Burnaby housing co-op rejects proposal that would have hiked rents up by average 52%

A Burnaby housing co-op whose building is up for sale has rejected a proposal to extend its lease that it says would have raised residents’ rents by about 50%.

115 Place, located at Cardston Ct near Lougheed, is a 244-unit housing co-operative that’s leased its land from the Operating Engineers’ Pension Plan, IUOE Local 115, since 1980.

The pension plan decided to extend the co-op’s lease, which would have originally expired at the end of October, through to January 31 after putting the complex on the private market.

The president of the Cooperative Housing Federation of BC tells the Beacon that it seems the pension plan had found a prospective buyer.

“We’ve had to make assumptions through this whole thing because the pension plan insists that any conversations with prospective purchasers are subject to non-disclosure agreements and [are] confidential, so we end up trying to read the tea leaves,” Thom Armstrong said last week.

“But the original lease was extended through to January 31, and then, all of a sudden, the pension plan got in touch with the co-op, and attended the meeting and presented to them an offer to extend the lease a further 10 years, on terms that would have resulted in the economic eviction of a good number of members and then gave them 48 hours to sign that offer of extension.”

Armstrong said that while the pension plan has not been particularly forthcoming with information, the co-op believes that a possible buyer must have required a 10-year lease extension as a condition of the sale in order to finance their purchase.

The organization said earlier this year that any offers would have to include a plan from potential buyers outlining how they would limit impacts on co-op residents. As the Beacon has previously reported, that reassurance didn’t allay the concerns of residents at 115 Place that a new owner would effectively be priced out of the building if it sold.

“Economic eviction”

Armstrong said the proposal would have raised rents in the building by an average of 52%—a devastating prospect for the co-op’s residents, most of whom are seniors. The proposal also reserved the right to increase other fees, like parking, laundry, key and fob replacement, and amenity room access.

“A third of the members in the co-op are over 75 years old. They’re on fixed and limited incomes. Imagine being told overnight is going to go up by 50—and then every year thereafter, without any protection from the Residential Tenancy Act,” he said.

In BC, landlords are not permitted to increase rent above the cost of inflation (for 2022, that’s 1.5%) and can only increase rent once a year. But that policy doesn’t apply to residents of housing co-operatives.

Armstrong said that would result in the “economic eviction” of many residents at 115 Place.

“And who knows where they [would] go—there’s certainly not a lot of available affordable rental stock in Burnaby at the moment, or anywhere really in Metro Vancouver. So the question a lot of them are asking themselves is, you know, ‘what’s going to become of me? Where will I live? How will I survive?’”

Monthly rent at 115 Place ranges from $771 for a studio apartment to $1,227 for a 2-bedroom corner unit. That’s a far cry from market rentals in Burnaby—where an average 1-bedroom unit rented for $1,696 in November, according to data from rentals.ca. Two-bedroom units rented for an average of $2,414 in November—the fourth-highest price in the country.

A source of community

But Armstrong said the issue at hand is more than just a financial one. He said while housing co-ops do put roofs over people’s heads, their real purpose is to create “strong, supportive, caring communities … It’s a community of older people who rely on each other for the kinds of neighbourly support that makes it possible for them not just to exist, but to thrive. And that that would be shattered.”

Some residents at 115 Place have lived there for upwards of 35 years and rely on the co-op for a sense of community.

“There’s a lot of close friendships and a lot of stability and a great sense of security because it is a community—I like to call it an urban village,” resident Duncan Beaton told the Beacon in October.

“The real strain is that some people here, we’re not sure they would handle the transition at all. It’s the breakup of a community, not just the selling of a building. And that’s really the core of it. People are afraid, just literally afraid.”

IUOE Local 115 didn’t respond to a request for comment from the Beacon. However, a representative called the Co-op Federation’s characterization of events “misleading” in a statement to the Vancouver Sun last week.

The pension plan also owns Post 83, a housing co-operative at Mayberry St near Patterson Ave. The lease there will come to an end on October 31, 2022—exactly one year after the original end date of the lease at 115 Place.

Armstrong said residents there are also worried about what their future holds—but at the moment, with the proposal at 115 Place rejected, that co-op is still in the dark about what’s going on.

“The big question now is, you know, what’s the status of the offer that was pending? Has it fallen through as you know, as an outcome of the co-op’s refusal to sign that extension? And what’s everybody’s next move?” Armstrong asked.

“The co-op doesn’t really have a move to make. They’re waiting to hear what their fate might be.”