Westsea Construction: Who owns it and what does it own?
Please let me know about any error of fact in this article, or be in touch to offer further information about Westsea Construction. -Gerald, April of 2018
Westsea Construction is a private company, so there are no bothersome shareholders who could make trouble at an annual meeting or call company management to account for poor behaviour. Owners Julie Barbara Trache and Bruce Sembaliuk are free to run things as they see fit and to ignore public opinion and media enquiries, like those regarding alleged “renovictions” at Victoria’s View Towers rental building a few years ago.
Public documents indicate that all of Westsea’s properties in B.C. and even more in Alberta were inherited by Ms. Trache and Mr. Sembaliuk from Ms. Trache’s father, George Mulek, who died in 2006, and the estates of Brian and Violet Hitchon and Westpark Investments Ltd. ‘Far as I can determine Mrs. Hitchon was George Mulek’s sister and aunt of Mr. Sembaliuk; she died in 2014. The Westsea portfolio holds at least six large residential properties in a mix of leaseholds and 100%-rental buildings, and the company retains the leases on numerous suites in several or even all of its leasehold buildings such as Orchard House in Victoria and Westsea Towers in Vancouver’s West End, so those are also rental suites.
A B.C. Registry search in February of 2018 showed that Westsea Construction Ltd. was incorporated in 1966 and has its registered office at #300—1122 Mainland Street in Yaletown, Vancouver. The company has administrative offices on the top floor of the residential Westsea Towers; #2108 at 1330 Harwood Street, in Vancouver’s West End, where the phone number is 604-681-2727. The current property manager for Westsea is Brian Slater. Note that Westsea directly administers its leasehold buildings, while most other B.C. leasehold towers and apartment developments are run by courteous property management firms hired by the property-owning corporation. “Courteous” is not a word that lessees at any Westsea building would use in connection with the company’s owners and managers.
The B.C. Company Summary lists Ms. Trache as Westsea’s President and her mailing address as being the Westsea Towers address, although she lives in Edmonton, while Mr. Sembaliuk is listed as Secretary and Treasurer with his mailing address being #1604 at the residential Rowand House tower, 9747 on 104 Street in Edmonton. Ms. Trache and Mr. Sembaliuk also own Capital Management Ltd., registered in Alberta, and which owns Rowand House. LinkedIn offers that she was a graduate in 1991 from the Alberta Institute of Technology in the field of education.
Capital Management has a web site at (opens new tab): www.CapManagement.ca that mirrors Westsea Construction’s site (opens new tab): www.Westsea.ca . Each site lists the rental properties in the province where that company operates and each web site confuses the singular and plural by heralding that the company is, “Developers and Managers of Prime Properties Since 1947.” All-caps in headlines was popular back then. The static sites offer no photos or links to further information, but only building names and a rental-office phone number for each.
Started in 1960, Capital Management (today’s name) holds the inherited Mulek and Hitchon families’ Alberta portfolio of 14 rental high-rise towers, low-rise apartment buildings and townhouse developments, all in Edmonton except for one in Fort Saskatchewan. None of these appear to have 99-year leases, but are entirely rental properties. A business-information web site says that Capital Management has revenues of $18.5 million per year and 30 employees, so $615,300/employee/year, which it says is six times the Canadian average revenue per employee. Accurate or out of date, it indicates that the Alberta and B.C. assets are terrific revenue producers and that owners Trache and Sembaliuk are very wealthy folks.
Returning to Westsea Construction in B.C., the company owns:
Orchard House, 647 Michigan Street in James Bay neighbourhood, Victoria, completed in 1969 or 1970, initially as a rental building. City records say it was built in 1967, but that was likely when construction was permitted. This is a 22-storey concrete building with 211 suites, 195 of them on 99-year lease assignments that expire at the end of 2073, and 16 suites whose assignments Westsea retained, 13 rented at market rates and two occupied by the site manager and by a weekend manager/maintenance man. One top-floor suite is kept for the company owners or perhaps as a shrine to Mr. Mulek. The 2020 tax assessment for the building and its land was $41,126,000, as it’s not condominium, so there is just one property title.
View Towers, 1147 Quadra Street in Harris Green neighbourhood, Victoria, completed in 1970 as a rental building, which it remains today; there are no leasehold suites. This 19-storey broad concrete slab is plain, at best, although it is said to have been worse for its first 15 years when it was, according to old news stories, deliberately left unpainted by Mr. Mulek over a property-development dispute with the City. View Towers houses a boggling 357 tiny suites which were mostly vacant for some years following a fire in May of 2014, after which asbestos was removed and repairs were made.
Westsea Towers, 1330 Harwood Street in Vacouver’s West End neighbourhood, completed about 1970 with most of its 157 suites leased for 99 years in 1974. The company retains the lease assignments for at least 10 suites that are advertised for rent on its web site. It also retains a large suite on the top floor (19th) for its property management staff, as Westsea appears to administer all of its buildings directly, rather than through a management firm.
Westsea Place, 1644 Nelson Street, also in the West End of Vancouver, a rental building of 24 floors completed about 1975.
Sun Creek Estates with various addresses at 70th Avenue and 133B Street in the West Newton neighbourhood, Surrey, east of Vancouver. Of 301 apartments and townhouses in 29 frame-construction buildings about 180 are on 99-year leases and about 120 suites are retained by Westsea, which rents them out. For photos of Sun Creek Estates, click here. Year after year through 2021 lessees faced bankruptcy-inducing billings to rehabilitate the entire development at the cost of millions of dollars. Lessees who cannot pay billings on time and whose debt exceed $5,000 are served notice by the company’s lawyer Mark Stacey that they now owed $750 more to cover legal costs and that failure to pay within 10 days will result in foreclosure action.
Royal Apartments and Blue Haven at 6340 and 6420 Buswell Street in Richmond, south of Vancouver. The two four-storey wood-frame buildings were completed in 1974 and house 51 suites each, either most or all on lease assignments. The Blue Haven property is owned by the same principals under the corporate name Westpark Investments, and their lawyer-enforced hard line on building rehabilitation expenses to be paid by lessees matches that at Sun Creek Estates.
Some history: George Mulek said that he built several thousand rental apartment suites in Alberta and B.C. during the 1960s and the early 1970s. For some of his projects Mr. Mulek was assisted by federal government loans during the era of “urban renewal”. One project saw taxpayers put up $1,336,050 for a rental housing project that, in reward for his initiative, he would end up owning.
During the tight rental and real estate market of the early 1970s Mr. Mulek was apparently angered by rent controls brought in by the NDP government, so he decided to sell many of his suites in B.C. as condominium conversions. Similar efforts were pursued by other rental-suite builders, like Victoria’s Congdon Construction (yes, there’s a “g” in Congdon).
But with renters being told to buy or get out, the Province gave cities the authority to prohibit condominium conversion. Clever apartment building owners (Mr. Mulek himself?) then came up with the alternative of selling 99-year lease assignments at some discount from full-ownership sale prices. Numerous buildings owned by Mr. Mulek and other builders were converted to 99-year leaseholds in the spring of 1974 just before that, too, was required to obtain municipal approval.
George Mulek’s name came up in the B.C. Legislature in 1975 when Richmond MLA Harold Steves told of suites that Mr. Mulek wanted to sell as long-term leases being kept vacant during a crisis in rental suite availability. Keeping suites vacant, however, was not contrary to the new Landlord and Tenant Act, although the new law did apply to 99-year leases and give lessees some protections.
But that didn’t last; in 1977 a Social Credit (read “conservative”) government brought in a new and re-named Residential Tenancy Act that stopped covering leases with terms longer than three years. Another change in 1984 saw the three-year limit extended to 20 years, which was likely meaningless, as most residential leases are for one-year renewable terms, apart from the 99-year leases at issue here, and which had already lost their protections in 1977.
The latest Social Credit tweaking of the Act was questioned in April of 1984 by NDP MLA Robin Blencoe, who had a lengthy exchange in the Legislature with the Minister of Housing on the topic of 20-or-more-year leases avoiding any regulation and such lessees not having any protection. Just one quote from Mr. Blencoe: “…this 99-year lease problem created all sorts of headaches, not only for the tenant(s) but also for the government. I’m really concerned that we’re going to have a repeat of the 99-year lease (with 20-year or longer leases): no protection, and no Act covering these leaseholders.”
Of course B.C.’s corporate governments, called Conservative, Social Credit or Liberal to suit a given decade’s mood, legislate for “the one percent”, as they’ve become known. Mr. Blencoe’s appeals were ignored, as were those of West-End Vancouver NDP MLA Spencer Chandra Herbert in 2012 when he raised our issue anew in the Legislature. Liberal/conservative Housing Minister Rich Coleman replied that he had known Mr. Mulek and that his properties were still owned by the family. “They are contract law,” Mr. Coleman said dismissively of 99-year leases, “and there’s nothing we can do for them.”
Well, Mr. Coleman, year-to-year residential leases are contract law, too, and those tenants have some legislation-granted rights and recourse to an appeals tribunal other than the courts. But your government represented people who own buildings, which I understand, having owned eight condo apartment suites myself as rental investments. But a government can also protect people of modest means from dictatorial behaviour, bankrupting capital costs and uncontrolled annual fee increases.