Tribunals Ontario
Assessment Review Board
ISSUE DATE: December 21, 2023 FILE NO.: ID 184943
Assessed Person(s): Maple Lodge Farms Ltd. Appellant(s): City of Brampton; Maple Lodge Farms Ltd. Respondent(s): Municipal Property Assessment Corporation Region 15 Respondent(s): City of Brampton; Maple Lodge Farms Ltd.
Property Location(s): 8301 Winston Churchill Boulevard; 8217 Winston Churchill Boulevard
Municipality(ies): City of Brampton Roll Number(s): 2110-080-012-08400-0000; 2110-080-012-08405-0000 Appeal Number(s): 3438004, 3488938, 3512837, 3266019, 3320261, 3359922, 3405583, 3438005, 3444842, 3488937, 3489027, 3512888, 3512785 Taxation Year(s): 2017 to 2023 Hearing Event No.: 778923
Legislative Authority: Section 40 of the Assessment Act, R.S.O. 1990, c. A.31
APPEARANCES:
| Parties | Counsel |
|---|---|
| Maple Lodge Farms Ltd. | Sarah Turney and Anna Lu |
| Municipal Property Assessment Corporation | Melissa VanBerkum |
| City of Brampton | John O’Kane |
HEARD: June 5 to 9, 2023 by video conference with submissions in writing submitted on various dates ending August 10, 2023.
ADJUDICATOR(S): Carly Stringer, Member
INTERIM DECISION
OVERVIEW
The Subject Appeals
1These 13 appeals (the “Subject Appeals”) relate to the property assessments of 8217 and 8301 Winston Churchill Boulevard in the City of Brampton.
2Maple Lodge Farms Ltd. (“Maple Lodge”) is the Appellant for appeals relating to the assessments of 8217 Winston Churchill Boulevard (“8217”) for the 2017 to 2023 taxation years. Maple Lodge says the current value is too high. The City of Brampton (the “City”) and the Municipal Property Assessment Corporation (“MPAC”) are responding to Maple Lodge’s appeals (Maple Lodge, the City and MPAC, together, the “Parties”).
3The City is the Appellant in appeals relating to 8217 and 8301 Winston Churchill (“8301”) for the 2021 to 2023 taxation years. The City argues that the current values are too low and should be increased. Maple Lodge and MPAC are responding to the City’s appeals.
Property Description
48217 and 8301 are located at the border between the City of Brampton and the Town of Halton Hills. The properties are used to operate a special purpose food processing facility – specifically, a slaughterhouse and poultry processing plant.
5For the 2017 and 2018 taxation years, 8217 and 8301 were legally separate parcels of land. 8217 consisted of 40.57 acres of land. In 2018, 8217 was reduced to 40.14 acres when a strip of land was transferred to the Region of Peel for road widening.
6Also in 2018, 8217 was legally consolidated with 8301 into a single parcel of land. Prior to consolidation, 8301 consisted of 65.65 acres of land. Since consolidation, the single parcel of land consists of 105.79 acres.
7Despite the consolidation, 8217 and 8301 have continued to be assessed under separate roll numbers. For this reason, 8217 and 8301 will be referred to as separate properties in this Interim Decision except where explicitly referred to as the consolidated parcel.
8The properties are primarily improved with steel and concrete buildings, water and wastewater treatment facilities, and parking lots. These improvements were constructed in a piecemeal basis between 1950 and 2020. Small portions of 8217 also contain residential improvements and an active farming operation.
98217 and 8301 are partially serviced. They have municipal water services, but no municipal sanitary sewer services. Instead, Maple Lodge uses onsite wastewater treatment systems for sewage and effluent treatment in support of its operations.
10The zoning appears to be tailored to the current and historic use of the properties. The site is split zoned Agricultural and Industrial M1A – Section 166. The M1A zoning permits a range of non-residential and accessory uses, while Section 166 permits egg and poultry processing; associated on-site wastewater treatment facilities including sewage ponds and lagoons; agricultural uses; a residential dwelling; and purposes accessory to the other permitted purposes.
11Portions of 8217 and 8301 are located within an area regulated by the Credit Valley Conservation Authority, as the Levi Creek runs through the rear portion of the land, alongside Maple Lodge’s water treatment ponds, lagoons and buildings.
Issues for the Hearing
Applicable Law and Valuation Methodology
12In accordance with s. 44(3) of the Assessment Act R.S.O. 1990, c. A.31 (“Act”), the Board must determine the value at which 8217 and 8301 shall be assessed.
13This requires the Board to determine the “current value of the land” [s. 44(3)(a) of the Act] and “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” [s. 44(3)(b) of the Act].
14Section 1 of the Act defines current value as “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”. Section 19.2(1) of the Act confirms that the valuation day for the taxation years under appeal is January 1, 2016.
Issues
15Therefore, the Board must address the following issues:
Issue 1 – What is the current value of 8217 and 8301 as of January 1, 2016?
Issue 2 – Is an equitable adjustment required and, if so, how much?
Result
16For the reasons that follow, the Board finds that:
a. The following rates per acre apply to determine the land value of 8217 and 8301:
i. $401,101.61 per acre applies to non-farmed land for all taxation years under appeal for 8301 and 8217.
ii. $16,626 per acre applies to 8.66 acres of farmed land on 8217 for the 2017 to 2020 taxation years, and to 6.65 acres of farmed land on 8217 for the 2021 to 2023 taxation years.
b. The reproduction cost new for the buildings on 8301 is $32,875,599 and 14% functional obsolescence should be applied.
c. An equitable adjustment is not required by s. 44(3)(b) of the Act.
ANALYSIS
Issue 1 – What is the current value of 8217 and 8301 as of January 1, 2016?
Valuation Methodology
17The Parties agree, and the Board accepts, that the Cost Approach is the appropriate way to determine current value.
18The Cost Approach represents a theoretical breakdown of the property into its land and building/improvement components. Therefore, Issue 1 can be divided into several sub-issues relating to the Parties’ disagreement over components of a Cost Approach valuation, specifically:
a. What is the land value?
b. What is the value of improvements? Specifically:
i. What is the appropriate amount for electrical lighting?
ii. What is the functional obsolescence rate?
a) What is the land value?
Areas of Agreement and Disagreement
19The Parties agree that a land rate of $16,626 per acre applies to 8.66 acres of farmed land on 8217 for the 2017 to 2020 taxation years, and to 6.65 acres of farmed land on 8217 for the 2021 to 2023 taxation years. The Parties also generally agree that the remaining non-farmed land should be valued by considering the sale price of comparable properties that have recently sold and then adjusting for time and differences in property characteristics.
20The Parties disagree over the land rate that applies to the remaining non-farmed land and, more specifically, which properties are sufficiently comparable to 8217 and 8301 for the purpose of determining that land rate.
Evidence and Submissions on Land Value - MPAC
21MPAC submits that the land should be valued at $577,960 per acre as of January 1, 2016.
22In support of this position, MPAC’s expert opined that $577,960 is the median time adjusted rate per acre of the sale amount of two properties that were most comparable factoring in location, the time of sale, lot size, official plan designation, zoning, and site servicing.
23The Board summarizes MPAC’s expert evidence in the following table:
MPAC’s Proposed Comparable Properties and Sales Information
| Property Address | 10534 Hurontario Street | 10254 Hurontario Street |
|---|---|---|
| Sale Date | April 2016 | March 2016 |
| Time Adjusted Sale Amount | $16,132,443 | $45,678,379 |
| Site Area (Acres) | 29.95 | 74 |
| Location | Brampton | Brampton |
24MPAC submits that these two properties should be preferred because:
a. They are both vacant or nominally vacant improved industrial lands with partial municipal servicing at the time of sale.
b. They are located in the City of Brampton within 11 km of 8217 and 8301.
c. They are in the same economic neighbourhood as 8217 and 8301 and no location adjustment is necessary.
d. They are proximate to 400-series highways, which is important for food processing plants and an important element of comparison.
e. The sales occurred within five months of the valuation day, reflecting a strong indication of market value as of January 1, 2016 and necessitating a minimal time adjustment.
f. They are large acreages and more comparable in terms of size. MPAC’s expert’s evidence is that combined, the total acreage of these two sites only differs by 1.84 acres when compared to acreage of 8217 and 8301 together. Therefore, no adjustment for size is warranted.
g. They are designated Industrial use in the City of Brampton Official Plan, similar to 8217 and 8301.
25Maple Lodge says the Board should not rely on MPAC’s evidence. Generally, Maple Lodge argues that any comparable property should be located in a primarily agricultural area, have similar zoning, and should reflect the Subject Properties extended timeframe to development based on the lack of sanitary sewers. Specifically, Maple Lodge argues that:
a. The Subject Properties are surrounded by agricultural lands, whereas MPAC’s proposed comparable properties are in built-up areas surrounded by industrial, warehouse, and residential properties.
b. MPAC’s proposed comparable properties have permissive industrial zoning, which is not comparable to the restrictive zoning of the Subject Properties.
c. MPAC’s proposed comparable properties do not take into account Levi Creek and the conservation lands that surround it, including restrictions imposed by these characteristics.
d. MPAC’s expert’s evidence regarding servicing is incorrect – in fact, MPAC’s proposed comparable properties were fully serviced at the time of sale, whereas the Subject Properties were not. MPAC’s proposed comparable properties do not reflect the extended timeline to development caused by the lack of sanitary sewers.
26Maple Lodge also submits that, in the event the Board decides to include either of MPAC’s proposed comparable properties in its determination of land rate, then adjustments must be made to account for size; the impact of conservation designations; and a 75% vendor take-back mortgage on 10254 Hurontario Street.
27The City did not provide submissions with respect to MPAC’s evidence.
Evidence and Submissions on Land Value – Maple Lodge
28Maple Lodge seeks a land rate of $371,310 per acre. It presented evidence from two experts regarding comparable property sales for the purpose of determining land value.
29Maple Lodge’s first expert, Alex Fraser, did not provide a value estimate, but provided evidence of land transactions that he opined could be used as appropriate comparables to derive a land value estimate for 8301.
30The Board summarizes his evidence in the following table:
Maple Lodge’s Proposed Comparable Properties Information from Mr. Fraser for 8301
| Property Address | 10254 Hurontario Street | 14045 Airport Road | 8250 Eighth Line | Steeles Avenue East (6 Cleve Court) | 10900 Coleraine Drive | 13304 Coleraine Drive |
|---|---|---|---|---|---|---|
| Sale Date | March 2016 | January 2016 | November 2015 | January 2014 | November 2013 | July 2013 |
| Sale Amount | $46,624,000 | $11,500,000 | $19,325,000 | $10,800,000 | $25,300,000 | $25,395,088 |
| Site Area (Acres) | 75.63 | 98.26 | 104.50 | 58.09 | 74.18 | 64.60 |
| Location | Brampton | Caledon | Halton Hills | Halton Hills | Brampton | Brampton |
31Mr. Fraser testified that the sales show a value range of $117,036 to $615,153 per acre (adjusted). He opined that 8301 would trade at a lower rate per acre than 10254 Hurontario Street ($615,153 adjusted) and a higher rate per acre than 14045 Airport Road ($117,036 adjusted), 8250 Eighth Line ($184,928 adjusted), 6 Cleve Court ($185,918 adjusted), and 10900 Coleraine Drive ($341,062). He opined that the sale of 13304 Coleraine Drive provides a reasonable indication as to what the Subject Property would trade for on a per acre basis ($414,947 adjusted).
32Maple Lodge’s second expert, Robert Ford-King, provided three expert reports to the Board. One report contained his expert opinion regarding the value of 8217 for the 2017 and 2018 taxation years; one contained his opinion regarding the value of 8217 for the 2019 to 2022 taxation years; and one contained his opinion regarding the value of 8301 for the 2021 and 2022 taxation years.
33Maple Lodge submits that an important feature of these appeals is that the property under appeal is not the same for all tax years – for instance, the property being valued for the 2017 and 2018 taxation years was only 40.57 acres in size as it was not until 2018 that 8301 and 8217 were legally consolidated. Maple Lodge submits that only Mr. Ford-King took these differences into account, as the only expert to have submitted reports for the different taxation years.
34Mr. Ford-King opined that the land rate for 8217 should be $420,860/acre for 2017 and 2018 and $371,310/acre for 2019 to 2023, with a land rate for 8301 of $371,310/acre for 2021 to 2023.
35The Board summarizes his evidence in the following tables:
Maple Lodge’s Proposed Comparable Properties Information from Mr. Ford-King 8217 for 2017 and 2018
| Property Address | 10900 Coleraine Drive | 10514 Coleraine Drive | 10671 Clarkway Drive | Coleraine Drive/Countryside Road | 16408 Steeles Avenue | 16917 Steeles Avenue |
|---|---|---|---|---|---|---|
| Sale Date | November 2013 | January 2019 | January 2013 | April 2015 | September 2013 | April 2015 |
| Sale Amount | $25,300,000 | $24,800,000 | $14,874,500 | $7,200,000 | $3,290,000 | $3,050,000 |
| Site Area (Acres) | 73.95 | 49.958 | 41.999 | 25.16 | 9.50 | 8.56 |
| Location | Brampton | Brampton | Brampton | Brampton | Halton Hills | Halton Hills |
Maple Lodge’s Proposed Comparable Properties Information from Mr. Ford-King for 8217 for 2019, 2020, 2021 and 2022 and 8301 for 2021 and 2022
| Property Address | 10900 Coleraine Drive | 12600 Coleraine Drive | Mayfield Road Part Lot 1, Con 6, Albion | Steeles Avenue East |
|---|---|---|---|---|
| Sale Date | November 2013 | March 2014 | February 2014 | January 2014 |
| Sale Amount | $25,300,000 | $27,000,000 | $19,500,000 | $10,800,000 |
| Site Area (Acres) | 73.95 | 99.40 | 52.05 | 58.06 |
| Location | Brampton | Caledon | Caledon | Halton Hills |
36MPAC challenges Mr. Fraser’s evidence on the following basis:
a. He did not provide an actual opinion of current value for either property.
b. He did not consider the value of the properties post-consolidation at 105 acres.
c. Only three out of six sales are near or in the shoulder years of the valuation day and no adjustments were made for time.
d. 14045 Airport Road is not in the same economic market as Brampton and it is in a rural service area that is not close to 400 series highways.
e. 10900 Coleraine Drive is too far removed from the valuation day and is part of a much larger assembly.
f. Both Coleraine Drive sales are located at the opposite corner in Brampton to the properties and are part of a 262.83 acre assembly that took place over a period of time.
37MPAC challenges Mr. Ford-King’s evidence on the following basis:
a. The sales on Coleraine Drive and Mayfield Road are in the Highway 427 Industrial Secondary Plan area, the opposite corner of Brampton from the properties. They sold prior to the extension of Highway 427 in 2021 so did not have the benefit of access to a 400 series highway at the time of sale. Some were zoned agricultural at time of sale.
b. The sales from 2013 and 2014 are too far removed from the valuation date and time adjustments are not based on market data.
c. The Halton Hills sales appear to be negatively impacted by the prohibition on development pending approval of the proposed Highway 413 route.
d. Taking different land values to reflect pre- and post-consolidation is inconsistent with the facts related to Maple Lodge’s operations on-site. The two parcels operate as a single site for business purposes.
38The City challenges Mr. Ford-King’s evidence by saying it is not reliable because it is selectively incomplete, argumentative, and strays outside his qualifications. The City argues that Mr. Ford-King’s evidence should therefore be given little to no weight. The City also submits that Mr. Ford-King made qualitative adjustments to his proposed comparable property sales without objective evidence to support the adjustments.
39Maple Lodge also provided evidence from two other experts:
a. Marc De Nardis, regarding the planning framework and land use impact of the wastewater treatment facilities situated on 8217 and 8301; and
b. Grant Parkinson, regarding the on-site wastewater treatment facilities, and how these facilities and the land required to operate them would differ if municipal sewage services were available to the Subject Properties.
Evidence and Submissions on Land Value - City
40The City submits the land rate should be $875,990/acre for 8217 for the 2017 and 2018 taxation years, and $621,896/acre for 8217 and 8301 for the 2019 to 2023 taxation years.
41The City provided expert evidence opining that the following sales should be used as comparables.
City’s Proposed Comparable Properties Information for 8217 for 2017 to 2018
| Property Address | 8875-8925 Torbram Road | 4629 Queen Street East |
|---|---|---|
| Sale Date | March 2014 | October 2017 |
| Time Adjusted Sale Amount | $47,963,700 | $19,113,249 |
| Site Area (Acres) | 37.43 | 39.23 |
42The City’s expert opined that the mean of the time-adjusted sale price produces a land rate per acre of $875,990 for 8217 for the 2017 and 2018 taxation years.
City’s Proposed Comparable Properties Information for 8217 for 2019 to 2023 and 8301 for 2021 to 2023
| Property Address | 8450 Boston Church Road | 13374 Coleraine Drive | 10254 Hurontario Street |
|---|---|---|---|
| Sale Date | August 2011 | July 2013 | March 2016 |
| Time Adjusted Sale Amount | $61,757,401 | $53,131,718 | $46,020,288 |
| Site Area (Acres) | 79.50 | 113.99 | 74.00 |
43The City’s expert opined that based on these three land sales, a range of $466,109/acre to $776,823/acre for land is established, with a median time-adjusted rate of $621,896.
44Maple Lodge challenged the City’s evidence on the basis that its expert did not give attention to the size and features of the properties that are different for the 2017 and 2018 tax years; that he misunderstood the zoning and, therefore, what is legally permissible at the Subject Property; and that he did not make appropriate adjustments for time, zoning, location, servicing, and conservation restrictions.
45MPAC did not provide submissions on the City’s evidence.
Summary of the Parties’ Positions on Land Value
46The following table summarizes the Parties’ positions on rate per acre:
| MPAC | Maple Lodge | City | |
|---|---|---|---|
| 8217 Winston Churchill Boulevard | $577,960 | 2017 to 2018 - $420,860 2019 to 2023 - $371,310 |
2017 to 2018 - $875,990 2019 to 2023 - $621,896 |
| 8301 Winston Churchill Boulevard | $577,960 | 2021 to 2023 - $371,310 | 2021 to 2023 - $621,896 |
Findings on Land Value
47The Board has analyzed the evidence and submissions provided by the Parties, and makes the following findings:
a. The Board finds that the non-farmed land at 8217 and 8301 should be valued for assessment purposes based on their singular use as a special purpose food processing facility. The Board makes this finding based on the extensive evidence from all experts regarding the singular use to which 8217 and 8301 are put. Even prior to the legal consolidation of the two parcels in 2018, both parcels operated as a single site for business purposes – for instance, with water treatment improvements on both 8217 and 8301 serving the operation. Neither property could operate without the other, in their current use. It was not disputed by any expert that the properties would have sold together prior to consolidation. The lands were legally consolidated in 2018 and, for all years after that, could not be sold as separate parcels.
b. In this regard, the Board finds that the portion of the land rate in dispute for 8217 and 8301 should be determined using the same land rate for all years under appeal. The Board also finds that it is appropriate to value 8217 and 8301 based on the total acreage of the consolidated parcel less farmed land. The Board accepts and relies on MPAC’s expert evidence in this regard.
c. The Board finds that the most appropriate way to account for the lack of sanitary servicing to 8217 and 8301 is to compare with similar lands that lack the same servicing. This approach is consistent with the evidence of both MPAC’s expert and Maple Lodge’s expert Mr. Ford-King. This approach ensures an element of comparability between the properties, particularly since it would be difficult to adjust for this feature in the absence of evidence regarding the cost, or time it would take, to bring sanitary sewers to 8217 and 8301.
d. The Board does not accept Mr. Ford-King and Mr. Fraser’s opinion evidence that Levi Creek and conservation restrictions at the site would negatively impact the value of 8217 and 8301. The Board does not accept this opinion for three reasons. First, there was insufficient market evidence to substantiate the impact, if any, of conservation restrictions on value. Second, the opinion is inconsistent with the factual evidence that 8217 and 8301 have been developed with improvements built in and around Levi Creek, including wastewater treatment operations right beside Levi Creek and roads overlapping it. Maple Lodge even uses Levi Creek for the discharge of its treated wastewater. Third, the Parties were all in agreement that 8217 and 8301 should be valued based on its current use, and not a hypothetical development use. For these reasons, the Board prefers and relies on MPAC’s expert evidence that Levi Creek is not a factor that impacts the choice of a comparable land sale, or for which an adjustment is required.
e. The Board notes that none of the proposed comparable property sales presented by the experts have the exact same planning restrictions and site-specific zoning as the Subject Properties. For this reason, the Board finds that it is appropriate to place greater weight on factors of comparison other than zoning when assessing comparability of the proposed property sales.
Excluded Sales
48Based on the above findings, the Board rejects 10534 Hurontario Street (relied on by MPAC’s expert), 10514 Coleraine Drive, 10671 Clarkway Drive, Coleraine Drive/Countryside Road, 16408 Steeles Avenue, 16917 Steeles Avenue (relied on by Maple Lodge’s expert Mr. Ford-King), 8875-8925 Torbram Road and 4629 Queen Street East (both relied on by the City’s expert) from the sales analysis. These properties are all less than 50 acres in size, which the Board finds is too small to be considered appropriately comparable to the combined acreage of 8217 and 8301.
49Further, there are sufficient sales in this case that the Board prefers the evidence of sales that occurred within shoulder years of the valuation date, and finds that such sales are the best evidence of value. For this reason, the Board rejects 10900 Coleraine Drive, 12600 Coleraine Drive, Mayfield Road, Steeles Avenue East, 6 Cleve Court, 13304 Coleraine Drive, 8450 Boston Church Road and 13374 Coleraine Drive. The Board finds these sales, which occurred two years or more before the valuation date of January 1, 2016, are too far removed from the valuation date to be reliable indicators of market value at that time.
Sufficiently Comparable Sales
50This leaves the sales of 14045 Airport Road, 8250 Eighth Line, and 10254 Hurontario Street.
51All three properties had vendor take-back mortgages (“VTBs”) as part of the sale transactions. The Board finds it is not necessary to exclude these sales based on the VTBs. The Board accepts the evidence provided by MPAC’s expert and the Maple Lodge’s expert Mr. Fraser that VTBs are not unusual in these types of land transactions. This opinion is consistent with the fact that many of the sales relied on by the experts, including Mr. Ford-King, had VTBs as part of the terms of sale.
52With respect to 14045 Airport Road, it is zoned agricultural, and the sale price is not time adjusted. As noted above, none of the proposed comparables had identical zoning to 8217 and 8301 and the Board gives more weight to other factors of comparability. This sale occurred very close to the valuation day, and therefore the Board finds that the lack of time adjustment is not fatal to its inclusion. The property has a large acreage and is comparable in terms of size. The Board finds that this property has generally comparable features to 8217 and 8301, however also finds that it is in an inferior location to 8217 and 8301 as it is in a different municipality without easy access to a 400 series highway. The Board accepts and relies on MPAC’s expert’s evidence that proximity to the 401 is a significant feature of 8217 and 8301. For this reason, the Board will rely on 14045 Airport Road but finds that it will represent a lower rate per acre than 8217 and 8301 due to its inferior location.
53With respect to 8250 Eighth Line, it has close proximity to the 401 and 407 ETR highways and has a large acreage. It sold close to the valuation day so the lack of time adjustment is not fatal. It has agricultural zoning, however zoning is given less weight as a factor of comparability since none of the proposed comparable properties had identical zoning to 8217 and 8301. The evidence supports that 8250 Eighth Line was similar in terms of servicing. For these reasons, the Board finds that 8250 Eighth Line is an appropriate comparable property, although also finds that it is inferior to 8217 and 8301 given the zoning and the fact that it is in a different municipality.
54This leaves 10254 Hurontario Street. This property was relied on by MPAC’s expert, the City’s expert, and Maple Lodge’s expert Mr. Fraser. The sale occurred three months after the valuation day; it was zoned industrial at the time of sale; it is only 11 km away; the existing improvement sold for a nominal amount so it was, effectively, a vacant land sale; the lot size is 75.63 acres; and it is proximate to a 400 series highway.
55There is competing evidence regarding whether 10254 Hurontario Street was serviced with sanitary sewers connections at the lot line at the time of sale:
a. MPAC’s expert testified that it was not. He confirmed that he made this determination following a consultation with the Region of Peel Planning and Development Services via phone call, and later confirmed it through site plans with the Region.
b. The City’s expert also testified that 10254 Hurontario Street was partially serviced at the time of sale, and confirmed in his evidence that he was provided this information from the City of Brampton’s Planning Department.
c. Maple Lodge’s expert Mr. Parkinson provided evidence that there is no sanitary sewer servicing available along Hurontario Street for 10254 Hurontario Street, but there are sanitary sewer services along Whybank Drive to the north of the property and Ironside Drive, which are side streets to the north and south of 10254 Hurontario. He stated in his report that there was sanitary sewer servicing to 10254 Hurontario Street.
d. Mr. Ford-King opined that 10254 Hurontario Street was fully serviced at the time of sale. He relied on images of the surrounding area that showed sizeable developments, including a DHL facility, to conclude that 10254 Hurontario Street is fully serviced.
56The Board relies on the evidence of MPAC’s expert, the City’s expert and Mr. Parkinson and finds that there were no sanitary sewers on the frontage street of Hurontario at the time this property transacted. The Board does not rely on Mr. Ford-King’s evidence that 10254 Hurontario Street was fully serviced because he simply inferred it was serviced because there were other serviced properties nearby. Mr. Parkinson’s evidence, in contrast, included maps from the City that showed there were no sanitary sewer lines on Hurontario Street at the relevant time. This is consistent with the information obtained by MPAC and City experts. Because of the lack of sanitary sewer servicing on the frontage street of Hurontario, the Board finds that 10254 Hurontario Street is sufficiently comparable to 8217 and 8301.
Adjustments
57As noted above, the Board accepts MPAC’s expert’s evidence that no adjustments are required to account for the Levi Creek, conservation restrictions and developable area.
58The Board has used partially serviced comparable properties and finds that no adjustment is required for availability of services or “development horizon”.
59With respect to any adjustments for VTBs, the Board accepts the evidence from MPAC’s expert and Maple Lodge’s expert Mr. Fraser that VTBs are not unusual with sales like these. The Board rejects Mr. Fraser’s opinion that 10254 Hurontario Street must be adjusted for the VTB in part because Mr. Fraser did not provide evidence of adjustments to 14045 Airport Road and 8250 Eighth Line despite VTBs associated with those transactions, nor did Mr. Fraser provide evidence to substantiate or calculate what any adjustment would be. Instead, the Board prefers, accepts and relies on MPAC’s expert’s evidence that the VTB would have minimal impact on the value. This opinion is consistent with Mr. Fraser’s evidence confirming its 8% interest rate was on the low end and Mr. Ford-King’s evidence confirming its very short 10-day term. In this regard, the Board does not accept that the financing arrangement renders the sale price subject to adjustment. For these reasons, the Board accepts and relies on MPAC’s expert’s evidence and finds that there are no adjustments required for the VTBs.
60With respect to location, 10254 Hurontario Street is in Brampton, as are 8217 and 8301. All properties have easy access to 400 series highways. The Board does not accept Maple Lodge’s submission that it should reject or adjust 10254 Hurontario Street because it is in a “built-up area surrounded by industrial, warehousing and residential uses”. This submission was not supported by quantifiable evidence, nor is it consistent with the fact that 10254 Hurontario Street, 8217 and 8301 are in the same municipality. The Board accepts and relies on MPAC’s expert’s evidence and finds the location of 10254 Hurontario Street is sufficiently similar so as not to require an adjustment.
61That said, the Board does find that all location factors, weighed together, make 10254 Hurontario Street a superior property to 8217 and 8301. As noted above in relation to 14045 Airport Road and 8250 Eighth Line, the Board finds these properties are inferior to 8217 and 8301 with respect to location and zoning.
Calculating Current Value
62The Board finds that 10254 Hurontario Street ($45,678,379/74 acres = $617,275/acre) is superior to 8217 and 8301. The Board finds that 14045 Airport Road ($11,500,000/98.26 acres = $117,036.43/acre) and 8250 Eighth Line ($19,325,000/104.50 acres = $184,928.23/acre) are inferior.
63Therefore, the rate per acre of 8217 and 8301 lies between a low of $184,928.23 and a high of $617,275. The midpoint of those amounts is $401,101.61.
64The Board finds this is a reasonable rate per acre to apply to the remaining land to be valued at 8217 and 8301. The Board’s finding in this regard is supported by information provided by Maple Lodge that MPAC’s Valuation Model for Vacant Industrial Land in the GTA would return a rate per acre of $423,143.
Conclusion on Land Rate
65For these reasons, the Board finds that the applicable land rate for the non-farmed land is $401,101.61 per acre for all taxation years under appeal for 8301 and 8217. Per the Parties’ agreement, the Board accepts that a land rate of $16,626 per acre applies to 8.66 acres of farmed land on 8217 for the 2017 to 2020 taxation years, and to 6.65 acres of farmed land on 8217 for the 2021 to 2023 taxation years.
b) What is the value of improvements?
Areas of Agreement and Disagreement
66The Parties generally agree with MPAC’s costing of improvements, except disagreement regarding the following components:
i. What is the appropriate electrical lighting rates?
ii. What is the functional obsolescence rate?
Evidence and Submissions on Improvements - MPAC
67MPAC’s expert opined that he applied the rate for special purpose intensity lighting, which is applied to large and special purpose properties and factors in the actual power distribution being provided to the buildings. MPAC’s expert testified that this reflects the overall electrical requirements that are needed to support improvements and systems for sanitary food production processes, including 24/7 operations and power usage necessary to prevent food spoilation.
68MPAC’s expert testified that a functional obsolescence adjustment for excess operating costs is required at 12.5%.
69Maple Lodge submits that this theory regarding the special purpose intensity lighting was only introduced at the hearing and not in the expert report. Maple Lodge submits that MPAC’s expert is unfamiliar with the buildings and the lighting located therein, which has resulted in reliance upon inaccurate assumptions about facilities like this one, leading to errors in his report. Maple Lodge also submits that MPAC’s expert evidence should not be relied upon because the expert does not recall having visited or inspected key buildings at the Subject Properties. Maple Lodge submits that Maple Lodge had provided electrical plans to MPAC years prior and even included a list of those plans in its evidence in these appeals, yet these plans were not consulted by MPAC’s expert.
70Maple Lodge also submits that MPAC’s expert erred in using the effective age of improvements rather than the actual age when calculating functional obsolescence.
71In MPAC’s submissions following the hearing, MPAC stated that its expert reviewed the valuation and revised this calculation to 13.5% based on the 1990 actual age of the building and not the effective age, which was in error.
Evidence and Submissions on Improvements – City
72The City adopts the MPAC calculations on cost.
73Maple Lodge submits that the City’s expert does not have any independent knowledge as to the costing of improvements on the Subject Properties, nor did he spend sufficient time inspecting the plant. Maple Lodge submits that, for these reasons, his evidence on lighting should be disregarded.
Evidence and Submissions on Improvements – Maple Lodge
74Maple Lodge’s expert Mr. Ford-King testified that his costing more precisely captures the actual electrical lighting component description and rate based on what is actually on-site.
75MPAC submits that Mr. Ford-King limited his evidence to photos and his own description of light fixtures, none of which showed systems such as generators and fire alarm systems. MPAC submits that the best evidence would be full electrical plans and these were not provided by Maple Lodge. MPAC submits that the Board should draw an adverse inference from the failure to provide this evidence.
76Mr. Ford-King also testified that he believes a functional obsolescence of 14% should apply based on the improvement being 28 years old as of the January 1, 2016 valuation date. He provided evidence that the facility has been constructed in no less than 18 phases since the early 1950s, and outlined examples of inefficiencies resulting from the “piecemeal” construction of the plant. He relied on MPAC’s “Market Valuation Report for Assessing Special Purpose Properties in Ontario: Meat, Beef, and/or Poultry Manufacturing Plants” and provided an effective age calculation based on the structural area weighted average age of all structures in the facility.
77MPAC submits that the Board should not accept Mr. Ford-King’s evidence because he used a weighted age of the building to determine the actual age, and because he did not use the updated condition of the facility following renovations in 2019 and 2020.
Findings on Issue 2
78The Board does not put any weight on MPAC’s expert evidence with respect to the rate for lighting. The Board does not find his evidence reliable insofar as it relates to this piece of the costing. In making these findings, the Board accepts and relies on the evidence that MPAC’s expert spent minimal time inspecting the applicable section of the facility, that he made assumptions about what he would expect to see in a facility like this one; and that he made several errors in his costing. Ultimately, MPAC’s expert evidenced very little knowledge of the actual lighting system that he was costing.
79In this regard, the Board does not accept MPAC’s submission that it should draw an adverse inference against Maple Lodge for failure to produce full electrical plans in these appeals. The Board accepts the evidence that electrical plans were provided to MPAC in previous years, even if not provided as evidence in this litigation, and that MPAC’s expert did not appear to have knowledge that MPAC had been in possession of those plans. The evidence also shows that a list of Maple Lodge’s electrical drawings was produced as part of this litigation. For these reasons, the Board does not draw an adverse inference against Maple Lodge.
80Instead, the Board prefers Mr. Ford-King’s evidence regarding lighting fixtures and rates. The Board finds that he showed significant familiarity with the electrical systems in the facility. He had conducted multiple inspections. His evidence was supported with photographs of the applicable lighting. For these reasons, the Board finds that Mr. Ford-King’s evidence is the best evidence regarding electrical lighting.
81With respect to functional obsolescence, the Board prefers Mr. Ford-King’s evidence. All parties agreed the facility was built in a piecemeal fashion and that a functional obsolescence adjustment is required. MPAC’s expert erroneously calculated functional obsolescence based on effective age and, therefore, the Board places little weight on his evidence. The Board accepts and relies on Mr. Ford-King’s evidence, as supported by the calculation in MPAC’s Market Valuation Report, that the appropriate functional obsolescence rate is 14%. The Board does not accept MPAC’s submission that Mr. Ford-King failed to account for changes to the facility in 2019 and 2020 – the description of the updates in these years would not alter the piecemeal fashion in which the facility was constructed, leading to its increased excess operating cost.
Conclusion on Value of Improvements
82The Board accepts Mr. Ford-King’s evidence regarding the value of improvements including lighting and functional obsolescence.
83Therefore, the Board finds that the reproduction cost new for the buildings at 8301 is $32,875,599 and a 14% functional obsolescence should be applied.
Issue 2 – Should an equity adjustment be applied to the current value and, if so, how much of a reduction is required?
Applicable Law
84Section 44(3)(b) of the Act directs that, after determining current value, 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 the land”.
Evidence and Submissions on Equitable Adjustment – Maple Lodge
85Maple Lodge submits that its expert Mr. Ford-King is the only expert that provided evidence on this issue.
86Mr. Ford-King opined that a reduction of -11.7% is required to make the assessment of the plant at 8301 equitable with similar lands. He opined that no adjustment is required in relation to 8217. In support of his opinion, he provided an assessment to sale ratio (“ASR”) analysis, which a frequently-accepted method of testing equity in assessment. He determined a median ASR of 0.883.
Evidence and Submissions on Equitable Adjustment – MPAC
87MPAC submits that no equity adjustment is required because Maple Lodge applied the equity test incorrectly and inconsistently. MPAC submits that there is no equity analysis in Mr. Ford-King’s report for 8217, and therefore Maple Lodge is effectively seeking to adjust only the assessed value of the industrial improvements on 8301.
88MPAC also submits that none of the properties relied on by Mr. Ford-King in his ASR study are special business properties or food processing plants, nor do they have the same unique on-site wastewater treatment facilities. Only 2 of the 14 properties are located in Brampton. All of the properties are less than 50% of the size of the consolidated parcel (105 acres). In this way, MPAC submits, the properties are not similar for the purpose of determining equity.
Evidence and Submissions on Equitable Adjustment - City
89The City submits that Mr. Ford-King did not provide evidence regarding special purpose meat processing properties and therefore no evidence of the ASRs of similar properties. The City also submits that his analysis focused entirely on the improvement at 8301 and essentially ignored the land value.
Findings on Equitable Adjustment
90With respect to the evidence required to satisfy the Board that an equitable adjustment is required, “the Board must have convincing evidence on equitable assessment to reduce an otherwise correct current value”: see Vale Canada Limited v Municipal Property Assessment Corporation, Region 30, 2022 CanLII 48461 (ON ARB) at paragraph 84.
91Maple Lodge only seeks an adjustment to 8301. In this case, the Board finds that Maple Lodge has not provided it with sufficiently convincing evidence that an equitable adjustment is required. The Board finds that many of the properties used by Mr. Ford-King in his ASR study are neither sufficiently similar to 8301 (particularly with respect to size and use), nor are they in the same vicinity.
92In the absence of convincing evidence demonstrating that a reduction in the current value assessment is required to make it equitable with the assessments of similar lands in the vicinity, the Board finds that no equitable reduction is required to 8301.
CONCLUSION
93The Board finds that the following rates per acre apply to the determination of land value:
a. $401,101.61 per acre applies to the non-farmed land for all taxation years under appeal for 8301 and 8217.
b. $16,626 per acre applies to 8.66 acres of farmed land on 8217 for the 2017 to 2020 taxation years, and to 6.65 acres of farmed land on 8217 for the 2021 to 2023 taxation years.
94The Board finds that the reproduction cost new for the buildings at 8301 is $32,875,599 and 14% functional obsolescence should be applied.
95The Board finds that no equitable adjustments are required.
ORDER
96With respect to the current value assessment of 8301, the parties did not provide submissions regarding apportionment. Therefore, the Board directs the parties to confer regarding the Board’s findings in paragraphs 93 to 95 herein, and advise the Board within 45 days of the issuance of this Interim Decision regarding their position(s) on current value and apportionment for 8301 for all taxation years under appeal, in accordance with Schedule A attached hereto.
97With respect to the current value assessment of 8217, the parties did not make submissions regarding the value of the residences located on 8217 and apportionment. Mr. Ford-King indicates in his report that MPAC has valued the residences at $233,521, and he accepts this value. The parties are directed to confer regarding the Board’s findings in paragraphs 93 to 95 herein, as well as the value of the residences, and advise the Board within 45 days of the issuance of this Interim Decision of their position(s) on current value and apportionment for 8217 for all taxation years under appeal, in accordance with Schedule B attached hereto.
"Carly Stringer"
CARLY STRINGER MEMBER Assessment Review Board Website: www.tribunalsontario.ca/arb
SCHEDULE A – ID 184943
8301 Winston Churchhill Blvd (Roll No. 2110 080 012 08400-0000)
| Appeal | Sec. | Effective Date | Commercial (Full) From | Commercial (Full) To | Large Industrial (Full) From | Large Industrial (Full) To | New Apportionment From | New Apportionment To | New Apportionment From | New Apportionment To | TOTAL From | TOTAL To |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 3438004 | 40 | 1-Jan-21 | $20,800 | $42,239,200 | New | New | $42,260,000 | |||||
| 3488938 | 40 | 1-Jan-22 | $20,800 | $42,239,200 | New | New | $42,260,000 | |||||
| 3512837 | 40 | 1-Jan-23 | $20,800 | $42,239,200 | New | New | $42,260,000 |
SCHEDULE B – ID 184943
8217 Winston Churchhill Blvd (Roll No. 2110 080 012 08405 0000)
| Appeal | Sec. | Effective Date | Residential (Full) From | Residential (Full) To | Commercial (Full) From | Commercial (Full) To | New Apportionment From | New Apportionment To | New Apportionment From | New Apportionment To | TOTAL From | TOTAL To |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 3266019 | 40 | 1-Jan-17 | $4,933,800 | $21,363,200 | New | New | $26,297,000 | |||||
| 3320261 | 40 | 1-Jan-18 | $4,933,800 | $21,363,200 | New | New | $26,297,000 | |||||
| 3359922 | 40 | 1-Jan-19 | $4,933,800 | $21,363,200 | New | New | $26,297,000 | |||||
| 3405583 | 40 | 1-Jan-20 | $4,909,000 | $21,156,000 | New | New | $26,065,000 | |||||
| 3444842 | 40 | 1-Jan-21 | $4,909,000 | $21,156,000 | New | New | $26,065,000 | |||||
| 3438005 | 40 | 1-Jan-21 | $4,909,000 | $21,156,000 | New | New | $26,065,000 | |||||
| 3488937 | 40 | 1-Jan-22 | $4,909,000 | $21,156,000 | New | New | $26,065,000 | |||||
| 3489027 | 40 | 1-Jan-22 | $4,909,000 | $21,156,000 | New | New | $26,065,000 | |||||
| 3512888 | 40 | 1-Jan-23 | $4,909,000 | $21,156,000 | New | New | $26,065,000 | |||||
| 3512785 | 40 | 1-Jan-23 | $4,909,000 | $21,156,000 | New | New | $26,065,000 |