Current Issues
Current issues dealing with commercial real estate law in Canada.
- Green Buildings, Carbon Taxes, Carbon Cap-and-Trade Schemes, Green Leases and other Environmental and Energy Related Issues. Read More
- CCDC-2008, OAA Standard Form Agreements and various Other Forms of Construction and Design Documents. Read More
- The Impact of the Change from Canadian GAAP to IFRS. Read More
- Recent Amendments of the Bankruptcy and Insolvency Act and the Company Creditors Arrangement Act. Read More
- Real Property Taxation and Assessment. Read More
- Retirement Home Development Agreements. Read More
- HST Read More
- The Current State of the Economy. Read More
- Telecommunications Service Providers Access and Related Agreements. Read More
Green Buildings, Carbon Taxes, Carbon Cap-and-Trade Schemes, Green Leases and other Environmental and Energy Related Issues
Developers and owners of commercial real estate need to ensure that they are able to take advantage of the benefits associated with LEED certification of their buildings. They are also concerned with ensuring that their leases give them the tools needed to achieve LEED certification and to maintain it. This involves a full appreciation of the LEED rating systems in order to ensure that the deals they negotiate with tenants, contractors, architects, and other suppliers of services position them to achieve energy savings and environmental improvements.
Tenants have similar concerns and, in addition, need to deal with
extra costs that are sought to be passed on to them to ensure that they
are fair and reasonable.
New developments arising from the Green Energy Act of Ontario include
leases and licenses of roof space and other facilities for solar panels,
power purchase agreements and other transactions associated with
renewable energy.
Familiarity with the carbon cap-and-trade schemes currently operating in
various jurisdictions and including Ontario will be essential for
building owners and managers having regard to the major contribution of
greenhouse gas emissions that is associated with commercial buildings.
It is essential for property owners and tenants to keep abreast of
sustainability requirements. For example, the City of Toronto has imposed
a requirement for all new multi-occupant buildings to have "green roofs".
CCDC-2008, OAA Standard Form Agreements and various Other Forms of Construction and Design Documents
Owners need to be familiar with the new CCDC-2008 Stipulated Price Construction Contract and the 2008 version of the Ontario Architects Association Standard Form Consulting Agreement. Owners of real estate need to know how to amend those documents in order to protect their interests. Supplementary Conditions have been developed and continue to be refined for use in conjunction with not only the documents noted above but other CCDC documents such as the Cost Plus CCDC 3 Form, Design Build Contracts and similar forms.
The Impact of the Change from Canadian GAAP to IFRS
Canadian generally accepted accounting principles ("GAAP") for Publicly Accountable Enterprises will be replaced with International Financial Reporting Standards (“IFRS”) for fiscal years beginning on or after January 1, 2011. Landlords and tenants need to consider the impact of this change on the calculation of operating costs and the drafting of lease clauses relating to cost recoveries.
Recent Amendments of the Bankruptcy and Insolvency Act and the Company Creditors Arrangement Act
These statutes have recently been amended. The implications for landlords and tenants in connection with lease restructurings and remedies need to be understood.
Real Property Taxation and Assessment
The major changes to the real property taxation system in Ontario that took effect on January 1, 1998, had a very significant effect on commercial property leasing. Since 1998 there have been numerous amendments and regulations that have further complicated real property taxation, and the recovery provisions of commercial leases. The "capping and clawback" regulations have been of particular importance and recent developments enabling municipalities, in certain circumstances, to opt out of the capping and clawback scheme have further complicated matters. There is a great need to deal with reviewing and appealing real property tax assessments, obtaining and accounting for vacancy space rebates and tax refunds and negotiating, drafting and interpreting, commercial lease provisions.
Retirement Home Development Agreements
The aging population has made the development and operation of retirement homes a major component of the economy. Construction management, development management, and partnership and other agreements relating to retirement facilities have been developed and are being adapted on a project-by-project basis.
The Province of Ontario intends to implement a harmonized 13% sales tax. Lease documentation is being updated to respond to this change.
The Current State of the Economy
As landlords and tenants struggle to meet the challenges of the current economy, the need to deal with tenant assistance arrangements, tenant defaults, lease repudiations, operating costs disputes and a variety of other stresses on the landlord and tenant relationship is greatly enhanced. The expertise and business sensitivity of our leasing and litigation teams are being called on regularly.
Telecommunications Service Providers Access and Related Agreements
CRTC policies encouraging competition in the telecommunication industry have resulted in the need for building owners to develop and negotiate various forms of access agreements to deal with point-of-presence facilities ("POP rooms"), rooftop antenna installations, cellular enhancement antenna agreements, and a variety of other agreements. In addition, cable television companies require access to apartment buildings and other buildings for purpose of providing bulk television service and for marketing their programming services. We have helped RealPac in developing recommended forms and we are continuously developing and negotiating a wide variety of these agreements for our clients. We are recognized as the leading firm in this area.