British Columbia

West End apartment owners using loophole to jack up rent, say tenants

Tenants of a building in Vancouver's West End say the owners are exploiting a loophole to increase rent by up to 20 per cent annually.

Owners Gordon Nelson say company is following the law and isn't exploiting anyone

Tenants at Blenheim Court in Vancouver's West End say the building owners are taking advantage of a loophole to increase rent beyond allowable amounts. (Google Maps)

Tenants of a building in Vancouver's West End say the owners are exploiting a loophole to increase rent by up to 20 per cent annually. 

When Adam Saint moved into the Blenheim Court building on Jervis Street with his girlfriend about a year ago, he was aware that his one-year lease had a fixed move-out date. 

But the recently remodelled building in a vibrant neighbourhood near the beach was an attractive housing option in a tight rental market.

One year later, when his lease was up for negotiation, he was shocked to discover his landlord was hiking the rent 20 per cent to $1,850 a month from $1,550.

"It's obviously shocking to see a rent increase that large in such a short period of time," said Saint.

With no guarantee their rent wouldn't sharply increase again in another year, the couple decided to move out.

"There's too much anxiety living that way, right? You want to be able to predict, to forecast a little bit about how you're going to be living in the future," said Saint.

The company which owns the building, Gordon Nelson, have three pet-friendly buildings in the West End.

Tenants in their other buildings say they have similar rental agreements with the company, which says it is following the law and isn't exploiting anyone. 

'Either negotiate or you leave'

Rent increases in B.C. are regulated under the B.C. Residential Tenancy Act to protect tenants against sudden, sharp rent increases.

Landlords are not allowed to increase rental rates beyond a percentage amount decided by the province each year, which has been around two to five per cent. Tenants also have to be given three months' written notice.

The loophole in that regulation comes with fixed-term leases that have a specific move-out date. Annual increase limits don't apply to those, as the lease is completely renegotiated when it comes to an end.

B.C. Housing Minister Rich Coleman says that as long as all parties willingly agree to the conditions, the arrangement at Blenheim Court is legitimate.

"When you enter a contract for a fixed term, you know when you sign that term that contract expires on x date, and now you either negotiate or you leave," said Coleman.

'Abusing the spirit of the law'

But Spencer Chandra Herbert, NDP MLA for Vancouver-West End, says the building owners are "abusing the spirit of the law."

"Fixed-term tenancies are just that, they're supposed to be fixed term, that you're here for a couple of months and then the landlord is going to renovate the place or have something else they plan to do," he said.

"They're not meant as a way for you to evade rent controls, so you can just jack up rents however much you want, whenever you want."

Chandra pointed out that this isn't the first time Gordon Nelson has implemented questionable rent practices. 

In 2008 tenants in another one of their West End buildings claimed they were being "renovicted" from their apartments. The company was evicting tenants — some who had lived in the building for 47 years — to renovate it and increase rents.

Eventually, an adjudicator at B.C.'s Residential Tenancy Branch Dispute Resolution Service ruled in favour of the tenants.

'It's a market force'

Chris Nelson, one of the building's owners, says his company, Gordon Nelson, isn't exploiting anybody. He said the company is open and clear with all of their tenants about their leasing policy.

He added that they provide a valuable service and they're simply charging market rates for the valuable renovated apartments. 

"Real estate's getting real expensive in this city and we're all having to navigate these waters of a city that's in high demand," said Nelson.

"Lots of people want to move and live and work here and it's a market force, not a Gordon Nelson force."

He said there's no shortage of people looking to move into the building, with a wait list of 20 to 30 potential tenants.

Nelson added that the company switched to fixed-term leases with a move-out date because they were considering redeveloping the Blenheim Court building, which he said would have been allowable under the latest West End Community Plan.

In the end, they decided to sell it for an undisclosed amount instead. The new owners take over in September.

With files from Kirk Williams

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