Sale of Van home yields twice as much in New West
Couple sells Vancouver house to buy two New Westminster properties
While many Vancouver residents wring their hands over the city’s skyrocketing real estate prices, others are quietly making the most of the situation. Rich Patterson, for example, sold his modest Vancouver house, then turned around and used the proceeds to buy a small commercial building for his business as well as a house in the suburbs.
It all started when Patterson’s Vancouver office lease came due.
Patterson Brands promotional products and uniforms was an 1,800-square-foot basement on West 6th Avenue in Vancouver’s Fairview Slopes costing $4,500 a month, but the landlord wanted to hike the rent.
“Since Hootsuite moved in, every building gets the Kit & Ace (style) makeover. My building went from $15 per foot to $30 overnight and I was in one of the buildings that didn’t get the makeover yet. We couldn’t stay,” Patterson said.
Rich’s wife, Shannon Patterson, had a chiropractic practice in Vancouver’s prime medical district at Broadway and Willow. It was part of a natural health centre and was costing her $1,200 to $1,500 a month, but she was at capacity and had no opportunity for expansion.
The couple decided that leasing separate offices for $6,000 monthly was wasteful. Instead, they would try to join forces and share one space, or buy.
“We did look at some larger leased space and purchase options in Vancouver, but the lease rates we were seeing were outrageous and the buildings for sale? Oh my goodness. The least expensive building we saw was the former Gran Fondo headquarters on Victoria Drive listed for $2.1 million, about 3,500 square feet and it was a very strange building.”
It would have worked for Patterson’s business clients, but Shannon needed better street presence.
The Pattersons had bought their south Vancouver home (near 60th Avenue and Ontario Street) for $720,000 in 2007. The traditional 1943 Vancouver bungalow had 800 square feet up, 800 down, and a 600-square-foot extension. The lot had a 45-foot frontage and the house had three bedrooms up, three bedrooms down and three bathrooms.
The couple started looking for new rental spaces for their businesses in spring 2014. One promising 5,500-square-foot space at Kingsway and Main Street would cost $11,000 a month, but needed a prohibitive $150,000 in leasehold improvements. A 4,500-squarefoot space on Broadway near Quebec Street was going for $8,000 a month and needed $40,000 in leaseholds.
“Pretty sobering,” Patterson said. That’s when a friend of Shannon’s told her he was selling his New Westminster chiropractic business and building. The commercially zoned building was a rambling 3,500-square-foot house. There would be enough room for both Shannon and Rich’s businesses to expand.
“Initially we were just going to use the equity in our (Vancouver) house to finance the commercial sale,” Rich said, but then they realized they could buy a home walking distance to work.
When they put their Vancouver home up for sale, they got 22 written offers, all cash, no subjects and five had cashier’s cheques stapled to them. The Pattersons sold their Vancouver house in May 2015 for $1.479 million. The New Westminster business and building set them back $900,000, their new house, $950,000.
The new house is on a 66-by-66foot corner lot. It is 3,400 square feet with inlaid hardwood floors and cove ceilings in a “lovely neighbourhood with tree-lined streets, great schools.” Four bedrooms, two-and-a-half bathrooms, and a one-bedroom basement suite.
“We paid slightly more than we’d like, but it wasn’t crazy like in Vancouver.”
They do miss some things about Vancouver.
“My wife misses the awesome shopping on Main Street and her favourite chai tea place.” But hipsters are now moving into their new neighbourhood.
“Every time I see a hipster out there, I want to just hug them,” said Patterson, 45. “They are bringing all the latest cool restaurants. A cool little decorating shop opened just a couple of months ago.”
Marketing and business networking is harder for Patterson from the suburbs, but the move was “worth it for the stability in the future. For small business people like myself and Shannon, at the end
Initially we were just going to use the equity in our (Vancouver) house to finance the commercial sale.
of the day, just to have an asset is worthwhile. You’re never going to sell a business like mine for half a million dollars.
“I don’t think it would have been possible if the (Vancouver) home hadn’t increased in value so much, so quickly. It was a double-sided coin,” Rich said. “Those rising commercial rents forced us to look around and thankfully we had the home equity behind us to support us in making a move.”
Shannon has had to rebuild her client list, but she’s retained 90 per cent of the practice’s original clients and grown the business.
“Both Shannon and I were raised in small towns. Without even realizing it, I’ve replicated the lifestyle my parents had in Cranbrook,” Patterson said. “I can walk home for lunch. That is an awesome lifestyle.”