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Kennedy Stewart said the idea is to target speculators and entrepreneurs who buy commercial property and leave it empty while waiting for the value of the land to rise or redevelopment.
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April 27, 2022 • 13 hours ago • 4 minutes reading • 53 comments Pedestrians pass by an empty window on Robson Street in Vancouver. Photo by RICHARD LAM / PNG
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Vancouver Mayor Kennedy Stewart is calling for a tax on vacancies, which will punish landlords who leave shop windows empty.
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On Tuesday, the council gave the green light to Stewart to pursue the idea of a tax on empty shops with the provincial government. Like the empty house tax introduced in 2018, the city needs the province to introduce legislation to change the Vancouver Charter before it can impose a tax on empty shops.
Stewart said some neighborhoods in the city are struggling with free business levels of 20 percent or more. Planked windows reduce the vitality and safety of the neighborhood, he said.
Pedestrians walk through an empty window on Robson Street in Vancouver, British Columbia, September 6, 2020. Photo: RICHARD LAM / PNG
The tax will go after speculators who buy commercial properties and leave them sitting empty, betting on increasing the value of the properties, and then later turn them over. The tax, if done correctly, will stop speculation, increase the supply of retail space and possibly even reduce rents, he said.
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“We need to end this kind of speculation. If we do it right, it would mean lower rents for small businesses. “
Stewart said the majority of commercial property owners are good owners who are actively seeking to fill the property. They are not subject to the tax, he said.
“The good ones don’t have to worry. They have to tick a few boxes each year … to say, “Here’s my rental agreement, here are my ads, I was trying to fill that space.”
Tonight I asked the Council to join me in calling on the province to investigate the empty shop tax.
Just like homes, commercial properties have jumped in value, but many remain empty.
I’m not surprised that the same people who oppose the tax on empty homes have also opposed it. # Vanpoli pic.twitter.com/oCpNifhOla
– Kennedy Stewart (@kennedystewart) April 27, 2022
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A 2020 staff report found that the share of empty windows in four of Vancouver’s six neighborhoods had risen by more than 10 percent.
In six quarters, the number of businesses occupied by owners decreased by 16% from 2012 to 2019, while the number of showcases owned by numbered corporations increased by 41% and the number owned by developers increased by 71 %.
Stewart could not say how much of the property was held by speculators, but said there were spaces in the city that remained confusingly empty for years, even on busy shopping streets and even in high demand for offices, retail space and artistic spaces.
He acknowledged that some of the empty windows could be caused by a pandemic decline. This can be explained by the high rents that companies can not afford, but it is noted that the tax may encourage landlords to reduce their rents to fill the space.
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“This not only opens up the possibility of more deliveries, but also has the added benefit of lower rents,” he said.
Empty storefronts on Robson Street Photo by Francis Georgian / PNG
San Francisco and New York recently adopted similar measures. The San Francisco tax, which went into effect earlier this year, charges landlords a rate starting at $ 250 per linear foot showcase for spaces that are empty more than 182 days a year.
But many Vancouver businessmen are skeptical about the effectiveness of the tax in tackling high vacancy rates.
Lorraine Lowe, executive director of the classic Sun Yat-sen garden in Chinatown, said the tax would be the last straw for the besieged neighborhood, struggling with high vacancies, frequent graffiti and vandalism and declining pedestrian traffic due to lack of tourism during the pandemic.
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“It’s just a slap in the face,” Lowe said. “It will kill us. We are already hanging by a thread. ”
Calling the “countryside” to look like the bad guys here? Applying a tax that would deliberately destroy #chinatownyvr, knowing that we are n-hood, suffering from the highest levels of job vacancies in the city? Get tired of anti-racists creating policies that would suggest otherwise. # Vanpoli pic.twitter.com/MXxBvAPpUq
– Lorraine Lowe (@lorrainelowe_) April 27, 2022
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Lowe is worried that the tax will force desperate building owners to rent out premises to companies that could dilute the area’s cultural heritage, contrary to the community’s plan to seek UNESCO heritage identification.
Instead of taxes, the city should work to improve public safety in Chinatown, she said.
Jordan Eng, president of the Chinatown Business Improvement Association, said he did not think speculation was a problem in Chinatown.
He notes that Chinatown Parkade Plaza, which has struggled with 73 percent vacancies and has vacancies for more than a decade, is owned by the city.
Eng said Chinatown, Gastown, Strathcona and Downtown Eastside will be hardest hit by the empty shop tax as neighborhoods are at the center of the opioid crisis and property owners are already struggling to find tenants to run a viable business in a challenging environment .
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“The city needs to encourage new businesses and provide carrots instead of raising hammers,” he said.
Nolan Marshall III, president and CEO of the Vancouver Center Business Improvement Association, said he was disappointed with the lack of advice on the proposed tax. He also disagrees that this is the way to help businesses recover. “It is very difficult to imagine a scenario in which you will successfully charge taxes for economic recovery.”
Instead, the city needs to cut red tape, cut long waiting times for business permits and improve public safety, Marshall said.
Councilors Rebecca Bly, Lisa Dominato and Sarah Kirby-Jung voted against the change on Tuesday. The trio recently joined the Better City party, led by mayoral candidate Ken Sim.
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Raising business owners’ taxes as they fight the pandemic shows how untouchable and mean Kennedy Stewart is. I am proud of the ABC advisers and those who opposed this policy of destroying accessibility #vanpoli https://t.co/6a7DVBI4Yt
– Ken Sim (@kensimcity) April 27, 2022
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On Wednesday, Bly said there was no pressure from business or the BIA to tax empty stores.
“Apart from a small handful of bad apples standing in empty shopping areas … most of the empty shop windows are not intended to be,” Bly said, citing COVID-19, problems with permits and rising rents. appropriate factors.
The tax will penalize property owners for a complex issue that needs a more stable plan, she said. “Taxing will not help, it will only harm the situation.
chchan@postmedia.com
twitter.com/cherylchan
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