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BC Housing explains its process in buying properties for social housing

BC Housing senior communications advisor Sophie Carrigan Gray explained via email a property’s assessed value is “not an accurate indicator of its market purchase price.”
Fortune Motel
BC Housing purchased the Fortune Motel on April 7 for $3.6 million, more than double its assessed value of $1.6 million.

In the wake of a purchase by the City of Kamloops/BC Housing of the Northbridge Hotel and a rear property at a cost of $7.15 million come questions about why the North Kamloops property was purchased for $4 million above assessed value.

The hotel property at 377/385 Tranquille Rd. was assessed this year at $2.6 million, down from the $2.83 million it was assessed at in 2020. The rear lot at 346 Campbell Ave., which has a former liquor store building on it, was assessed this year at $544,900. In 2020, that land was assessed at $544,900.

The assessments are done by the BC Assessment Authority, a provincial government Crown corporation.

During an interview with BC Liberal leadership candidate Kevin Falcon this past the summer, Falcon was spoke to KTW about social issues and criticized the province for overpaying on old motel/hotel properties for BC Housing initiatives.

He said the province had been building housing without supports, leading to the deterioration of local support for such initiatives. Falcon had been touring Kamloops and said the province “overpaid” for the Fortune Motel at 654 Fortune Dr. in North Kamloops.

“By the way, this is becoming a joke inside the real estate industry,” he said at the time. “I worked in that industry, where they’re massively overpaying for these hotels and motels.”

Falcon went on to express his concern that the province would not provide sufficient supports for those who end up living in social housing units at the Fortune Motel.

Falcon is executive vice-president for Anthem Capital Corp, a parent company involved primarily in real estate development.

BC Housing purchased the Fortune Motel on April 7 for $3.6 million, more than double its assessed value of $1.6 million.

Following that interview with Falcon, KTW reached out to BC Housing to ask about the general process the province uses for negotiating these types of deals and asked specifically, in the case of the Fortune Motel transaction, why the province paid more than double the assessed value.

BC Housing senior communications advisor Sophie Carrigan Gray explained via email a property’s assessed value is “not an accurate indicator of its market purchase price.”

“To ensure there is a thorough and current estimate of the value of the property that reflects the highest and best use, BC Housing secures independent appraisals by a third-party appraiser for all properties we are considering purchasing,” Carrigan Gray said.

“An independent appraisal of the former Fortune Motel property in Kamloops was $3.3 million. The appraisal considered the existing property, as well the value of future redevelopment, which encompasses BC Housing’s intent for purchasing.”

She said other considerations include urgency for housing, land and housing type supply or the uniqueness of the opportunity presented by the purchase.

Carrigan Gray said BC Housing has a real estate team with expertise in property acquisition and development and “strives to purchase properties that reflect best value for public dollars.”