Stanley Hotel, 36 Blood Alley SQ., Vancouver

74757-09 36 Blood Alley Square, Vancouver Stanley Hotel
Narrative Appraisal of
Stanley Hotel
Located at
36 Blood Alley Square, Vancouver, BC
Prepared For
PHS Community Services Society
As at
October 19, 2012
Appraised by
Simon Poon, AACI, P. App, B.Comm
Our Reference Number
500484-12
December 3, 2012
Reference # 500484-12
PHS Community Services Society
20 W Hastings Street
Vancouver BC
Dear PHS Community Services Society:
Re:
Valuation of 36 Blood Alley Square, Vancouver, BC
In response to your recent instruction and authorization, Campbell & Pound Ltd have
appraised the referenced properties with the objective of estimating the current market
value of the fee simple interest. The data, information, and calculations leading to the
value conclusion are incorporated in the Narrative report following this letter. The
report, in its entirety, including all assumptions and limiting conditions, is an integral part
of and inseparable from this letter.
As a result of our investigation and analyses, our final opinion of value as at October 19,
2012, subject to all assumptions and limiting conditions contained herein, is as follows:
$9,510,000
(Nine Million Five Hundred Ten Thousand Dollars)
The analyses, opinions and conclusions prepared in this report were developed in
conformance with our interpretation of the guidelines and recommendations set forth in
the Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP 2003
edition) and the requirements of the Code of Professional Ethics and Standards of
Professional Appraisal Practice of the Appraisal Institute of Canada. This appraisal
report has been prepared exclusively for PHS Community Services Society. If any
questions arise by reason of this report, please contact the undersigned at your
convenience.
Respectfully submitted,
CAMPBELL & POUND, LTD.
per:
_________________________________
Simon Poon, AACI, P.App, B.Comm
1111 11871 Horseshoe Way, Richmond BC V7A 5H5

T: 604.270.8885 F:604.270.8045
INTRODUCTION
TABLE OF CONTENTS
Letter of Transmittal
TABLE OF CONTENTS ...................................................................................................... 3
INTRODUCTION............................................................................................................. 4
TERMS OF REFERENCE ..................................................................................................... 8
ASSUMPTIONS AND LIMITING CONDITIONS .................................................................... 10
FACTUAL DATA ........................................................................................................... 13
AREA DATA ................................................................................................................... 16
SITE DESCRIPTION ......................................................................................................... 18
LAND USE INFORMATION............................................................................................... 21
DESCRIPTION OF IMPROVEMENTS .................................................................................. 22
ANALYSIS AND CONCLUSIONS .............................................................................. 25
HIGHEST AND BEST USE ................................................................................................ 26
METHODS OF VALUATION.............................................................................................. 29
INCOME APPROACH ....................................................................................................... 30
DIRECT COMPARISON APPROACH .................................................................................. 40
COMPARISON APPROACH LAND .................................................................................. 61
LAND SALES ANALYSIS ................................................................................................. 62
RECONCILIATION ........................................................................................................... 67
EXPOSURE TIME............................................................................................................. 68
FINAL ESTIMATE OF VALUE ........................................................................................... 68
CERTIFICATION .............................................................................................................. 69
EXHIBITS AND ADDENDA ........................................................................................ 70
(A) DEFINITION OF TERMS
(B) TITLE SEARCH
(C) EXCERPTS FROM ZONING BY-LAW
(D) QUALIFICATIONS OF APPRAISER
(E) ADDITIONAL PHOTOS
INTRODUCTION
INTRODUCTION
INTRODUCTION
Subject Lane View
Subject Street View
INTRODUCTION
Aerial Photo
INTRODUCTION
EXECUTIVE SUMMARY
Property
The subject is improved with a two OT heritage buildings, of two

and three storey designs. These are improved for use as 12 retail
units on the ground floor and as a 104 unit rooming house and
care facility above. The buildings appeared in average condition.
Property Address
Legal Description
Lot 14, Block 2, District Lot OGT Gastown Men's Residence

Plan VAP168
PID
015-713-342, 015-713-326, 015-713-334, 015-713-318
Zoning
HA-2 Gastown Historic, Heritage B(M)
Site Area
19060 sq. ft. (206.75 x 92.19)
Effective Improved Area
+/-38112 sq.ft. (104 rooms, 12 retail unit approx. 14356 sq.ft.)
Remaining Economic Life
+/- 30 years
2012 Property Assessments:
Land:
Improvements:
Total:
2012 Gross Property Taxes:
$5287.07
Neighbourhood Description
The subject is located in the Gastown neighborhood
Highest And Best Use
Highest and Best Use for the subject property is as a

redevelopment and/or heritage restoration.
Stabilized Net Income:
$552,066 per annum (based on projected stabilized rental rates)
Capitalization Rate
6.50%
Valuation
Income Approach:
Direct Comparison Approach
(As Improved):
(As Development Land )
$8,490,000
$9,510,000
$9,530,000
$9,510,000
Final Estimate of Value

Effective Appraisal Date
$1,352,001
$422,001
$1,774,002
October 19, 2012
INTRODUCTION
TERMS OF REFERENCE
Purpose and Function of the Report
The purpose of this report is to estimate the Market Value of the Fee Simple interest in
the properties legally described herein as of October 1, 2012. The function of this report
is to determine fair market value for security in first mortgage financing
This appraisal report has been prepared exclusively for PHS Community Services Society
to determine fair market value for security in first mortgage financing. Liability to others
or for any other uses is expressly denied.
The properties have been appraised free and clear of all encumbrances, financing, liens,
easements and restrictions, except for those encumbrances required to permit
development, subject to any leasehold interest, and as otherwise noted herein.
PROPERTY RIGHTS APPRAISED

The property rights appraised is the Fee Simple ownership in the property, except for
normal limitations.
SCOPE OF APPRAISAL
1) This report constitutes a self-contained, fully documented narrative appraisal,
which has been prepared in accordance with the Canadian Uniform Standards
of Professional Appraisal Practice as adopted by the Appraisal Institute of
Canada to date. In the preparation of this appraisal we have conducted a
complete market analysis including the following steps which were taken in
the preparation of this appraisal:
2) Inspected the property on October 19, 2012.
3) Surveyed the surrounding neighbourhood and documented existing land uses,
access and traffic patterns, development trends and competitive facilities.
4) Reviewed the electronically obtained title search & tax assessment data for
verification of ownership, property taxes and assessments.
5) Reviewed municipal zoning and land use data. Note however, no consultation
was made with City of Vancouver Planners at this time.
6) Reviewed the general market with emphasis on similar land uses in the area,
including existing inventory, potential new construction, and market rental
rates.
7) From an analysis of the site, existing improvements, land use trends and
financial data, determined the probable highest and best use of the property.
8) Analyzed sales of comparable properties in the competitive market area, and
where deemed appropriate, we interviewed market participants for analytical
purposes.
INTRODUCTION
9) Concluded value estimates using the Direct Comparison Approach and

Income Approach.
10) Reconciled the value estimates for a final conclusion of Market Value as of
October 19, 2012.
DOCUMENTATION
For the purposes of this report, the following documents were relied upon:
BC Assessment Tax Report

Municipal Zoning Bylaw (included in Appendix)
Municipal Land Use Plan
BC Online Title Search (included in Appendix)
The following documents were provided by the client and were relied upon.
information contained within these documents was assumed to be correct:
All
No supporting documents were received

A brief summary of some current leases was received from the client
The analysis set out in this report relied on written and verbal information obtained from
a variety of sources we considered reliable. Unless otherwise stated herein, we did not
verify client-supplied information, which we assumed to be correct.
No current building plan was received

No Current Leases were obtained
No income or expense statements were received
No Rental details for the SRO operation were received.
INTRODUCTION
ASSUMPTIONS AND LIMITING CONDITIONS

The estimate of value in this report is based on a detailed analysis of information obtained
from various sources. Some of this data has required subjective interpretation and our
terms of reference have, in some instances, required us to make certain assumptions in
arriving at our value conclusion. As a result, the opinions and conclusions contained in
this report are subject to the following Assumptions and Limiting Conditions:
Terms
1.
The estimated Market Value of the property appraised is based on the

assumption that it would be sold on payment terms consistent with common
practices in the real estate market and subject to the contractual encumbrances
outlined in this report, unless otherwise stated.
Sources
2.
The legal description of the property appraised and the dimensions and area of
the site were obtained from several sources, including the Land Titles Office,
the local municipal jurisdiction, and BC Assessments (BCA).
Legal
3.
No responsibility is assumed for legal factors pertaining to the state of title or

for technical matters relating to hidden or unapparent conditions of the
property, such as subsoil or structural problems which were not brought to our
attention and which may have an impact on value. Title to the property is
assumed to be good and marketable unless otherwise stated.
Visual Reference
4.
Maps or plans appearing in this report are included for the sole purpose of
visual reference and should not be construed as legal surveys, since the
appraiser has not completed a survey of the property, and assumes no
responsibility in connection with such matters.
Mineral Rights
5.
The property rights appraised herein exclude mineral rights, if any.
Original Signature
6.
This report is only valid if it bears the original signature of its author.
Compliance & Conformity

7.
Unless otherwise stated, it is assumed that there are no outstanding

governmental order or directives requiring upgrading of the property or
limiting its occupancy. It is assumed that the property is in full compliance
with all applicable federal, provincial and local environmental regulations and
laws, unless non-compliance is stated, described, and considered in the
appraisal report.
10
INTRODUCTION
8.
It is assumed that all applicable zoning, land use regulations and restrictions
have been complied with, unless non-conformity has been identified,
described, and considered in the appraisal report.
9.
It is assumed that all required licences, occupancy certificates, consents, or

other legislative or administrative authority from any federal, provincial or
local governments have been or can be obtained or renewed for any use on
which the value estimate contained in this report is based.
10.
It is assumed that the utilization of the land and improvements is within the
boundaries or property lines of the property described and that there is no
encroachment or trespass unless noted in the report.
Hazardous Material
11.
Unless otherwise stated in this report, the existence of hazardous material,

which may or may not be present on the property, was not observed by the
appraiser. The appraiser has no knowledge of the existence of such materials
in or on the property, and is not qualified to detect such substances.
12.
The presence of substances such as asbestos, urea formaldehyde foam

insulation, or other potentially hazardous materials may affect the value of the
property. The value estimate reported herein is predicated on the assumption
that there is no such material in or on the property that would cause a loss in
value. No responsibility is assumed for any such conditions or for any
expertise or engineering knowledge required for their discovery.
Improvements
13.
We have assumed that all heating, ventilation and electrical systems, plumbing
and other mechanical systems are in good working order. No responsibility is
assumed for any expertise or engineering knowledge required for making such
determination.
Furniture Fixtures & Equipment

14.
This appraisal report considers the market value of the real estate only and does
not include any business that may be carried on in this subject. Any
contribution value of Furniture, Fixtures, and Equipment(FF&E) would be
included only to the extent that such items contribute to the normal operation
of the property, and are not separable as such. No list of FF&E or other chattel
property was supplied to the appraisers.
Use
15.
This report is intended for the use of the Addressee, and shall not be
distributed, copied or reproduced in whole or in part without prior written
consent of Campbell & Pound Ltd. Further, neither all, nor any part of this
appraisal report shall be used in any marketing of financing package or in any
advertising, public relations, news, sales or other media for public or third
party communication without prior written consent from an authorized
representative of Campbell & Pound Ltd.
11
16.
INTRODUCTION
The appraiser, by reason of this appraisal, is not required to give testimony,

appear in court, or attend any hearing, arbitration proceeding or other meeting,
unless prior arrangements have been made.
Statement of Competency
17.
The professional staff at Campbell & Pound, Ltd., and Simon Poon, AACI,
P.App, B.Comm, have experience in the valuation of similar properties. In this
regard, we have the knowledge and experience to complete this assignment and
have appraised and analyzed this type of property before.
EXTRAORDINARY ASSUMPTIONS & LIMITING CONDITIONS

Development Potential
For the purposes of this valuation, we have assumed a buildabe area of 5.0
FSR. The majority of the properties in the area show a similar density.
Sales in the area have shown some higher densities, however, these are
case by case with approval from the City. The heritage designation and
the need for discussion with the City of Vancouver means that the acutal
density will vary.
No consultation has been made with City Planners regarding the
development potential of this property. We have assumed a minimal
allowable density based on surrounding uses. The subjects heritage
designation and SRO use will restrict redevelopment.
Actual
redevelopment may involve heritage restoration and incentives from the
City. As no plans or proposals have been submitted at this time, we have
assumed an allowable density of 5.0 FSR.
12
FACTUAL DATA
FACTUAL DATA
13
FACTUAL DATA
CIVIC ADDRESS
LEGAL DESCRIPTION
Lot 14, Block 2, District Lot OGT Gastown Men's Residence Plan VAP168
PARCEL IDENTIFIER
015-713-342, 015-713-326, 015-713-334, 015-713-318
CERTIFICATE OF TITLE NUMBER

BV112001
REGISTERED OWNERS IN FEE SIMPLE

The property is registered to City of Vancouver
REGISTERED CHARGES
A title search revealed the following charges on title:
HERITAGE DESIGNATION BY-LAW, VANCOUVER
PARTY WALL AGREEMENT (1925)
3EASEMENT AND INDEMNITY AGREEMENTS (1970, 1970, 1970)
OPTION TO PURCHASE (2003, PORTLAND HOTEL SOCIETY)
No further investigation has been made. A copy of the title search has been
included in the appendix. Note that this should not be construed as a legal
opinion of title. We did not obtain a legal opinion of the state of title or any of the
encumbrances, we have not read the documents registered against title. Our
appraisal therefore assumes that title is good and marketable and that
encumbrances do not affect the value of the appraised interest.
ASSESSMENT INFORMATION
BCA Roll Number:
026589172650000
Actual Assessment Values (2009)

BC Assessment (Land)
BC Assessment (Improvements)
BC Assessment (Total)
$1,352,001
$422,001
$1,774,002
BC Assessed Taxes
$5287
14
FACTUAL DATA
SALES HISTORY
A search of public records indicates that the last transfer of the subject property
took place in 3/1/2003 under transfer document BV112001 for the amount of
$2,000,000. This was reported as a non-market transaction. A search on the MLS
system revealed no active listings for the subject
15
FACTUAL DATA
AREA DATA
NEIGHBOURHOOD DATA
Neighbourhood Map of Subject Property
NEIGHBORHOOD SUMMARY
The subject property is located at the edge of the Gastown Historic section of the
downtown east side of the City of Vancouver. The area which comprise the immediate
location are a collection of old factory and hotel buildings which have been converted
into stylish retail, office properties, plus numerous restaurants, and mixed
commercial/residential buildings. The entire neighborhood carries a Heritage designation
which strictly controls development in preserve the character of the neighborhood.
The streets which are considered to form the Gastown neighborhood include Abbot,
Cambie, Water, and Carrall Streets. Except for Water Street which traverses the
neighborhood, all the others are no more than two blocks long.
Water Street between the square and its end at the intersection of Cordova and Richards
Streets, is the main commercial and tourist oriented section of Gastown. Throughout the
neighborhood extensive upgrading of old factory and hotel buildings is underway.
Development is spilling out of the specific Gastown blocks onto streets south of the
16
FACTUAL DATA
neighborhood. All of this new development activity is slowly improving what is

considered to be one of the poorest and most run down districts-the Downtown East Side.
In general the subject neighborhood is a unique area, a tourist destination, and an
emerging inner city residential neighborhood. Full municipal services are available in the
city core. These include regular police/fire services, sanitary and storm sewers, central
water supply, electricity, natural gas source, communications lines. Local public transit
service operates on the main routes along Hastings Street adjacent to the Gastown interior
blocks. The Waterfront SkyTrain rapid transit station is to the west of the end of Water
Street.
The City of Vancouver has instituted the Carrall Street Greenway Concept Design
Program. The goal of this program has to create a greenway that connects Gastown, the
Downtown Eastside, and with a greenway that completes the downtown recreational
seawall loop by linking False Creek to Burrard Inlet and a greenway that encourages
active ground floor uses and facilitates economic revitalization and community
development.
The completion of the Woodwards project has spurred increased revitalization of the
neighbourhood, with recent refurbishment of the properties along Hasting Street and
increasing retail tenancy. The section of Hastings Street between Cambie Street and
Carrall Street remains in the revitalization phase, but appeal of the properties in this area
is steadily increasing.
17
FACTUAL DATA
21.7 9
32.8
9
2.57 m
12.401m
20.63m
20.626m
25.718m
25.721m
26.873m
31.485m
31.49m
31.19m
43
43
43
43
58.077m
52
52
52
52
25
25
38.75
55
1
38
.7
56
56
56
3
4 8 8.7
.6 1
82
m
34
34
34
34
25
25
25
52
52
52
80
80
80
80
38
.7
37.193m
37.195m
15.252m
9.5
79
m
37.191m
28
28
28
28
204
204
204
204
7.625
1 68.33
29.875m
97.92
13.421m
37.197m
37.189m
44
55
55
55
55
POWELL
00 POWELL
POWELL ST
ST
<--POWELL
ST <--ST
<---
120
43.5
26.2
26.2 5
20.11m
65.97
200
CARRALL
200
200 CARRALL
CARRALL ST
ST
200
<--CARRALL
ST <--ST
<---
210
210
210
9.07m
19.934m
214
214
214
214
24.981m
9.908m
200
200 CARRALL
200
CARRALL ST
CARRALL
ST <--ST
<--<---
--<--<ST <ST
ER ST
ER
DER
D
AND
AN
EX
EXAN
EX
ALEX
AL
00 AL
666
214
214
214
214
120
42.696m
64.7
55
55
55
55
11
11
15.19m
65.7 9
18.973m
76.15m
47.6 7
50
88
88
E
CORDOVA
00
ECORDOVA
CORDOVAST
ST
00 E
E
--->
CORDOVA
ST --->
--->
ST
--->
88
88
88
8
131.12
8.86 8
m 24
.7 1
131.75
53
53
53
53
23.0 04
m
88
8
DD
m
0 .8 .05 m
0
61
61
61
15.2 97
21 m
10.2
66
66
32.8 9
50
50
50
50
39.9
91
m 11.1 52
m
31 m
1 .0.05
0
15.5 36
m
131.
88
32.8 5
44.901m
99
99
65.9
2
26
65.7 9
88
88
40.2 26
m
32.8 5
19.63
1m
64.4 2
5.94
15.9 9m
POWELL
00
POWELL ST
ST
<--00 POWELL
POWELL
ST <--<--ST
<---
42
92.2
8
39.9 2
56
56
56
33.4 76
m
131.
93
132.21
86.4 15
m
B OTT
ST
65.7
1
300
AB
15
15
15
15
24.7
8
309
309
309
309
300 CARRALL ST
66.1
6
39.9 93
m
60
60
60
60
65.7
1
95
95
95
95
65.9 2
65.7
9
320
320
320
320
66.0 8
CD-1 (450)
33.4 78
m
65
65.0 8
ST
B OTT
306
306
306
306
300
AB
351
351
351
351
65.9 2
000 W
W
W CO
W
CO
COR
R
RDO
DO
DOVA
VA
VA ST
ST
ST ------->>>
55
55
55
55
83
31.9
41
41
41
1.70 7m
13.7 77
m
229
229
229
229
36
36
36
34.9 2
65.7 9
30.542m
47
4 7 .108
.1
01 m
m
31
351
351
351
351
15.248m
m
60.9 28
42.5
36
36
27
27
27
27
27
27
27
27
17.912m
39.9 4
24.03m
65.9 5
132.2
23.5
31 m
36
36
36
36
50.0
9
65.9 4
36
36
36
36
S QU
ARE
32.7 92
m
200
200 CARRALL
200
CARRALL
CARRALL ST
ST
ST <--<--<---
LL E Y
55.1 4
57
57
57
57
0 GAO
LER'
SM
100
BLO
OD A
92.2 5
33
28.6
OU N
CE AL 87 m
LE Y
92.1 9
65
65
65
65
132.12
92.1
1.82 9m
S M EW
S
EWS
43.5 79
m
43.5 89
m
0 TR
92.1 3
33
0 GAO
LER'
21.1 44
m
40.2 76
132.1 m
81
81
81
81
12
12
12
12
9.90 4m
42.0 43
m
31.0 4
17.3 74
m
25
57
20.2 61
m
238
238
238
238
93
93
93
36
36
36
36
43.5 84
m
22.8 63
m
25
ST
43.5 88
43.5 87 m
m
25
21.9 34
m
60
228
228
228
OU N
CE AL
LE
21.9
m
46
46
46
46
40.1 92
m
351
351
351
351
100
CARRALL
100
100 CARRALL
CARRALL ST
ST
100
<--CARRALL
<--ST <--<---
ST
BOTT
143.
08
43.5 91
m
50
50
50
50
8.002
m
m
16.3 36
13.8
73
28.7 66
m
R=356.869m
45.787m
6 4m
8 .4
6 1m
8 .4
14.584m
11
11
21.0 69
m
0 TR
228
228
228
BOTT
18.2 79
m
247
247
247
247
21.9 4m
10
10
10000
W
W
W CO
CO
COR
R
RDO
DO
DOVA
VA
VA ST
ST
ST ------->>>
23.196m
9.90 7m
68
68
68
68
21.9 67
m
21.9 68
m
36.5 37
m
20.2 67
m
210
210
210
210
200
AB
21.9 28
m
21.9 27
m
18.2 68
m
18.2 73
m
98.6 91
m
66
200
AB
143.08
100 T
ROU
NCE
AL LE
Y
66
000 W
WAT
W
ATER
AT
ER ST
ER
ST
ST <ST
<--<---
66
57
43.5 77
m
102
102
102
102
0 .0
2 5m
CWD
45.789m
110
110
110
110
233
233
233
233
10.329m
33
33
33
50.2 92
m
122
122
122
122
151
151
151
151
26.50
5m
41.446m
33
65.9 7
90.4 98
m
119.24
7m
55
55
55
66
100
AB
32.9 8
150
150
150
150
98.7 14
m
BOTT
1000 W
10
10
W
WAT
AT
ATER
ER
ER ST
ST
ST <<<--<---
32.9 8
4
13
90.5 02
m
132
40.22
1m
SITE DESCRIPTION
33
3 .5 m
22.59m
9.954m
CITY OF VANCOUVER
20.39m
8.501m 25
Data quality not guaranteed
25
25
25
25
50
50
50
50
Figure 3 Orthographic View of Subject Property
PROPERTY APPRAISED
The subject property is located on the south side of Blood Alley Square, a small street
section off of Trounce Alley, between Carrall Street and Abbot Street. The property also
fronts onto West Cordova. The property consists of two interconnected buildings
operating as a rental subsidized shelter and community care centre, with multi-tenant
retail on the ground floor fronting onto West Cordova.
18
FACTUAL DATA
AT
TE
TE
TE
ER
ER
RR ST
ST
ST
28.7 66
m
68
<----<<-
50
46
12
43.5 84
m
000 POWELL
POWELL ST
POWELL
ST <--ST
<--<--0 GAO
LE
43.5 79
m
9.90 4m
R'S M
209
EWS
0 GAO
LE
0 TR
OUN
CE
SQU
ARE
ALLE
Y
HA-2
0 TR
O
UN CE
42
ALLE
Y
204
13.7 77
m
132.
2
43.5
210
229
24.03m
31
23.5 31
m
39.9 4
36
92.2 5
36
40.1 92
m
92.1 9
65.9
5
36
34.9 2
65.9 2
15
19.6 31
m
64.4 2
55.1 4
92.2
8
65.9
2
000 W
W
W CO
CO
COR
R
RDO
DO
DOVA
DO
VA
VA ST
ST
ST ------->>
>>
33.4 78
m
5.94
214
42.5
36
120
32.7 92
m
92.1 3
132.12
ALLE
Y
65.9 4
92.1
40.2 76
m
132.1
100
BLO
OD
44.901m
R'S M
28.6
87
ALLE
Y
1.82 9m
57
EWS
0 GAO
LE
0 TR
OUN
CE
65
R'S M
EWS
21.1 44
m
31.0 4
214
120
39.9
2
26
21.7
9
42.696m
50.0 9
ALLE
Y
42.0 43
m
44
20.2 61
m
200
200 CARRALL
200
CARRALL ST
CARRALL
ST <--ST
<---
43.5 88
m
43.58
7m
36
200
200 CARRALL
200
CARRALL ST
CARRALL
ST <--ST
<---
43.5 89
m
43.5 91
m
22.8 63
m
0 TR
OUN
CE
000 AL
AL
ALEX
EX
EXAN
AN
AN
A
ND
D
D
DER
ER
ER
E
R ST
S
ST
ST
T <<<-----
200
CARRALL
200 CARRALL
200
CARRALL ST
200
<--CARRALL
ST <--<--<---
21.9 m
17.912m
65.9 2
65.7 9
CITY OF VANCOUVER
32.8 9
Data quality not guaranteed
32.8 9
Figure 4 Plan of Subject Property
LOT SHAPE AND SIZE

Shape of lot: Rectangular
Total Area: +/- 19060 sq. ft.
Total lot area is from current municipal tax records. (note previous
tax records had shown an area of 18783 square feet)
LOT FRONTAGE AND DEPTH

Frontage:
Depth:
+/- 206.75 ft
+/- 92.19 ft
TOPOGRAPHY
As at the date of inspection, the subject was generally level.
We have assumed that soil conditions are stable and that the underlying geology is
adequate to support the existing improvements on the subject site. No
representations, however, are made as to soil conditions.
SERVICES AND ACCESS

Access:
The subject property include a pedestrian access from

West Cordova Street as well as from Blood Alley
Square. Vehicular access is available from the Trounce
Alley.
Parking:
The subject lot included no offstreet parking stalls.
19
FACTUAL DATA
Traffic Patterns/Volume: The subject street had average traffic volumes along
West Cordova, and mainly local traffic along Trounce
Alley and Blood Alley Square.
VISUAL EXPOSURE
The subject property had good visual exposure to traffic along Cordova.
STREET IMPROVEMENTS & UTILITIES

Sidewalks:
Curbs and Gutters:
Lighting:
Yes
Yes
Yes
Sanitary Sewer:
Water:
Electrical:
Yes
Municipal
Yes
20
FACTUAL DATA
LAND USE INFORMATION

LAND USE CONTROLS
The subject property is zoned HA-2 District Schedule according to the City of Vancouver
Zoning and Development Bylaw No. 3575, as amended. (Enacted 1956)
The intent of this Schedule is to recognize the history of Gastown-the old Granville
Townsite dating back to the turn of the 20th century and the late 1800s, and to maintain
the historical and architectural character of the small neighborhood. Permitted uses
include a long list of commercial, institutional, residential, service, and industrial. Any
and all proposed alterations or changes to the exterior appearance of any building is
requires approval by the Development Permit Board and consultation by an approved
advisory group for the area. The entire HA-2 zone is designated a Heritage section. Some
regulations include a maximum building height of 75 feet at the street line, a minimum
building height of 40 feet. Regulations with respect to setbacks, yards, site coverage, and
floor space ratios are not a part of this By-Law as many buildings are close to or over 100
years old..
Heritage Registry
The subject property is listed within the Vancouver Heritage Register, within the B(M)
category.
An M or P following the building evaluation, indicates buildings or
sites that are protected by a legal heritage designation by the City of
Vancouver (M) or the Province of British Columbia (P). Some of the
municipally designated sites in Chinatown and Gastown may not have an
A, B or C category. However, they may still have historic value.
There is a Heritage Designation registered on title. The presence of the listing in the
Vancouver Heritage Register essentially creates the situation where it will be virtually
impossible to legally demolish the subject improvements.
Typically, the City is willing to negotiate re-development concessions such as density
bonuses or relaxation of Parking requirements in order to retain the faade of the
building.
21
FACTUAL DATA
DESCRIPTION OF IMPROVEMENTS
Subject Property
The subject property includes two interconnected buildings, consisting of a 2 and 3 storey
wood frame and masonry rooming house. The property includes 104 bedding units and
12 retail units facing Cordova and Blood Alley Square. The exterior includes brick trim
with older single pane wood frame windows, and tar and gravel roof.
Site
The site includes a rear courtyard along Trounce Alley, with a open street plaza design.
The courtyard includes direct access to the mezzanine level of the retail units fronting
onto Cordova, as well as limited access to the SRO portion of the buildings. The front of
the site includes a small covered landing in front of the retail units, which has been gated
for security.
Structure & Exterior
The property includes brick/masonry construction and a three storey design over aa
partial basement. The main entrance to the SRO is located at the front of the property at
grade. Each streetfront retail unit includes at grade access from W Cordova. Some of the
rear portions have access from the courtyard and from the 2nd floor balcony. There is a
rear 2nd floor balcony running the length of the building. Windows were mainly older
single glaze wood frame designs, with some updated windows and commercial display
22
FACTUAL DATA
windows for the retail units. The roof was not viewed and is assumed to be a torch on
membrane.
Ground Floor
The ground floor retail includes main entrances off of Cordova Street, with recessed and
gate secured entryways. There are approximately six individual retail units, although
only four units were inspected. Each includes a split level design, with a ground level
storefront portion and rear upper and lower section. Each unit is reported to have a 2pc
washroom.
There were also six reported retail units facing the rear of the building, fronting onto
Blood Alley. Original submitted plans show a total of 9 retail spaces with access to both
Cordova and Blood Alley Square. The current configuration is reported to have six
individual units facing each side of the building, for a total of 12 units. Note that we
were unable to confirm this at the inspection due to lack of access to some of the units.
Rooming House
The 2nd through 3rd floors included 104 rooms of varying sizes. Rooms were generally
in average/fair condition, with linoleum floors, painted drywall and standard lighting.
Most of the units included a single sink and closet. Heating was provided by hot water
radiators throughout the buildings.
Common area facilities included 6 shared washrooms, 2 shared kitchens, 2 offices and
common area utility and laundry rooms. The central area between the two buildings
includes a glass skylight atrium area as well as open hallways and activity rooms. Other
features include roughly 10 ceilings, numerous balconies overlooking the lane, some
older hardwood flooring and large display windows facing Cordova.
Overall, the property was in average condition, with some recent maintenance and
upkeep upgrades evident.
Total area is derived from plans submitted by the owners. Estimated main floor retail
area is 14,356 square feet. Second floor area is estimated at 14,356 square feet. 3rd floor
area is estimated at 9400 square feet. The total area of 38112 does not include the
basement portions of the retail spaces.
FLOOR AREA
Number of stories: 3 plus basement
Total Units: 116
Gross Building Area (GBA): +/-38,112 ft2 plus basement
23
FACTUAL DATA
Total Retail Leaseable Area: +/-14356 ft2

Total Rentable Units: 116
104 rooms
12 retail units, +/-14356 square feet
The above descriptive information is for the purposes of this report only. It is not to be
regarded as being an architects survey. All dimensions/floor area estimates are subject
to survey. Electrical, mechanical, plumbing, and fire and security protection equipment
were not tested by us for operation. These are presumed to be in operating order.
EFFECTIVE AGE & OVERALL CONDITION

The subject building was reported to be built in the 1900s.. The client was unable to
provide a summary of recent renovations. However, there is evidence of some new
features and fixtures:
The retail units vary in condition and repairs, from fair condition in some of the
offices facing the alley, to recently renovated and good condition in some of the
retail units off of Cordova.
The SRO portion included some renovations in the interior cosmetics. No
indication of when major systems and upgrades were received.
As of the date of our inspection, the subject property improvements appeared to be in

average to fair condition.. No roof, structural, mechanical or other professional
inspections were made (See Assumptions and Limiting Conditions).
The original total economic life of buildings similar to the subject property is generally in
the vicinity of 65 years, according to our information. This is the time period over which
the improvements generally contribute to the value of the overall property.
The exterior, and the visible interior of the subject property appeared to have received
below average maintenance during this period. We have estimated that the effective age
is approximately +/-35 years.
The subject is considered to have an estimated remaining economic life expectancy of
+/-30 years.
The estimate of remaining economic life is assuming acceptable maintenance standard is
continued. This remaining economic life takes into account the renovations and the
upkeep that has taken place on the property.
24
ANALYSIS AND CONCLUSIONS
25
HIGHEST AND BEST USE

The concept of Highest and Best Use represents the underlying premise on which real
estate value is based (refer to appendix for definition).
The determination represents an opinion, rather than a fact, based on analysis and
judgement, giving consideration to the following types of factors affecting real property:
Marketability;
Profitability;
Financial Constraints;
Statutory Limitations;
Regulatory Controls;
Title Restrictions;
Physical and Functional Limitations.
It is to be recognised that in cases where a site has existing improvement on it, the highest
and best use may very well be determined to be different from the existing use. The
existing use will continue, however, unless and until land value in its highest and best use
exceeds the total value of the property is its existing use. Implied within these definitions
is recognition of the contribution of that specific use to community environment or to
community development goals in addition to wealth maximisation of individual property
owners.
It is customary that the highest and best use of the land to be determined separately from
the highest and best use of the improvements. The highest and best use of the land is
considered with respect to four factors, legal permissibility, physical possibility, financial
feasibility and maximum profitability.
1) Legal Permissibility
A test of legal permissibility helps the appraiser
determine which uses are permitted by current zoning,
which uses could be permitted if a zoning change were
granted, and which uses are restricted by private
restrictions on the site.
2) Physical Possibility
A test of physical possibility addresses the physical
characteristics of the site that may affect the
highest and best use.
The size, shape, terrain, and
accessibility of land and risk of natural disasters
affect the uses to which land can be put.
3) Financial Feasibility
Income
producing
properties
are
said
to
be
financially feasible if the net revenue capable of
being generated from a use is sufficient to satisfy
26
the required market rate of return on the investment.

Other types of properties rely on an analysis of uses
that will create a value or result in a profit equal
to or greater than the amount needed to develop and
market the property.
4) Maximum Profitability
This test addresses not only the value created under
the maximally productive use but also the costs to
achieve the value, if any.
Discussion - As if Vacant
The highest and best use of the land as vacant is considered with respect to four factors:
(1)
Legal Permissibility: the subject property is zoned HA-2. This zoning allows a
building height of 75 feet, with no specific density allowance. Estimated effective
density is between 5.0 and 6.0 based on building height requirements. As each property
is a heritage building, new development is limited. If the property were vacant, a high
density residential use or mixed use residential would be likely.
(2)
Physical Possibility: given the regular shape and size of the site, as well as the
location, potential improvements are varied. The site has access, topography and area to
accommodate a variety or residential and mixed uses. The traffic along Cordova would
be sufficient for commercial uses.
(3)
Financial Feasibility: based on our analysis of the subject property and the
surrounding uses, it is our opinion that it is financially feasible for a high density
development.
(4)
Maximum Profitability (as vacant): amongst the legally permissible and
financially feasible uses the maximum profitability is as a mixed use retail and residential
development.
27
Discussion - As Improved
Existing improvements are built up to about 2.0 FSR and are in average condition. The
Gastown area has seen rapid redevelopment and revitalization. The property would be a
prime location for high density retail and residential development.
However, the subject propertys existing heritage designation and rental assisted housing
use makes any redevelopment of the property difficult. The Citys heritage revitalization
program would undoubtedly be involved in any redevelopment attempts. In addition, the
assisted housing would be retained or relocated, as the City is currently intent on
preserving rental assisted housing in this area.
As a result, the most likely use of the property would be as a heritage restoration with an
agreement with the City for a cash allowance or density transfer.
According to the City of Vancouver, Any redevelopment of heritage and SRA buildings
is subject to special review and conditions, to ensure that established objectives are met.
In addition, Gastown (HA-2) and Chinatown (HA-1) are municipally designated historic
areas, and have specific guidelines that apply to all development.
The subject would be redeveloped on site specific agreement with the City. No
redevelopment plans or consultation have been made thus far with the City. For this
appraisal report, we assume that the highest and best use of the property would involve a
redevelopment with an effective FSR of 5.0, whither this is achieved through density
transfers or other incentives.
28
METHODS OF VALUATION
The appraisal process involves a systematic analysis of the factors that bear upon the
value of real estate. The three common approaches, namely the Cost Approach, the
Direct Comparison Approach, and the Income Approach, are available for analysis.
INCOME APPROACH
Under the Income Approach potential gross income is estimated for the subject, based on
the existing income generated by the subject, and/or rental rates for similar use properties
in the area. An income/expense statement is developed, based on area vacancy rates and
the operating expenses of the subject and those of similar properties. The net operating
income derived from this process is then capitalised at a market overall rate to arrive at
the indication of value by the Income Approach.
DIRECT COMPARISON APPROACH

Under the Direct Comparison Approach, also known as the Market Approach, a market
value per unit for the subject is derived from comparison to similar properties, utilizing
the selling price and an appropriate unit of comparison. Such units of comparison may
include either price per: apartment; square foot; acre of land area; price per build-able
square foot of potential building area for vacant sites; and, price per square foot of
building area for developed sites. For most categories of property, the Direct
Comparison Approach is considered to be a reliable and appropriate method of Appraisal.
COST APPROACH
In the Cost Approach, the land value is typically estimated from comparable land sales
found throughout the general area. The reproduction cost new of the improvements is
estimated from cost data contained in office files and from the national cost service of
Marshall-Swift Valuation Services.
The reproduction cost new (less accrued
depreciation) of improvements is added to the value of the land, contribution value of site
improvements and entrepreneurial profit to reach a value via the Cost Approach. The
Cost Approach is most appropriate in the valuation of the full bundle of rights in real
property, i.e. fee simple.
Although recognized as one of the three main methods of valuation, the Cost Approach is
considered inappropriate for use with properties exceeding fifteen years of age unless
they are of a class of property not normally bought and sold on the market. The Cost
Approach can be employed so as to show a breakdown between land and building value
if requested by the client.
SELECTION OF APPRAISAL METHODS

The following approaches will be used in this report: Direct Comparison Approach and
Income Approach.
29
INCOME APPROACH
The first step in the completion of the income approach is to ascertain the income earning
capabilities of the subject property. Under this approach, potential gross income is estimated for
the subject based on the existing leases and/or rental rates for similar use properties. A potential
income stream is developed based on area vacancy rates, the operating expenses of the subject,
plus similar properties. The net operating income derived from this process is then capitalized at
a market rate to arrive at the indication of stabilized value by the Income Approach.
In addition to information on any leases in-place at the subject property, a survey of competing
properties was conducted. These comparable rental properties help establish the market rental
income applicable to the subject. To this end we have surveyed areas in the Lower Mainland for
recent leases of similar type and have selected the following indicators from a wider range as
being most representative of the subject propertys earning capability.
SUMMARY OF PRESENT LEASES
No rent roll or lease statement was received. The client reports that 93 rooms are rented out for
$375 per month in the Stanley Hotel. Details of the commercial rentals received from the client
are as follows:
DTES Janitorial Supplies: $1000 per month gross, month to month
Nightclub: $5200 per month gross, month to month
Salome Community Office: $600 per month gross, month to month
Community Thrift Store: $600 per month gross, month to month
Tenancy and Income details for both portions of the subject are incomplete. The commercial
leases appear to be short term and below market. We will estimate market rents for both portions
of the property.
30
ANALYSIS OF LEASE INFORMATION

In analyzing market rental rates for the subject, we have utilized the comparison approach by
researching recent rents and asking rents for similar properties to the subject.
The primary factors affecting rental rates are:
1) The level of competition offered by similar properties;
2) Location factors;
3) Project amenities and appearance; and
4) Landlords leasing policies and procedures.
Room Rentals
#
Address
City
Units
Type
Mix
$350-450 gross
Rooming House
15 sleep.
2 housekeep
17 units
$325-600 average gross
Rooming House
16 housekeep.
1 self contained
Van
34 units
$357 average gross
Rooming House
34 sleep.
4 466 Union St
Van
16 units
$400 average gross
Rooming House
14 sleeping
2 self contained
Chinatown rooming house. Older

building
5 565 Powell St
Van
11 units
$350-$375 average gross
Rooming House
11 housekeeping
DEOD rooming house. Older

building, some renovations
6 90 Alexander
Van
59 units
$410-$550 gross
Rooming House
45 housekeeping Gastown rooming house. Older

14 self contained building
7 488 Carrall
Van
98 Units
$400-$525 gross
$600 gross (SC)
Rooming House
Downtown rooming house. Older

14 self contained
buildng. Central location. Some
84 Sleep.
double rooms
8 369 Columbia
Van
27 Units
$475 average gross
Rooming House
27 sleeping
9 230 Princess
Van
12 units
$325 average gross
Rooming House
12 sleep.
Long term tenants, 3 parking

stalls, 1 bedroom units are self
contained with kitchens and
bathrooms. No reported vacancy.
Chinatown rooming house. Older
building. Busy commercial area
103-105 Hastings
1
St
Van
17 units
2 568 Powell St
Van
3 259 Powell St
Average Indicated Rental Rate
10 872 Hastings E
Van
8 units
$350-$450 gross
Rooming House
4 1Bed
3 Bach
1 Retail
11 221 E Georgia St
Van
13 units
$302 average gross
Rooming House
13 units
12 221 Abbott
Van
91 Units
$370 average gross
Rooming House
91 sleeping units
13 1125 Granville
Van
76 units
$390-$450 gross
Rooming House
76 Sleeping
14 316-324 Powell
Van
79 Units
$375-$425 gross
Rooming House
78 Sleeping Units
Comments
Rooming house located at E
Hastings and Columbia. Two
double occupancy renting at $450
building. Housekeeping units rent
between $325 and $400.
building.
Newly Renovated DTES rooming

house
building.
Gastown rooming house. Older

building
Downtown rooming house. Older
buildng. Central location
DTES rooming house. Older
building.
Summary of Rental Comparables
Rates for rooming houses run in the general rate of $350 per unit to $600 per unit. The higher
end rates of $550 and $600 are for fully self contained units with one bedroom, kitchen and
bathroom. The lower rates at around $375 are generally for smaller sleeper units and properties
in poor condition.
31
For rooming houses, there are three basic types of room: sleeping units, which includes just a
single bedroom with shared facilities; housekeeping units with a bedroom and kitchenette and
shared bathrooms; rarely seen are self contained units with a bedroom, kitchen and bathroom.
Most SROs have sleeping or housekeeping units with shared washroom faculties on each floor.
For a large percentage of SRO rentals, all furnishings, including bedding are included in the
rental. Some operations included a cleaning service for the bedding, cablevision, and in some
cases, common cooking facilities. These are widely varied and differ from property to property.
The subject units provide beds and include utilities, but no cablevision, telephones, laundry
facilities or other services.
Note that these rates are considerably lower than the average rental rates for apartment units,
which rent for about $824 for one bedrooms (2010 CMHC Rental Survey for East Hastings) and
for bachelors in the area, which rent for an average of $762 per month. The average apartment
unit includes a living and dining area, making it superior to the self contained units. They also
differ in that this rate does not include electricity, whereas rooming house rates typically include
all utilities.
Excerpt from CHMC Rental Survey 2010
The subject consists of older housekeeping rooms. The rooms are average in size and condition.
Utilities were included but no additional services were provided. The building did include a
shared kitchen and the ratio of rooms to washrooms are typical in this type of property. The
median rent in the apartment is $375 per room per month.
East Hastings average rates for Bachelors units are $734 in 2009. The immediate location is
The Carnegie Community Action Project, a non-profit group advocating social housing in the
Downtown Eastside, has provided annual reports on SRO housing and rents since 2008. In their
2011 report, they have provided some significant statistics:
Only 7% of rooms surveyed included rents that were under $375 per month, down from
12% in 2010 and 29% in 2009
47% of the rooms surveyed had rents of $425 and above
Of the 90 hotels checked, only 17 had vacancies
Average rents for privately run renovated rooms were reported at $400 to $500 per month, with
some reported at $700 for the newer buildings.
32
The CCAP report is one of the most comprehensive rental surveys available for SROs, as it
consists of direct primary research for 90 buildings and 3600 rooms in the Downtown Eastside.
We have estimated market rates based on the reported size, design and layout of each room as
$375 per room per month.
Retail Lease
Address
City
Type
Area
(sf)
Date
Net Rate
Comments
33 W Hastings
Van
Retail
3900
Ask 2012
$10.00
Older ground floor retail space. Asking

$10 plus $5 CAE
573 E Hastings
Van
Retail
1587
2010
$17.00
Older streetfront retail. $2248/mo net
386 Powell St
Van
Retail
2000
Ask 2012
$20.00
Ground floor retail space, DEOD. $3.80

CAE
280 Carrall
Van
Retail
680
2007, 5
years
$20.72
Ground floor retail space in mixed use

building. $8 CAE.
291-297 E
Georgia
Van
Retail
3008
2011
$21.94
HA1A zoned ground floor retail space

good exposure. Bonuse basement space.
$7.70 CAE
158 Powell St
Van
Retail
807 to
1195
2012
$22.00
Four retail street front spaces. New shell

retail. HVAC, U/G Parking. $11 CAE
320 W Cordova
Van
Retail
2957
2009
$24.00
Streetfront Gastown retail. Older heritage

storefront, high ceilings. Estimated $8
CAE
243 Union Street
Van
Retail
1047
Term
undisclosed
(2011)
$24.07
Newer ground floor retail space.

Chinatown. Reported CAE $4.58
495 Main
Van
Retail
2000
July 2008,
10 year
term
$24.25
Corner caf located in Chinatown. High

exposure, good improvements
10
122 W Hastings,
Main
Van
Retail
9000
Ask, 2011
$25.00
Newly renovated building across from

Woodwards. Demisable to 3000 sf.
11
636 Main Street
Van
Retail
1004
3 years,
2008
$26.07
Ground floor retail space, Chinatown.
Retail Lease Rates
The subject ground floor includes one retail unit with estimated leasable areas of about 14356
square feet, divided into twelve tenancies, averaging 1196 square feet per tenancy. The front
spaces have high ceilings with average streetfront exposure. However, the rear spaces are more
limited in exposure and access.
Streetfront retail units in the neighborhood are obtaining rates between $20 and $35 per square
foot with widely varying rates between the older retail and the newer boutique retail. In the
neighbouring area and in Chinatown, units are listed for lease for amounts between $10 and $20
per square foot.
33
At the higher end of the range are the newly renovated retail storefront units along Hastings
Street, across from Woodwards. These appear to be the upper end of the retail rates in the area.
The majority of spaces appear to be fairly stable at around $20 to $25 per square foot for
streetfront retail in reasonable condition. There appears to be a significant drop-off from the 100
block of West Hastings to the subject block in terms of tenant quality and appeal. However,
given the proximity, there should be a trickledown effect as revitalization of the area continues.
The lower listing, in the neighboring building is an older space that appears to require extensive
renovations. The lower rate is an indication that some tenant improvements would be necessary
for the space to be functional. The remainder of the comparables are fairly consistent, around
$20 to $25 per square foot.
In the current market, the area remains a less desirable but improving area of the downtown core,
with a mix of older businesses. We have adopted a market rate of $20 per square foot net for
the subject spaces. This is at the mid end of the market and reflects the location appeal and
exposure for the subject area and the subject street.
VACANCY and BAD DEBT
Potential income reflects the properties full income generation potential. However, income
properties are rarely, if ever, fully occupied over their economic lives and for this reason vacancy
and collection losses must be considered. This factor, the "vacancy rate" is normally expressed
as a percentage. While this factor takes into account the current level of vacancies it is in effect a
long-term average and may well be at variance with either the typical vacancy in the area of the
subject or, indeed, the actual level of vacancies within the subject.
Vacancies for apartment units typically are in the 0.5% to 2% range for Vancouver. However,
rooming houses show higher vacancies and turnover.
Rooming houses in the area show vacancies that have dropped in the past few years as rents in
Vancouver has increased steadily. The lower rental SROs are generally fully occupied.
However, turnover and bad debt would be a larger factor without the existing government
assistance programs. Historical vacancy and bad debt rates are in the 10% to 20% range.
The subject is reported at 89% occupancy, with a reported 11 vacancies out of 104 units.
However, the operation of the SRO as an emergency shelter may distort these figures. We have
observed a typical vacancy for SROs in the area of about 3% to 6% for the newer or better
maintained SRO rentals.
The vacancy estimate reflects long term vacancy over the life of the property. We estimate a
long term stabilized rate of 6% vacancy/bad debt. This factor will be adopted for this analysis.
The retail portion of the property has an average traffic location and has moderate demand.
There is average retail vacancy in the neighborhood. We estimate the retail vacancy at 3%.
34
Bad debt allowance is related to vacancy rate and is a risk factor that arises from leasing and the
receiving of rents. The average for bad debt allowance is 0.5 to 1%. The subject would likely be
much higher than this if we disregard the government subsidized nature of the tenants. This
factor has been included in the vacancy estimate
OPERATING EXPENSE ANALYSIS
For the income analysis, an expense statement must be reconstructed, as follows in the NOI
chart. No expense statements were received for this property.
The factor to allow for the expenses is based mainly upon investigations of other properties, and
discussions with persons familiar with the type of investment. Commercial properties are
typically rented out on a net basis, where most of the landlords costs are recovered from the
tenant. Expenses not covered by the triple net tenancy include management fees and structural
reserve/non recoverable expenses.
We have based the expense projections on projected rates with the following assumptions:
10% maintenance and misc. expense per annum, which should be average for this type of
property.
2.5% insurance
12% utilities have been projected based on utility rates for SROs. The projected rate is
slightly higher than average due to the observed design of the building, which includes
higher ceilings and more communal area than most typical SROs
8% management fees. Typically, for SROs there are onsite managers or a management
team responsible for multiple SRO buildings. A typical property management company
would not be responsible for these buildings and if any were to take on the responsibility,
the management fees would be much higher, likely in the double digits. The typical
management team or onsite manager for this type of property is a resident of the building
or maintains a permanent office nearby, and would charge fees roughly equivalent to the
projected amounts.
2012 actual taxes
The commercial units would typically be on a triple net lease with full recovery of
expenses
Other typical expenses include 1-3% for other miscellaneous expenses and a structural reserve
allocation, which are not covered by the triple net tenancy. We have used these rates for the
subject. The resulting expense ratio is 32% of EGI, which is at the lower end of the typical range
found in similar buildings. The lower expenses are mainly due to the lower maintenance and
utilities costs.
The retail portion of the property would pay a triple lease, that would cover a portion of the
property taxes and maintenance costs. We have estimated an additional income expense of $6
per square foot, making the rental rate about $26 per square foot gross. $5 to $6 per square foot
35
is roughly comparable to some of the properties in the area, although these rates vary widely.
The total estimated gross income is roughly 44% to the retail portion and 56% to the SRO
portion.
CAPITALIZATION RATE ANALYSIS
The Capitalization Rate is a mathematical relationship which exists between the net income
derived from the property and the value or price which a probable purchaser would pay for the
privilege of receiving that income stream. Influences most affecting the price an investor would
pay are the quality, quantity, and probable duration of the net income expectancy.
Address
City
Type
Sale
Date
Bldg
Size
Price
Annual
Potential
Income
Overall
Cap
Rate
33 W Hastings
Van
Rooming
House
Jan 2012
33
$1,500,000
$80,000
4.91%
1123-1127
Granville
Van
Rooming
House
Apr 2010
76
$4,500,000
$270,000
5.52%
259 Powell
Street
Van
Rooming
House
Nov
2011
35
$1,650,000
$105,000
5.85%
466 Union St
Van
Rooming
House
Apr,
2009
16
$720,000
$51,800
6.62%
111 E Pender
Van
Rooming
House
May,
2009
$1,015,000
$87,000
7.89%
1168 E
Hastings
Van
Rooming
House
Mar
2010
33
$1,100,000
$96,778
8.09%
1190 E
Hastings
Van
Rooming
House
Nov
2010
32
$1,100,000
$107,000
8.95%
Assumptions
Vacancy
& Misc
8.0%
Summary of Capitalization Rate Comparables
Cap rates are based on the most recent available sales, with additional assumptions of 6% for
vacancy and 2% for misc. expenses.
The Capitalization Rate is a mathematical relationship which exists between the net income
derived from the property and the value or price which a probable purchaser would pay for the
privilege of receiving that income stream. Influences most affecting the price an investor would
pay are the quality, quantity, and probable duration of the net income expectancy.
Multifamily cap rates have dropped dramatically in recent years, with premium properties selling
for sub 4% returns. The subject property represents a higher risk. Historically, rooming houses
36
in this area have sold in the 8%+ range. As shown by the cap rate chart above, sales of similar
properties have been in the 5.5% to 8.95% range. Many of the more recent sales include
expectations of rental increases and/or development potential.
The recent sale of the Chelsea Hotel showed a fairly low sub 5% cap rate based on an NOI of
$80,000. However, this does not take into account any potential rental from the ground floor,
which was vacant at the time. If we project the rents for this space, the cap rate jumps to about
6.67%. The subject should have a similar or slightly lower cap rate.
Sale 2 is the 2010 sale of the Clifton Hotel, located on Granville Street with superior location and
overall appeal. The subject should have a higher cap rate.
Sale 3 is the sale of the York Rooms, a similar SRO with ground floor retail. The sale is from
2011, with comparable overall appeal as the subject.
Sales 4 through 7 are all older SRO sales with inferior location and appeal. The caps are much
higher, between 6.6% and 9%. The subject property should have a lower rate.
The subject building is in the edge of the downtown core. Its SRO design increases risk, as there
is little room for rental growth and fairly high management responsibilities.
The ground floor retail is currently leased at a rate that is approx. 1/3rd higher than the projected
rental rates. The lease is signed through 2014. However, the lease does include unfinished
basement space, which is not leasable space. Due to these inconsistencies, we have projected a
fair market rental rate for the space, and adopted a slightly lower cap rate to account for the
current above market lease income.
The subject property includes an estimated 58% of its income from the SRO portion and 42%
from the retail portion. The actual income is closer to 50/50. This is significant because the
retail portion of the building has a lower risk factor than the SRO.
A typical SRO would have a cap rate of about 5.5% to 6.5%. This is far low than the historic cap
rates for SROs, which were 8 to10%. Recent sales show much lower caps, however and are
bringing this property type in line with other commercial properties in the City. The subject
property would likely have a rate in this range, between 5.5% and 6.5%.
From the above information, we conclude that a 6.50% overall capitalization rate is suitable.
37
Income and Expense Statement

Description
Area (SF)
Rate
Estimated Annual
Amount
Estimated Potential Income

SRO Rooms (104)
$375/mo
468,000
Ground Retail
14,356
$ 20.00
287,120
Additional Rent
(Triple Net Recovery )
14,356
86,136
Total Gross SRO Income
468,000
Total Gross Retail Income
373,256
841,256
6.00
Potential Income
Less
Vacancy & Bad Debt Expense SRO
6.0%
-$
28,080
Vacancy & Bad Debt Expense Retail
3.0%
-$
11,198
Effective Gross Income (EGI)

Operating Expenses
Maintenance, Misc
Taxes 2012
Utilities (% of SRO Rent)
801,978
projected
10.0%
actual.
0.7%
80,198
5,287
projected
12.0%
56,160
Insurance
projected
2.5%
20,049
Management
projected
8.0%
64,158
Structural Reserve & Non

Recoverable Expenses
projected
3.0%
24,059
31%
249,912
552,066
8,493,329
Less Total Operating Expenses

Annual Net Operating Income (NOI)
Cap Rate
Value by Income Approach
6.50%
Summary of Income Approach
38
VALUATION
The value of the subject property is best done by a method known as Discounting. This type of
analysis is applicable to long term lease revenues, and to those contracts which feature periodic
increases in the rental payments. As outlined in the above table, we have subtracted the annual
expenses from the Gross Rental income of the building to result in the Net Operating Income.
This income is divided by the capitalization rate, which results in the final estimate of value via
the income capitalization method. The value of the subject property can now be estimated via
the Income Approach as follows:
NOI
$552,066
divided by
/
Cap Rate
Value
6.50%
$8,493,329
rounded to
$8,490,000
ESTIMATE OF VALUE BY THE INCOME APPROACH (VIA CAPITALIZATION)

$8,490,000
39

The Direct Comparison Approach (DCA) is based upon the principle of substitution which states
that a prudent investor would pay no more for a property than the cost of acquiring an alternative
property with the same utility.
The Comparison Approach involves the investigation and analysis of recent, similar sales and
listings of properties coupled with a process of comparison with the subject. Adjustments are
made to account for relevant differences between each comparable sale and the subject. Such an
adjustment process derives from each comparable an expected price that it would have sold for
had it possessed the relevant characteristics that the subject possesses. From these adjusted sales
prices an estimate of value for the subject is made. In applying this approach various units of
comparison can be selected depending upon the nature of the property. For multiple residential
or commercial/residential investment properties a price per revenue producing unit can be
applied.
Where the subject consists of SRO, the commonly used measure is per income generating unit or
rentable area. For this analysis, we have compared the subject to other SRO with ground floor
retail. The price per unit will be used, with consideration given to the size and extent of the
ground floor retail units.
Information on current market rental rates for comparable properties was obtained by reviewing
data on similar properties, published rent surveys, analysis of the comparisons, a market rent
survey of properties with a similar use as the subject, discussions with professionals with
knowledge about the type of property as is the subject.
The information was examined and qualified for use in the formation of the final value
conclusion. All relevant aspects of the data relied upon, as known to the appraisers, are reported
within the text of this report. Following are details of the available sales/listing data with
comments, photographs of the respective properties, plus map(s) showing their approximate
location.
40
Sale Number:
Property Type
Civic Address
Short Legal Description
#1
Palace Hotel
35-37 W Hastings Street
Lot A of Lots 13 to 15, Block 3, Old Granville Townsite
1193
014-879-697
PID
PROPERTY INFO
4356
Lot Size (sq.ft)
33
Units
OT
Estimated Age
Average
Condition
DD-C2
Zoning
SALES INFO
June 2012 (Foreclosure)
Date of Sale
$2,071,300
Sale Price
0847566 B.C. Ltd.
Vendor
Laurelwood Ventures Inc.
Purchaser
$62,767
Price per unit
COMMENTS
Located on the north side of West Hastings Street, east of Abbott Street. The property is
improved with one three-storey plus basement, wood-framed, rooming containing 32
residential suites one ground floor commercial unit operating as a pub. This transaction
was pursuant to a Foreclosure Order dated June 25, 2012 in which the Laurelwood
Ventures Inc., et. al. is named as the Plaintiff and 0847566 B.C. Ltd., et. al. is named as
the Defendants. The asking price for the property was approximately $3,198,000.
41
Sale Number:
Property Type
Civic Address
#2
North Star Hotel
5 W Hastings Street
The East 26 Feet of Lot 16, Block 3, Old Granville
Townsite, Plan 168
014-235-234
PID
PROPERTY INFO
3485
Lot Size (sq.ft)
31
Units
OT
Estimated Age
Average
Condition
HA2
Zoning
SALES INFO
Apr 2012
Date of Sale
$1,320,000
Sale Price
469346 B.C. Ltd.
Vendor
Five West Hastings Holdings Ltd.
Purchaser
$42,581
Price per unit
COMMENTS
Located on the north side of West Hastings Street, west of Carrall Street. The property is
improved with a four-storey rooming house containing 30 rooms and a ground floor
retail component. The retail unit was vacant a t the time of sale.
42
Sale Number:
#3
Chelsea Hotel
Property Type
33 W Hastings Street
Civic Address
Lot B of Lot 13 to 15, OGT 1193
011-698-641
PID
PROPERTY INFO
3050
Lot Size (sq.ft)
32 + retail
Units
OT
Estimated Age
Average-Fair
Condition
DD-C2
Zoning
SALES INFO
Jan 2012
Date of Sale
$1,500,000
Sale Price
Gemz Holdings Ltd
Vendor
0927000 B.C. Ltd.
Purchaser
$45,455
Price per unit
COMMENTS
Three storey wood frame and masonry SRO with vacant ground floor retail and full
unfinished basement. The property included 32 sleeping rooms with shared facilities.
Ground floor included a vacant retail tenancy with good exposure along Hastings Street
near Abbott Street. No heritage designation.
43
Sale Number:
Property Type
Civic Address
PID
PROPERTY INFO
Lot Size (sq.ft)
Units
Estimated Age
Condition
Zoning
SALES INFO
Date of Sale
Sale Price
Purchaser
Price per unit
COMMENTS
#4
Rooming House
259 Powell Street
Lot 17, Block 4, District Lot 196, Plan 184
015-701-476
3050
35 (including 1 commercial unit)
1935
Average-Fair
DEOD
Oct 2011
$1,650,000
59 Powell Holdings Ltd.
York Rooms Located on the north side of Powell Street, west of Gore Avenue. The
property is improved with one four-storey rooming house containing a total of 34 rooms
and one ground floor commercial unit.
44
Sale Number:
Property Type
Civic Address
PID
PROPERTY INFO
Lot Size (sq.ft)
Units
Estimated Age
Condition
Zoning
SALES INFO
Date of Sale
Sale Price
Price per unit
COMMENTS
#5
Rooming House
242 E Hastings Street
Lot 32, Block 11, District Lot 196, Plan 184
011-692-103
9438
26 (including 1 commercial unit)
1910, 1955
Fair
DEOD
Oct 2011
$1,180,000
$45,385
Everest Rooms, or the former F. Morgan Building. Located on the south side of East
Hastings Street, east of Main Street. Three storey plus basement SRO with ground floor
retail.
45
Sale Number:
#6
Rooming House
Property Type
403 Vernon Drive, 1190 E Hastings St
Civic Address
Lot A Plan 355
007-763-301
PID
PROPERTY INFO
3985
Lot Size (sq.ft)
32
Units
OT
Estimated Age
Average
Condition
RT3
Zoning
SALES INFO
Aug 2011
Date of Sale
$1,286,000
Sale Price
Big City Holdings Ltd
Vendor
$40,188
Price per unit
COMMENTS
Three storey, 32 unit SRO on East Hastings Street and Vernon Drive. Located in the
Strathcona neighbourhood of Vancouver. The property included 28 sleeping units, 3 self
contained units and one retail unit. The property is a legal and non-conforming use to
the RT zoning.
46
Sale Number:
#7
Rooming House
Property Type
928 Main Street
Civic Address
Lot s 6 & 7, Plan 184, Portion of Lot 8, Plan 184
014-568-845, 014-568-853, 014-568-888
PID
PROPERTY INFO
5227
Lot Size (sq.ft)
39 (including 2 retail units)
Units
OT
Estimated Age
Fair
Condition
FC1
Zoning
SALES INFO
Jun 2010
Date of Sale
$2,400,000
Sale Price
GS0137 Ventures Ltd.
Vendor
928 Main Street Holdings Ltd
Purchaser
$61,538
Price per unit
COMMENTS
American Hotel. Old three storey SRO located on Main Street, near Prior Street. Good
location, with 51 of frontage along Main Street. The property was reported to be vacant
at the time of sale, and appeared in below average condition. The building consisted of a
reported 37 rooms, plus ground floor retail, assumed to be an additional 2 units. Possible
redevelopment site given the condition of the improvements, location, and zoning.
47
Sale Number:
#8
Rooming House
Property Type
341-343 E Hastings Street
Civic Address
Lot 28, Plan 196
015-584-771
PID
PROPERTY INFO
3050
Lot Size (sq.ft)
25
Units
OT
Estimated Age
Average
Condition
DEOD
Zoning
SALES INFO
April 2010
Date of Sale
$1,000,000
Sale Price
Thuan Phouc Hotel Ltd
Purchaser
$40,000
Price per unit
COMMENTS
Sunwest Hotel. Four storey plus basement SRO unit with 24 housekeeping units and one
ground floor retail unit. The property was located near the Chinatown neighborhood,
with moderate traffic and exposure along Hastings Street. Formerly known as the
Tweedale Block. The property last sold in 2005 for the amount of $550,000
48
Sale Number:
#9
Rooming House
Property Type
1123-1127 Granville Street
Civic Address
Lots 33 & 34, Plan 210
003-533-476, 003-533-484
PID
PROPERTY INFO
6000
Lot Size (sq.ft)
76
Units
OT
Estimated Age
Average
Condition
DD-K3
Zoning
SALES INFO
Aug 2010
Date of Sale
$4,500,000
Sale Price
Persepolis Investments Inc
Purchaser
$59,211
Price per unit
COMMENTS
Clifton Hotel. Four storey masonry SRO with ground floor retail and full unfinished
basement. The property included 74 sleeper rooms with shared facilities. Ground floor
included 2 retail tenancies with excellent exposure along Granville Street. Heritage C
designation.
49
Sale Number:
Property Type
Civic Address
PID
PROPERTY INFO
Lot Size (sq.ft)
Units
Estimated Age
Condition
Zoning
SALES INFO
Date of Sale
Sale Price
Vendor
Purchaser
Price per unit
COMMENTS
# 10
Heatley Block
684-688 E Hastings Street, Vancouver BC
Lot 14, 15, & 16, Plan 196
015-576-515, 015-576-507, 015-576-493
9,148
24
1889 (year built)
Average
DEOD
January 28, 2010
$1,600,000
City of Vancouver
Atira Development Society
$66,667
Heatley Block is an improved 2 storey, wood framed rooming house with a ground
floor retail component and two, 2 storey wood framed multi-family residential dwellings.
20 of the 24 units are single room occupancy.
50
Sale Number:
# 11
Rooming House
Property Type
7-11 W Hastings Street, Vancouver BC
Civic Address
Lot 16, Plan 168
015-713-164
PID
PROPERTY INFO
5,227
Lot Size (sq.ft)
44
Units
OT
Estimated Age
Average
Condition
HA2
Zoning
SALES INFO
July 15, 2009
Date of Sale
$3,045,000
Sale Price
0823550 BC Ltd.
Vendor
Provincial Rental Housing Corporation- Government
Purchaser
$69,205
Price per unit
COMMENTS
The Backpackers Inn is improved with one four storey wood framed rooming house
containing 42 residential rooms and two commercial units. Property appeared in average
condition at the time of sale.
51
# 12
Sale Number:
Rooming House
Property Type
210-216 Abbott Street
Civic Address
Lot 7, Plan 168
015-713-237
PID
PROPERTY INFO
9438
Lot Size (sq.ft)
71
Units
OT
Estimated Age
Renovated
Condition
HA2
Zoning
SALES INFO
Feb 2009
Date of Sale
$7,940,000
Sale Price
Water Street Projects Ltd
Vendor
Provincial Rental Housing Corporation
Purchaser
$111,931
Price per unit
COMMENTS
Dominion Hotel, located on the corner of Abbott and Water Streets, in the Gastown
neighbourhood of Vancouver. The property consists of a three storey rooming house
with 67 rooms on the upper floor and 4 retail units on the ground floor. The property
was in good condition, with renovations reported in 2005, 2008, and 2009. Vancouver
Heritage List B Designation
52
ANALYSIS
OF COMPARABLE SALES
In order to apply the Comparison Approach it is necessary to make adjustments to the above
detailed Comparables to reflect the varying differences with the subject. As such the sales search
utilized in this report was directed towards similar or similar use properties in the area.
For properties the nature of the subject adjustments traditionally involve the following:
1.
Location Factors
2.
Physical Characteristics
3.
Zoning and Land Use Factors
4.
Time/Market Conditions
5.
Financing Terms
6.
Motivating Forces and/or Conditions of Sale
LOCATIONAL FACTORS
Location has a significant effect on value.
Area: Geographic location within the community, proximity to other commercially and
residentially zoned properties, accessibility for transportation of goods, surrounding area uses
such as residential, industrial or commercial, proximity to amenities or market. Comparables
have been selected nearby in the same or similar areas as the subject.
Exposure/Locale: Traffic levels on the street, sites which are located on street corners, or have
more than one frontage, have a higher value than those that do not. Adjustments have been made
where appropriate. Commercial property values are dramatically affected by their exposure to
high traffic locations. Accessibility is the main concern for industrial properties, while
residential properties values are affected by amenities, neighbourhood appeal and low traffic
streets.
PHYSICAL CHARACTERISTICS
Size: Historic research has indicated that larger properties sell for a slightly lower price per unit,
due to economies of scale in development or use. Larger properties as a result tend to sell for a
lower square foot value than a smaller property. Adjustments have been made where the size of
the comparables differ from the subject.
Configuration: The configuration of the property does typically not affect the value of the
property except where it is a detriment. Irregular shapes, lack of access, panhandle lots all lower
the value of the property. Adjustments have been made where appropriate.
Improvements and Condition: We have considered the quality of construction and condition of
maintenance of the comparables relative to the Subject.
53
ZONING AND LAND USE

All of the comparable properties were zoned for the same or similar uses as is the subject. The
existing improvements on the subject lands are considered to be the highest and best use in their
location, within the given zoning.
TIME ADJUSTMENT
The data of sale identifies market conditions prevailing when the particular transaction occurred.
Market conditions may change between the data of sale of a Comparable and the effective date
of the appraisal. Changing market conditions often result from various causes such as inflation,
economic recession, changing demand, changing supply and the cost or availability of mortgage
funding. The cause of the adjustment is not time itself but a change in market conditions.
The 2009 market saw dramatic drops in value across all market segments. Mid 2009 saw a
recovery and gradually increasing values in most markets and asset classes. 2010 through 2012
saw an overall stabilization of the market, with some increases in the residential and investment
markets.
MOTIVATION ADJUSTMENT
When conditions motivating the Vendor or Purchaser are at variance, the price for the sale may
differ from that involving a more normal transaction. Such circumstances may include a Vendor
under pressure to sell quickly or an adjoining owner acquiring a property to enhance the
development potential of the existing holding.
A review of the transactions used in this report did not reveal any unusual circumstances which
would require this adjustment. All appeared to be on an arms length basis.
FINANCING ADJUSTMENT
The sale price of one property may differ from that of an otherwise substantially identical
property due to the impact of the financing arrangements. This becomes a crucial variable when
either the subject or one or more of the comparables has a preferential financing arrangement
when contrasted to that typically offered by the market as at the relevant date of the appraisal.
This is most often the case with Vendor take-back financing or when existing financing is
assumed. In these circumstances the Purchaser may have paid a premium. No financing
variables are known of.
54
Improved Sales Comparable Location Map
55
Address
Subject
10
11
12
Stanley Hotel
Palace Hotel
North Star
Hotel
Chelsea
Hotel
York Rooms
Everest
Rooms
32 Unit SRO
American
Hotel
Sunwest
Hotel
Clifton Hotel
Heatley
Block
Backpackers
Inn
Dominion
Hotel
36 Blood Alley
35-37 W
Hastings St 5 W Hastings
St
259 Powell
Street
242 E
Hastings
403 Vernon
Drive
928 Main
Street
341-343 E
Hastings
1123-1127
Granville st
684-688 E
Hastings
7-11 W
Hastings
210-216
Abbott
Vancouver
33 W
Hastings
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
19060
4356
3485
3050
3050
9438
3985
5227
3050
6000
9148
5227
9438
Moderate
Moderate
Moderate
Moderate
Moderate
Moderate
Moderate
Moderate
Moderate
High
Moderate
Moderate
Moderate
Total Units
116
33
31
33
35
26
32
39
25
76
24
44
71
Rooms
104
32
30
32
34
25
31
37
24
74
20
42
67
Retail
12
Est. year built
OT
OT
OT
OT
OT
OT
OT
OT
OT
OT
OT
OT
OT
Design
3 Storeys
3 Storeys
4 Storeys
3 Storeys
3 Storeys
3 Storeys
4 Storeys
3 Storeys
4 Storeys
4 Storeys
2 Storeys
4 Storeys
3 Storeys
Condition
Average
Average
Average
Fair
Avg-Fair
Fair
Avg-Fair
Fair
Average
Average
Average
Average
Renovated
City
Lot Size
Exposure
HA2
Zoning
Sale Price
Sale Status
Sale Date
valuedate
Price per Unit
DD- C2
HA2
DD-C2
DEOD
DEOD
RT3
FC1
DEOD
DD K3
DEOD
HA2
HA2
$2,071,300
$1,320,000
$1,500,000
$1,650,000
$1,180,000
$1,286,000
$2,400,000
$1,000,000
$4,500,000
$1,600,000
$3,045,000
$7,940,000
Foreclosure
Market
Market
Market
Market
Market
Market
Market
Market
Market
Market
Market
Jun, 12
Apr, 12
Jan, 12
Oct, 11
Oct, 11
Aug, 11
Jun, 10
Apr, 10
Aug, 10
Jan, 10
Jul, 09
Feb, 09
$62,767
$42,581
$45,455
$47,143
$45,385
$40,188
$61,538
$40,000
$59,211
$66,667
$69,205
$111,831
Adjustments
Property Rights Conveyed
Comparable Comparable Comparable Comparable Comparable Comparable Comparable Comparable Comparable Comparable
Comparable
Comparable
Financing Terms
Comparable Comparable Comparable Comparable Comparable Comparable Comparable Comparable Comparable Comparable
Comparable
Comparable
Conditions of Sale
Upward Adj
Comparable Comparable Comparable Comparable Comparable Comparable Comparable Comparable Comparable
Comparable
Comparable
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Inferior
Superior
Inferior
Location
Inferior
Inferior
Comparable
Inferior
Inferior
Inferior
Superior
Improvements & Condition
Inferior
Comparable
Inferior
Inferior
Inferior
Inferior
Inferior
Down.Adj.
Down.Adj.
Down.Adj.
Down.Adj.
Down.Adj.
Down.Adj.
Down.Adj.
Down.Adj.
Comparable
Inferior
Inferior
Inferior
Inferior
Inferior
Comparable
Inferior
Inferior
Size
Zoning
Comparable Comparable Comparable
Additional Adjustment
Comparable Comparable Comparable Comparable
Net Percentage Adj.

Adj. Price per Unit (rounded)
Superior
Comparable Comparable
Inferior
Comparable
Superior
Superior
Down.Adj.
Down.Adj.
Comparable
Inferior
Comparable
Comparable
Superior
Inferior
Comparable
Comparable Comparable Comparable
26%
2%
13%
28%
33%
44%
9%
24%
-2%
14%
0%
-14%
$79,000
$43,000
$51,000
$60,000
$60,000
$58,000
$67,000
$50,000
$58,000
$76,000
$69,000
$96,000
Improved Sales Comparison Chart
56
SUMMARY OF SRO SALES USED

A total of 12 comparables were used in this analysis. All are sales of SRO buildings in
the subject neighbourhoods. All are recent sales from 2009 through 2012. The units are
generally smaller in size as the subject property, with the exception of #9 and 12.
However, given the lack of SRO transactions, these remain the most relevant indicators
of value for the subject. Overall, the main adjustment factor for the comparables was for
improvements due to the subjects recent renovations.
The unadjusted range was from $40,000 per unit to $111,831 per unit. After adjustments
the range narrows to $43,000 per unit and $96,000 per unit. The average adjusted value
of the comparables was $63,900 per unit, with a median value of $60,000 per unit.
Sale 1 is the most recent SRO sale in the area. However, it is a distress sale that appeared
to be under full market value. The property itself is fairly similar to the subject, with a
full ground floor commercial pub and upper floor SRO units. The subject would likely
have a higher value.
Sale 2 is a recent sale of a smaller SRO on W Hastings Street. It has a HA2 zone, but is 4
storeys with a small lot. The subject should have a higher value.
Sale 3 is recent sale of a SRO located next to the subject. The value appears somewhat
below market, given that the property was on the market for an extended period. The
comparable had superior improvements but was superior in condition. The subject
should have a higher value.
Sales 4 through 6 are recent sales of similarly sized SROs in generally inferior areas.
These showed lower overall values, but also included improvements in inferior condition,
with DEOD/RT zoning and minimal ground floor retail components. The subject should
have a higher value.
Sale 7 is a sale of an old SRO located on Main Street. The property required extensive
renovations at the time of sale, but had good revenue potential on the retail and SRO
portions. The property sold mainly for land value, with a larger lot than the subject.
Sale 8 is a similar property called the Sunwest Hotel. The location was inferior to the
subject, but the unit consisted of ground floor retail and housekeeping unit above, which
is similar to the subject property. The subject should have a similar or higher value.
Sales 9, 11 and 12 are larger SROs in the area. Sale 7 has as superior location, while #9
is comparable.
Sale 10 is located near the subject, and is similar in size, but is an older 2009 sale, zoned
HA2. The subject would likely have a similar value.
57
For this analysis all the properties are SRO hotels located around the subject property.
The values varied widely due to differences in condition and appeal.
Despite the wide range of sales, the subject differs in that it has a large lot and would be
more likely to be redeveloped than most of the comparables. In addition, the subject has
a more extensive retail component. For this reason, we have valued the retail portion
separately
The subjects value should fall within the adjusted range of $50,000 to $60,000. After
separating out the retail, the subjects per unit value should be at the lower end of the
range. Also, due to the relative lack of activity in this market in the past year, we have
used the lower rate.
Our final estimate of the improved space is estimated at $50,000 per unit for the SRO
potion The subject property consists of 104 SRO units, therefore, the comparative
estimate of value is as follows.
Units
Price/unit
Value
104 SRO units
$50,000
$5,200,000
58
SUMMARY OF RETAIL SALES USED

Address
City
Lot Size
Exposure
Building Area
(*retail only)
Est. year built
Improvements &
C
Condition
Zoning
Subject
36 Blood Alley
1
62-68 E
Cordova
Street
2
68-92 E
Hastings
Street
3
140-142 W
Hastings
4
112 W
Hastings
5
128 W
Hastings
6
155-163 E
Pender
Street
7
157-199 W
Hastings
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
Vancouver
19060
6100
12023
6100
3125
12000
3050
7800
Moderate
Moderate
Moderate
Moderate
Moderate
Moderate
Moderate
Moderate
14356*
6000
6000
12000
12000
48000
6150
50000
OT
OT
OT
OT
OT
OT
1970
Reno 2006
Commercial
Retail
Commercial
Commercial
Commercial
Commercial
Commercial
Retail/Office
Average
Average
Avg
Avg-Fair
Avg-Fair
Good
Avg-Gd
Good
HA2
Sale Price
Sale Status
Sale Date
Price per sq.ft.
valuedate
HA2
DEOD
DD C2
DD-C2
DD-C2
HA1
HA2
$1,610,000
$2,500,000
$2,200,000
$2,550,000
$11,500,000
$1,665,000
$15,531,436
Market
Market
Market
Market
Market
Market
Market
Jan, 10
Sep, 10
Aug, 11
Jan, 11
Aug, 11
Nov, 10
Sep, 10
$268
$417
$183
$213
$240
$271
$311
The retail component of the subject has been valued separately from the SRO units. The
subject currently includes 104 SRO units and 14356 square foot of commercial space
fully improved as a retail and office uses. In our typical SRO valuation, the retail
component has been included in the unit count. However, typical SROs have minimal
income from the ground floor space. In the subjects case, the ground floor space
accounts for a large portion of the subjects value. Therefore, we have considered this
separately.
A total of 7 comparables were used in this analysis. All the sales are fairly recent and
located in the subject area. Note that the commercial section has been considered in
isolation. Therefore, the effective density would about 1.0, while in the comparables, the
density is generally much higher, at around 2.0. The selected sales show values between
$183 and $417 per square foot. In general, the comparables which are built out at about 2
FSR show values averaging $200 to$240 per square foot. Sales 1 and 2 are the only
properties built out at a lower FSR, and shows rates between $268 and $417, almost
double that of the remaining sales, despite the inferior location.
No adjustments have been made to the retail sales comparables due to the nature of the
comparison. Of the Sales, #1 and 2 are deemed the most comparable, and show
unadjusted values between $268 and $417 per square foot.
The subject unit is in average condition and has exposure comparable to the sales used.
In considering the comparables, the subject would likely have a value above $250, which
would be the base value of a 2.0 FSR building. Sale 1 has an FSR of about 1, which is
what we have assumed for the subject in this analysis. However, it is in an inferior
59
location. Sale 2 has a much higher value, but is built out at a 50% FSR. The subject
should be lower than this sale. In applying adjustments to Sales 1 and 2, we have a value
that lies around $300 per square foot. This will be applied to the ground floor space of
the subject.
Our final estimate of the improved space is estimated at $300 per sq.ft. The subject
property consists of 14356 sq.ft. of retail space therefore, the comparative estimate of
value is as follows.
Area (sq.ft.)
Price/unit
Value
14356 sq.ft.
$300
$4,306,800
The final value is as follows:

Units
Price/unit
Value
104 SRO units
$50,000
$5,200,000
14356 sq.ft.
$300
$4,306,800
Total
$9,506,800
Rounded to
$9,510,000
Estimated Value by Direct Comparison Approach:
$9,510,000
60
COMPARISON APPROACH LAND

There are six methods of valuing vacant land:
1.
THE DIRECT COMPARISON APPROACH , in which the recent sales of

similar vacant sites are analyzed and compared and then by making adjustments
for dissimilarities, an indication of the value is given for the subject site.
2.
THE ABSTRACTION METHOD, is based on the principles of balance and

contribution, involves the allocation of value to the land component in a recent
improved property sale using a typical ratio of land to total property value. The
method is not considered conclusive proof , but can be useful in establishing
general parameters of value in which the final estimate of value can be found.
3.
THE EXTRACTION METHOD, is a variation of the abstraction method,

involves estimating the depreciated value of the improvements and then
subtracting it from the overall sale price to indicate a vacant land value.
4.
THE DEVELOPMENT METHOD, Is used mainly on vacant parcels of land

that may be subdivided. It involves the hypothetical projection of a lot or lots and
an estimate of gross sales figures. The expenses such as servicing costs, sales
commissions, overhead and a profit factor are then estimated and deducted from
the gross sales figures. The balance is an indication for the raw land without the
benefit of servicing. This method is also known as the Subdivision Method.
5.
THE LAND RESIDUAL METHOD, involves the hypothetical erection of

various types of improvements on a site in order to determine which utility will
result in the highest net return to the land. The return estimated from this
optimum use is then capitalized in an appropriate manner to provide an indication
of value for the Subject Site. This method is used mainly in estimating the value
of sites with a potential for income producing improvements such as commercial
and office buildings and apartments.
6.
GROUND RENT CAPITALIZATION, involves the capitalization of ground

rental at an appropriate rate to indicate the market value of a site. It corresponds
to the value of the landowners interest in the land, the leased fee interest. The
procedure is useful when an analysis of comparable sales of leased land indicates
a range of rents and capitalization rates. If the current rental corresponds to
market rent, the value indication obtained by applying a market capitalization
rate will be equivalent to the market value of the fee simple interest in the land.
An alternative method of ground rent capitalization involves discounting the
anticipated cash flows (rental income) over the holding period and the reversion,
or the lump sum benefit received upon the termination of the investment.
In this report, I have utilized the Direct Comparison Approach to estimate the LAND
value of the subject property.
61
LAND SALES ANALYSIS

A comparative sales analysis involves researching market information to find properties
with comparable attributes to the subject property. In everyday appraisal practice,
available market data may allow the appraiser to make quantitative adjustments for some
elements of comparison and to analyze qualitatively the factors that cannot be quantified.
The property being appraised is a lot of approximately 19060 sq. ft. in size, and zoned
HA-2.
The following is a chart summarizing the comparable sales and a map of their relative
locations.
62
Land Sales Comparable Location Map
63
Property
Subject
Subject
1
2
3
4
5
Telus Garden Development Development Development Development
Site
Site
Site
Site
6
Assembly
7
Development
Site
8
Development
Site
Address
36 Blood Alley
775 Richards
891 Cambie
St
633 Main
Street
245-247 E
Georgia
989 Main
Street
557 E
Cordova
Vancouver
19060
0.44
HA2
5.00
Vancouver
25502
0.59
DD-C3
5.00
Vancouver
14996
0.34
DD-C3
5.00
Vancouver
14386
0.33
HA2
5.00
Vancouver
9024
0.21
DD-L1
8.69
Vancouver
15868
0.36
HA1A, CD1
9.29
Vancouver
7149
0.16
FC1
5.00
Gastown
CBD
Gastown
-
Chinatown
2 Storey
Retail
Main
Parkade
Downtown
2 Storey
Office
Vancouver
3050
0.07
DEOD
5.00
Downtown
East
n/a
Yaletown
2 Storey
Retail
Vancouver
3050
0.07
DEOD
5.00
Downtown
East
2 storey
commercial
$18,000,000
$11,600,000
$5,283,000
$5,000,000
$13,480,000
$1,150,000
$1,750,000
$742,500
Non-Arms
Feb, 12
Market
Aug, 11
Market
Jan, 11
Market
Sep, 11
Market
Feb, 12
Market
Jun, 12
Market
Jun, 12
Market
Sep, 12
$706
$141
$774
$155
$367
$73
$554
$64
$849
$91
$377
$75
$245
$49
$243
$49
Property Rights Conveyed
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Financing Terms
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Conditions of Sale
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Upward Adj
Location
Superior
Superior
Comparable
Superior
Superior
Inferior
Inferior
Inferior
Site improvements
Superior
Superior
Comparable
Superior
Superior
Superior
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Down. Adj.
Comparable
Comparable
Superior
Superior
Comparable
Comparable
Comparable
Inferior
Comparable
Inferior
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
Comparable
-28%
$506
$101
-22%
$603
$121
6%
$388
$78
-17%
$460
$53
-8%
$784
$84
2%
$383
$77
12%
$273
$55
16%
$282
$56
City
Lot Size (SF)
Lot Size (Acre)
Zoning
Allowable FSR
Location
Improvements
Sale Price
Sale Status
Sale Date
Price per Square foot
Price per Buildable
Configuration & Size

Zoning
Additional Adjustment
Net Percentage Adjustment
Adjusted Price per Square foot
Adjusted Price per Buildable
60 W Cordova 1107 Seymour

St
Land Sales Comparable Chart
64
SUMMARY OF LAND SALES

A total of 8 comparables were used in this analysis. All are redevelopment properties located
in the vicinity of the subject. The lots are mainly smaller, with similar density and land use.
Most are recent. We have adjusted for the value of any structures on redevelopment parcels
where they appear to retain some contributory value.
Price Per Square Foot Land
The unadjusted range was from $243 per square foot to $849
per square foot. After
adjustments the range narrows to $273 per square foot and $784 per square foot. The average
adjusted value of the comparables was $460 per square foot, with a median value of $424 per
square foot.
Sale 1 is a recent sale located in the downtown core, but it was reported as a non-arms length
transaction. The property was also improved with a parkade structure. Despite this, the property
is a development parcel, and is fairly comparable to the subject property.
Sale 2 is a redevelopment parcel in Yaletown. This site is also superior to the subject. The
property was improved with a retail building and is superior to the subject.
Sale 3 is located near the subject, and consists of a HA2 zoned development parcel. This is the
oldest sale, but is also the most similar to the subject.
Sale 4 included a property that was used as a community services centre, with redevelopment to
a higher density facility. The property is to be rezoned to a CD-1 Comprehensive Development
classification in order to allow for the development of a 15 storey mixed use building with four
storeys of office space and 11 storeys of affordable rental housing containing 81 units. The
proposed maximum floor space ratio (FSR) is 8.69 yielding 22,200 square feet of Social
Amenity Office Space and 56,050 square feet of Residential Space. The location is superior to
the subject, with a higher proposed density. The site is also smaller than the subject. The
subject would likely have a lower overall value.
Sale 5 is a high density mixed use development in Chinatown. The HA1 area has experience a
spike in development due to the new height regulations. The increased density has spurred new
development, which is reflected in the high value of the sale.
Sale 6 through 8 are sales of smaller redevelopment parcels that have sold recently. All three
sales are likely to be assembled for larger developments. All three sales showed lower per square
foot and per buildable values.
Overall, Sales 3 and 4 are the most similar, with an adjusted per square foot value of $388 and
$489.
Our final estimate of the space is estimated at $500 per sq. ft. The subject property consists of
19060 sq. ft., therefore, the comparative estimate of value is as follows.
65
Land Area
19060 sq. ft.
Price/unit
Value
$500
$9,530,000
Rounded to
$9,530,000
Price Per Square Foot Buildable

For higher density redevelopment sites, the most commonly used unit of measure is the buildable
area, measured in square foot buildable. Of the sales used, most have a similar 5.0 allowable
density with the exception of #4 and #5. However, the overall per buildable indicators showed a
very wide range of value between $55 and $121 per square foot. The most similar comparable is
#3, with an indicator of $78 per square foot. This is lower than most development site in the
downtown area, which generally show higher per buildable rates.
For this analysis, we have assumed a buildable area of 5.0 times the lot size, or 95300 square
feet. Therefore, the valuation is as follows:
Buildable Area
Price/unit
Value
95,300
$95
$9,053,500
Rounded to
$9,050 ,000
Estimated Value by Direct Comparison Approach:
$9,530,000
66
RECONCILIATION
INCOME APPROACH
The Income Approach (IA) is considered a good indicator of value based on a revenue
generating property if the building were leased out at market rates and capitalized at the market
rate. The estimated value according to the Income Approach is:
$8,490,000
The Direct Comparison Approach (DCA), or Market Approach as it is known, is important
because it provides evidence of actual market activity. The estimated value of the direct
comparison approach is:
As Improved
$9,510,000
As Redevelopment Land
$9,530,000
The Direct Comparison Approach and Income Approach were used to estimate the market value
of the subject property.
67
EXPOSURE TIME
The Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP) require that we
estimate the exposure time necessary to market the property at the appraised value. The time is
always presumed to occur prior to the effective date of the appraisal, and is substantiated by
related facts in the appraisal process.
Sales of SROs have dropped significantly in 2011, with the Government no longer actively
purchasing these assets. The subject property has been on the market for an extended period of
time possibly due to the market conditions and the overall condition of the building.
The estimated an exposure period for such a property is likely in the order of 6 to 10 months to
successfully market the subject properties at the appraised value as of the effective date of
appraisal, given current market conditions.
FINAL ESTIMATE OF VALUE

Our final conclusion of value therefore as at March 14, 2012, subject to all Assumptions and
Limiting Conditions contained herein, is:
$9,510,000
68
CERTIFICATION
Re: 36 Blood Alley Square, Vancouver, BC
I certify to the best of my knowledge and belief that:
1) The statements of fact contained in this report are true and correct;
2) The reported analysis, opinion, and conclusions are limited only by the reported assumptions
and limiting conditions and represent my personal, unbiased professional analyses, opinions,
and conclusions;
3) I have no present or prospective interest in the subject property, and have no personal interest
or bias with respect to the parties involved;
4) My compensation is not contingent upon the reporting of a predetermined value or direction
in value that favours the cause of the client, the amount of the value estimate, the attainment
of a stipulated result, or the occurrence of a subsequent event, such as the approval of a loan;
5) This appraisal assignment was not based upon a requested minimum valuation, a specific
valuation, or the approval of a loan;
6) My analyses, opinions, and conclusions were developed, and this report has been prepared in
conformity with the Canadian Uniform Standard of Professional Appraisal Practice
(CUSPAP) of the Appraisal Institute of Canada;
7) The use of this report is subject to the requirement of the Appraisal Institute relating to
review by its duly authorized representatives;
8) I have completed the requirements of the continuing education program of the Appraisal
Institute of Canada (AIC);
9) I have personally inspected the subject property;
10) I have experience in the appraisal of similar properties.
11) Based upon the data, analyses and conclusions contained herein, the market value of the
interest in the property described, as at October 1, 2012is estimated at:
$9,510,000
_____________________________ Date: ________________
Simon Poon, AACI, P.App, B.Comm
69
EXHIBITS AND ADDENDA
70
ADDENDUM A
(A) Definition of Terms
71
Various terms and abbreviations have been used in this report, and are defined herein for the
purpose of clarification of the meaning and usage:
assessed value Assessed value applies in ad valorem
taxation and refers to the value of a property according to
the tax rolls. Assessed value may not conform to market
value, but it is usually calculated in relation to a market
value base.
cash equivalency The procedure in which the sale prices

of comparable properties sold with atypical financing are
adjusted to reflect typical market terms.
contract, coupon, face, or nominal rent
The
nominal rent payment specified in the lease contract. It
does not reflect any offsets for free rent, unusual tenant
improvement conditions, or other factors that may
modify the effective rent payment.
Cost Approach A set of procedures through which a value

indication is derived for the fee simple interest in a
property by estimating the current cost to construct a
reproduction of (or replacement for) the existing
structure, including an entrepreneurial profit, deducting
depreciation from the total cost, and adding the estimated
land value. Adjustments may then be made to the
indicated fee simple value of the subject property to
reflect the value of the property interest being appraised.
coupon rent
See Contract, Coupon, Face, or Nominal Rent
Direct Comparison Approach A set of procedures in
which a value indication is derived by comparing the
property being appraised to similar properties that have
been sold recently, applying appropriate units of
comparison, and making adjustments to the sale prices of
the comparables based upon the elements of comparison.
The Direct Comparison Approach may be used to value
improved properties, vacant land, or land being
considered as though vacant. It is the most common and
preferred method of land valuation when comparable
sales data is available."
effective rent
1) The rental rate net of financial

concessions such as periods of no rent during a lease
term; may be calculated on a discounted basis, reflecting
the time value of money, or on a simple, straight-line
basis. 2) The economic rent paid by the lessee when
normalized to account for financial concessions, such as
escalation clauses, and other factors. Contract, or
normal, rents must be converted to effective rents to form
a consistent basis of comparison between comparables.
exposure time The estimated length of time the property

interest being appraised would have been offered on the
market prior to the hypothetical consummation of a sale
at market value on the effective date of the appraisal; a
retrospective estimate based upon an analysis of past
events assuming a competitive and open market.
Exposure time is different for various types of real estate
and under various market conditions.
face rent
fee simple estate Absolute ownership unencumbered by

any other interest or estate, subject only to the limitations
imposed by the governmental powers of taxation,
eminent domain, police power, and escheat.
floor space ratio (FSR) The relationship between the

above-ground floor area of a building, as described by the
building code, and the area of the plot on which it stands;
in planning and zoning, often expressed as a decimal,
e.g., a ratio of 2.0 indicates that the permissible floor area
of a building is twice the total land area; also called
building-to-land ratio or floor area ration (FAR)
full service lease
A lease in which rent covers all

operating expenses. Typically, full service leases are
combined with an expense stop, the expense level
covered by the contract lease payment. Increases in
expenses above the expense stop level are passed through
to the tenant and are known as expense pass-throughs.
going concern value Going concern value is the value

of a proven property operation.
It includes the
incremental value associated with the business concern,
which is distinct from the value of the real estate only.
Going concern value includes an intangible enhancement
of the value of an operating business enterprise which is
produced by the assemblage of the land, building, labour,
equipment, and marketing operation. This process
creates an economically viable business that is expected
to continue. Going concern value refers to the total value
of a property, including both real property and intangible
personal property attributed to the business value.
gross building area (GBA) The sum of all areas at

each floor as measured to the exterior walls.
highest and best use The reasonably probable and legal
use of property, that is physically possible, appropriately
supported, and financially feasible, and that results in the
highest value.
Income Approach A set of procedures through which an
appraiser derives a value indication for an incomeproducing property by converting its anticipated benefits
(cash flows and reversion) into property value. This
conversion can be accomplished in two ways. One years
(stabilized) income expectancy can be capitalized at a
market derived capitalization rate or at a capitalization
rate that reflects a specified income pattern, return on
investment, and change in the value of the investment.
Alternatively, the annual cash flows for the holding
period and the reversion can be discounted at a specified
yield rate."
insurable value
Insurable Value is based on the

replacement and/or reproduction cost of physical items
72
that are subject to loss from hazards. Insurable value is

that portion of the value of an asset or asset group that is
acknowledged or recognized under the provisions of an
applicable loss insurance policy. This value is often
controlled by provincial law and varies from province to
province.
market value as is on the appraisal date Market
investment value Investment value is the value of an
market value Market value is one of the central concepts
investment to a particular investor based on his or her

investment requirements. In contrast to market value,
investment value is value to an individual, not value in
the marketplace. Investment value reflects the subjective
relationship between a particular investor and a given
investment. When measured in dollars, investment value
is the price an investor would pay for an investment in
light of its perceived capacity to satisfy his or her desires,
needs, or investment goals. To estimate investment
value, specific investment criteria must be known.
Criteria to evaluate a real estate investment are not
necessarily set down by the individual investor; they may
be established by an expert on real estate and its value,
that is, an appraiser.
of the appraisal practice. Market value is differentiated

from other types of value in that it is created by the
collective patterns of the market. Market value means
the most probable price which a property should bring in
a competitive and open market under all conditions
requisite to a fair sale, the buyer and seller each acting
prudently and knowledgeably, and assuming the price is
not affected by undue stimulus. Implicit in this definition
is the consummation of a sale as of a specified date and
the passing of title from seller to buyer under conditions
whereby: 1) A reasonable time is allowed for exposure
in the open market; 2) Both parties are well informed or
well advised, and acting in what they consider their own
best interests;
3) Buyer and seller are typically
motivated; 4) Payment is made in terms of cash in
Canadian dollars or in terms of financial arrangements
comparable thereto; and 5) The price represents the
normal consideration for the property sold unaffected by
special or creative financing or sales concessions granted
by anyone associated with the sale.
leased fee
See leased fee estate
leased fee estate
An ownership interest held by a

landlord with the right of use and occupancy conveyed by
lease to others. The rights of the Lessor (the leased fee
owner) and the leased fee are specified by contract terms
contained within the lease.
leasehold
See leasehold estate
leasehold estate The interest held by the lessee (the

tenant or renter) through a lease conveying the rights of
use and occupancy for a stated term under certain
conditions.
load factor The amount added to usable area to calculate

the rentable area. It is also referred to as a rentable addon factor which, according to BOMA, is computed by
dividing the difference between the usable square footage
and rentable square footage by the amount of the usable
area. Convert the figure into a percentage by multiplying
by 100.
Market rent
The rental income that a property

would most probably command in the open market;
indicated by current rents paid and asked for comparable
space as of the date of appraisal.
market value as if complete on the appraisal

date Market value as if complete on the appraisal date is
an estimate of the market value of a property with all
construction, conversion, or rehabilitation hypothetically
completed, or under other specified hypothetical
conditions as of the date of the appraisal. With regard to
properties wherein anticipated market conditions indicate
that stabilized occupancy is not likely as of the date of
completion, this estimate of value should reflect the
market value of the property as if complete and prepared
for occupancy by tenants.
value as is on the appraisal date is an estimate of the

market value of a property in the condition observed
upon inspection and as it physically and legally exists
without hypothetical conditions, assumptions, or
qualifications as of the date of appraisal.
marketing period The time it takes an interest in real

property to sell on the market subsequent to the date of an
appraisal.
net lease Lease in which all or some of the operating

expenses are paid directly by the tenant. The landlord
never takes possession of the expense payment. In a
Triple Net Lease all operating expenses are the
responsibility of the tenant, including property taxes,
insurance, interior maintenance, and other miscellaneous
expenses. However, management fees and exterior
maintenance are often the responsibility of the Lessor in a
triple net lease. A modified net lease is one in which
some expenses are paid separately by the tenant and some
are included in the rent.
net rentable area (NRA) 1) The area on which rent is

computed. 2) The Rentable Area of a floor shall be
computed by measuring to the inside finished surface of
the dominant portion of the permanent outer building
walls, excluding any major vertical penetrations of the
floor. No deductions shall be made for columns and
projections necessary to the building. Include space such
as mechanical room, janitorial room, restrooms, and
lobby of the floor.
nominal rent
prospective future value upon completion of

Prospective future value upon
construction
completion of construction is the prospective value of a
property on the future date that construction is completed,
based upon market conditions forecast to exist, as of that
73
completion date. The value estimate at this stage is stated

in current dollars unless otherwise indicated.
prospective future value upon reaching stabilized

occupancy Prospective future value upon reaching
stabilized occupancy is the prospective value of a
property at a future point in time when all improvements
have been physically constructed and the property has
been leased to its optimum level of long-term occupancy.
The value estimate at this stage is stated in current dollars
unless otherwise indicated.
reasonable exposure time The estimated length of

time the property interest being appraised would have
been offered on the market prior to the hypothetical
consummation of a sale at market value on the effective
date of the appraisal; a retrospective estimate based upon
an analysis of past events assuming a competitive and
open market.
rent
See
full service lease
net lease
contract, coupon, face, or nominal rent
effective rent
shell space Space which has not had any interior

finishing installed, including even basic improvements
such as ceilings and interior walls, as well as partitions,
floor coverings, wall coverings, etc..
Usable Area 1) The area actually used by individual

tenants. 2) The Usable Area of an office building is
computed by measuring to the finished surface of the
office side of corridor and other permanent walls, to the

centre of partitions that separate the office from adjoining
usable areas, and to the inside finished surface of the
dominant portion of the permanent outer building walls.
Excludes areas such as mechanical rooms, janitorial
room, restrooms, lobby, and any major vertical
penetrations of a multi-tenant floor.
use value
Use value is a concept based on the

productivity of an economic good. Use value is the value
a specific property has for a specific use. Use value
focuses on the value the real estate contributes to the
enterprise of which it is a part, without regard to the
propertys highest and best use or the monetary amount
that might be realized upon its sale.
value appraised During the real estate development

process, a property typically progresses from a state of
unimproved land to construction of improvements to
stabilized occupancy. In general, the market value
associated with the property increases during these stages
of development. After reaching stabilized occupancy,
ongoing forces affect the property during its life,
including a physical wear and tear, changing market
conditions, etc. These factors continually influence the
propertys market value at any given point in time.
See also
market value as is on the appraisal date
market value as if complete on the appraisal date
prospective future value upon completion of
construction
prospective future value upon reaching stabilized
occupancy
74
ADDENDUM B
(B) Title Search
https://apps.ltsa.ca/SRS_UIWeb/TitleSelectionListResults.do
Date: 04-Dec-2012
Requestor: (PB33947)
Folio:
VANCOUVER
TITLE SEARCH PRINT

CAMPBELL AND POUND COMMERCIAL LTD.
TITLE - BV112004
LAND TITLE OFFICE
Time: 22:39:44
Page 001 of 002
TITLE NO: BV112004

FROM TITLE NO: BR163548
APPLICATION FOR REGISTRATION RECEIVED ON:

ENTERED:
31 MARCH, 2003
11 APRIL, 2003
REGISTERED OWNER IN FEE SIMPLE:

CITY OF VANCOUVER
453 WEST 12TH AVENUE
VANCOUVER, BC
V5Y 1V4
TAXATION AUTHORITY:
CITY OF VANCOUVER
DESCRIPTION OF LAND:
PARCEL IDENTIFIER: 015-713-342
LOT 14, EXCEPT (A) THE EAST 26 FEET AND (B) PART IN REFERENCE PLAN 11078,
BLOCK 2 OLD GRANVILLE TOWNSITE PLAN 168
LEGAL NOTATIONS:
NOTICE OF INTEREST, BUILDERS LIEN ACT (S.3(2)), SEE BV123174
FILED 2003-04-09
HERITGAGE DESIGNATION BY-LAW, VANCOUVER CHARTER SECTION 593,
SEE BJ91210 AND BV47125
CHARGES, LIENS AND INTERESTS:
NATURE OF CHARGE
CHARGE NUMBER
DATE
TIME
PARTY WALL AGREEMENT
32117H
1925-04-14
15:00
EASEMENT AND INDEMNITY AGREEMENT

505398M
1970-03-11 12:22
REGISTERED OWNER OF CHARGE:
CITY OF VANCOUVER
505398M
REMARKS: INTER ALIA
521420M
1970-12-31 11:19
CITY OF VANCOUVER
521420M
REMARKS: INTER ALIA
H16778
1980-03-19 14:46
CITY OF VANCOUVER
H16778
REMARKS: INTER ALIA
Date: 04-Dec-2012
TITLE SEARCH PRINT
Requestor: (PB33947)
CAMPBELL AND POUND COMMERCIAL LTD.
Folio:
TITLE - BV112004
Time: 22:39:44
Page 002 of 002
OPTION TO PURCHASE
BV112005
2003-03-31 14:57
PORTLAND HOTEL SOCIETY
INCORPORATION NO. S30883
BV112005
REMARKS: INTER ALIA
"CAUTION - CHARGES MAY NOT APPEAR IN ORDER OF PRIORITY. SEE SECTION 28, L.T.A."
DUPLICATE INDEFEASIBLE TITLE: NONE OUTSTANDING
1 of 2
12/4/2012 10:39 PM
https://apps.ltsa.ca/SRS_UIWeb/TitleSelectionListResults.do
TRANSFERS: NONE
PENDING APPLICATIONS: NONE
*** CURRENT INFORMATION ONLY - NO CANCELLED INFORMATION SHOWN ***
2 of 2
12/4/2012 10:39 PM
ADDENDUM C
(C) Excerpts from Zoning By-Law
HA-2
HA-2
(Gastown Historic Area)
1
Intent
Gastown is the site of the old Granville Townsite, and it is from this area that the City of
Vancouver developed and grew. This District Schedule is designed to recognize the areas
special status and to ensure the maintenance of Gastowns turn of the century historical and
architectural character.
Outright Approval Uses
2.1
Subject to all other provisions of this By-law and to compliance with section 2.3 and the
regulations of this Schedule, the uses listed in section 2.2 shall be permitted in this District and
shall be issued a permit.
2.2
Uses
2.2.R
[Retail]
y
y
2.2.S
Grocery or Drug Store.

Retail Store.
[Service]
y
Restaurant - Class 1.
2.3
Conditions of Use
2.3.1
All commercial uses listed in this section shall be carried on wholly within a completely
enclosed building except for the following:
(a)
(b)
(c)
parking and loading facilities;

restaurant and refreshment facilities;
display of flowers, plants, fruits and vegetables.
2.3.2
Notwithstanding the provisions of section 5 of this By-law, any and all proposed alterations or
changes to the exterior treatment or appearance of any building or structure or changes of use
shall require the approval of the Development Permit Board after consultation with any
advisory group approved by Council for the area.
2.3.3
For the purposes of this Schedule, ground floor does not include a basement.
2.3.4
All uses listed in this section shall be limited to the ground floor only and shall be further
limited to a maximum gross floor area of 500 m and a maximum frontage of 10.7 m.
Conditional Approval Uses
3.1
Subject to all other provisions of this By-law, section 3.3.3 and the provisions and regulations
of this Schedule, the Development Permit Board may approve any of the uses listed in section
3.2, subject to the conditions of section 3.3, and including such other conditions as it may
decide, provided that it first considers:
(a)
the intent of this Schedule and all applicable policies and guidelines adopted by Council;
and
City of Vancouver
Zoning and Development By-law
HA-2
October 1996
HA-2
(b)
the submission of any advisory group, property owner or tenant.
3.2
Uses
3.2.A
y
y
3.2.C
[Cultural and Recreational]
3.2.D
Accessory Buildings to any of the uses listed in this Schedule.

Accessory Uses to any of the uses listed in this Schedule.
y
y
y
y
y
y
y
y
y
Artist Studio, subject to the provisions of section 11.18 of this By-law.

Hall.
Fitness Centre.
Library.
Museum or Archives.
Park or Playground.
Swimming Pool.
Theatre.
Zoo or Botanical Garden.
Deposition or extraction of material so as to alter the configuration of the land.
3.2.DW [Dwelling]
y
y
3.2.I
[Institutional]
y
y
y
y
y
y
3.2.LW
Office Uses.
[Parking]
y
3.2.R
Bakery Products Manufacturing.

Clothing Manufacturing.
Jewellery Manufacturing.
[Office]
y
3.2.P
Live-Work Use, subject to section 11.23 of this By-law.
[Manufacturing]
y
y
y
3.2.O
Child Day Care Facility.

Church.
Public Authority Use.
School - Elementary or Secondary.
School - University or College.
Social Service Centre.
[Live-Work Use]
y
3.2.M
Dwelling Uses.
Residential Unit associated with and forming an integral part of an artist studio, subject to
the provisions of section 11.19 of this By-law.
Parking Uses.
[Retail]
y
y
Farmers Market. Compatibility with nearby sites, parking, traffic, noise, hours of
operation, size of facility, pedestrian amenity.
Furniture or Appliance Store.
City of Vancouver
HA-2
July 2010
HA-2
y
y
y
y
y
3.2.S
[Service]
y
y
y
y
y
y
y
y
y
y
y
y
y
y
y
y
y
y
y
y
y
y
3.2.U
Auction Hall.
Barber Shop or Beauty Salon.
Beauty and Wellness Centre.
Bed and Breakfast Accommodation, subject to the provisions of section 11.4 of this
By-law.
Cabaret.
Catering Establishment.
Hotel.
Laundromat or Dry Cleaning Establishment.
Laundry or Cleaning Plant.
Neighbourhood Public House.
Photofinishing or Photography Laboratory.
Photofinishing or Photography Studio.
Print Shop.
Production or Rehearsal Studio.
Repair Shop - Class B.
Restaurant - Class 1, other than as provided for in section 2.2.
Restaurant - Class 2.
School - Arts or Self-Improvement.
School - Business.
School - Vocational or Trade.
Sign Painting Shop.
Wedding Chapel, subject to section 11.20 of this By-law.
[Utility and Communication]

y
3.2.W
Grocery or Drug Store, other than as provided for in section 2.2.

Liquor Store.
Retail Store, other than as provided for in section 2.2.
Small-scale Pharmacy, subject to the provisions of section 11.22 of this By-law.
Vehicle Dealer.
Public Utility.
[Wholesale]
y
y
y
Lumber and Building Materials Establishment.

Wholesaling - Class A.
Wholesaling - Class B.
3.2.Z
Any other use which is not specifically listed and defined as a use in section 2 of this
By-law but which the Development Permit Board considers comparable in nature to the
uses listed in this Schedule, having regard to the intent of this District Schedule.
3.3
Conditions of Use
3.3.1
All uses listed in this section shall be carried on wholly within a completely enclosed building,
except for the following:
(a)
(b)
(c)
(d)
(e)
parking and loading facilities;

restaurant;
display of flowers, plants, fruits and vegetables;
neighbourhood public house; and
farmers market.
City of Vancouver
HA-2
July 2010
HA-2
3.3.2
Any development permit issued for live-work use must stipulate as permitted uses:
(a)
(b)
(c)
dwelling unit;
general office, health care office, barber shop or beauty salon, photofinishing or
photography studio, or artist studio class A; and
dwelling unit combined with any use set out in subsection (b).
Regulations
All uses approved under sections 2 and 3 of this District Schedule shall be subject to the
following regulations.
4.1
Site Area -- Not Applicable.
4.2
Frontage -- Not Applicable.
4.3
Height
4.3.1
The minimum height of a building shall be 12.2 m, and the maximum height of a building shall
be 22.9 m.
4.3.2
The Development Permit Board may permit an increase or decrease in the maximum or
minimum height of a building with respect to any development provided they first consult with
any advisory group approved by Council for the area and take into account the following:
(a)
(b)
(c)
the height, bulk and location of the building and its effect on the site, surrounding
buildings and streets, and existing views;
the effects of overall design on the general amenity of the area; and
the intent of this Schedule.
4.4
Front Yard and Setback -- Not Required.
4.5
Side Yards -- Not Required.
4.6
Rear Yard and Setbacks -- Not Required.
4.7
Floor Space Ratio -- Not Applicable.
4.8
Site Coverage -- Not Applicable.
4.9
[Deleted -- see Parking By-law.]
4.10
Horizontal Angle Of Daylight -- Not Applicable.
Relaxation of Regulations
5.1
The Development Permit Board or the Director of Planning, as the case may be, may relax the
use conditions of sections 2.3.1 and 3.3.1 for the following uses, and may include additional
conditions, provided they first consider the intent of this Schedule and all applicable policies
and guidelines adopted by Council and the submission of any advisory group.
(a)
(b)
restaurant and refreshment facilities;

retail uses.
City of Vancouver
HA-2
March 2006
ADDENDUM D
(D) Qualifications of Appraiser
ADDENDUM E
(E) Additional Photos
Interior Retail
Interior Retail
Interior Retail
Interior Retail
Interior Retail
Interior Retail
Interior Retail
Subject from W Cordova Street
Subject from W Cordova Street
Interior SRO
Interior SRO
Interior SRO
Rear Courtyard
Rear View

Stanley Hotel, 36 Blood Alley SQ., Vancouver

Diunggah oleh

Informasi Dokumen

Judul Asli

Hak Cipta

Format Tersedia

Bagikan dokumen Ini

Bagikan atau Tanam Dokumen

Opsi Berbagi

Apakah menurut Anda dokumen ini bermanfaat?

Apakah konten ini tidak pantas?

Hak Cipta:

Format Tersedia

Stanley Hotel, 36 Blood Alley SQ., Vancouver

Diunggah oleh

Hak Cipta:

Format Tersedia

74757-09 36 Blood Alley Square, Vancouver Stanley Hotel

Valuation of 36 Blood Alley Square, Vancouver, BC

1111 11871 Horseshoe Way, Richmond BC V7A 5H5

36 Blood Alley Square, Vancouver, BC

36 Blood Alley Square, Vancouver, BC

36 Blood Alley Square, Vancouver, BC

Subject Lane View

Subject Street View

36 Blood Alley Square, Vancouver, BC

36 Blood Alley Square, Vancouver, BC

The subject is improved with a two OT heritage buildings, of two

36 Blood Alley Square, Vancouver, BC

Lot 14, Block 2, District Lot OGT Gastown Men's Residence

015-713-342, 015-713-326, 015-713-334, 015-713-318

HA-2 Gastown Historic, Heritage B(M)

19060 sq. ft. (206.75 x 92.19)

Effective Improved Area

+/-38112 sq.ft. (104 rooms, 12 retail unit approx. 14356 sq.ft.)

Remaining Economic Life

2012 Property Assessments:

2012 Gross Property Taxes:

The subject is located in the Gastown neighborhood

Highest And Best Use

Highest and Best Use for the subject property is as a

Stabilized Net Income:

$552,066 per annum (based on projected stabilized rental rates)

Final Estimate of Value

October 19, 2012

36 Blood Alley Square, Vancouver, BC

PROPERTY RIGHTS APPRAISED

36 Blood Alley Square, Vancouver, BC

9) Concluded value estimates using the Direct Comparison Approach and

BC Assessment Tax Report

No supporting documents were received

No current building plan was received

36 Blood Alley Square, Vancouver, BC

ASSUMPTIONS AND LIMITING CONDITIONS

The estimated Market Value of the property appraised is based on the

No responsibility is assumed for legal factors pertaining to the state of title or

The property rights appraised herein exclude mineral rights, if any.

Compliance & Conformity

Unless otherwise stated, it is assumed that there are no outstanding

36 Blood Alley Square, Vancouver, BC

It is assumed that all required licences, occupancy certificates, consents, or

Unless otherwise stated in this report, the existence of hazardous material,

The presence of substances such as asbestos, urea formaldehyde foam

Furniture Fixtures & Equipment

36 Blood Alley Square, Vancouver, BC

The appraiser, by reason of this appraisal, is not required to give testimony,

EXTRAORDINARY ASSUMPTIONS & LIMITING CONDITIONS

36 Blood Alley Square, Vancouver, BC

36 Blood Alley Square, Vancouver, BC

CERTIFICATE OF TITLE NUMBER

REGISTERED OWNERS IN FEE SIMPLE

HERITAGE DESIGNATION BY-LAW, VANCOUVER

PARTY WALL AGREEMENT (1925)

3EASEMENT AND INDEMNITY AGREEMENTS (1970, 1970, 1970)

OPTION TO PURCHASE (2003, PORTLAND HOTEL SOCIETY)

Actual Assessment Values (2009)

36 Blood Alley Square, Vancouver, BC

36 Blood Alley Square, Vancouver, BC

Neighbourhood Map of Subject Property

36 Blood Alley Square, Vancouver, BC