariff on steel imports and a 10 per cent tariff on aluminum imports.

“The construction environment in Canada was really different then. Condos were booming. Everything was going hard. You couldn’t find people to build,” recalled Ugo Bizzarri, managing partner and chief executive officer of Hazelview Investments. “Today is a little bit different. The condo market is dead. Trades are coming looking for work.”

Andrew Joyner, managing director, multifamily, with Tricon Residential also cited declining costs for trades, particularly for forming, which he characterized as the “single biggest line item of construction costs” along with ebbing interest rates on construction financing and expectations that land values will drop further. “When you put that soup together, we’re seeing the denominator of yield on cost calculations shift down,” he said.

“We’ve actually started getting in the ground in some development probably a little earlier than we normally would just to take

advantage of the cost environment,” concurred Rob Kumer, chief executive officer of KingSett Capital. “That’s for sure a trend across the board and that goes to offset some of the threats of the tariffs.”

That tariff threat continues to be fluid due to less-than-consistent messaging from the U.S. about the start-date and comprehensiveness of its purported measures. Reflecting on the Canadian government’s initial list of CAD $30 billion worth of countermeasures, should they be necessary, Joyner hypothesized that multifamily developers would see most of the flow-through impact in new surcharges on appliances, equating to about a 0.25 per cent increase in total development costs.

In February, Joyner forecasted a 1 per cent increase in total development costs if Canada moved to a retaliatory tariff framework on steel and aluminum, which is now the case. “If we move to a retaliatory framework on all inputs from the U.S., we think that’s closer to 4 per cent of total development cost,” he added. “So, in an environment where getting new housing starts off the ground is hard, it’s not helpful.”

Carss is editor-in-chief of Canadian Property Management.

INNOVATION INSPIRING BY DESIGN AND

Barbara

Living the ‘suite life’ at The Well

Balconies with built-in solar panels, smart lighting that mimics sunlight and air filters that remove indoor pollutants on demand are a few of the technologies incorporated into a self-powered condo unit dubbed the Current Suite. Located in one of Tridel’s new downtown Toronto towers at The Well, the 1,080-squarefoot residence is billed as the developer’s most eco-friendly model yet.

GGraeme Armster, Tridel’s director of innovation and sustainability, says it focuses on health and wellbeing, and reduces energy use and carbon emissions through innovative technologies. The design also builds upon lessons learned from three previous innovation suites, one of which is located in the developer’s first smart condominium, Ten York; another in Aqualina at Bayside, the first high-rise condo in Toronto to earn LEED Platinum certification.

“The world is trying to transition to lower carbon energy sources, which right now means electrifying as much as possible,” he says. “The concern is that, as we add more to the grid, we have to manage it more effectively and that’s where the energy efficiency comes in.”

A solar-powered battery can supply half of the suite’s daily electricity consumption. Solar panels take up a

seamless spot on the balcony railings and power a battery storage system, which feeds all the indoor HVAC equipment and LED lighting with DC power. The battery can provide up to 10 hours of electricity during power outages and charge overnight during off-peak hours.

“We have the ability to consume free energy from the solar or cheap energy at two cents per kilowatthour, if you’re on an ultra low off-peak program,” said Armster. “The savings are quite drastic.”

A power-over-ethernet system, which has traditionally been used for distributing the internet, sends data and electricity to devices around the home, bringing various control capabilities like customizable LED fixtures that match ambient lighting to human circadian rhythms.

The suite synchronizes the natural and built environments.

Photo courtesy of Tridel.

Light and temperature are primary synchronizers of the body’s circadian rhythm, which regulates the sleepwake cycle and is tied to a person’s 24-hour body clock.

“In the morning, the sun rises and delivers warmer orange-yellow hues, which wake us in a calm fashion,” explains Armster. “By noon, you start to get those colder white lights that are bright. The orange hues keep us relaxed; the blue cold light keeps us focused and awake. We have the ability to control that in the suite.”

Once occupants program their longitude and latitude, the indoor lighting will naturally match all the colours of the sun according to its location and allow for remote control.

“If you hit good morning, the blinds will open and a light fixture will turn on in that orange fashion to really give you the feel of the sun rising.” says Armster.

This is particularly beneficial during dark winter days. Another feature breaks occupants out of their circadian rhythms. For instance, while focusing on work after the

sun sets, the lighting can adjust its colour and emit more white light.

To deliver heating and cooling to the suite, a multi-flow fan coil unit works more efficiently using a six-way valve. Typically, the fan blows air through two coils when only one is being used to heat or cool. In this case, one of the coils is omitted and the valve connects to a smart thermostat.

“That thermostat will tell the valve to send hot water or cold water to the coil. Now, we’re using a single coil to deliver either heating or cooling,” explains Armster. “Less material means less

“Less material means less embodied carbon.”

embodied carbon, it’s more energy efficient and saves money.”

In place of a gas-powered boiler, a smart electric hot water heater in the suite allows for remote monitoring and control, while a heat pump dryer prevents exterior venting and improves air tightness. To further reduce energy waste, during the contraction phase, a blower door test

assessed where air leakage was occurring.

A spray gun then shot out fine particulate matter to plug up those crevices and holes, improving the air tightness of the suite by 50 per cent, while boosting air quality and preventing sound and odour infiltration.

An energy recovery ventilator (ERV) exchanges air to ventilate the suite. In this case, the ERV is

Clockwise from bottom left: In the kitchen, a ventless range hood and charcoal filter eliminate the need for exterior venting; every element has been carefully chosen for comfort, convenience and energy savings; modern design meets functionality in the bathroom; The Classic Series II towers above downtown Toronto. Photos by Tridel.

connected to a sensor that measures CO2 levels. “If the CO2 gets too high the ERV kicks on,” explains Armster.

““It’s right-sizing the solution for the problem. We’re getting perfect ventilation in the unit and perfect air quality and oxygen levels without comprising energy.”

On top of that, a separate sensor, tied directly to a charcoal hepa filter, measures volatile organic compound levels and particulate levels. The system runs high or low depending on the indoor air quality.

Yet another feature is a wastewater heat recovery system that captures and repurposes thermal energy from sanitary drainage. Coils around the drain absorb heat from flowing hot water and pre-heat the incoming cold water before it reaches the hot water tank, minimizing energy waste.

CUTTING CARBON

Due to carbon intensive features like solar panels and batteries the suite had slightly higher emissions from the start. Yet other components, such as the electric

hot water tank, reduce carbon. “Just through your operational savings, when you hit the 105-day mark of living in this unit, you’ll start to have a lower carbon footprint than your neighbour or other average condo units in the city,” says Armster.

The plan is to sell the condo unit and retrieve feedback and real testing data to enhance other projects.

“We’re so happy with some of these features that we’re going to roll them into future developments,” he adds.

“We’ve already learned a lot.”

A DC microgrid powers the suite, using fewer materials to maximize living space.

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LOAN AS AN OPTION TO SPECIAL ASSESSMENT: DEALING WITH FINANCIAL ANXIETIES IN UNCERTAIN TIMES

Financial stress is a hot topic in Canada. Between political/economic uncertainties, the potential impact on construction materials with the imposition of tariffs, and supply chain monopolies, our current environment can be tricky to navigate both logistically and emotionally.

Canadian businesses and their consumers are facing difficult hardships, as weʼre reminded of this in the media. Specifically for condos, regional news sources spotlight the increasing amount of compounded stress that corporations and their condo unit owners must cope with due to increasing fees and the possibility of special assessments for necessary repairs and replacements to common property elements. In a recent article published by the CBC, one condo owner from London, Ontario saw, in less than a yearʼs time, his condo fees climb 36%, along with a $5,000 special assessment. That is not an easy situation for most, and, unfortunately, this owner is not alone. Research indicates that 48% of Canadians have reported losing sleep due to financial stress.

As well, a growing number of new reserve fund studies have determined that corporations donʼt have sufficient funds to cover necessary updates/replacements. Causes for this include significant increases in construction costs, increased labour wages, and earlier than forecasted major common element component replacement

requirements. Balancing fiduciary duties, keeping common element fees competitive in the marketplace for real estate investment value and resale purposes, and maintaining owner harmony are ongoing challenges many condo boards face.

One important fact owners need to remember is that the board members are typically owners of the corporation and are also confronted with necessary funding increases. The board has an obligation to do their due diligence and they should rely on professional advice (i.e. auditors, engineers, lawyers, condominium managers) in any forecasting or project deferral recommendations. Full transparency and having an open dialogue with the owners will provide reassurances that the board of directors has completed a full review and assessment of the situation before any decisions are reached.

The reality is more boards have to deal with a very challenging financial environment in properly managing their condominium and community. They are looking for alternative solutions to the dilemma. A corporate loan should be considered as a potential strategic option to special assessment.

While it isnʼt an easy topic for a condo board to evaluate and navigate, knowing how to present a loan option and manage community responses can help ease anxieties for both the board and community members.

WHY & WHEN A CONDO CORP LOAN SHOULD BE CONSIDERED

Without available savings to cover the special assessment, many owners will have to brave the financial burden of borrowing personally. On an emotional level, the process of obtaining new personal debt can be jarring, time consuming and anxietyinducing. No condo board wants to heighten the financial stress of their community members, but sometimes there is no choice if they are to satisfy their responsibility to maintain the common elements. It is important to remember there is more than one path they can take.

As an alternative to forcing owners to pay a lump sum special assessment and securing the means to pay for it, certain specialty lenders in Canada will provide a loan to the corporation as an option. This allows the owners to pay for the cost of the project(s)

CWB Maxium Financial provides financing options to condo or strata Boards faced with reserve fund shortfalls. Industry-leading professionals in condo financing allow CWB Maxium Financial to provide your corporation with prompt, reliable and creative solutions. We work with the Board, property managers, owners, engineers, consultants and contractors – presenting at Board and owner meetings if requested. Our experts help answer questions and make sure each condoʼs unique circumstance is considered before curating financing solutions. Visit www.cwbmaxium.com to learn more about how our financial experts can support you and your business.

over time through increases to their monthly condo fees. This offering can reduce stress in the following ways:

• The loan leverages the borrowing capacity of the corporation to obtain a favourable rate and provide an affordable solution to all owners.

• The loan is with the corporation, so no lien or registration is placed on any individual unit.

• The loan option is an affordable way to pay for projects now to avoid costs associated with deferral or phased major projects.

• The cost of the replacement/improvement is paid for over time and is shared by current and new owners.

• The loan can be included in the reserve fund study to potentially ease the necessary increase in monthly condo fees.

LOAN IS LOOKING LIKE THE RIGHT MOVE: NOW WHAT?

Once a loan option may be the right solution for the community, these important steps should be taken to minimize the stress for the board and the owners.

1. Education: Early in the process of considering a loan as an option to special assessment, project deferral or project phasing, boards should fully understand the lending process in preparation for communication to the owners. Preparation should include:

• Arranging presentations from at least 2 lenders experienced in condo lending and the corporationʼs reserve fund study engineer. Be sure to ask questions about term, amortization, rate, process, borrowing by-laws, etc.

• Request your preferred lender to provide a term sheet and other educational resources.

2. Communication: The board should communicate to the owners early and frequently in the process to lessen the uncertainty. The community should be provided with the following:

• Reasoning for the boardʼs decision to look at the loan option,

• Information on the loan option and the benefits to the owners,

• Confirmation that the board has assessed different lenders in selecting a partner to work with

• Estimated financial impact for each owner,

• Town Hall meeting(s) for the lender to present and address all questions from the unit owners, and

• Consistent updates on the loan review process.

The owners should be provided with as much information as possible to fully understand the loan option and know the board has done their due diligence in evaluating multiple loan offers. This shows that the board has weighed their options to find the best possible solution to this challenging financial situation.

This will also effectively prepare owners, board members, and property managers for the important borrowing by-law voting process, which authorizes the board to borrow on behalf of the corporation. When communication with the owners has been thorough, clear and frequent, owners will be more comfortable with the process and more confident in their voting decision.

Having to deal with a reserve fund shortfall is very difficult for the board, property managers and unit owners. The board has a duty to maintain the common elements and get necessary projects done. A good understanding of the loan option by all parties, paired with strong communications for the owners, will alleviate some of the stress when shortfalls in reserve funds arise.

CONDO AND STRATA

Status Certificates: Proposed Price Hike & Why a Thorough Review Matters

BY THOMAS BEATTIE

One of the most important documents in a condo transaction is the status certificate—and its price may be set for a sharp increase. The Association of Condominium Managers of Ontario has formally asked the Minister of Public and Business Service Delivery and Procurement to raise the fee to $500. Since the cap has remained at $100 since 2001, this 400% jump might seem extreme at first glance, but when broken down as a 7% compounded annual increase, it appears more reasonable—though still well above inflation. Do the condo boards and managers that prepare them deserve such an increase?

TThis package provides a snapshot of the condominium corporation’s financial health, the status of any legal matters, and lifestyle restrictions. Preparation requires multiple data sources to be consulted, and errors can lead to liability, so there is certainly justification for a material increase in price. And it has real value for buyers; a careful review can identify potential issues, save a buyer from unexpected expenses, or even encourage them to walk away – so long as it wasn’t an unconditional offer.

Here are the key sections of a status certificate, what to watch for, and the risks of not paying close attention.

WHAT IS A STATUS CERTIFICATE?

A status certificate is a set of documents provided by the condominium corporation’s board or management that offers detailed insight into the operations and overall condition of the corporation. It covers aspects such as financial status, building insurance, management practices, and legal issues, giving a true picture of what is being purchased—not just the physical unit, but the entire community’s health. In Ontario, the package typically includes several important documents; however, there are additional items a potential buyer should request to gain a complete understanding, and which should likely become part of the package if a significant increase in price goes forward:

Meeting Minutes: In many provinces, sellers are required to provide 12 to 24 months of meeting minutes. These minutes offer valuable insights into the community’s ongoing issues, such as security concerns, elevator maintenance, or leak problems, which may not be fully detailed in the standard package.

Reserve Fund Study:

The status certificate includes a financial summary, but it is wise to request the full report. Updated at least every three years by an engineer, the complete reserve fund study reveals the health and long-term plan for major repairs and replacements.

KEY SECTIONS OF THE STATUS CERTIFICATE

Unit Information & Common Expenses:

This section outlines the specifics of the unit, including legal descriptions, additional components like parking spaces or storage lockers, and the common interest share. It also details the current monthly condo fees and any arrears owed by the seller. It is important to verify what is included in the purchase and to assess if any outstanding balances or unusually high fees could signal financial mismanagement.

Financial Information: Financial

health is central to understanding the viability of the condominium corporation. This section includes the budget, financial statements, reserve fund balance, and any details regarding condo fees and special assessments. A wellfunded reserve fund indicates that the condo is prepared for future repairs and maintenance. Conversely, rising fees or a history of special assessments might suggest upcoming major projects or financial instability, potentially increasing costs after purchase.

Legal Matters and Litigation:

Here, the status certificate reveals any pending or ongoing litigation, as well as unresolved insurance claims or liabilities. Active legal disputes can be a red flag for mismanagement, while unresolved insurance issues may lead to significant future costs. Reviewing this section is essential to avoid inheriting legal challenges that could affect both the investment and the condominium corporation’s stability.

Governance and Board Practices:

Good governance is key to a wellmanaged condo community. Frequent changes in management or board disputes might indicate internal issues that could affect policy consistency and decision-making. It could also be an indicator of deadlock over major projects. Look for transparency in meeting minutes and clear, proactive communication from the board, as these are indicators of a healthy governance structure.

Pending major repairs could lead to additional special assessments or increased fees, while a history of regular maintenance suggests a proactive approach to property care.

Bylaws, Rules, and Restrictions: The bylaws and rules govern the day-to-day living in the condominium. They cover everything from renovation guidelines and pet policies to other restrictions that might affect one’s lifestyle. It is important to ensure that these rules align with the buyer’s own needs and plans. For example, if anticipating renovating, renting out the unit, or keeping pets, the buyer should confirm that these activities are permitted under the current bylaws. Overly restrictive or unusual rules could limit enjoyment or future use of the property.

Physical Condition and Maintenance Issues:

Details of upcoming capital projects are vital considerations, as high expenditures in the near future could reflect the condition of common areas and the overall community.

Pending major repairs could lead to additional special assessments or increased fees, while a history of regular maintenance suggests a proactive approach to property care. Understanding these details helps gauge future costs and assess the investment.

OTHER RED FLAGS TO CONSIDER

Additional factors to watch for include recent changes in the management company, which might be a sign of underlying issues, and rapid increases in reserve fund contributions. A switch in management can trigger a new engineering firm, potentially resulting in more critical assessments of the building’s condition and higher fees.

Similarly, a sudden spike in reserve fund contributions might indicate that the condominium is trying to catch-up on neglected repairs, which could mean higher costs for going forward. In this example, the reserve portion of condo fees increase by more than 60% in three years: *Year Percentage Increase in Recommended Annual Contribution

Based on the current level of reserve contributions, analysis indicates that more than 10% of Ontario condo corporations could require a special assessment over the next five years, amounting to roughly $10,000 per unit. However, because Ontario requires a plan for how much to contribute to the reserve fund each year, the more likely scenario will be rapid increases in reserve contributions for those

communities with a much smaller percentage of special assessments.

BEST PRACTICES FOR REVIEWING A STATUS CERTIFICATE

Engaging a real estate lawyer who specializes in status certificate reviews is highly recommended. Their expertise can help interpret the details and spot any potential red flags. Additionally, there are condo document review tools available that simplify the process, making it easier to understand the key elements. Regardless of the chosen method, potential owners should take time to read the document thoroughly, ask questions about any unclear points, and compare the findings with their personal needs and long-term goals.

A CRITICAL TOOL

The status certificate is more than a doorstop— it is a critical tool that provides deep insights into the financial, legal, and operational aspects of a condominium. Carefully reviewing each section helps make well-informed decisions and protects from unforeseen liabilities. Investing in professional advice and taking the time to understand this document not only safeguards the financial investment but also ensures that a new home aligns with lifestyle and future plans.

Do boards and managers deserve to be compensated for preparing this document and assuming liability? Absolutely. The real question is how

much—and whether attaching meeting minutes and the full reserve fund study should become the standard rather than the exception.

Thomas Beattie is CEO of OctoAI Technologies, a condo intelligence company that provides reports and data to buyers, owners, property managers, Realtors and businesses that serve condo communities. The company has delivered over 25,000 Eli Reports since 2020, helping thousands of people understand what matters about their property, and recently launched the Annual Benchmark Report to help owners save money. Thomas is a CFA Charterholder, an entrepreneur and former investment banker. Contact him at thomas@elireport.com

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Unpacking the Performance Audit

What new condo board members need to know

BY RYAN HALEY

When condo owners join the board of a newly registered condominium project, they’ll often face a lot of new processes and terminology that they’re not familiar with. One of the most significant is a performance audit.

TThe performance audit is a key part of the warranty on the common elements of a project, which the directors on the board will need to manage. The audit occurs in the first year after registration of the condo so it’s important that the condo board members learn as soon as possible about its purpose, what’s involved, and what role the board plays.

WHAT IS A PERFORMANCE AUDIT?

A requirement under Section 44 of the Condominium Act, the performance audit is a comprehensive inspection of a project’s common elements to identify any construction deficiencies that need to be addressed, such as water penetration or fire safety issues.

The first-year performance audit must be conducted between six and ten months from the date of registration of the project, and the resulting report is then submitted to Tarion, the non-profit consumer protection organization that administers the

Ontario new home warranty, before the end of the 11th month following registration.

The individual who conducts the performance audit for the condominium corporation is referred to as the performance auditor who must hold a certificate of authorization under the Professional Engineers Act or hold a certificate of practice under the Architects Act. It is up to the condominium corporation to hire and pay for the performance auditor.

WHAT HAPPENS DURING AND AFTER THE PERFORMANCE AUDIT?

During the performance audit, all major components of the building are reviewed, including, but not limited to, the foundation, parking garage, elevators and mechanical, electrical and fire protection systems.

On some condominiums, Tarion requires the builder to provide thirdparty reporting, referred to as the B19 Final Report. If this is required to be completed, the performance auditor

will also review this documentation. Additionally, they will conduct a survey of unit owners to determine if there are any concerns that unit owners have that may relate to a deficiency in the common elements.

Along with the performance audit report, the performance auditor will submit a performance audit tracking summary (or PATS) to Tarion and the builder. The PATS, which lists all items identified in the performance audit, is a tool used to track the progress of repairs and allows communication to take place between the condo corporation and the builder; they both are expected to update the PATS every 90 days.

The builder will have an 18-month repair period from the first anniversary of the registration date of the condo project to repair or resolve all items listed on the PATS that are covered by the warranty.

APPOINTING A DESIGNATE AND USING MYHOME

Around the time the performance

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audit is submitted, the condominium corporation must select a “designate.” The designate is the individual (e.g., a board member, property manager or performance auditor) who will act as a point of contact between the corporation and Tarion. The designate is responsible for overseeing the resolution of warranty items, managing timelines, and making the required regular updates to the PATS.

The name of the designate must be communicated using the appointment of designate form. As soon as Tarion receives the form, the designate can use MyHome and CEPATS, digital tools that make managing the common elements warranty a lot easier.

For example, MyHome allows the designate to submit warranty forms, upload documents to support a warranty claim, and update the PATS. Email reminders are sent important warranty dates.

ADDITIONAL TIPS FOR CONDO BOARDS

1. Review the declaration and description to have a clear understanding of unit and common element boundaries. Include unit questionnaires with the performance audit.

2 Keep track of warranty timelines. Know when a warranty claim can be submitted.

3 It’s important to keep the lines of communication open with your builder. Work with the builder to resolve the claim items. Update the performance audit tracking summary every 90 days.

4

Keep unit owners informed about concerns and repairs related to the condo’s common elements.

5.

Maintain the condo building. Keep in mind that improper maintenance can affect warranty coverage on the common elements.

Ryan Haley has worked at Tarion since 2008 and is the director of common elements. He works closely with vendors, builders, municipalities, consultants, and owners across Ontario to help ensure condominiums are constructed as required under warranty. Ryan graduated from George Brown College with a Diploma in Architectural Technology and has since obtained a Certificate in Building Science from the University of Toronto. He has been a member of the Building Science Association of Ontario (BSAO) and has held the designation of Building Science Specialist (BSS) since 2016.

Engage. Educate. Advance.

The Building Operations Designation (BOD) Program is creating a new standard for the commercial real estate industry and Building Operations professionals through current, relevant, engaging, and interactive training content with ongoing insights and information through continuing education, special events and direct access to industry subject matter experts.

The BOD Program is online, self-paced and includes a robust, ongoing continuing education component. For more information, please visit BODProgram.com.

In tandem with the commercial real estate industry and over 450 recognized subject matter experts, we are proud to offer the BOD Program and its 22 certificates to all Building Operations professionals.

Over 2,900 real estate and operations professionals have already registered across Canada and many have attained various BOD Program certificate diplomas.

Proudly Developed and Delivered by:

If you and your staff are interested in registering for the BOD Program, please contact Chuck Nervick at chuckn@mediedge.ca or 416-803-4653

Passive Purpose

Passive home principles for detached housing are gaining recognition, but how do they apply to multi-residentials buildings in Ontario?

BY PAUL KEALEY

As the construction industry in Canada moves toward more sustainable practices, integrating net-zero and passive building principles into condominiums represents a new era for environmentally-friendly urban living

BBuilding codes are evolving in North America and, in some cases, requiring passive home principles in more new construction. Applying these standards to condo units is not just innovative but increasingly necessary. Here’s how builders, buyers, and owners can adapt these principles in Ontario, particularly focusing on multi-unit rentals, affordability, and long-term value preservation.

UNDERSTANDING PASSIVE HOUSE STANDARDS

Passive house standards focus on ultra-low energy buildings that require little energy for space heating or cooling: up to 90 per cent less than typical code. A key aspect of these buildings is their ability to be airtight while still creating a healthier interior environment and also harnessing energy from external sources to meet most

heating demands. For condos, this means constructing or retrofitting units that maximize thermal comfort with minimal mechanical intervention.

UNDERSTANDING POINTS SYSTEM AND CMHC FUNDING

The Canada Mortgage and Housing Corporation (CMHC) offers a points system under its funding programs, encouraging the adoption of energy-efficient practices in multi-unit residential buildings. Condos can earn “50 points right out of the box,” making them eligible for affordable housing funds and other financial incentives. This point system is part of a broader initiative to make sustainable housing more accessible and appealing.

FINANCIAL INCENTIVES FOR ADOPTING PASSIVE HOME FEATURES

For condo developers and boards who may consider retrofitting older units or constructing new buildings with passive home features, financial incentives in Ontario are significant. Such features can

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make properties eligible for CMHC funding, which supports the development of affordable, energy-efficient housing. Adopting passive standards now can also safeguard against future changes in the building code, ensuring that today’s new builds will remain compliant and competitive in the future market.

LONG-TERM VALUE AND COST SAVINGS

Integrating passive home features into condos also offers long-term savings and value protection. These buildings are

ingly

also particularly attractive to prospective condo buyers interested in lower maintenance costs and healthier living environments.

DURABILITY AND MAINTENANCE

Conventional homes often face issues with moisture, leading to mould and mildew, necessitating frequent and costly repairs. In contrast, passive homes are designed

with wall systems that are more resilient to moisture and are permeable, allowing unwanted moisture to escape for better breathability, significantly reducing the likelihood of such damage. Applying these passive home principles to condo buildings means fewer maintenance issues as the condo ages, lower maintenance fees, and longer-lasting building materials.

HEALTH AND COMFORT BENEFITS

Passive homes offer enhanced indoor air quality due to their air-tight construction

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and controlled ventilation systems, which continuously circulate fresh, filtered air at a consistent temperature. This design minimizes drafts and fluctuations in temperature, which is particularly beneficial for aging residents or those with health concerns. Moreover, the thicker walls required for passive standards contribute to quieter, more peaceful living spaces, free from external noise. Issues that often come with living in multi-unit buildings — such as noisy neighbours or stuffy air quality — are negated.

RESILIENCE AND STRUCTURAL INTEGRITY

Passive buildings are often constructed to be three times stronger than standard code requirements, providing enhanced resilience against environmental stresses and growing environmental disasters or events. This robust construction means that passive homes can sustain more wear and tear over time, making them particularly suitable for the densely populated condo market, where longevity and durability are key concerns.

THE CHALLENGE OF RETROFITTING

While new builds can integrate passive home standards from the design phase, retrofitting existing condo units poses challenges. However, with the right planning and investment, older buildings can be upgraded to reflect these standards, enhancing their market value and extending their lifespan. Key retrofitting strategies include improving insulation, sealing leaks, upgrading HVAC systems to heat pump systems, and replacing windows and doors that align with passive principles.

As Ontario and the rest of the world moves towards a more sustainable future, applying net-zero and passive home principles to condo units is not just feasible but increasingly necessary. Developers, homeowners, and policymakers must collaborate to navigate the challenges and embrace opportunities.

Paul Kealey is the founder and president of EkoBuilt, an Ottawa-based company that specializes in passive house design. Paul is a thought leader in the development of building systems for affordable energy efficient homes and is regularly called upon to speak about energy-efficient and net-zero buildings.

Driven by our core values of putting people first and doing what’s right, we continue to raise the bar in accessible home design—ensuring that everyone can find a home that fits their needs and love where they live.

OUR COMMITMENT TO ACCESSIBILITY & INCLUSIVITY

New & Notable

At The Daniels Corporation, we are deeply committed to creating communities that are accessible, inclusive, and foster a sense of belonging for all. Through our Accessibility Designed Program (ADP), we aim to break down barriers for those living with disabilities or looking to age in place by designing homes that go beyond the accessibility standards set by the Ontario Building Code (OBC).

SHARING ACCESSIBILITY KNOWLEDGE

Standard sets new requirements beyond the Ontario Building Code

The Daniels Corporation is making its Accessibility Designed Program (ADP) Technical Standards Guide available to all industry professionals.

We understand that mobility needs differ, that’s why we provide a selection of standard accessible layouts, with the opportunity for homebuyers to collaborate with our team on personalized upgrades.

Originally developed for its core construction program in 2017, the guide contains thoughtfully designed features that improve livability for people using mobility aids, those with sensory impairments, cognitive or intellectual disabilities, as well as individuals who wish to age in place. Some include comprehensive specifications for appliances, fixed items and plumbing fixtures.

Other highlights are accessibility-focused design elements, such as roll-in showers, height-adjusted countertops, braille signage, wider doorways and grab bars.

Driven by our core values of putting people first and doing what’s right, we continue to raise the bar in accessible home design—ensuring that everyone can find a home that fits their needs and love where they live.

“Inclusivity is a shared responsibility, and real progress happens when the industry works together,” said Jake Cohen, Daniel’s chief operating officer. “A collaborative effort is key to creating a more accessible future.”

Designed for both in-suites and common areas, the program was created in collaboration with accessibility partners, design leaders and individuals with lived experiences.

What’s our secret to servicing the GTA’s largest condo portfolio?

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Management teams are trained and certiffied experts in condominium security. Knowledge is shared daily so your board is always well informed. Talk to a Paragon expert today.

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