The Basics

September 17, 2020 CCI Original Content Published by CCI National

Getting Started as a Director

Condominiums are not a new concept. In one form or another, they have been around for thousands of years.

History

Many of the citizens of ancient Rome lived in Condominiums, and one supposes that Nero’s fiddling while Rome burned would likely have been a breach of his condo’s nuisance/noise rules. The great walled cities of medieval Europe and England also contained many Condominium residences.

The first quasi-Condominium in Canada was created in Toronto around the turn of the last century when a two-floor apartment building was divided and sold to several owners, who then signed an agreement to co-operate in the upkeep of the building structure.

The first true Condominiums in North America were built in Puerto Rico in the 1950’s and shortly afterwards in New York City. The state of New York was the first US state to enact Condominium laws in 1964. Alberta enacted Condominium legislation in 1966 and Ontario in 1967. Now all provinces in Canada have some form of Condominium legislation. In British Columbia, which has a different method of recording title to real estate, Condominiums are known as “Strata Corporations” and in Quebec they are called “syndicats de copropriété ” (syndicate of co-ownership).

Statistics

Statistics Canada’s 2006 census estimates the average household size is 2.5 persons. If applicable to Condominiums, this would mean that almost 1.5 million people call residential Condominiums home, which is almost 10% of the population of Ontario.

Condominium Ownership and Types

The term “Condominium” describes a method of owning property where individuals acquire dwellings, referred to as “units” that are located within a multiple unit housing development called a “Condominium Corporation”. Condominiums can be residential, commercial or mixed-use in purpose.

Condominiums are divided into units and common elements with the sole exception of Common Elements Condominiums which has POTLs and common elements. When an individual acquires their unit, they also obtain an interest in the common areas, called the common elements and assets, which all owners own collectively.

The percentage of ownership in the common elements that attaches to each unit is set out in the Declaration for the Condominium Corporation. The Declaration is the document that is registered to create the Condominium Corporation as a legal entity.

The word “Condominium” and its abbreviated version “condo” are also frequently used to describe a type of building or home. For example, “I just bought a condo in Florida.” While this may or may not be technically correct, such usage is common.

UNITS	COMMON ELEMENTS	ASSETS
Units can include Residential units Parking units Storage locker units Garage units Commercial/Retail units Industrial units Telecommunication units	Ordinary Common Elements include: Everything that is not a unit or an exclusive-use common element but that is in the property boundaries of the Corporation	Assets can include: Cash Investments Residential units such as guest suites or a superintendent’s unit Parking or storage units Equipment and vehicles Furniture and electronics
	Exclusive-Use Common Elements can include: Parking spaces/driveways Storage lockers Patios/decks Balconies Yards

• Condominiums can own, acquire, encumber and dispose of real property and personal property (i.e. assets) subject to the requirements of the Provincial Legislation.

There are four main types of Condominiums. They are Standard, Common Element, Vacant Land and Leasehold. Not all types of condominiums are in all provinces.  

You will also hear the name ‘Phased’ which is a Standard Condominium as described below.

Standard Condominium Corporations

A Standard Condominium is created when a Declaration and description are registered in the land registry office. A Standard Condominium, is a Condominium Corporation that is not a phased Condominium and is not a Vacant Land Condominium. A Standard Condominium has units and common elements.

Phased Condominium Corporations

Phased Condominiums can add units and/or common elements that are built in subsequent phases to the original Condominium. The original Declaration and description are amended to incorporate the addition. The registration of amendments maintains a single Condominium and a single Board of Directors. Once all phases are complete the Condominium operates as a Standard Condominium.

Vacant Land Condominium Corporations

Vacant land Condominiums are those where there are no buildings or structures built on the units at the time the Declaration and description are registered. This allows the developer to build the individual dwelling when the vacant land units are sold. The developer may choose to permit the purchaser or other builder to build the dwelling unit.

Vacant Land Condominiums can be a phased Condominium.

The Declaration of a Vacant Land Condominium will likely set out restrictions with respect to the type, design and maintenance requirements for the units. The Vacant Land Corporation must maintain the common elements and repair them after damage while the owner of the unit must maintain the unit including the structures and repair them after damage. There is no ability in the Declaration to shift the responsibility for maintaining and repairing the units to the Condominium Corporation. Purchasers will require typical home insurance, as opposed to a standard Condominium contents and unit package, as most Provincial Legislation provides that the owner of the unit has the obligation to insure the unit and any structures on the unit.

Leasehold Condominium Corporations

A Leasehold Condominium is a Condominium developed on land that is not owned by the Condominium or its owners but is leased from an owner pursuant to a ground lease. Leasehold Condominiums are expected to be more affordable because the land cost component is amortized over a 40 to 99-year lease. This option also provides landowners who cannot sell their land by virtue of their charter to utilize their assets for gain i.e.; governments, churches, universities, hospitals etc.

The Leasehold Condominium will automatically be renewed for 10 years, unless the ground lessor has given a notice to terminate at least 5 years before the end of the initial lease term. If at least 80% of the unit owners vote against renewal, the ground lease will be terminated at the end of its original term.