Heritage is in Demand!
Release of ground-breaking new report: Financial Measures to Encourage Heritage Development
Heritage is in Demand! The National Trust envisions a future where the tangible benefits of heritage are recognized by society and seen as worth investing in.
A new report by the National Trust -- drawing on broad input from the heritage property development industry -- provides strong insights into the best potential financial measures to encourage heritage development in Canada. Commissioned by the Federal-Provincial-Territorial Ministers' Table on Culture and Heritage, the report draws on detailed input from 27 stakeholders from the heritage property development industry from 8 provinces. The report also identifies key factors that discourage heritage development. This is the first time that a pan-Canadian sampling of this type has been collected.
The report is accompanied by a concise Discussion Guide which details 14 financial measures for consideration and is supplemented by a Simulation Model to help stakeholders assess the potential revenue impacts of Income Tax Credit and Capital Cost Allowance measures.
Best Financial Measures:
- Ongoing Property Tax Relief (Provincial/Territorial)
- Heritage Grants (Federal)
- Refundable Income Tax Credit (Federal & Provincial/Territorial)
- Non-Refundable Income Tax Credit (Federal & Provincial/Territorial)
- Heritage Grants (Provincial/Territorial)
Key Heritage Development Disincentives:
- Low Return on Investment (ROI)
- Limits on Development Potential
- Complexity of Building Code Compliance
- The "Unexpected" in Heritage Projects
- Delayed Return on Investment (ROI)
Read the full report here.
Try out the Financial Measures Simulator or check out the Simulator Background and sample scenarios
Why financial incentives?
Heritage has value -- social, cultural, historical, environmental, associative, aesthetic value -- not to mention economic value. Financial incentive programs exist to encourage private sector investment in the preservation of historic properties. Generally, they counter demolition by giving owners the financial ability — tax breaks, grants, waivers of fees, material and labour donations, and non-monetary density bonuses—to proceed with rehabilitation projects that might not otherwise happen.
The investment would act as a catalyst to:
- neighbourhood renewal;
- support sustainable development;
- reduce greenhouse gas emissions; and
- improve overall economic prosperity.
Over the last 30 years Canada has lost more than 25 percent of its pre-1920 historic buildings to demolition. Financial considerations have played a pivotal role:
- an unpredictable bottom line for heritage building rehabilitation projects scares lenders and developers;
- rising land values in Canada’s big cities encourage large new buildings; and
- smaller urban centres are experiencing a lack of development activity.
Currently, it is municipalities and, to a lesser extent, provinces that have put financial incentives in place. Canada`s federal government is almost entirely absent.
DID YOU KNOW?
Victoria, BC's ten-year Tax Incentive Program has spurred the creation of 631 residential apartments in some 34 seismically upgraded and rehabilitated heritage buildings?
That it has attracted over $205 million in private investment to the downtown core that dramatically increased the value of the building and the city's property tax revenue?
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