Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE:

March 14, 2017

FILE NO.:

WR 145242

Assessed Person(s):

1818104 Ontario Inc.

Appellant(s):

1818104 Ontario Inc. and Joseph Benny

Respondent(s):

Municipal Property Assessment Corporation (“MPAC”) Region 09

Respondent(s):

City of Toronto

Property Location(s):

1585 Markham Road

Municipality(ies):

City of Toronto

Roll Number(s):

1901-122-042-00863-0000, 1901-122-042-00949-0000 1901-122-042-00950-0000, 1901-122-042-00958-0000 1901-122-042-00960-0000, 1901-122-042-00969-0000 and 1901-122-042-00970-0000

Appeal Number(s):

3123691, 3147150, 3123692, 3149358, 3123693, 3147508, 3123694, 3146066, 3123695, 3146373, 3123696, 3147151, 3123732 and 3148203

Taxation Year(s):

651564

Hearing Event No.:

2015 and 2016

Legislative Authority:

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

Heard:

January 13, 2017 in Toronto, Ontario

APPEARANCES:

Parties

Counsel⁺/Representative

1818104 Ontario Inc.

Joseph Benny

MPAC

D. John

City of Toronto

No one appeared

ISSUE

1The subject properties are seven commercial condominium parking space units located on the underground level in a commercial low rise condominium building. This commercial building comprising 49 above ground commercial units, 130 underground parking units and 50 outdoor visitor parking spaces is municipally known as 1585 Markham Road, in the City of Toronto and located on the east side of Markham Road, south of Sheppard Avenue East.

2MPAC returned the assessment for the subject parking space unit properties at $20,000 each for the 2015 taxation year and $15,000 each for the 2016 taxation year. Following an inspection on November 8, 2016 of the subject properties and a sales analysis, MPAC is recommending that the returned assessments for each of the parking space units be reduced to $3,000 for both taxation years.

3The representative for the Appellant argued that the assessment roll numbers for the seven parking spaces units owned by the Appellant should be deleted and the roll numbers for three of the parking spaces units should be “consolidated” with the roll number for retail Unit 408 owned by the Appellant and the roll numbers respecting the remaining four parking spaces units owned by the Appellant should be “consolidated” with the roll number for retail Unit 113 also owned by the Appellant. He also argues that the individual parking space units included in the 2010 real estate transactions respecting retail Units 408 and 113 have no independent current value as their values were accounted for in the purchase price for these retail units. He also argues that the other five parking space units purchased by the Appellant in 2014 for a total bulk sales price of $4,500 should be valued at $900 each or one fifth of the bulk sale price.

4The Assessment Review Board (“Board”) must determine whether the 2015 and 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 each of the subject properties is $3,000.

6The Board finds that the current value should not be adjusted for equity pursuant to s. 44.(3)(b) of the Act.

7Accordingly, the assessment of the subject properties is reduced to $3,000 each for the 2015 and 2016 taxation years.

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:

Valuation days

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

1. 1. For the 2006, 2007 and 2008 taxation years, land is valued as of January 1, 2005.

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.

Exception

(5) Subsection (1) does not apply in respect of the valuation of land for a taxation year after 2004 if the Minister prescribes a different day as of which land is valued for that year.

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

13Olga Roudnitski is a Property Valuation Specialist with MPAC. Her curriculum vitae filed as Exhibit 1 indicates that she has significant education in real property and appraisal matters and has been employed with MPAC since 2006 in the valuation of residential and commercial properties. She prepared a valuation report which she submitted as Exhibit 2. To prepare her report, Ms. Roudnitski inspected the subject properties on November 8, 2016 and performed a sales analysis of suggested comparable sales.

14In her sales analysis, Ms. Roudnitski identified seven comparable sales in the general area that sold between 2010 and 2014. She determined the average sale price of these transactions to be $5,829 and the median sale price to be $3,000. Based on her research, Ms. Roudnitski recommended that the 2012 current value assessment be reduced to $3,000 for each parking space unit.

15Ms. Roudnitski also performed a separate review of the sales of all parking space units sold by the builder in the condominium building containing the subject parking space units. She reviewed information provided to MPAC by the builder (tab 4. of Exhibit 2) indicating that the original purchase price for individual commercial parking space units sold together with retail units was $20,000 each and that over 60 commercial parking units were sold and purchased with retail units on this basis. However, the purchase and sales documentation provided by Mr. Benny did not corroborate this sales value of $20,000 for parking space units as the purchase price for the retail units he purchased did not apportion the sales prices between the retail units 408 and 113 and the related parking space units included in the respective purchases.

16Ms. Roudnitski was able to find only one sale of a parking unit in the building close to the valuation date. It sold on May 4, 2012 for $15,000. Since there was only one sale for this time period the Board did not find this value to be a reliable indicator of current value and prefers the median value of the comparable sales in her sales analysis which includes this sale.

17Mr. Benny completed the sale of five parking spaces in a bulk sales transaction on March 25, 2014 and therefore argues that the value of each of these spaces should be assessed at $900. However, according to the information provide in Ms. Roudnitski’s report, in 2013 until the end of February 2014 parking space units were being sold for $3,000 each. It was not until March 2014, that the remaining parking spaces were being sold off by the builder predominately in bulk sales of two or more parking units, at a discounted price of $900 per space. Therefore, the Board does not consider the sales price paid by Mr. Benny in a bulk sale in 2014 as being the best evidence of the current value of the parking space units as of January 1, 2012.

18Accordingly, based on the aforementioned limited information and Ms. Roudnitski’s analysis the Board finds that the current value of an individual parking space unit as of January 1, 2012 to be $3,000. This value would apply to all parking space units, including the parking space units conveyed to the Appellant with retail units 408 and 113. The Board does not accept Mr. Benny’s argument that these parking units have no independent current value merely because the prices of these units were not specifically mentioned in the related sales documentation.

19Mr. Benny also argues that the Board should delete the roll numbers for the parking space units under appeal and somehow consolidate parking space units with the assessment roll numbers for the retail units 408 and 113 owned by the Appellant. However, the Board has no such authority. According to the relevant condominium declaration the parking spaces in the subject building are units that can be purchased and sold and pursuant to applicable condominium legislation the parking space units are considered separate parcels for the purpose of municipal assessment and taxation.

Equity Analysis

20There was no evidence before the Board that would support a reduction to the assessments based on equity considerations pursuant to s. 44.(3)(b) of the Act.

21Accordingly, the Board finds that the current value should not be adjusted for equity pursuant to s. 44.(3)(b) of the Act.