Busloads of the 3,500 London residents who could see their rent increase by almost 10 percent in 2013 are expected at a Landlord Tenant Board hearing March 5.
According to one affected tenant who spoke to London Community News on condition of anonymity, at least 100 residents of the 12-tower Cherryhill apartment complex have signed up to attend the hearing, which will determine whether their rent can be increased at twice the rate permitted by provincial law, or 6.1 percent retroactively to May 2012.
The owner, Minto Properties Ltd., has applied to increase the rent for 2,023 units by another 3.25 percent in 2013, three-quarters of a percent above the limit set by the province this year (2.5 percent).
It’s called an above guideline increase or AGI.
“A lot of us are on a fixed income,” the tenant said. “There are people who have lived in these buildings for 40-plus years. I think everyone in the building is upset.”
One resident has retained a law student through Western University’s Community Legal Services Clinic to represent her interests in the matter. The clinic’s director, Doug Ferguson, declined further comment citing the law faculty’s confidentiality policy.
According to Blair Spencer, Minto’s director of property operations in London, the company is attempting to recoup some of the $9 million it has spent on the apartment campus since purchasing it in March 2011.
He said much of the construction, including work on boilers and elevators, was dedicated to bringing the buildings up to code.
“Community is our first priority,” he said. “There is a new fitness centre here, state-of-the-art which is free of charge to residents.”
Although the usage of the fitness centre is free, but the cost of the construction is identified as a line item in the rent increase application.
“We have an open door policy here,” he said. “And we communicate with the Cherryhill Residents Association.”
He said all the data backing up the application is available for purchase on a CD for $5.
The rent increase has been optional for the residents since May. If it approved by the rent tribunal, those who have opted out will owe back rent from that date on.
Mike Drabick has lived at Cherryhill for 23 years. He said he could afford the increase, but disagreed with the company putting the cost of improving the buildings on the backs of its tenants.
“They knew about the repairs before they bought it,” he said. “They should have included that in their assessment of the price. They didn’t have to rush into them right away.”
The province announces the rent increase guideline a year in advance, according to the Landlord Tenant Board.
Ontario’s annual “Rent Increase Guideline” is based on the Ontario Consumer Price Index (CPI), which is a measure of inflation calculated monthly by Statistics Canada. The rate of allowable rent increases for 2012 was 3.1 percent, more than four times higher than the 2011 guideline of 0.7 percent.
The guideline is the maximum amount that most landlords can increase a tenant’s rent during the year without making an application to the Landlord and Tenant Board, which is what the March 5 hearing is about. The guideline is based on the CPI, which is regarded as an “objective, reliable measure of inflation, charting the change in the price all goods and services in the provincial economy.”
The Rent Increase Guideline is calculated by averaging the monthly CPI from June 2010 to May 2011, as required under the Residential Tenancies Act, 2006 (RTA).
The 2012 guideline applies to rent increases between Jan. 1 and Dec. 31, 2012.
The average yearly increase from 2004-2011 was 1.89 percent. The average yearly increase from 1993-2003 was 3.17 percent.
Minto Group manages 14,000 residential rental units in Ottawa, Toronto and London as well as over two million square feet of retail, industrial and commercial space according to their website. It has constructed more than 70,000 new homes across Canada and the United States.
The Cherryhill complex, which includes a mall with a bank, grocery store, hairdresser, VON office and other amenities, is the company’s only London holding.
The above-mentioned resident said she is very happy with the building and Minto as landlords, but is worried about her ability to afford to live there in the future.
The rent for the pensioner’s “large” one-bedroom apartment jumped to $838 when the 6.1 percent hike was applied.
“They’ll have to carry me out of here,” she said. “I can still drive, but in 10 years, who knows? I’ll be paying as much as a penthouse by then. I see beautiful buildings all over London, but they aren’t near anything. I’m 77 so it’s a concern.”