323 Richmond Street East Inc. v. Municipal Property Assessment Corporation, Region 09, 2015 CanLII 52624

Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE:

August 18, 2015

FILE NO.:

WR 132237

Assessed Person(s):

323 Richmond Street East Inc.

Appellant(s):

323 Richmond Street East Inc.

Respondent(s):

Municipal Property Assessment Corporation (“MPAC”)

Region 09

Respondent(s):

City of Toronto

Property Location(s):

313 Richmond Street East Units 1-8

Municipality(ies):

City of Toronto

Roll Number(s):

See Schedule “A” attached

Appeal Number(s):

See Schedule “A” attached (and deemed 2015)

Taxation Year(s):

2013, 2014 (and deemed 2015)

Hearing Event No.

574057

Legislative Authority:

Section 40 of the Assessment Act, R.S.O. 1990, c. A.31, as amended

Heard:

May 4, 2015 in Toronto, Ontario

APPEARANCES:

Parties

Counsel^+^/Representative

323 Richmond Street East Inc.

Laine Gambeta

MPAC

Chin-Wei Li

City of Toronto

No one appeared

DECISION OF THE BOARD DELIVERED BY SONIA LIGHT

ISSUE

1The subject properties 313 Richmond Street, Units 1-8, are commercial condominium units located at the intersection of Richmond Street East and Sherbourne Street. The subject properties consist of eight (8) retail units on the ground floor of a 13-storey residential condominium. Four tenants occupy the units.

2The retuned assessments for the units ranged from $343,000 to $614,000 or $409 per square foot (“psf.”) to 469 psf. for the 2013 and 2014 taxation years.

3The Appellant’s position is that the assessments for the subject properties (except for the assessment of Unit 3), are too high and that the assessments should be reduced to $400 psf. The representative for MPAC argued that the returned assessments should be confirmed.

4The Assessment Review Board (“Board”) must determine whether the 2013 and 2014 assessments are correct and equitable.

DECISION

5For the reasons stated below and as directed by s. 44.(3)(a) of the Assessment Act (“Act”) the Board finds that the current value of the subject properties is $449 psf.

6The Board finds no basis to support a reduction in the current value pursuant to s. 44.(3)(b) of the Act based on equity considerations.

7Accordingly, the assessment of the subject properties for the 2013 and 2014 taxation years should be reduced to $449 psf. for the units with assessments that exceed this value and the remaining assessment are confirmed as returned. This results in the following assessments:

Unit 1 - $409,000 (confirmed), Unit 2 - $439,000 (confirmed), Unit 3 – $614,000 (confirmed), Unit 4 - $381,650 (from $385,000), Unit 5 – $396,916 (from $397,000), Unit 6 -$408,590 (from $427,000), Unit 7 - $332,260 (from $343,000), Unit 8 - $457,000 (confirmed).

REASONS FOR DECISION

Legislation

8Section 19.(1) of the Act states:

19.(1) Assessment based on current value. - The assessment of land shall be based on its current value.

9Section 1 of the Act defines “current value” as:

“current value” means, in relation to land, the amount of money the fee simple, if unencumbered, would realize if sold at arm’s length by a willing seller to a willing buyer.

10Section 19.2(1)2 states:

19.2(1) Valuation days. – Subject to subsection (5)¹, the day as of which land is valued for a taxation year is determined as follows:

2. For the period consisting of the four taxation years from 2009 to 2012, land is valued as of January 1, 2008.

3. For each subsequent period consisting of four consecutive taxation years, land is valued as of January 1 of the year preceding the first of those four taxation years.

11Section 44.(3) states:

44.(3) Same, 2009 and subsequent years. – For 2009 and subsequent taxation years, in determining the value at which any land shall be assessed, the Board shall,

(a) determine the current value of the land; and

(b) have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment of the land to make it equitable with that of similar lands in the vicinity if such an adjustment would result in a reduction of the assessment of the land.

12Section 40.(26) of the Act directs:

40.(26) Deemed appeals, 2009 and subsequent years. – For 2009 and subsequent taxation years, an appellant shall be deemed to have brought the same appeal in respect of a property,

(a) in relation to the assessments under sections 32, 33 and 34 for the year; and

(b) in relation to the assessment, including assessments under sections 32, 33 and 34, for a subsequent taxation year to which the same general reassessment applies, if the appeal is not finally disposed of before March 31 of the subsequent taxation year or, if an assessment has been made under section 32, 33 or 34, before the 90th day after the notice of assessment was mailed.

Current Value Analysis

13Mr. Li is a property valuation analyst with MPAC and represented MPAC at this hearing. He prepared the report for MPAC and presented it to the Board at the hearing as Exhibit 1. At page 4 of his report under the heading “analysis”, he included a list of six sales of suggested comparable properties. However, extremely limited information is provided to support the selection of the properties, aside from their being located in reasonably close proximity to the subject properties. His verbal testimony did not shed any additional light respecting the rationale for the selection of the suggested comparable sales in the MPAC report.

14Mr. Gambeta for the Appellant presented his report to the Board as Exhibit 2. He argues that the most comparable properties to the subject properties are the commercial retail units located across the street from the subject properties at 320 Richmond Street East. The Board finds that these properties would be more similar to the subject properties than those submitted in the MPAC report, based on their commercial street level uses and locations and their being located across the street from the subject properties. Four of the eight units were sold in the year 2012. The sales prices psf. of these sales ranged from $409 psf. to $474 psf. The Board calculates the average sale value psf. of these four sales as $449 psf.

15Mr. Li argues that the sales at 320 Richmond Street East should be totally disregarded because they are builder’s sales. However, he does not provide any rationale for this opinion. He also alleges that for reasons of “economy of scale”, the assessments at the subject property should be higher than the assessments of units at 320 Richmond Street East, but again fails to substantiate this assertion with any meaningful information. Likewise with his assertion that the configurations of the subject units intrinsically justify higher assessments than the properties located across the street.

16Therefore, the Board finds the best evidence presented of current value are the sales at 320 Richmond Street East and determines that the current value of the subject properties is $449 psf.

Equity Analysis

17The Board has reviewed the evidence presented at the hearing to determine whether a further reduction to current value should be applied pursuant to s. 44.(3) of the Act and the Board finds the evidence would not support a further reduction based on the equity considerations in that section of the Act.

18Accordingly, the Board finds no basis to support a further reduction in the current value pursuant to s. 44.(3)(b) of the Act based on equity considerations.

2015 DEEMED APPEAL

19An appeal for the 2014 taxation year is presently before the Board. Section 40.(26) provides that the appellant is deemed to have made the same appeal for the subsequent taxation year if the appeal is not finally disposed of before March 31 of the subsequent taxation year. The Board has not disposed of the 2014 appeal before March 31, 2015. For that reason, this decision also applies to the 2015 taxation year.

20Section 40.(26) of the Act directs:

Deemed appeals, 2009 and subsequent years

For 2009 and subsequent taxation years, an appellant shall be deemed to have brought the same appeal in respect of a property,

(a) in relation to the assessments under sections 32, 33 and 34 for the year; and

(b) in relation to the assessment, including assessments under sections 32, 33 and 34, for a subsequent taxation year to which the same general reassessment applies, if the appeal is not finally disposed of before March 31 of the subsequent taxation year or, if an assessment has been made under section 32, 33 or 34, before the 90th day after the notice of assessment was mailed.

Footnotes

1. 1Subsection 5 permits the Minister to prescribe a different valuation day. A different day has not been prescribed.