Former Surrey co-op residents face eviction or steep rent hikes after land sold

Residents of a former co-op housing development in Surrey say they’re facing an impossible decision between displacement or massive rent hikes, and have been left with no protection under the law.

The lease on the 58-unit Totem Housing Co-Op in South Surrey expired in December and the property was sold to a new owner.

Residents have been told they’ll now have to pay market rents, tripling what most tenants currently pay.

There appears to be little they or the government can do, because unlike most co-ops, the development is on privately-owned land.

“We’ve been trying to go to everybody to keep this as affordable housing,” 15-year resident Brant Dufty told Global News.

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Many residents Global News spoke with expressed fear of the new owner, who they believe is trying to force them out, and who they say wants to charge steep rents for property that’s in terrible shape. They pointed to black mold, rotting decks and floors, and an apparent willingness on the part of new the new owner to tolerate squatters and “skid row”-like conditions.

Many of the former co-op members have already moved on.

“What happened was, the new owner took over, and he is charging me 230-per cent more rent for my building that’s kind of falling apart and it’s not worth it,” said resident Steve, who would not give his last name.

“What used to be here was a family community, everyone got along … Now it’s sad, it’s like your family members have been torn from you, and some people have nowhere to go. You’re trying help them, but yourself — you’re being pressured to get out.”

Thirty-year resident Lavena, who also declined to give her last name, said she relies on the affordable rent because she is on disability. She said she used to pay just over $700 per month and is now being asked to pay about $2,800 per month.

She said the new owner has told her to be out by Monday or face legal proceedings and is “doing everything they can to threaten us.”

“I don’t have a place to go to, so I’m going to be couch surfing back and forth between my daughter and my son’s houses,” she said.

“I cannot afford the rents that they have put in here. It’s very hard, because this was a co-op, which is considered low-income, which is why all of us moved in here because they were reasonable prices and we could afford it.”

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Global News spoke with someone who identified himself as a property caretaker for the new owner, who said he was instructed not to speak about the issue. Calls to the new owner were not returned.

The situation has roots dating back about five years.

Totem is one of just eight co-ops in B.C. on private land, a situation Co-operative Housing Federation of BC CEO Thom Armstrong said puts them in a unique and precarious position. Most other co-ops lease from governments or the Community Land Trust.

Armstrong said the Totem Co-Op finished paying off its mortgage in 2017, which covered the buildings on the land.

Co-ops have the legal right of first refusal to purchase the land they are on. When the mortgage was paid off, he said Totem was offered the opportunity to buy the property from the previous owner, the B.C. Labourer’s Pension Plan.

“We were very closely involved, working with the co-op and the agency for co-op housing … to help the co-op buy the land from the pension plan and make them secure forever,” he told Global News.

“At the time, the pension plan was actually amenable to a sale that would have represented quite a discount on the full market value of the property, it was at the time valued just under $10 million.”

Armstrong said such a deal would have left residents facing an increase in housing costs of between three and seven per cent, but that the co-op declined, and wanted a better deal.

“I thought we got them the deal of the century, frankly, but to them, they didn’t think it was good enough,” he added. Armstrong said he never got clarity on how much information about the situation the co-op’s board had shared with members.

Armstrong said talks between the co-op and the pension plan broke down at that point. He said a later attempt by the Community Land Trust to buy the land — then valued around $12 million — was also rejected by the co-op because of increased monthly housing costs, and that the pension plan opted to sell to a private party.

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Co-op residents told Global News they made every attempt to work out a deal, and never had enough money to move forward in the process until their window had closed. They said they sought out another developer who would have kept the property a co-op, but were rejected by the pension plan.

Dufty said the co-op was offered loans, but the cost was far too expensive for the low-income residents.

“Nobody would help us … autistic children, seniors, disabled people, regular families with brand new babies, children,” he said. “Then the next thing you know, everything is sold.”

BC Housing Minister Ravi Kahlon said Totem residents were in a “rare situation” of being located on private land.

“In this case, there was a lot of attempts made to ensure both the folks living in the co-op and the owner of the parcel could come to a fair resolution, many attempts were made, and unfortunately they couldn’t comes to that,” he said.

“We don’t like to see that, nobody likes to see that.”

Kahlon said the Co-operative Housing Federation of BC is now working with residents to try and find them alternative co-op locations.

Armstrong said residents have been invited to apply through the association’s co-op portal, but acknowledged the system faces long wait lists. Even so, he said, most modern co-ops have higher monthly housing costs, and if accepted, residents would be broken up, meaning the community they developed over decades at Totem would be lost.

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He said the association is currently redeveloping another Surrey co-op named Sunshine with large number of new units, but it would be months before they came online.

“I have to say what’s most disappointing to me is not the 58 households that live there now, but the 58 and more who could have lived there in five years, 10 years and 50 years and 100 years if they had taken the right decision in 2017 and bought that property,” he said.

“The moral of the story, I think, is don’t start a co-op on land leased from a party that’s going to have a direct financial interest at the end of the lease.”

That answer, however, is cold comfort for the current residents of Totem, who are facing either massive monthly rent hikes, or the monumental task of trying to find affordable housing elsewhere in Surrey.

“It was a co-op and went to residential, he has the right to (raise the rent), our government is allowing it,” Steve said.

“It’s very hard because I raised my kids here … I practically raised my grandchildren here too, and it’s my home … they are ripping away my home,” Lavena said.

“They’re taking away all the good memories we had living here and it hurts and it makes me really angry. I can’t believe somebody can just come in here and do that.”