Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: July 22, 2016

FILE NO.: WR 139793

Assessed Person(s): Morguard Industrial Properties Limited

Appellant(s): Morguard Industrial Properties Limited

Respondent(s): Municipal Property Assessment Corporation (“MPAC”), Region 9

Respondent(s): City of Toronto

Property Location(s): 10 Commander Boulevard

Municipality(ies): City of Toronto

Roll Number(s): 1901-123-090-03600-0000

Appeal Number(s): 2962082, 3016972, 3078166 and 3146417 (deemed 2016 appeal)

Taxation Year(s): 2013, 2014, 2015 and 2016 (deemed appeal)

Hearing Event No.: 622671

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

Heard: April 12, 2016 in Toronto, Ontario

APPEARANCES:

Parties	Representative
Morguard Industrial Properties Limited	Chris Ratnasingham
MPAC	Tyler Nastich
City of Toronto	No one appeared

DECISION OF THE BOARD DELIVERED BY PAUL MULDOON AND PETER ANDREWS

BACKGROUND

1The subject property, 10 Commander Boulevard (“Blvd”), was constructed in 1975 on a 2.56 acre lot located at the corner of Commander Blvd and McCowan Road. The combined area of the improvements are 34,377 square foot of office and warehouse space with ceiling heights ranging from 13 feet to 20 feet.

2MPAC returned an assessment, for the 2013 to 2016 taxation years, at $3,050,000. Tyler Nastich, appearing on behalf of MPAC, suggests that the correct approach to value the subject property is by the sales approach to value. He submitted the sales of five suggested comparable properties, four of which were also suggested by the appellant.

3Chris Ratnasingham, appearing on behalf of the appellant, agrees with Mr. Nastich that the preferred approach to value is the sales approach. However, he suggests the returned assessment is too high when compared to similar properties in the vicinity of the subject property. His witness, Chandelle Hamilton, presented the sales of five suggested comparable properties all but one of which, 32 Upton, were suggested by MPAC.

4The Assessment Review Board (“Board”) must determine whether the 2013, 2014, 2015 and deemed 2016 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 property, as at the valuation day January 1, 2012, is $2,428,000.

6The parties agree that the correct classification of the subject property is Industrial (IT).

7The Board finds that there is no evidence before it leading to the conclusion that the current value of the subject property, as determined above, requires a further adjustment in accordance with s. 44.(3)(b) of the Act.

8Accordingly, the assessment of the subject property as at the valuation day, January 1, 2012, is reduced from $3,050,000 to $2,428,000 in the Industrial Property Class.

REASONS FOR DECISION

Current Value Analysis

9The initial task for the Board is to determine the current value of the subject property as required by s. 44.(3)(a) of the Act “…the Board shall…determine the current value of the land…”

10Section 19.(1) of the Act states that “…the assessment of land shall be based on its current value…” and section 1 of the Act defines current value as “…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…”

11The best test of current value is an arm’s length and market tested sale of the subject property on the valuation day, January 1, 2012 or close to it. If, as in this case, no such transaction took place, the next best measure of current value is arm’s length and market tested sales of comparable properties in the same vicinity and market, on or close to the valuation day. This measure acts as a benchmark and a gauge of the accuracy for the assessed value of the subject property and comparable properties.

12To enable an estimate of value for the subject property to be derived from suggested comparable properties there must be sufficient elements of similarity, in terms of physical factors such as building area, land area, land frontage, age of construction, physical condition etc. so as to enable a direct comparison to be made between a suggested comparable property and the subject property.

13The parties provided six suggested comparable properties four of which were provided by both parties.

14A fifth property, 32 Upton Road, was initially suggested by the appellant as comparable. However, when it was determined that the property had been subject to contamination, it was withdrawn on the basis that such a condition was not reflective of market conditions.

15A sixth property, 650 Barmac Road was suggested by MPAC as comparable. Barmac Road is located in the south west quadrant of the junction of Highway 407 and Highway 400. The Board finds that such a location is too far and too remote from the subject property to be reflective of values in the vicinity of the subject property. The Board disregards this suggested comparable.

16The Board accepts the four remaining properties as being comparable to the subject property in as far as all of the suggested comparable properties are similar to the subject property having similar lot sizes, structural areas, ceiling height and age built and the suggested comparable properties are all in the same vicinity as is the subject property.

17The Board agrees that the appropriate unit of comparison is, as used by the parties, a value per square foot of structure.

18The comparable properties sold at values ranging between $50.63 per square foot and $92.48 per square foot with a mean value of $70.63 or a total value of $2,428,000 (rounded).

Equity Analysis

19The Act was amended for taxation years beginning with 2009 to require the Board to lower an assessment below current value if required to make the assessment equitable with the assessments of similar properties in the vicinity.

20Section 44.(3)(b) of the Act states:

“… the Board shall… 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 land.”

21Neither party provided evidence nor argument under s. 44.(3)(b)

CONCLUSION

22Accordingly, the Board finds that there is no evidence before it leading to the conclusion that the current value of the subject property, as determined above, requires a further adjustment in accordance with s. 44.(3)(b) of the Act. The assessment of the subject property as at the valuation day, January 1, 2012, is reduced from $3,050,000 to $2,428,000 in the Industrial Property Class.

2016 DEEMED APPEAL

23An appeal for the 2015 taxation year is presently before the Board. Section 40.(26) of the Assessment Act 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 2015 appeal before March 31, 2016. For that reason, this decision also applies to the 2016 taxation year.

24Section 40.(26) of the Act directs:

Deemed appeals, 2009 and subsequent years

(26) 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.