Ontario company with 'renoviction' history buys 178 Saint John rental units

A major purchase of 178 apartment and condominium units in Saint John by an Ontariobased rental company at prices more than double their assessed values is triggering new worries about the city's tightening supply of low-cost housing.

Property records show Whitehall Apartments of Oakville, Ontariopaid $11.52 million in December to buy units in 16 Saint John buildings that cater to low and moderate income renters

The acquisitions include a 71unit property at 175 Britain St. in the south end and a 12unit east side building at 100 Inverness Place.

Whitehall also bought 95 rentable condominiumsin 14 buildings at the Forestview development in and around Coldbrook Crescent near Mystery Lake.

According to Service New Brunswick, the entire group of properties was valued by provincialassessors at just $5.08 million in 2021, less than half what Whitehall has paid for them.

Saint John Coun. David Hickey said it is difficult to know whether to be excited or worried about an investmentof that size in Saint John's lowend housing market, given increasing shortages in affordable apartments for low-income residents.

"It's tough because there's two sides of this coin," said Hickey.

"It's exciting to see the investment and someone taking a $12 million bet on SaintJohn. But at the same time, if it's not prioritizing the folks that have always been there, then we're in a challenging spot."

Whitehall owns 50 apartment buildings throughout Ontario, many in secondary markets withsimilarities to SaintJohn like Sudbury, Sarnia and Windsor.

The company is privately held and has made no public comment about its move into Saint John or any plans it might have for rent changes or renovations.

Calls and messages to Whitehall's head office and its chief executive,Robert Kelava, were not returned.

Lawson Property Management is looking after Whitehall's apartments in Saint John but its owner, John Lawson, said he has no information to share on whether the company is planning major or minor changes in the buildings it bought.

"I can't tell youany plans," said Lawson,"We're waiting for a directive."

The centrepieceof the Saint John purchase and of local concernis the building on Britain Street.

It was involved in bankruptcy proceedings in 2020 and is not in the best condition. Last year it carried one of the lowest property valuations for a large apartment building in Saint John from provincial assessors at just $17,127 per unit.

The building has traditionally offered lowincome tenantssome of the cheapest rents in the city, although that has been changing in recent months.

'I can't afford that'

Louesa Fournier has been a tenant in the BritainStreet property for three years. She is 75 and paid $529 per month last year, including utilities, for her oneroom studio apartment. But she got a 14.6 per cent increase from the previous owner that took her rent to $606 on Jan.1.

"I can't afford that, but there's not much I can do," said Fournier.

Joe Buckley said he has lived in the Britain street building for the last 10 years and still pays $485 per month for his studio apartment.

Buckley is on social assistance and said if his rent increases like Fournier's he will have to leave.

"That's going to make it very very hard on me," said Buckley about any rent in the$600 range.

"Actually it's more than I receive (on assistance). How am I going to pay my rent when it goes up to that?"

Although there is no information on whether Whitehall will leave rents where they are, raise them or renovate, the company has been known to overhaul rundown properties it has acquired in the past.

Whitehall evicted tenants from a deteriorating 55unit apartment building it bought in Sudbury in 2019 for extensive upgrades in what was called a "renoviction"by one analyst in the local paper.

The building has since reopened and in November in ads onkijiji.cawas charging rents of $900 per month for a bachelor apartment, up from $500 before the renovations.

It was "good news for fans of renewal and anyone who viewed the aging edifice as an eyesore and hazard," reported the Sudbury Star in November, 2019. But "not so good for the folks who were displaced and others seeking affordable housing in Sudbury."

That's the dilemma that has been confronting New Brunswick policy makers about how to deal with companies like Whitehall who have been buying up rental properties at a record pace in New Brunswick since 2020.

Investments and renovations in deteriorating buildings are positive improvements, but a displacement of lowincome tenants from their homes and neighbourhoodsthat often follows those improvements is a social problem governments haven't fullysolved.

Last week, New Brunswick Social Development Minister Bruce Fitch said the province is spending more on rent supplements this year to help low income tenants deal with rising costs.

The province has also claimed that a change it made to double the notice period required to be given for rent increases to six months is helping people "adjust" to changes.

However, Hickey, who represents the city ward that includes the Britainstreet apartment building, said he still gets frequent calls from people in danger of losing their apartments to renovations or rent increases and he's worried Whitehall's majorinvestment may eventually add to those troubles.

"It's nonstop," said Hickey. "I get calls all the time.People are consistently being priced out of the market and priced out of the homes that they're living in.Folks are left with no scenarios of places to go."