If you live in a strata property in British Columbia and are lucky enough to have the exclusive use of two or more parking stalls, or are looking to purchase an extra parking space, you need to read this blog post!
If you are buying or selling a parking stall, the first step is to determine whether the parking stalls are designated as limited common property or are governed by leasehold assignments.
Limited Common Property Parking Stalls
If your parking stalls are designated as limited common property for the exclusive use of the owners’ strata lots, this designation will appear in the formal strata plans for the Strata Corporation that are registered in the Land Title Office. To buy or sell an extra parking stall, you will need to change the registered strata plans. This can be a complex process that may require legal assistance.
To give another strata lot exclusive use of a parking stall, and assign a limited common property parking stall to another strata lot, the owners in the Strata Corporation will need to approve the change in the strata plan under section 76 of the Strata Property Act by a ¾ vote at an Annual or Special General Meeting.
Once the change is approved, the Strata Corporation will need to submit certification of the vote, along with a new “sketch plan” of the change for approval and registration with the Land Title Office.
Leasehold Assignment Parking Stalls
In many newer strata developments, developers have used creative legal methods to avoid designating parking spaces as limited common property. Developers will lease out entire parking areas to a separate corporate entity prior to depositing the strata plan and creating the Strata Corporation.
This other corporate entity will then assign its leasehold rights to owners, giving them exclusive use of parking stalls. This method “pre-encumbers” the Strata Corporation, allowing the developer to assign, rent and sell parking stalls without the approval of the Strata Corporation or Land Title Office.
An “assignment” is the legal term for selling or transferring your rights and obligations under a contract to another person. Many contracts restrict the ability to assign the contract to another person without the permission of one or both of the parties. A lease or leasehold interest refers to a long term “rental” agreement, giving one party an interest in land over a given period of time.
If your parking stall is a leasehold assignment, you will need to review the original lease agreement and any related assignment agreements to determine whether you have the right to assign your parking spot to another owner.
Every lease is a little different, so you will need to review the original Disclosure Statement or Prospectus provided by the developer, as well as any supporting parking stall lease assignment documentation.
Depending on the terms of the original lease agreement and your original parking spot assignment, you may or may not have the ability to sell your parking stall. If you do, it will likely be an easier process than selling a limited common property parking stall. If you do not have the right to assign your parking stall to another person, you may be out of luck.