#13091
Jimmy-T
Keymaster

    I can see why your SM would suggest leasing. There would be no need to adjust unit entitlements, for a start, and I’m sure there could be some way of ensuring that owners could on-sell the lease with their apartments at some time in the future.

    As far as valuations go, there is a formula established by the Supreme Court for purchasing Common Property to improve existing lots.  Basically you get professional estimates of how much the property will be worth with the addition of the terrace and how much it is is worth now.  You subtract the latter from the former, and also take off any costs associated with the work and remainder is what the lot owners pays the OC.

    So I would be tempted to use that principle, only with rents.  Get valuations of how much it would cost to rent the apartments as is, and then with the terrace/balconies, and subtract one from the other.  The difference would be the basis for your lease.  The OC pays to fix up the balconies and the lot owner pays for installing the doors etc (to your approved design).

    You could then take that money from the leased space and go to a strata finance company like Lannocks and find out how much that would get you in a loan to pay for some of the work you need to do. 

    Selling the space may sound easier but it really isn’t when you get into things like adjusting unit entitlements for the whole building.

    The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.