By this time next year, tenants should be moving into the first privately owned purpose-built rental buildings in Saanich in a quarter century.
Three generations of the Yakimovich family, owner-operators of EY Properties Ltd., returned to the site of their former offices, where, after three years of planning, they finally broke ground on Herons Landing and The Ardea.
The two six-storey buildings, located at the corner of Burnside and Tillicum Roads, will offer 104 bachelor, one, two and three bedroom rental units, ranging in price from $775 to $1,700.
“This is important that we get something going. Nothing’s really happened here in 25 years and I’m really hoping that this one development will kick start others in the area,” said Paul Gerrard, a Saanich councillor and Gorge-Tillicum resident. “We’ve got the mall, services, doctors, the rec centre, fantastic bus routes. This is obviously the best place for densification.”
Company president, Ernie Yakimovich, alongside his mother, 88-year-old Olga Yakimovich, co-founder of George Yakimovich and Son, the precursor to EY, exuded enthusiasm over the much-anticipated start of the project and didn’t rule out the possibility of another new rental development, should economic conditions allow.
“We’re looking at this one step at a time,” Ernie Yakimovich said. “It could be dependant on government regulation or government policy in that they’re talking about it finally after 25 years.”
The “it” Ernie Yakimovich was referring to is the capital gains taxation, which requires rental unit owners who sell to pay 50 per cent of the increased value of the property, and the lack of a rollover tax option for building owners selling properties in order to reinvest.
The tax regime on rental buildings – not to mention ongoing upkeep costs – has created a disincentive to build new rentals, and an incentive for developers to build condos.
The family has been open about the factors that allowed the project to move forward, despite the current challenges of building new rental stock.
Working on a site the company already owns and seeing the change in B.C. Building Code in 2009 to allow for six storey wood frame residential construction, as opposed to the previous four-storey limit, rendered the project financially viable.
“It’s been a long process and we’ve done a lot of work between ourselves and our consultants, the community and the municipality, to come up with the right building concept,” Ernie Yakimovich said. “I’m excited to be able to be able to produce this quality of rental building in this location.”
EY has the set standard of achieving at least a Gold LEED (Leadership in Energy and Environmental Design) rating, yet the company is more likely to achieve platinum standards on the project, through details such as common areas are powered by LED technology, exterior insulation, higher efficiency windows, energy star appliances and air to water heat pumps, said Doug Yakimovich, project co-ordinator.
The higher efficiency standards will come at an initial investment of approximately $400,000 to $500,000 more than standard construction and are expected to yield a 60 per cent energy savings. Farmer Construction Ltd. has been hired for the contract.