How the City effectively Creates Millions in Property Values
Ron Bolin: Feb. 13, 2011
A few years ago Council, in the same kind of wisdom that it used for the Conference Centre, decided to get rid of the Urban Containment Boundary (UCB) which demarcated urban from rural land in the city by basically shifting the UCB to the city boundary. This allowed two massive development proposals on the southern boundary of the city: Sandstone and Cable Bay (now called Oceanview). The city has spent countless hours working with both ventures, but in this piece I will only be concerned with Oceanview.
You may recall that we had an “alternate referendum process” dealing with a Cable Bay/Oceanview annexation to the City from the RDN where over 10% of Nanaimo voters refused that negative option process which entailed passage of the required referendum question unless over 10% of registered voters, acting by petition, refuse it. While such an alternate process seldom fails as most remain ignorant of the question, this one, through the great efforts of a number of people from both the city and the RDN, did not.
Undeterred, the developer and the city (with an unknown expenditure of time and resources by our planning department and Council) continued with the revised planning for the project. The end result of the actions of our planners and our Council in approving the plan identified in the ad below, but with no major changes on the ground, changed the value of the property mightily. This is how a few strokes of a City pen create big bucks in real estate.
While I do not know how much was paid for the five properties that define the Cable Bay/Oceanview project, I do know that they were assessed in 2009 at $5,729,500 with three of the five identified as “Managed Forest” for $289,500 and with the other two zoned as “Residential” and assessed at $5,440,000. In a turn of events which I still am unable to follow, the total assessment on these properties in 2010 was reduced to $514,000, less than 10% of the 2009 assessment, with all five properties now in the “Managed Forest” category. In yet another grand turn, the 2011 assessment rolls show these same five properties (all now listed as “Industrial”) at $13,309,000.
And now the latest entry into this intrigue of valuations comes in the form of an ad:
The property “comes with its approved 420 acres within the City of Nanaimo, British Columbia on Vancouver Island. Oceanview Golf Resort & Spa Master Plan approved for 2,677 dwelling units ranging from single family to multi-family/hotel units. Master Plan provides for 18 hole golf course. Official Community Plan (OCP) designation is ‘Resort Centre’. 97.3 acres contiguous is located in District of Cedar. Excellent views of Northumberland and Stuart Channels and Vancouver Island mountains.”
The list price is $60,000,000.
This is a fantastic walk through assessments, planning department recommendations and Council decisions, through Managed Forest, Residential, and the latest Industrial classifications, from an unknown amount spent to acquire the land, to assessments ranging from a half million dollars to five and a half million to 13 and a half million, to an offering price of $60,000,000 – and in the meantime almost nothing changed on the ground…. Go figure…. And calculate the value added by strokes of the pen at City Hall.