Have you heard the following myths about First Nations lease lands?
- The band blockades roads
- Rent is jacked up without notice
- The certificate holder (generally an individual band member) took back the land without notice
None are true. First Nations lease agreements work just like regular leases – there’s a contract that’s signed and followed between all parties involved with the lease.
How First Nations Lease Land Agreements Work
The following illustrates the dynamic within leased land.
This is the agreement between the developer and the land’s certificate holder. Here’s how the agreement typically works:
- Lease length – it’s almost always 99 years
- Rent – the amount the lease is per month
- Insurance – developer must get proper insurance (e.g. fire insurance)
- Construction requirements – everything must be built to code, and all construction must be approved by the certificate holder
- No contaminants policy – e.g. no oil leaks from vehicles, dumped chemicals, etc.
- Occupancy – developer states whether the property is residential or commercial
If the leasee (developer) doesn’t follow the agreement, the certificate holder can terminate the lease. A property manager isn’t involved with a head lease.
This is the agreement between the developer and the owner (or owners, depending on the development size).
All terms that are in the head lease transfer down to the sublease (from construction approval to rent amount). The main difference is that sub-leasees are communicating with the developer, not the certificate holder.
The sublease also spells out what the developer is providing in return for rent. This is normally a building (e.g. renting out a unit in a commercial building).
A property manager can be hired to:
- Help enforce the sublease
- Educate the elected board of directors
Lease Land Properties Need A Board Of Directors, Not A Strata Council
Properties on leased land can be businesses or residential.
If a property is a business, they have to follow the BC Business Corporations Act. If they’re residential, they have to follow the BC Society Act.
A board of directors has many of the same duties a strata council does:
- Bylaw enforcement
- Bylaw creation
- Property maintenance, like:
- Leaking roofs
- Budgeting for:
- Contingency funds
- Maintenance fees
A board of directors needs to file an annual report, which is the same for both commercial and residential and includes a:
- List of shareholders involved with the businesses within the development
- List of directors on the board
Why HomeLife For First Nations Lease Land
There are many differences between regular strata corporations and lease land overseen by a board of directors. When you team up with HomeLife, you get these benefits:
1: Lawyer Approved
HomeLife property managers are very familiar with the complexities of lease land, so much so that lawyers (e.g. barristers, solicitors) suggest us to those wanting help understanding the ins and outs of First Nations lease land.
2: Easy-To-Follow Procedures
If your board of directors aren’t sure of their obligations, a property manager can educate them and put systems in place that are easy for them to follow. They can get systems for things like:
- Annual reports
Selling property on leased land can be confusing.We are there to assist realtors who aren’t familiar with the differences.
Ready To Hire A Property Management Company?
Follow This Simple 4 Step Process!
Step 1: Special General Meeting
First things first – have a General Meeting (AGM or SGM) to ensure that the corporation approves a budget that includes management services by a 3/4 vote.
Step 2: Sever Ties
This step only applies to you if you’re changing companies.
Your council must approach your current management company and ask to be let out of their contract.
Step 3: First Contact
Request a proposal and phone us at 604-858-7368
Is your previous company reluctant to let you go? The property management company you’re changing to can aid you in making the switch.
Step 4: Agency Agreement
Your new company can’t provide any services until the Agency Agreement is in place. It goes hand in hand with the proposal.
You need to bring the minutes of your SGM (where you decided to change/add your company) before the agreement can be finalised.
They can work behind the scenes (give guidance) until the agreement is set.
This takes a maximum of 2 days. Once set, the changes are official!