Closure of Surrey, B.C., co-operative leaves residents desperate for affordable housing

Residents of a 40-year-old housing co-operative in Surrey, B.C., are facing the difficult task of finding a new home.

Families in 58 units of the Totem Housing Co-operative are in limbo after the co-op'slease expired in December 2022.

While previous owners provided residents with a six-month extension, the land was eventuallysold to new owners this March,along with the property.

The new owner, a numbered company that can be traced back to Munish Katyal of Surrey, southeast of Vancouver, is now demanding residents pay market value rent for their units or move out before July 1.

According to notices sent to residents and their lawyers, Katyal whoco-owns thelocal newspaper, Indo-Canadian Voice is not interested in re-leasing the property to the co-operative, and instead plans to turn it to rental housing.

"I'm in a pinch and I only make $2,100 a month. How am I going to pay $1,600 plus my insurance?" said Judy Patka, 79, who has lived at Totem for 15 years. She currently pays $600 a month to the co-operative for her one-bedroom apartment.

"I don't know what can be done There's such a shortage of housing and it's so expensive. We're really kind of stuck."

Marilyn Mactavish, 82, says "it's a shame that we're going to lose [the co-operative] because [a new owner] wants to take it over. I don't understand why the B.C. government hasn't stepped in."

Mactavish and her husband, Totem residents for 39 years,use their pension and some part-time income to make ends meet, and currentlypay $935 for athree-bedroom. Now, they're being asked to pay $2,750 in rent.

"I'm an old-age pensioner," she said, "and there's no way we can pay that kind of money."

'Time just kind of ran out'

Co-operative housing is a legal association formed by member-residents who live and maintain a property together.

As long as land is leased to co-operatives, those co-operatives are considered owners of the propertyon that land. Member-residents pay monthly fees, which go to mortgage payments,repairs, and other community costs. In 2017, Totem residents paid off their mortgage for their units.

Property law expert Ron Ushersays federal housing programs helped build thousands of co-operatives across Canada in the 1970s and 1980s.

He says many co-operatives were founded on land leased by municipal governments or private owners which may not have been an issue then, but is starting to cause concern now as leases end.

"Way back then, people didn't think we should give these co-ops ownership of the land or have the ownership be held by kind of a government agency," he said.

Usher says Totem'slease from 1982included the right of first refusal, which allowed the co-operative to make an offer on the land if the owners were to sell.

When that lease expired after 40 years,the co-op renegotiated a six-month extension, but was ultimately unable to make a deal on the landbefore it was sold to another owner.

"Time just kind of ran out and here they are," Usher said. "They're essentially almost squatters now on a piece of land owned by somebody else."

WATCH | Totem residents say they have nowhere to go:

Residents of Surrey, B.C., co-op speak out against dramatic rent increase

1 year ago

Duration 1:23

Marilyn Mactavish, Barb Shepherd and Helga Macdonald say they can no longer afford to live at Totem Housing Co-operative after the co-op's property lease expired, and its new owner increased rent to about triple the price.

Thom Armstrong, CEO of the Co-operative Housing Federation of B.C. (CHF BC), says it's a "disturbing situation" to see the end of a co-operative, adding previous owners offered Totem the opportunity to purchase the land.

"They didn't take advantage of that opportunity I'm guessing quite a number of members in the co-op today are wishing they had taken that [offer]," he said.

Patka says residents were always interested in buying the land, valued at $15.5 million in March, but never managed to make a competitive offer.

"None of that went through ... we didn't manage to make a proposal that we could afford."

Armstrong saysresidents have the option of reaching out to CHF B.C. for assistance.

"There may be an opportunity for other co-ops or newly developing co-ops to open their doors to welcome those members at much more affordable rates than $2,700 a month," he said, adding the federationhelped two Burnaby co-operatives in a similar situation in 2022, and was able to purchase them new propertieswith contributions from the City of Burnaby.

"We own those properties and can make them permanently affordable over time," he said.

"We didn't have that opportunity [with Totem] because the property was sold to another private interest."

Co-opnot under Residential Tenancy Act: ministry

In a statement, the housing ministrysaid co-operative housing does not fall under the Residential Tenancy Act, and therefore rent prices can be increased over the 2 per cent annual limit.

"This is a very rare occurrence in B.C. as the vast majority of co-ops that exist on private leased land are owned by a municipal or regional government," said the ministry.

Barb Shepherd, a Totem resident of eight years, says the co-operative tried to negotiate with the new owner, but he was not interested in letting them stay on at their current rent.

"We work like dogs. We maintain the whole place, we do all the plumbing, the electricity, all of it and that's to keep our costs down. But how can you go from paying [those low fees] to $2,750?" she said, adding the hunt for other housing options has been difficult.

"Some of us have been on waitlists for affordable housing for many, many years I've been [waiting] for several co-ops for six years."

When reached for comment for this story, Katyal said he was not interested in speaking with CBC News.