Tribunals Ontario
Assessment Review Board
ISSUE DATE: July 05, 2024 FILE NO.: WR 186394
Assessed Person(s): 1504700 Ontario Inc. Appellant(s): 1504700 Ontario Inc Respondent(s): Municipal Property Assessment Corporation Region 09 Respondent(s): City of Toronto
Property Location(s): 3340 Lawrence Avenue East Municipality(ies): City of Toronto Roll Number(s): 1901-052-730-03500-0000 Appeal Number(s): 3508730, 3512282 and 3524950 Taxation Year(s): 2022, 2023 and 2024 Hearing Event No.: 783679
Legislative Authority: Section 40 of the Assessment Act, R.S.O. 1990, c. A.31
APPEARANCES:
| Parties | Representative |
|---|---|
| 1504700 Ontario Inc. | Robert Baranowski |
| Municipal Property Assessment Corporation | Christine Giorgio |
| City of Toronto | No one appeared |
HEARD: May 7, 2024 by video conference
ADJUDICATOR(S): Dan Weagant, Member
DECISION
OVERVIEW
11504700 Ontario Inc. (the “Appellant”) believed the assessment returned by the Municipal Property Assessment Corporation (“MPAC”) for the 2022 taxation year was too high. In accordance with s. 40 of the Assessment Act, R.S.O. 1990, c. A.31 (the “Act”) the Appellant filed its appeal of the assessment with the Assessment Review Board (the “Board”). Pursuant to s. 40(6) of the Act, that appeal was subsequently deemed to apply to the 2023 and 2024 taxation years.
2MPAC returned a value for 3340 Lawrence Avenue East (the “subject property”) of $2,499,000 for 2022 in the Commercial property class. The Appellant agrees with the property class but believes the current value of the subject property is $1,400,000. MPAC believes the assessment returned reflects the current value of the subject property and is therefore correct.
Areas of Agreement
3The Parties agree that the subject property is in the Commercial property class.
Issues for the Hearing
4The Board must decide the following, as set out in s. 44(3) of the Act:
- The correct current value of the subject property, and in particular: a. Comparability of other properties. b. The correct fair market rents to be applied in the income approach to value.
- Whether a reduction in the current value should be made, when reference is made to the assessments of similar lands in the vicinity.
Result
5The Board finds that the correct current value of the subject property is $1,900,000 and that when reference is made to the assessments of similar lands in the vicinity, no reduction in this value is required for it to be considered equitable assessment.
ANALYSIS
Description of Subject Property
6The subject property lies at the corner of Lawrence Avenue East and Greencedar Crescent. It is accessible from both streets and has an area of 0.65 acres. The land is improved with a single-storey, multi-tenanted building with a total area of 9,776 square feet.
Issue 1 – What is the correct current value of the subject property?
MPAC’s Evidence
7MPAC applied two approaches to determining the current value of the subject property. Its primary approach is the income approach to value. As a secondary ‘test’ of the income approach results, MPAC also used the direct comparison approach.
8The income approach to value involves the calculation of current value by first determining the Potential Gross Income (“PGI”) of the property by multiplying the leasable area by the Fair Market Rent applicable to the uses present at the subject property. The PGI is then reduced by an amount for vacancy and collection loss and non-recoverable expenses to arrive at the property’s Net Operating Income. (“NOI”).
9The NOI is then divided by a market driven capitalization rate (“Cap Rate”) to determine the current value of the subject property.
10MPAC