The four-unit line
Alberta draws a line through real estate licensing at four residential premises, and a builder scaling up crosses it without much warning. A fourplex sits on one side of that line. A five-unit building sits on the other.
What the rules say
Under the Real Estate Act Rules, residential real estate means real estate used or intended to be used for residential purposes, comprising not more than four residential premises. Commercial real estate means real estate used or intended to be used to generate income, and that definition expressly takes in residential real estate comprising more than four residential premises. Retail, office, industrial, institutional, and investment property sit inside the same category.
The practical effect is a referral. A licensee holding residential authorization alone reaches the fourplex and stops there. The client gets introduced to somebody new, at the stage of a project where the arithmetic gets hardest.
What a handoff costs
A handoff carries a cost that appears on no invoice. The incoming party learns your specifications from the beginning, meets your trades for the first time, forms an independent view of who your buyer is, and starts the working relationship at zero. The schedule absorbs all of it.
What we hold
Ricky holds both authorizations, residential and commercial. A program that begins as a pair of infills and becomes a small apartment building stays with us, on the same file.
Where commercial habits help a residential file
Commercial work runs on arithmetic. Absorption, carrying cost, and the spread between what a site costs to hold and what it returns when it clears. Those habits do not switch off on a residential file, and for a builder they are the part of the conversation that decides the file, because a builder is running a business.
It is also the reason the low-density side of our work reads the way it does. A duplex gets underwritten before it gets photographed.
Where to begin
If a program is heading past four units, the licensing question gets answered before it turns urgent. Start the conversation.
Ricky Jin
Founder
FOUNDRY COMPANY · Marketing & Design
Real Estate Professionals Inc.