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Turner Drake & Partners Ltd.
6182 North Street
Halifax, N.S.
B3K 1P5
Canada

Tel.: (902) 429-1811
Toll Free: (800) 567-3033
Fax.: (902) 429-1891

Suite 221
12 Smythe Street
Saint John, N.B.
E2L 5G5
Canada
Tel.: (506) 634-1811

Suite 11
109 Richmond Street
Charlottetown, P.E.
C1A 1H7
Canada
Tel.: (902) 368-1811

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St. John's, N.L.
A1C 5M3
Canada
Tel.: (709) 722-1811

4th Floor
111 Queen Street East
Toronto, ON.
M5C 1S2
Tel.: (416) 504-1811

E-Mail: tdp@turnerdrake.com
Internet: www.turnerdrake.com

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# Wednesday, 25 October 2017

Nova Scotia’s 2018 Preliminary Property Assessments are available on the Property Valuation Service Corporation (PVSC)’s website, and there is a brief window to discuss assessments with PVSC assessors prior to the assessment roll being finalized on December 1st.

Between now and then, the PVSC is encouraging property owners to discuss any errors or provide additional information which may have an impact on the value of their property. The benefits in taking advantage of this opportunity are:


1)     It provides a higher level of certainty in preparing tax budgets for the 2018 fiscal year (for both the owner, and the municipality).


2)     It provides property owners with an opportunity to address concerns with 2018 assessments outside of the formal appeal process, and before the values are finalized and inserted on the official assessment roll.


3)     Owners who are not satisfied with the results of pre-roll consultations can still file a formal appeal when official assessment notices are received in January.

 

Preliminary consultations are typically less formal and more timely (and thus cost effective) than an appeal.  This is especially so because at the “pre-roll” stage, assessors aren’t in the position of defending an assessment that has already been published.  The best time to address an assessment issue is before the problem becomes one.

 

The link to proposed 2018 assessment data is as follows: https://www.pvsc.ca/en/home/findanassessment/searchbyaan.aspx.  Preliminary 2018 assessments are publicly available; owners will need their Assessment Account Number and PIN Access Code (which can be found at the top-right hand corner of their 2017 Assessment Notice) to access the underlying valuation records.


 

Giselle Kakamousias is the Vice-President of Turner Drake’s Property Tax Division.  Her experience negotiating and appealing property assessments is extensive (don’t be fooled by the photo - her calculator is older than some of her colleagues): it is a wise property owner who follows her advice.  If you’d like more of it, she can be reached at (902) 429-1811 ext. 333 or gkakamousias@turnerdrake.com.

Wednesday, 25 October 2017 12:49:18 (Atlantic Daylight Time, UTC-03:00)  #    -
Atlantic Canada | Nova Scotia | Property Tax | Turner Drake
# Friday, 18 August 2017

Of Heaven and Sea and Earth 

Please be suitably impressed by this photo: it has all three of a church, a lighthouse and a commercial heritage building


Five years ago, the Chronicle Herald reported that some of Nova Scotia’s churches were exploring the option of deregistering their buildings’ heritage status under the provincial Heritage Property Act.  Nova Scotia’s churches are often their town’s signature property, featuring architectural details ranging from elaborate stained glass windows to ceilings built by 19th century shipwrights using the same techniques used on the hulls of wooden ships.  But cultural and demographic shifts have reduced demand for churches in the province.  Dwindling congregations mean reduced budgets unable to cope with the high costs of maintaining and operating historic properties.  Deregistration is required for demolition, the only option some congregations saw in the face of financial realities: maintenance requirements outweighed the ability to keep these architectural gems standing.  Recent years have seen other churches amalgamate congregations, keeping and maintaining a single building while selling the rest off for (hopefully sympathetic) redevelopment.

Wolfville United Church as it was

A more literal beacon facing a similar threat of extinction is the Canadian lighthouse.  Changing technologies have rendered redundant their function, if not their cultural attraction.  In May 2008, Parliament passed the Heritage Lighthouse Protection Act, a bill to designate and preserve lighthouses of historic significance.  It took effect in May 2010, only to be followed in June by an announcement declaring almost all Canadian lighthouses surplus, no longer to be maintained by the Coast Guard.  Since then, community groups have become the champions of select historic lighthouses, while the rest, presumably, will suffer the same fate as many an unfortunate ship along our rocky coasts.  

Peggy’s Cove lighthouse, a likely survivor

The foregoing each illustrate the perils of functional obsolescence: when a building’s functionality no longer meets market demands only its cultural significance can protect it – and then only if a champion steps up, e.g. government, community group, or passionate property owner.  Urban heritage properties are particularly susceptible to rising functional obsolescence due to the high value of the land on which they sit: the financial rewards of redevelopment contrast starkly with the economic pitfalls of retaining and maintaining them. Demolition is tempting. 

This year we celebrate Canada 150.  With our history and heritage, for better or worse, on prominent display, we decided to turn our attention to the uphill battle faced by commercial heritage properties in Halifax.

Size Matters

Hemlines are the harbinger of stock prices.  Construction of the tallest skyscraper marks the dawn of recession.  Floorplates sound the death knell of heritage properties?  

Open concept office-in-waiting

Downtown heritage buildings in Atlantic Canada are at an inherent disadvantage versus modern construction because they are simply too small.  Even 30-year-old buildings are feeling the strain imposed by their new, more spacious contemporaries, whose design is able to accommodate demand for open concept offices.  In Halifax, total demand has yet to catch up with new supply. Rental rates are restricted and tenants can afford to move into the new buildings, leaving the last generation of Class A office space struggling to stay relevant – and occupied.  The trend is toward larger floorplates as companies are opting for large, open concept offices with collaborative workspaces and few individual offices.  Downtown Halifax doesn’t have a supply of unused historic warehouses with high ceilings and large floorplates ripe for conversion well suited to modern tastes. Instead, our heritage properties are mainly small buildings, 3-6 storeys high and with floor plates between 1,000 and 6,000 square feet (typically at the lower end of this range). 

Halifax has a few examples of what can be done to overcome this drawback.  Barrington Espace and the RBC Waterside Centre both maintained the façades of a number of adjacent heritage properties while completely overhauling their innards, joining the buildings within to allow for larger floorplates (Saint John’s CentreBeam Place is another example of where this technique was used successfully).  If done carefully, this can present a best of both worlds compromise.  If not, the result may be the Disneyfication of heritage: it looks about right, but there’s no soul.  Either way, it is not an option for detached heritage properties: they are left to find occupants happy with the original floorplates size.

Barrington Espace, RBC Waterside Centre, CentreBeam Place…thanks, Google Street View!

Finding a Fit

Heritage properties need a certain tenant.  The predominant competitor of the heritage office building is the home office: to attract a tenant away from this “free” space, a historic building must provide cachet and interest, and must find a tenant who wants (or needs) both as marketing tools for their business.  Heritage tenants are drawn from a pool of largely creative firms represented by public relations and marketing firms, IT companies, and (interestingly) employment recruiting agencies.  Often, these firms are start-ups; there is a symbiotic relationship between the two, with the heritage property providing an inspiring ambiance (and maybe cheap rent: see below), and the company providing income and life to the building.  What the heritage property has more trouble providing is a flexible workspace that can grow with the company.  When they become too large for their space, they must seek a larger floorplate in a more modern building.  There is a happy medium: mid-sized companies who could occupy an entire heritage property as a single tenant.  But in Atlantic Canada, most companies are either large or small, a by-product of provincial regulatory demands which force companies to “get large or go under” (Atlantic Canada is made up of four small provinces each with their own regulatory requirements for businesses: half the population and half the land area of any other province, but four times the regulations…but this is a topic for another day).         

The Champions

There are three classes of champions for heritage properties: passionate owners (hopefully with deep pockets), community groups who recognize the social benefit of maintaining our built heritage, and governments which either have a measure of both these characteristics or are open to the influence of those who do. 

Heritage property owners must appreciate the unique features of old buildings.  To quote one (you’ll never guess who), they “speak to you in a way new buildings don’t.  There is a sense of calm, a personality.  They have been there for centuries, and if the economics can work, they will be there long after you’ve turned to dust.”  Ah, the economics.  Heritage properties in Halifax do not attract a rental premium as they do in some larger cities, such as Toronto’s trendy Distillery District.  There may be a purchase premium, albeit not driven solely by heritage, but location as well, due to the prime situation some heritage properties enjoy by virtue of having gotten there first.  Halifax’s downtown is distinguished by its waterfront; heritage properties with a connection to it in particular may enjoy a purchase premium, provided this connection is maintained (pause now to be thankful for the public outcry that halted “Harbour Drive” before it started…and hopeful that the redevelopment of its first phase, the Cogswell Interchange, will be successful in repairing the fabric of the area). 

 

Toronto’s Distillery District, as modelled by a pair of junior TDPers

There is a social benefit to heritage properties, usually external to the site itself.  A 2011 study by Place Economics highlighted six areas of positive economic impact attributed to heritage preservation: jobs, property values, heritage tourism, environmental impact, social impact and downtown revitalization.  Heritage properties differentiate cities from one another, providing a unique draw to residents, visitors and immigrants alike.  The world’s most successful cities have vibrant heritage architecture, often interspersed with modern buildings.  Community groups recognize this and fight to preserve historic built environments, but it is often the building owners who fund these broader social benefits by bearing the increased costs of renovation and upkeep.  It is here that governments can play a vital role via heritage preservation policies, but they must take care that they get them right.       

Incentivise or incense?

Halifax Regional Municipality recently commissioned a study to investigate heritage incentives.  However structured, these are a means by which society as a whole, via taxes, can help pay for the social benefit of heritage properties.  Two of the largest pitfalls of which governments must be wary when enacting policies to protect heritage properties both involve the risk of (inadvertently) penalizing property owners. 

The first is the more obvious one, wherein the owner of a protected building is prevented from redeveloping a site to a more lucrative density, diminishing the ability to make money from the property and potentially its market value.  One avenue available to the city is to compensate the property owner for the diminished value by purchasing the air rights, i.e. the space above the building in which they would otherwise be allowed to build, but are prevented by heritage preservation policy.  This could be accomplished either directly, with the municipality retaining ownership of the air rights, or by opening the market for air rights trading, allowing heritage property owners to sell their air rights to developers of non-heritage sites to increase the allowable height on their sites.  (Yes, this has the potential to open another can of worms, but it’s a good theory if the policy is well thought out). 

The second potential pitfall lies in supporting some, but not all heritage properties; such as with the creation of a heritage preservation zone.  While those properties (and their owners) located within the zone stand to benefit from financial incentives offered by the municipality, any heritage properties outside the zone are placed at greater disadvantage.  Still competing against larger modern buildings, they are now on an uneven field against their direct (heritage) competition.  The supported properties have the money to modernize without deficit to their owners’ bottom line, while unsupported properties are further penalized physically and financially. 

For more on heritage rights and wrongs, don’t miss our Summer 2017 newsletter, coming soon to a mailbox near you.  If you are not already subscribed to this informative and gutsy publication, please get in touch with us at 902-429-1811 or tdp@turnerdrake.com.

Alexandra Baird Allen is the Manager of our Economic Intelligence Unit, a position which makes surprisingly good use of her liberal arts degree in history & cultural studies, as well as her expertise in GIS.  For more information on our Economic Intelligence Products, visit our website or contact Alex at 902-429-1811 ext. 323 or abairdallen@turnerdrake.com.

Friday, 18 August 2017 12:21:25 (Atlantic Daylight Time, UTC-03:00)  #    -
Atlantic Canada | Brokerage | Counselling | Economic Intelligence Unit | New Brunswick | Newfoundland & Labrador | Nova Scotia | Planning | Prince Edward Island | Property Tax | Turner Drake  | Valuation
# Thursday, 01 June 2017

I can honestly say that these 13 weeks have been nothing short of amazing, over this time I have learned so much and gained experience that will help me throughout my life. I expected to come in one day a week for 8 hours a day and job shadow someone. I never thought that I would have my own space to work and be able to do so many things on my own. Every Tuesday morning I would meet with Ashley Urquhart (my boss for the day) and she would tell me the plan. If I had any questions that her door was always open, she was always very upbeat and happy, that made it extremely easy to talk to her.

I got into a morning routine of doing certain jobs, I would do Tenders, Google Analytics, and they even let me post on their social media accounts! I got to tweet about news that I thought was important, that was probably one of the best parts of my Co-Op experience. I never thought that they would give a Co-Op student in high school this much responsibility, I am beyond grateful that they did.  I always had someone close by to help me if I ever needed anything. The person sitting closest to me was Michael McCurdy, he made the day fun and I got to see how to be professional in the workplace and how to talk to clients over the phone. I worked with a great bunch of people that made this experience a lot of fun and helped me learn new things. My aunt, Patti Farewell, has work at Turner Drake & Partners for 26 years and now I see why, it is a very enjoyable place to work and everyone makes you feel welcome. The owner, Mike Turner, would always talk to me and ask me how things are going, along with his wife Verna, who would always make a point of talking to me and saying how nicely I was dressed, they were nice little conversations that made me smile. One day I got to sit in on a support staff meeting, we got lunch and talked about new ideas for TDP, I felt very included and like I was a part of the team.

The Co-Op interview was with Mark Turner (Vice President of the company) it was professional like a “real” interview would be so that I would be prepared for the actual thing when I go to apply for my full time job later in life. He was very nice and made me excited to start, I later got to work on a small project for him.

Right away I was being trained by two people who did exactly what I wanted to do. Ashley Urquhart and Alex Baird Allen were my safety nets throughout this time. The first few things they let me do on my own was, Tenders- finding new jobs and properties for the company to look at. The next job was Google Analytics- finding out how many people looked at the websites and how many people follow TDP’s social media accounts. They also trained me to do a few other jobs that would help me later, Data Mining- updating client’s information, Media Sheets- updating who they send things to. There were also basic jobs such as, photocopying, mail-outs and manuals. After a bit of time went by I was able to post on the company’s twitter. I was given the job of making a new flyer that would later be sent out to clients, I was surprised that they felt like I was doing well enough to be given a project that important. I spent many hours on it and got nothing but positive feedback. It’s going to be weird not seeing these people for a while, I would really like to come back for my grade 12 Co-Op and give it my all once more. Lastly I liked how much responsibility I had. They gave me my own place to work but it was also around people so I never alone. This is definitely a place I would love at work at after I finish school.

Help us prevent youth migration, hire a coop student today!


Thursday, 01 June 2017 16:08:11 (Atlantic Daylight Time, UTC-03:00)  #    -
Atlantic Canada | Brokerage | Counselling | Economic Intelligence Unit | Lasercad | New Brunswick | Newfoundland & Labrador | Nova Scotia | Planning | Prince Edward Island | Property Tax | Turner Drake  | Valuation
# Monday, 08 May 2017


(Image via Global News)

Symptoms of an Election
In the run up to the now transpiring Nova Scotia provincial election, our governing party engaged in the time-honoured tradition of the spending announcement roadshow. A few million for a community centre here, a few million more for an overpass there, culminating finally in the double whammy of a new outpatient facility in suburban Halifax, and toll-free twinning of several sections of highway.

Unlike most spending announcements, the outpatient facility drew immediate criticism. While the highway twinning has started to attract some rightful critique, the patently foolish choice of locating a medical facility in the retail backlands of a dysfunctional industrial park was apparent to many; not the least of which being senior municipal staff who’d advised the Province of these issues months prior. Embarrassingly, the location is a miserable failure when measured against the Province’s own aging population action plan, Shift, which it had announced along with nearly $14 million in funding mere weeks before.

As an aside: of the opportunities for criticism of the outpatient location, and there are many, the purchase price of the land is not a fruitful one. Without the benefit of knowing the particular details of the deal, the $12.00/ft² paid by the Province for the raw land includes the cost to bring the site to a state of development-readiness. Land in this condition elsewhere in Bayers Lake has sold in the neighbourhood of $11.50/ft², so this is hardly the 12,000% markup insinuated by some reporters and rival politicians. (For future reference, comparing purchase price to assessed values for development land – or any real estate for that matter – can be extremely misleading. Media Types: if you’re looking for a real estate angle on a story, give me a call… I know some people.)

A Bad Prognosis if Left Untreated
So here’s the rub. Atlantic Canada, as we’ve described many times, is facing a serious demographic crunch that will constrain income tax revenue to the provinces, and property tax revenue to municipalities (in Nova Scotia, see Canso, Springhill, Hantsport, and Parrsboro for a preview). Given the scale of these trends, immigration is not likely to alleviate this difficulty. This means public investment utilises increasingly precious dollars; long gone is the time where we could rely on growth to overcome poor decisions.

Yet, public capital spending is and will remain one of the most significant factors in the trajectory of our communities. The provision and location of these facilities influences development trends for decades. A new medical facility is not just a site for convenient patient care. It is also a major employer, and consumer of both public and private services. It generates broader impacts; spinoffs that if harnessed properly can enhance the benefits of other facilities, strengthen neighbourhoods and local business, and mitigate future infrastructure costs. A newly twinned highway is not just a safety improvement for the travelling public, it is a half-billion dollars no longer available to be spent on other priorities. We’ve got to get serious, we’ve got to be scrappy, and we have to be careful to maximise the benefits our public spending generates. Opportunities of an equivalent scale from private-sector activity are few and far between.

By narrowly constraining their site selection study (I presume, as this information is also not publicly available), the government has perhaps saved money on the land for the outpatient facility, only to create far greater costs in the form of municipal servicing expenses, diminished economic spinoff, and foregone social benefits. This short-sightedness is not resigned only to our provincial overlords, municipalities large and small consistently miss opportunities to strengthen and improve neighbourhoods or commercial main streets. At best, we have a habit of placing community facilities in a location that only performs well on measures of land price and vehicular accessibility. At worst, it is directed by decades of parochial bickering and ends up in a location agreed to be equally terrible for everyone.


Nice wellness centre you have there, shame about the sidewalk.
(Image via Pictometry ©2015)

Prescription As the highway twinning issue has shown, no “overwhelming public consensus” is going to emerge on any policy or funding choice other than those promising a free lunch. It is going to take political guts to lead the way: the decisions we need to make are pound-wise at the risk of appearing penny-foolish. Better analysis can help identify the optimal site selection and communicate the wisdom of that choice. A paltry million saved in cheap land will pale in comparison to full lifecycle costs of poorly located public infrastructure. The property taxes generated by that good natured economic development project might never recoup its initial cost. And increasingly, methods are available to help quantify and communicate the broad community and economy strengthening effects that government undertakings can create. A complete approach to site selection and capital project analysis in a time where each dollar counts is the difference between spending decisions that achieve lasting public value instead of fleeting public relations.


Remember, an ounce of prevention is worth a pound of cure, and we have the skills required to evaluate your options in the context they deserve. Neil Lovitt, our Senior Manager of Planning & Economic Intelligence can be reached at 428-1811 ext. 349 (HRM), 1 (800) 567-3033 (toll free), or nlovitt@turnerdrake.com.

Monday, 08 May 2017 10:29:39 (Atlantic Daylight Time, UTC-03:00)  #    -
Atlantic Canada | Brokerage | Counselling | Economic Intelligence Unit | New Brunswick | Newfoundland & Labrador | Nova Scotia | Planning | Prince Edward Island | Property Tax | Turner Drake  | Valuation
# Wednesday, 26 April 2017

Property tax is by far the most important source of revenue for municipalities in Canada, accounting for 49.5% of revenue in 2008 with an annual average growth rate of 1.6% (1988-2008). As reliance on property tax increases, so does the complexity of administering this regressive but necessary evil. Increased computing power in the mid-1960s prompted a shift towards automation of property tax systems, beginning with simple tasks and culminating in today’s fully automated assessment, notification, and payment systems. Modern Automated Valuation Models (AVMs) allow for rapid processing of data with minimised human-bias… but (and this is a large but) real estate appraisal is a nuanced trade: reducing the role of Appraiser to AVM Technician can have significant negative repercussions.

Service New Brunswick’s ongoing cleanup of their attempt at an AVM is a prospective case study in the dangers of a “hands-off” approach to the valuation process. Massive value errors were created by a computer-driven system with insufficient checks in place to alert users to suspicious results. When reviewed by human appraisers many of the shockingly incorrect valuations were easily overturned based on traditional market comparison valuation. Autopilot replaced the flight crew and actual appraisers are left cleaning up the crash, while their political and bureaucratic colleagues deal with the rightful public outcry.

While seemingly seductive, potential time and cost savings offered by an AVM should never mask the fact that, in order to operate successfully, an AVM must integrate human expertise throughout the valuation process. At Turner Drake the “A” in our in-house AVM stands for Accelerated to reflect the role that expert opinion plays in our two-stage computer-assisted mass appraisal model. Stage One combs through real property sales to select comparable properties based on locally relevant, value-defining attributes such as size, location, and design. Stage Two adjusts and weighs a unique set of comparable sales to create a market-based value estimate for each subject property in an assessment area. Throughout each stage of the model, a professional appraiser defines the selection criteria and adjustment values for comparable properties based on market evidence and local expertise. The model does the heavy lifting but certified appraisers evaluate and refine the results.



Outliers - which no system can avoid - can wreak havoc on the results of an AVM unequipped to handle the inherently diverse nature of real estate. It is critically important to flag potential outliers for review so the model can be adjusted for future assessments. During the initial rollout of an AVM model, refinement is time consuming but absolutely necessary for creating reliable, equitable assessments in successive years. In developing our Accelerated Valuation Model, we put the time in up front so the system flags out of the ordinary results, and the professional appraiser, made aware of the potential issue, is able to quickly and easily account for them.

In a Case Study of condominiums on the Halifax Peninsula, the Turner Drake AVM out-performed PVSC assessment values by a margin of up to 45%. That is, 86% of TDP value estimates were within 5% of an actual time-adjusted sale price versus PVSC’s 41% and 98% of TDP values were within 15% of actual sale price versus PVSC’s 84% in the same pool of properties. Our combination of custom programs and a traditional direct-comparison valuation can produce a list of unique comparables with adjustments for 1,000 properties in about two seconds.

Property tax administration systems are as diverse as the municipalities they serve and every region relies to a degree on the convenience of computers and automation. However, no matter the size or complexity of a property tax system it is important to follow best practices, and learn from the success - or failure - of others. When the pursuit of speed comes at the expense of quality there is a significant risk to the accuracy of valuations and the credibility of the property tax system as a whole.

For more information on how our AVM can benefit you, call James Stephens at 902-429-1811 ext. 346 or email jstephens@turnerdrake.com

Wednesday, 26 April 2017 10:21:10 (Atlantic Daylight Time, UTC-03:00)  #    -
Atlantic Canada | Brokerage | Counselling | Economic Intelligence Unit | New Brunswick | Newfoundland & Labrador | Nova Scotia | Planning | Prince Edward Island | Property Tax | Turner Drake  | Valuation
# Monday, 03 April 2017



Our Economic Intelligence Unit is always on the hunt for new data sources to bolster our maps and feed our spreadsheets: any good analysis begins with high quality data. The majority of our databases are populated with a wealth of information via a process of blood, sweat, and tears (though increasingly data is graciously released by provincial gatekeepers) and it could be that our next trove of valuable data is being cultivated on farms across the Maritimes. The movement of food from field to plate involves numerous stops along the agricultural supply chain and, when property tracked, that data can prove valuable for a host of analytical tasks.

The ability to track an item from Point A to B in a large-scale supply chain is known as traceability. The theory behind it is relevant in all aspects of our lives: be it an Amazon package or a donair pizza, consumers - and businesses - have discovered that real-time knowledge of where a product is, physically, at any point in time is a competitive advantage in terms of marketing and efficiency. Agriculture is no exception. Traceability is already in use as a health risk management tool: it allows for rapid response to health emergencies by identifying exactly where and when afflicted produce or livestock stopped along the supply chain. Efficiently pin-pointing sources of contamination (think E.coli outbreaks) and creating cost-effective responses, such as targeted treatments and recalls, are critical in a modern, globally connected agricultural sector.

In addition to the obvious benefits of using traceability from an epidemiology perspective, there is also major potential for economic spinoff benefits from tracking the movement of agricultural goods. At a recent gathering of Nova Scotian Agrologists, speaker Chris deWaal of Getaway Farm (of Seaport Market fame) touted the very real benefits of offering consumers the entire life history of their food as a competitive advantage over mass-produced “mystery meat.” The introduction of the “Trace My Catch” program for canned seafood provides an example of how seafood processors are embracing traceability as a marketing tool, and provides an indication of the feasibility of doing so. In a province with a growing love affair for all things local it is no surprise that demand for local meat and produce is on the rise.

Benefits beyond health and marketing can be opened with traced agricultural data. Used in conjunction with GIS, the location and density of animals, farms, stockyards, abattoirs, and processing facilities become inputs for site selection and trade area analysis and indicators of economic health in rural economies - an issue of pressing concern for many Nova Scotian communities.

Imagine opening a meat processing and distribution facility to feed growing demand for local, organic products while still maintaining capacity for foreign exports. A standard GIS-based site selection analysis would use static location data (suppliers, purchasers) with network data (highway, rail, sea) to build a short-list of potential development sites which minimize transportation costs for both inputs and outputs. Additional variables such as workforce availability, machinery and equipment suppliers, veterinary services, and property taxes can all be integrated with locational data to suit the needs of the processor. But a standard analysis does not take into account how many animals are produced by individual farms or the variability in production from year to year.

Traceability data can enhance GIS analysis by optimizing site selection so it is based on not just the density of farms within a trade area, but the capacity to bring high volumes of livestock (or produce) efficiently to market. Historic tracking data of individual animals could forecast future production including where livestock are ultimately processed and sold. A savvy processor would use this data to identify opportunities for expansion and generate reliable, defendable business projections.

The agricultural sector already collects traceability data for use in health risk management; leveraging that same wealth of data for marketing and day-to-day business operations is the logical next step. The agricultural sector is a ray of light in the gloom of rural Nova Scotia: according to Statistics Canada’s census, between 2006 and 2011, Nova Scotia was the only province in Canada to see an increase in the number of farms, total farm area, and number of farm operators. Should the 2016 census indicate continued growth, it will clearly indicate that it’s time for all players in the agricultural game to leverage their existing data infrastructure to gain a competitive advantage at home and abroad.

For more information on how spatial analysis can benefit your business, call James Stephens at 902-429-1811 ext. 346 or visit: Economic Intelligence Unit

Monday, 03 April 2017 10:02:51 (Atlantic Daylight Time, UTC-03:00)  #    -
Atlantic Canada | Counselling | Economic Intelligence Unit | New Brunswick | Newfoundland & Labrador | Nova Scotia | Planning | Prince Edward Island | Turner Drake  | Valuation
# Thursday, 16 February 2017



Finding Answers in the Bottle

Recently our Brokerage Division closed a deal that will see a mid-century commercial building transition from a hair salon to Halifax’s first cidery – a business dedicated to the production and enjoyment of hard ciders. It is the city’s newest addition to the burgeoning craft beverage industry, and by my count, the fifth such business within short walking distance of our head office. Thanks to double digit year-over-year growth in the industry, such businesses have been setting up shop throughout our region, but I have good reason to believe we at Turner Drake are working in the very nexus of Beer Oriented Development.

The craft beverage industry is booming throughout the continent evidently. However, BOD is a specific variant distinguished by integrating the production element the brewery, with the social gathering element of a retail/food service business, wrapping it all in a locally authentic brand identity and plunking it in walking distance to residential neighbourhoods. The term itself was apparently coined in the weary rust-belt city of Buffalo where a pattern of revitalisation lead by the craft brewing industry has been observed in neighbourhoods otherwise dogged by the Midwest’s manufacturing decline and hard hit by the Great Financial Crisis.

Back in our corner of North America, we can certainly attest to the healthy “third place” function of Beer Oriented Development. That is to say, in addition to the production itself, many businesses serve as a nexus for community development outside of the home and workplace. They are small enough operations to revitalise defunct or underused properties without the timeline and complexity of projects requiring land assembly. The size and design of the retail operation typically creates an enjoyable atmosphere and promotes interaction between customers (who are often neighbours). Where the sale and service activities are able to spill outside onto a patio or sidewalk café, they further add to the vitality and liveliness of the entire street. With seemingly endless groups of engineering school buddies (it’s always those engineers) keen to start their own sudsy venture, why do some areas see a flourish of BOD while others simply get an increase in breweries?

The Broken Window Fallacy

There’s a classic economic parable that goes something like this: A baker’s shop window is broken and he hires a glazer to repair it. Passersby observe the glazer at work and remark on the economic activity stimulated by the broken window. Meanwhile, the baker having spent his money on the window now postpones his plan to purchase a larger oven to increase his production. In this way, the passersby are mistaken about the benefit of a broken window because they consider only what they see, and not what they can’t see. That is, they do not consider the opportunity cost; the lost benefits that would have been generated by things that were prevented, often without conscious purpose, from ever happening in the first place.

We don’t often think about opportunity cost in planning. We like to have the initiative; there are no problems that can’t be fixed through the application of more regulation or better policy. In this mindset, it is sometimes easy to lose sight of the fact that many (perhaps even most) good things tend to happen on their own if we leave the space for it. Nevertheless, Halifax, like many Atlantic Canadian cities, does benefit from not having gone too far off the deep end when it comes to land use regulation… at least compared to standard practices west of our region. Consider the present (if outgoing) land use bylaw for the Halifax Peninsula area where residential land use is governed by 6 zones. Contrast that with London Ontario, a city of comparable population and municipal budget, where no less than 17 zones are needed just to regulate single detached housing! Clearly one approach provides more “regulatory space” than the other.

Six of One Ain’t Always a Half Dozen

London, like Halifax, is a university town with no shortage of thirsty students or courageous engineering buddies. Like Halifax, it has its own litany of recently launched microbreweries. And finally, like Halifax, London did not, and does, not specifically target or promote Beer Oriented Development. What London does have is its hyper specific approach to coding land use which classifies microbreweries as “Food, Tobacco, and Beverage Processing Industries” and among the 20+ flavours of commercial zoning, relegates such uses to the “General Industrial” areas of the city. In Halifax, some microbrewers also set up shop in the industrial areas, depending on their business model. However, Beer Oriented Development is mostly occurring under the General Business zone which allows – to paraphrase – basically any business that doesn’t create problems in the area.

The shocking result? All of London’s new microbreweries are segregated into soulless industrial parks. Sure, they’ve got a quality product, backed by the same witty, self-aware marketing, and most even have attached tasting rooms and offer brewery tours, but to access any of it you’ve got to drive out past electrical suppliers and find their docking bay among the other distributers and warehousers. So while both city economies are benefiting from growth in the craft beverage industry, only Halifax is gaining the additional benefits to neighbourhood revitalisation and contributions to a lively pedestrian atmosphere. These are not just intangible perks for urban hipsters. There is a hard dollar cost to London in terms of lost economics spinoffs and unrealised gains in property value, but that cost is the new oven, hidden behind a broken window.

The Future is Delicious

Beer Oriented Development is just a microcosm of a larger dynamic. No one was anticipating an explosion of craft brewing or the potential of BOD when the zoning codes were written twenty years ago, just as the codes we write today do not address a futuristic possibilities like the rise of distributed manufacturing, or an explosion of artificial intelligence. In truth, it’d be foolish if they did. In dealing with an ultimately unknowable future, it is basic human nature to play it safe; control what is knowable, and regulate the unexpected out of existence. The costs of this approach are easy to ignore because we are never fully aware of paying them. Yet, as Beer Oriented Development clearly demonstrates, there is a benefit, indeed a competitive advantage, to the city that sets itself up to embrace the unknowable future and capitalise on the unexpected.

Our Role

What can you build on your property? The answer to this is determined by interpreting the local planning policy and regulation. However these are living documents, and project timelines are often measured in years. Thus, it is essential to not only look at the present-day context, but peer into the future for additional opportunities. This is precisely why all our Planning Policy and Regulatory Review reports contain a Long-term Outlook section.

For a recent client, this feature paid dividends. For their property, the desired outcome would have required multiple amendments and the negotiation of a Development Agreement under present requirements; an expensive and risky process overall. However, by casting a wider gaze in our investigation, we identified an opportunity to pursue the same goals through a larger policy update the municipality was preparing to make. While this didn’t save our client any time, it lowered the risk, and greatly reduced the cost.

We’re finding our Planning Division lends vital assistance to our other areas of operation, improving the detail and delivery time of Valuation, Counselling, Economic Intelligence, Property Tax and Brokerage assignments. More importantly, it creates value for our clients, aiding with development projects big and small.



Whether you’re musing about options or working towards a clear goal, ask Neil Lovitt, our Planning Division Manager, how we can help: 1 (902) 429-1811 (HRM), 1 (800) 567-3033 (toll free), or nlovitt@turnerdrake.com

Thursday, 16 February 2017 12:26:42 (Atlantic Standard Time, UTC-04:00)  #    -
Atlantic Canada | Brokerage | Counselling | Economic Intelligence Unit | New Brunswick | Newfoundland & Labrador | Nova Scotia | Planning | Prince Edward Island | Turner Drake
# Thursday, 03 November 2016

On the 1st of this month, Bill 52, an amendment to the Halifax Regional Municipality Charter allowing HRM Council to set separate commercial tax rates in areas it designates, received its First Reading in the Nova Scotia Legislature.

The Bill (as tabled) provides that Council may:

(a) Set different commercial tax rates for commercial property located in areas of the Municipality designated by Council, based on the assessment of commercial property under the Assessment Act;

(b) Set different commercial tax rates for commercial property located in areas of the Municipality designated by Council, based on the length or proportion of frontage of a property on a street, including a private road;

(c) Set additional tiered or escalating commercial tax rates based on the factors set out in clauses (a) and (b) that are in excess of the rates set in clauses (a) and (b); and

(d) Set additional or different commercial tax rates using any combination of clauses (a) to (c).

The infusion of flexibility into the taxation regime is laudable, and while the tools could allow Council to, for example, provide assistance to owners affected by construction in the Downtown, or to reduce the tax rate in areas in the City that have been impacted by rapidly rising assessments, the potential changes allowed by the Bill won’t be the panacea for all commercial tax woes.

The potential for inequitable tax loads where “street frontage” is used, in whole or part, to calculate the tax rate is alarming (and puzzling) especially for properties located on corner lots or developed less intensively than neighbouring properties. It appears to be a way of circumventing the current ad valorem methodology for distributing the tax load. There have been many attempts worldwide to eliminate or “improve” the ad valorem (market based) method of allocating property taxes: none have yet been successful… some, such as the late Mrs. Thatcher’s infamous poll tax in the United Kingdom, resulted in riots.

There would be winners and losers for each amendment being proposed; any change to tax rates in one area, or upon one class of property, will shift the burden onto another, because there is nothing in the Bill that would reduce the overall contribution of the commercial sector to the City’s tax base. The true elixir would be a change that would make all commercial owners better off.

It’s unclear how Council will utilize their new tools, but it’s not anticipated that the Bill will result in any widespread changes to commercial taxation in the short term. We are monitoring the situation closely, and will provide updates as changes occur. Stay tuned.

Thursday, 03 November 2016 15:05:43 (Atlantic Standard Time, UTC-04:00)  #    -
Nova Scotia | Property Tax
# Tuesday, 23 August 2016

When you think of the ideal office space, what are your must-haves? An environmentally friendly building? Open work spaces? Proximity to your home or city amenities? These are considered some of the most commonly desired traits in office space by HRM tenants. Office space that fit this bill is becoming more available in the downtown core. Does this mean that the recent trend of moving into office space in the suburbs will come to an end?

HRM comprises eight urban and suburban sub-markets: Central Halifax, Central Dartmouth, Downtown Peripheral Halifax, Suburban Halifax, Peripheral Dartmouth, Burnside/City of Lakes, Bedford and Sackville. Notable changes to these submarkets since 2011 include 950,000ft.2 of new office space added to the rental market in Central Halifax, Bedford, Burnside/City of Lakes and Suburban Halifax.

With the current lagging economy, it is not surprising to learn that vacancy has almost doubled in the last five years, especially considering the plethora of new office space brought on stream throughout HRM. Vacancy increased in every submarket, but the changes in vacancy rates indicate a shift in where demand for office space is flowing – to suburban business parks. For example, Burnside/City of Lakes and Suburban Halifax experienced among the lowest increases in vacancy. The chart below reflects how the distribution of total rentable area by sub-market has changed in the last five years.



It’s not all bad news for the CBD, though… vacancy in downtown Halifax saw a below average increase in vacancy. This begs the question: because suburban space was highly available, are tenants moving there because they wanted to, or because of its availability? With more space coming on stream in the downtown core consistent with commonly desirable office traits, does this mean tenants will start to shift back toward the downtown core?

In the last year, vacancy increased in the downtown core, not because of tenants vacating the area, but because there is more inventory available. Urban space is competing against new, modern office developments in suburban business parks (previously the only option for new office space in the city) and the population is concentrating in the urban core. With rental rates stagnating as vacancy rises, this is the prime opportunity for tenants to move into new space… and perhaps that space will be in the downtown area.

Click here to read more, including a map showing the spatial distribution of vacancy rate changes since 2011. This topic was covered in detail in this month’s TDP Trends, a free service provided to decision makers with property portfolios in Atlantic Canada. Each month, it provides information on demographic, psychographic, migratory, income and wealth distribution, investment, technological, space utilisation, and other trends influencing property values now or in the future. TDP Trends are archived on the public area of our website.

Tuesday, 23 August 2016 14:01:14 (Atlantic Daylight Time, UTC-03:00)  #    -
Economic Intelligence Unit | Nova Scotia
# Thursday, 05 May 2016

Immigration into Canada is nothing new: the country admits an average of 253,875 immigrants each year. This number is responsible for almost two-thirds of the national population growth from 2005 to 2015. Based on a housing demand projection study conducted by the Canada Mortgage and Housing Corporation (CMHC), a 1% increase in immigrant population causes housing demand to rise by about 0.66%. However, the Maritime housing market is facing a projected decline in the coming years due to three interdependent facors: an aging and shrinking population, a dearth of immigration and very low rates of economic growth. This is not new information: alarms were given by various sources and it’s time to halt the slide.

History has proven that an aggressive immigration policy can help smooth the impact of an aging population (e.g. Ontario and Vancouver). It is not surprising, therefore, that increasing migration into the Maritimes is an effective way of addressing the adverse effects of our aging population. New immigrants will not only help increase the production of goods and services but will also directly increase the demand for housing.

Becoming a Maritime immigrant myself, I have a special interest in exploring the relationships between immigrant and housing trends in this region. I came to Canada in late 2012 as an international student and have seen several immigrants who decided to stay and purchase a house here. Many of them are below age 40, well-educated, and economically independent. Do they represent the majority immigrant group in the Maritime Region? I decided to dig into the data to find the answer.

The Maritime Immigration Trends

Immigrants comprise less than 6% of the Maritime Provinces’ total population, but 20.6% of the national population. Immigrant inflows to the Maritimes fluctuated dramatically from 1991 to 2006, however in the last decade, trends have been rising. This can be attributed to new policy initiatives (e.g. provincial nominee program, skilled worker express entry) aimed at attracting more immigrants to the Maritime region. From 2006 to 2011, the number of immigrants to PEI rose six-fold. Not surprisingly, employment growth in PEI caught up with the national average during the same period. Although this growth is from a small base, it still means the island is attracting more than twice as many immigrants compared to its share of the total population.




Maritime Immigrants: Countries of Origin and Demographic Profile

The United States and United Kingdom were the top two source countries of the Maritime immigrants during the 1980s. The position was taken over temporarily by some Middle Eastern countries (in the aftermath of the Gulf War) and China in the 1990s. In the last decade, the US and UK again became the top two sources of immigrants, but China and other Asian countries are listed among the top five.



The map above shows the percentage of the total population formed by Maritime immigrants in in 2015, along with the most common countries of origin. Immigration to the Maritimes is heavily slanted in favour of Halifax County (NS), Queens County (PE), Westmorland County (NB) and York County (NB). However, according to the immigration demographic profile report provided by the Atlantic Metropolis Centre, more than one-fifth of immigrants who arrived in the Maritimes from 2006 to 2011 declared their intended destinations to be outside a Census Metropolitan Area (CMA), which indicates the potential for allocating new immigrants to rural areas.

The age profile of immigrants in the Maritimes is dominated by the lower age group according to the most recently released Statistics Canada data. About 75% of immigrants who arrived from 2011 to 2015 were under age 45, and 7.5% were under age 25. The corresponding numbers for resident Maritimers aged under 45 and under 25 in 2015 were 44.3% and 14.7% respectively.

The Housing Situation and Needs of Immigrants

There have been many reports and studies exploring the current economic and population trends in the Maritime region: evidence shows Maritimers are now on the brink of an extended period of decline. The unavoidable aging trend is weakening the Maritime housing market and will continue to do so unless effective action is taken. The key to slowing down the aging trend is to be open to the outsiders by targeting and attracting skilled immigrants to the region.

In last month’s TDP trends, we explored the HRM residential house market tipping point. In the Atlantic Region, most first-time buyers are aged 25 to 34, followed by a small portion in the 35 to 59 group. Second-time buyers are also primarily aged 25 to 34. Finding suitable and affordable housing is an essential step in immigrant integration. With relatively lower housing prices (compared to Ontario and Vancouver), the Maritimes have advantages in attracting potential younger aged immigrant home buyers. Such a future can have only one outcome: reversed housing declines in demand for the aging population trend, which will boost the regional economy.



Written by Chen Shi, Consultant in our Economic Intelligence Unit. To learn more about Chen, visit our Facebook page to see her Featured Consultant article.

Thursday, 05 May 2016 09:56:23 (Atlantic Daylight Time, UTC-03:00)  #    -
Economic Intelligence Unit | New Brunswick | Nova Scotia | Prince Edward Island
# Friday, 08 April 2016

If you live in Nova Scotia, you may have noticed that the rate of job creation in the province has slowed during the past decade. Not only has this trend directly affected the job market, but it has also reduced activity in the resale market and in new housing construction. These effects on the housing market aren’t due to reduced supply, but instead are caused by a lack of demand.

The HRM population is aging. The number of 60+ year old residents is increasing rapidly in Nova Scotia and throughout the Atlantic provinces. Because of the aging population, fewer residents are buying single-dwelling homes, which is accelerating an already generally weakened regional housing market.

Additionally, in Atlantic Canada, only 35% of homebuyers are identified as first-time buyers (the majority of whom are aged 34 and under; see stats below from CAAMP), which is 10 percentage points below the national average. Out-migration of young people to other parts of the country is one major cause of this low percentage.

Based on the NSAR MLS® and Turner Drake in-house data, the most commonly purchased home in HRM is single-detached (more than 3,900 each year). More than half (64%) of those purchasing this type of home are typically second-time buyers. On the lower side of the market, there are approximately 878 purchases of semi-detached and row homes in HRM each year, about two-thirds of which are typically bought by first-time buyers.

According to statistics from the Canadian Association of Accredited Mortgage Professionals (CAAMP), most first-time and second-time Canadian homebuyers are aged 25-34. Subsequent buying is most often among those aged 50-59. Less than 2% of home purchases are made by those who are 70 years or older. Why does this matter? The bottom line is that as the population ages, more people are less likely to purchase first-time, second-time, or even subsequent homes.

As the majority of single-detached first-time buyers (aged 34 and under) and subsequent buyers (aged 50-59) reaches peak levels, expect the single-detached demand to level off, and then start to decline. The HRM population reached its peak levels of these age groups in last year. Therefore, housing market sales will continue to decline slowly throughout 2016 and in the next few years.

Click here to read more, including tables outlining the statistics discussed above. This topic was covered in detail in this month’s TDP Trends, a free service provided to decision makers with property portfolios in Atlantic Canada. Each month, it provides information on demographic, psychographic, migratory, income and wealth distribution, investment, technological, space utilisation, and other trends influencing property values now or in the future. TDP Trends are archived on the public area of our website.

Friday, 08 April 2016 16:59:10 (Atlantic Daylight Time, UTC-03:00)  #    -
Nova Scotia
# Friday, 19 February 2016

The Property Valuation Services Corporation (PVSC), formerly the provincial assessment department, is going boldly where it has gone before… demanding that property owners hoist themselves with their own petard. It is doubly ironic that property owners are required to pay for the cost of PVSC by way of a levy on their tax bill… and then are expected to do much of its work for it by downloading, printing and then completing its Income and Expense Questionnaires. While disregarding the request is poor strategy, completing it has its dangers too. PVSC will use the information it gleans from the Questionnaires to assess property for the 2017 taxation year. If your property is currently under-assessed, it is tempting to ignore the request in the hope that this happy circumstance will continue. Unfortunately, failing to file the Questionnaire can send a clear signal to PVSC that you think you are undervalued. Far from keeping you out of sight, it has the opposite effect. And it gets worse. In the absence of a completed Questionnaire, PVSC will use its own data, unimpeded by your property’s factual income and expenses, to calculate its assessment… and you will be left without recourse, as the penalty for failure to comply with the request will be loss of 2017 appeal rights. We recommend therefore that you complete and file the Questionnaire, but with your audience in mind. Comfortably cushioned from the vicissitudes of tenant selection, rental negotiation and collection, and things that burst in the night, PVSC will happily accept at face value your rental income, unless it appears to be too low… and gaily disregard expenses they consider to be above the norm. Do not expect them to empathise with your sweat and tears, services you undertake yourself to minimise costs, unless you monetise them. Nor should you expect increased maintenance costs - inherent, for example, in a single bedroom apartment building with a transient population - to strike an echoing chord. Expect PVSC to discount these as “outliers,” or your management and administration costs as “excessive,” unless you explain the nuances of revolving doors and are prepared to supply provenance. Tenant inducements and management efforts to maintain occupancy are concepts unfamiliar to the cozy world of PVSC. You will have to quantify them. If your building contains office, retail or industrial tenancies, be careful how you describe your leases; the subtleties of “net” versus “gross” lease terms may not be fully understood by PVSC.

Further complicating this year’s round of requests is the fact that it is being made almost a full fiscal quarter earlier than is customary. For 2016, and for the recent past, assessments reflect a property’s market value as of a date two years in the past (called the base date). In an effort to produce assessments that are more current, PVSC is shifting the base date to reflect market values one year in the past. This means that assessments provided to property owners in January 2017 will reflect a property’s market value as of January 1, 2016. With this shift comes a requirement to analyse income and expense information earlier in the year…so early, in fact, that owners with December year-ends may not yet have 2015 statements completed. Any owner in that predicament should provide the most recently-available information, because the PVSC has no legislative authority to extend the 30-day deadline.

The Bottom Line: Download the appropriate Questionnaire from the PVSC’s website at www.pvsc.ca. Complete it with caution; your responses may be misinterpreted. Return it to PVSC by 17th March.

Action Required: If your property is enrolled in our PAMS™ Property Tax Manager program, let us review your completed Questionnaire before you return it to PVSC. Our Lead Consultant assigned to protect your property will be pleased to provide you with assistance in completing the Questionnaire. If you are not yet a PAMS™ client, and would like assistance in completing the Questionnaire, please call our Nova Scotia Tax Team, Giselle Kakamousias, Mark Turner, or Greg Kerry at 1-800-567-3033 (902-429-1811 in HRM).

Friday, 19 February 2016 12:27:08 (Atlantic Standard Time, UTC-04:00)  #    -
Nova Scotia | Property Tax
# Tuesday, 02 February 2016

If you own a residential property in Nova Scotia you may have noticed recently when you received your assessment notice that there are two values assigned to your assessment; the market value and the capped value.  If you've lived in your home for a few years now, you will have also noticed that your capped value is lower than your market value. You might be thinking that you are benefiting from the capped value, but in reality for a lot of people those savings are what we call "phantom savings".  The Capped Assessment Program (CAP) was introduced in 1995 in order to protect homeowners from rapid and sudden increases in assessment values. The CAP was implemented in response to concerns from families and seniors worried about not being able to afford higher property tax bills as a result of higher assessment values. It sounds like a great idea, but there are some major flaws in the program.

One the biggest issues with the CAP is that it doesn't discriminate between homeowners with high levels of wealth or lower levels of income. The property owner who hasn't seen much of a rise in the market value of his or her property will end up having to pay higher tax rates in the long run in order to subsidise the properties which have increased significantly in value but are only paying taxes on a much lower capped value. The problem will only get worse over time.

The longer the program remains in place, the more distorted the assessment base becomes. Assisting those who can least afford to pay their property taxes would be better served with more targeted efforts such as credits and deferral programs. Allowing seniors to defer a portion of their property taxes when their assessment values increase will allow them to stay in their homes longer and once their homes are sold the outstanding taxes can then be repaid. Some people believe that it's important to continue using the capping program because taxpayers benefit from lower property taxes. This is a gross misconception however. Every year municipalities need to collect a certain amount of revenue in order to fund their budgets. Property tax collection is the main source of revenue for municipalities and whether everyone has a high assessment value or a low assessment value, the tax rate needs to be adjusted accordingly in order to generate the necessary amount of revenue. If we lower one of the factors, the other must go up and vice versa.

Property Taxes = Assessed Value (or Capped Value) x Municipal Tax Rate


The result is that for many properties, a reduction in the assessed value via the cap simply results in a higher tax rate and a shift in the tax burden to properties which are ineligible for the cap. The CAP is not producing the outcomes that it was designed to do, and I'll provide a simplified example to illustrate one of the problems with the program.

In our example, the municipality consists of many different neighbourhoods with all different types of properties, but we’re going to narrow our focus and make the assumption that there are only two types of houses that will fall under the CAP criteria and all other properties are assessed at their market value. The two types of capped homes are each in a different neighbourhood; we’ll call them Home A and Home B.
  The people that live in the neighbourhood with home type A are mostly seniors and families that have lived in the area for a long time. These are older homes that haven't been renovated in years. The people that live in the neighbourhood with home type B are younger working age people who all built brand new homes in a new up-and-coming neighbourhood back in 2007. As of 2007, both home types had a market value of $200,000.   

The people that live in Home A have seen the market value of their property rise at an annual rate of 3% which is slightly above the capped rate while the people that live in Home B have seen an annual increase of 8% in the market value of their property which is much higher than the capped rate of growth. While homeowners in both house may be thinking that they are benefitting from the CAP, in reality the people living in House A (i.e. seniors) are having to pay property taxes at a higher tax rate in order to subsidise the lower capped values of the working age people in House B.

The table below shows that the taxable value of both house types is $237,000 and produces tax revenues of $2,867.70 per house on a rate of 1.21%. If we were to remove the CAP, the tax rate could actually be lowered to 0.87% and the people living in Home A would actually pay less property taxes while people in Home B would pay more.

While there are people out there who are benefitting from the CAP, the program has serious flaws and is creating distortions in the assessment base. For more information on the CAP, I encourage you to check out the Final Report on Municipal Property Taxation by the Union of Nova Scotia Municipalities which can be found on their website. 


Written by Mathieu Chaput, Consultant in our Property Tax Division. If you have any questions about your property tax assessment, feel free to contact Mathieu at (902) 429-1811 or MChaput@turnerdrake.com.  
Tuesday, 02 February 2016 16:45:09 (Atlantic Standard Time, UTC-04:00)  #    -
Nova Scotia | Property Tax
# Monday, 01 February 2016

There are just 7 days left in which to appeal your 2016 property tax assessment ... or forever hold your peace. The Property Valuation Services Corporation (PVSC), the municipally controlled body responsible for tax assessment throughout the province, mailed out your Assessment Notice on January 8th. The appeal period ends at midnight on February 8th. If you have enrolled your property in our PAMS™ Property Tax Manager program, PVSC have already sent us an electronic copy of your Assessment Notice enabling us to review your assessment and file an appeal if the opportunity exists to reduce your tax burden. If you do not have PAMS™ protection, and have not yet asked us to review your Assessment Notice, you should do so now. The 2016 increase experienced by many property types is lower than that of years past, however the decision to appeal/not appeal should never be based solely on a single years change in value. Most property types are assessed 25% to 30% higher than five years ago. You should be vigilant in your efforts to manage your tax load and take every opportunity to minimise your assessment.

The basis for your Year 2016 assessed value is your property’s Market Value on 1st January 2014 (the “base date”) but having regard to its physical state on 1st December 2015 (the “state date”). In practice these criteria are oft stated by PVSC in defence of its assessed values, but in our experience property is often assessed at less than its market value perhaps because supporting sales data is not available, or to discourage appeals. (There may be legitimate reasons too for assessing a property below its base date sales price; for example, if the property had lost a major tenant by the state date). Of course it would not matter if all property were under-assessed by the same percentage amount, but such is not the case. Fortunately the Assessment Act does provide protection against such shenanigans by including a requirement that all properties in the municipality be assessed in a uniform manner. Case law has determined that uniformity is achieved by calculating the “General Level of Assessment” within the municipality, by property category (commercial or residential). The General Level of Assessment is the ratio of the 2016 assessment to the property’s 1st January 2014 Market Value. This can only be achieved by totalling all of the 2016 assessments, for those properties whose sales occurred between 1 st July 2013 and 30th June 2014, with the aggregate of their sale prices. Sales data is now publicly available; however, its format and accessibility is fairly limited. PVSC usually insist that their General Level of Assessment is 95% to 100%. This is rubbish: base your calculations on 80% and file an appeal if the assessed value of your commercial, industrial or investment property > 80% x Market Value (@ 1st January 2014). Exclude the HST from the market value. (We have built an information technology platform Compuval™, and have populated it with sales, assessment and rental information. It allows us to calculate Market Values and gives us a broad indication of the true General Level of Assessment. The quantity of sales data varies by municipality since we gather it from multiple sources, so we have built capability into CompuVal® to run a variety of analyses comparing your property with others in its peer group).


The Bottom Line: If your Realty Assessment > [(Market Value as of 1st January 2014) x (General Level of Assessment)], you are over-assessed. The real General Level of Assessment is probably between 0.8 and 0.9 in most municipalities.


Action Required: If in doubt, appeal ... or contact our Nova Scotia Tax Team, Mark Turner, Giselle Kakamousias or Greg Kerry at 1-800-567-3033 (429-1811 in HRM).

Monday, 01 February 2016 16:40:28 (Atlantic Standard Time, UTC-04:00)  #    -
Nova Scotia | Property Tax
# Monday, 11 January 2016
If you own property in Nova Scotia, you have probably now received your annual Assessment Notice from the municipally-owned and controlled assessment authority, the Property Valuation Services Corporation (PVSC): it was mailed on Friday, 8th January. Resist the urge to light it on fire, and review it carefully… or risk being unpleasantly surprised (and without recourse!) when your tax bill arrives later this year.

The 2016 appeal period was a scant few hours old on Friday when the PVSC began trumpeting the fact that its average 2016 property assessment increase is only about half of 2015’s. Don’t be lulled into a false sense of security by an assessment that has only increased marginally, remained unchanged, or even declined - particularly in secondary centres and rural locations. Leaving the assessment unchanged is a strategy routinely employed by assessing authorities to discourage appeals. The PVSC is undoubtedly hoping that Nova Scotian taxpayers have short memories, because in spite of a more moderate 2016 rise, assessments have increased by between 20 and 25% over the past five years … and by 30 to 35% in Halifax (where over 50% of Nova Scotia’s assessment base is situated).

And, the comparatively temperate rate of 2016 increase reported by the PVSC (which, of course, is only an average) will be of hollow comfort to property owners who have experienced unforeseen, double-digit increases in value. Early indications are that apartments, retail property, and income-producing industrials have been particularly hard hit for 2016.

The basis for your 2016 Realty Assessment, as mandated by the provincial Assessment Act, is the market value of your property on 1st January 2014 (the “base date”), having regard to its physical state on 1st December 2015 (the “state date”) and the assessments of the other commercial properties in the municipality (the “General Level of Assessment”). Market value then is the first test: if your realty assessment exceeds your property’s market value on 1st January 2014, it is over-assessed and you should file an appeal.

The second test to apply is the General Level of Assessment (“GLA”), calculated by dividing the sum of the 2016 assessments of those properties that sold between 1st July 2013 and 30th June 2014, by the aggregate of their sale prices. PVSC has, on occasion, (and only when prodded!) condescended to divulge their General Level of Assessment. On the occasions where we have formally reviewed PVSC’s calculations, they’ve often proven to be nonsense. It would be reckless in our view, to place any reliance on PVSC’s General Level of Assessment ... which it usually insists is 95% to 100%. A more realistic figure is 80% to 90%. So if your investment, commercial or industrial property’s assessment is greater than 80% of its base date market value, file an appeal.

The Bottom Line:
You may have to pay taxes ... but you don’t have to leave a tip.

Action Required:
If you are in any doubt that your property is over-assessed, you should file an appeal on or before 8th February 2016. You will not get another opportunity this year. If you wish, we can file the appeal for you. If you would like to discuss your property assessment with us before you file an appeal, call our Nova Scotia Tax Team, Giselle Kakamousias, Mark Turner, or Greg Kerry at 1-800-567-3033 (429-1811 in HRM).

Monday, 11 January 2016 16:00:48 (Atlantic Standard Time, UTC-04:00)  #    -
Nova Scotia | Property Tax
# Friday, 30 October 2015

On 14th October the Property Valuation Services Corporation (PVSC) published its proposed Year 2016 assessments for Nova Scotia (with the exception of apartments).  If your property is enrolled in our PAMS® Property Tax Manager program we are reviewing the assessment and will do our best to engage PVSC in negotiations to mitigate the increase.  Unfortunately PVSC’s customary tardiness may limit this opportunity:  the official Assessment Roll will be finalised on 1st December.  (If your property is not yet PAMS® protected you can check what PVSC has in store by accessing their web site www.pvsc.ca.)

The practice of publishing an Assessment Pre-roll began in 2000 as a well-intentioned initiative by the then Minister of Municipal Affairs to bring some stability to municipal budgets.  It followed a meeting between the Minister, Deputy Minister, our company president and senior members of our Property Tax Division.  At that time the Department of Municipal Affairs was responsible for calculating assessed values and the Minister reasoned that publishing a Pre-roll would give property owners the opportunity to informally challenge incorrect assessments, which could then be rectified before the official roll (on which municipal budgets were based) was published in January.  The “Pre-roll” was to be published in June, six months prior to the publication of the official Assessment Roll.  It was an idea of such startling common sense that we thought it unlikely to prevail.  But it did!  True to her word, the Minister implemented a policy of publishing the Pre-roll mid-year to provide ample time for negotiations.  The policy survived subsequent Ministers until the job of determining assessments was passed to PVSC, a “not for profit” corporation (paid for by property owners) created for that very purpose in April 2007 … but sadly no longer answerable to the Minister.  Despite the fact that PVSC inherited the Minister’s assessment staff the “Pre-roll” was an early casualty.  At first “transitional” computer cockups bore the brunt of the blame but as the years rolled by excuses were no longer deemed necessary as PVSC struggled to issue its Pre-roll at the eleventh hour.  Today we raise our eyes to the heavens and offer silent thanks if and when the Pre-roll materialises … or as is the case this year, a partial Pre-roll.  Still half a loaf is better than none at all even if it comes at a cost to taxpayers of $17 million annually.  (To be fair PVSC is the only assessment authority in Atlantic Canada that publishes a Pre-roll).

So, if your property is not yet in the PAMS® fold, how do you determine whether your commercial property is overassessed?  The basis for your 2016 Realty Assessment, as mandated by the provincial Assessment Act, is the market value of your property on 1st January 2014 (the “base date”), having regard to its physical state on 1st December 2015 (the “state date”) and the assessments of other commercial properties in the municipality (the “General Level of Assessment”).  Market value then is the first test:  if your realty assessment exceeds your property’s market value on 1st January 2014, it is over-assessed and you should so remonstrate with the assessor (or ask us to do it for you). 

The second test to apply is the General Level of Assessment (“GLA”), calculated by dividing the sum of the 2016 assessments of those properties that sold between 1st July 2013 and 30th June 2014, by the aggregate of their sale prices.  When PVSC divulge their General Level of Assessment they invariably claim it to be between 97% to 100%. Discerning readers will readily realise that 100% can be achieved if half the properties in the municipality are over-assessed by 50%, so long as the other half are under-assessed by 50% … so a property may be assessed at double its twin and still meet this test!  No matter, on the one occasion in which we were afforded the opportunity to review PVSC’s calculations, they proved to be a nonsense:  a point on which the court concurred.  A more realistic GLA for commercial property is 80% to 90%.

The Bottom Line:  If you do not challenge your assessment now you will have to wait until the Appeal Period in January 2016.

Action Required:  If you are in any doubt as to whether your property is over-assessed contact a member of our Nova Scotia tax team, Giselle Kakamousias, Greg Kerry or Mark Turner at 1-800-567-3033 (902-429-1811 in HRM).  They may not be able to help; but by golly, they are nice people.

Friday, 30 October 2015 13:58:13 (Atlantic Standard Time, UTC-04:00)  #    -
Property Tax | Nova Scotia