It’s been more than a year since Sabrina and Jason Watson hired a local contractor to renovate their Chestermere home, and the job still isn’t done.

The couple is among five homeowners who have filed complaints with provincial consumer protection officials against Kreate Cabinets and its operator, Kieron Warren, alleging he illegally took tens of thousands of dollars in upfront payments for work that was never completed.

“Total losses (in the current investigation) are estimated between $400,000 and $500,000,” Service Alberta spokesman Mike Berezowsky said.

Under provincial regulations, contractors who take advance payments are required to have a special licence allowing them to do so and must maintain a security fund to ensure clients get refunds for jobs that are cancelled or not finished.

The Watsons said they paid a total of $151,000 over the summer of 2011 for a job that included a major renovation of their home’s upstairs, kitchen and bathroom.

The contract stipulated an Aug. 20 completion date, which was important, Sabrina Watson said, so the couple and their three young sons would be back in their house in time for the beginning of school.

The family was out of town as the summer wound down, but Watson said they were assured the work was progressing whenever they checked in.

When they arrived home, they were greeted by bare walls and little else.

“Nothing had been done. Our house was still in studs,” said Watson.

Hounding Warren resulted in some subcontractors arriving to do plumbing, electrical work and drywalling, but Watson said they never returned because they hadn’t been paid.

“Everybody walked off the job on us,” she said.

The Watsons cancelled their contract with Warren and Kreate in January, but have yet to receive a refund.

Warren declined comment when contacted by the Herald, instead saying to talk to his lawyer.

With their house untenable, the Watsons have moved from Sabrina’s mother’s home on an acreage outside Calgary to a rented house in Chestermere and back to the acreage after the lease on the rental ran out.

“It was devastating,” she said.

The family has also taken out a second mortgage on their home to get the renovations finished and are paying more than $2,000 a month to keep their belongings in storage.

Watson credits her and her husband’s experience in the real estate industry with helping them work out the complex financing, but said the stress on their family has been immense even with that knowledge on their side.

“I remember sitting here saying, ‘I wouldn’t wish this on anybody,’” she said.

Another couple, Brian and Angie Chubb, hired Warren in mid-April to renovate their kitchen and bathrooms in their Calgary home.

Brian said they paid Warren $28,000 up front for the job, which was supposed to be finished at the end of May.

“The demolition went fast,” he said.

However, a temporary kitchen that would have allowed the Chubbs to resume cooking took five weeks to complete instead of the specified five days, said Chubb.

Weeks passed with little work being done. Chubb said tradesmen who installed a granite countertop demanded payment for the material — money Chubb said was included in the amount already paid to Warren.

Chubb fired Kreate in August and the couple have returned the kitchen to usable condition with their own money, though it’s still not finished.

Chubb said the stress forced his wife, Angie, to take a two-month medical leave from work.

“It takes a toll,” he said.

In addition to the current investigation, Warren is facing sentencing in provincial court next week for breaching the province’s Fair Trading Act while operating under the name Hillcrest Renovations.

Warren pleaded guilty to five charges: three counts of operating as a prepaid contractor without a licence and two counts of failing to provide a refund after a customer cancelled a contract.

In that case, three complainants lost a total of $55,000 paid to Warren between 2007 and 2008.

Generally speaking, Service Alberta advises homeowners contemplating renovations to check with the department or the Better Business Bureau for any complaints against contractors they’re thinking of hiring.

Berezowsky said it’s also wise to shop around.

“Get written estimates from more than one business — we recommend at least three,” he said.

Consumers should make sure any prepaid contract has all the legally-required elements, including a detailed, itemized price list, a completion date and a statement of the client’s cancellation rights.

jvanrassel@calgaryherald.com

Twitter.com/JasonvanRassel

CALGARY — Qualex-Landmark has announced the launch of a $100-million downtown condominium project in Calgary’s emerging Design District called MARK on 10th, which will be 34-storeys.

The first stage of the construction process is underway as demolition crews start to dismantle the existing building, formerly West Canadian Graphics, at 10th Avenue and 8th Street S.W. It will have 270 units and is scheduled for completion in late 2015. Starting prices will be in the low $200,000 range with prices still to be determined and they will be released over the next few months.

“MARK on 10th is purpose built for today’s urban dweller because of its proximity to the downtown Design District, offices, universities, transportation, and entertainment districts,” said Roger Navabi, president of Qualex-Landmark, in a statement. “We are redefining the urban home by adding amazing amenities like the rooftop lounge and the generous 17,000-square-foot garden on the third floor podium into the mix.”

MARK is a mixed-use highrise tower conceived by designers Rafii Architect in partnership with BKDI Architects Inc. and Durante-Kreuk Landscape Architects. Interiors are created by interior designers at Trepp Design Inc.

Parham Mahboubi, vice-president of marketing and new developments for Qualex-Landmark, said the company has always been quite confident and have a lot of faith in the Calgary real estate market.

“There’s some softening happening in the Toronto and Vancouver markets but Calgary seems to be a quite solid place to invest. We’ve always had faith in Calgary, even during the worst of times and we still do. Our outlook for Calgary is still quite positive,” he said.

The Vancouver-based company has completed three condo projects and has one currently under construction all in the Beltline area.

The developer said homes at MARK will feature over-height doors and ceilings, expansive windows, wide plank wood-laminate flooring, elegant porcelain tiles and individually-controlled heating and cooling.

Plans for MARK include building a rooftop amenity with private members club, fitness studio and glass mezzanine lounge with 360-degree panoramic views of downtown and the surrounding mountains. Outside, there will also be an elevated hot tub, sunbathing patio with seating, lounge area with outdoor barbecue and raised fire pit.

The rooftop’s fully-equipped fitness studio will include a Yoga/Pilates studio, infrared sauna and steam rooms, private changing rooms, lockers and shower facilities.

The garden will be one of the largest residential highrise common gardens in the city. It will include open lawn areas for passive recreation, overhead shade trees and a fully accessible pedestrian pathway network with lounge seating.

A recent national report said job gains, population growth, and low interest rates will support condominium demand in Calgary and the city is the most affordable among the top eight large metropolitan areas when analyzed relative to local incomes.

The Metropolitan Condo Outlook by Genworth Canada in conjunction with the Conference Board of Canada said it expects condo starts to hit a four-year high of 2,373 units in 2012, up 15.5 per cent from the previous year but to drop by 11.7 per cent in 2013 to 2,099 units.

The report, which looked at eight large Canadian metropolitan areas, said resale condo transactions in Calgary would jump by 3.8 per cent this year to 3,555 and another 1.9 per cent in 2013 to 3,621.

Calgary’s resale condo price is forecast to increase by 0.9 per cent this year to $239,445 and by another 2.9 per cent in 2013 to $246,414.

mtoneguzzi@calgaryherald.com

CALGARY — The Calgary-area housing market remains one of the most affordable in Canada, according to a report released today by RBC Economics Research.

The latest Housing Trends and Affordability Report said the local market has enjoyed the best of all worlds recently: stronger home resales and home building, moderately rising prices, and attractive and improving affordability.

“Such a combination is a rare feat, but it follows years of sluggish performance in the aftermath of the area’s mid-2000s boom,” said the report. “In the second quarter of 2012, a sharp drop in the costs of utilities provided unusual help to affordability in the area. Utilities and property taxes—two small components of home ownership costs—typically do not sway affordability, but the sudden reversal of earlier electricity rate increases led to a substantial 17 per cent quarterly decline in utilities, which was more than enough to move the affordability needle.”

In the second quarter, the RBC measures edged lower for condominium apartments and two-storey homes by 0.6 percentage points and 0.4 percentage points, respectively, while the measure for detached bungalows was unchanged in Calgary.

“Such general amelioration kept housing affordability in check at some of the better levels among Canada’s largest cities,” said the report.

The RBC Housing Affordability Measure, which has been compiled since 1985, shows the proportion of median pre-tax household income that would be required to service the cost of mortgage payments (principal and interest), property taxes, and utilities.

In the second quarter, RBC measures for Calgary edged lower for condominium apartments by 0.6 percentage points to 21.6 per cent and for two-storey homes by 0.4 percentage points to 37.2 per cent. The measure for detached bungalows remained unchanged at 36.7 per cent.

RBC said significant drops in the prices for electricity and natural gas in the second quarter of 2012 in Alberta “further solidified this province’s position as the market with the lowest home ownership costs as a share of household income in Canada.”

The RBC measures eased by 0.6 percentage points for both two-storey homes and condominium apartments, while the measure for detached bungalows edged lower by 0.3 percentage points, it said.

“Alberta experienced a 17 per cent decline in utility costs, which was the largest contributor to across-the-board improvements in housing affordability in the most recent quarter,” said Robert Hogue, senior economist, RBC. “Attractive affordability and a vibrant provincial economy are providing powerful incentives for Alberta homebuyers – second quarter home resales were at the best level in five years, surging 18 per cent over the same period last year.”

The affordablity measures in Alberta were: 32.0 per cent for detached bungalows; 34.8 per cent for two-storey homes; and 19.7 per cent for condominiums.

In Canada, they were: 43.4 per cent for bungalows, up 0.2 per cent; 49.4 per cent for two-storeys, up 0.6 per cent; and 28.8 per cent for condominiums, unchanged.

mtoneguzzi@calgaryherald.com

CALGARY — Calgary’s retail vacancy rate continues to decline as consumer spending in the province remains higher than year-ago levels.

Statistics Canada reported Wednesday that Alberta retail sales reached $5.6 billion in June, up 6.6 per cent from a year ago and the highest annual growth rate in the country. But sales dipped by 1.3 per cent from the previous month.

At the national level, sales of $38.7 billion were up 1.7 per cent from a year ago but down 0.4 per cent on a monthly basis.

“There’s a lot of pressure on good quality space from good quality tenants looking to expand (to Calgary),” said Jeff Robson, vice-president and associate broker with Barclay Street Real Estate Ltd. in Calgary.

“The economy here seems to be a little more protected than other parts of the country. Interest and expansion is coming largely from within. But U.S. retailers are certainly entering our market. Where once we would have been overlooked in favour of three or four cities in Canada, now we’re considered a hot place to look.”

According to Barclay Street, the overall retail vacancy rate in the city of 1.9 per cent has been on a downward decline since 2009. Total retail space inventory in Calgary is about 37.2 million square feet.

Robson said once the city hit the million-mark in population it opened the doors to a new set of retail tenants.

In the next five years, he said, the central business district will see retail expansion at a substantial level.

Current inventory is about 6.4 million square feet.

“I could see a million to two million square feet of inventory come online in the next three to five years based on the projects that are coming up, the tenants that are looking, whether it’s East Village, the west Beltline, east Beltline. All these areas,” said Robson.

Statistics Canada said retail sales fell in six provinces in June with Alberta reporting the largest decline in dollar terms after posting the largest increase in May. Lower sales of new motor vehicles were the main reason for the June decrease, it said.

“While wages and consumer prices in Alberta have been increasing over the past couple years, another big reason provincial receipts are so much higher in 2012 relative to 2011 — receipts in June were six per cent higher on a year-over-year basis — is the jump in inter-provincial migration that occurred over the period. This might foreshadow lower second quarter 2012 migration numbers,” said William van’t Veld, economist with ATB Financial.

“It should be noted that consumer spending in Alberta, while still very important, constitutes a much smaller proportion of economic activity than in other jurisdictions. That is to say, personal expenditures make up 60 per cent of Ontario’s economy and only 43 per cent of Alberta’s. Conversely, Alberta is far more dependent on business investment than other jurisdictions.”

The surprise drop in June sales at the national level was broad-based, suggesting households are becoming a little more cautious, though cross-border shopping may have played a role as well, said Benjamin Reitzes, senior economist with BMO Capital Markets, of the national scene.

“Indeed, annual sales growth hit the slowest pace in 16 months and activity is actually lower since the start of the year,” he said.

“The constant haranguing by policy-makers urging households to borrow more cautiously, along with slowing job growth, has prompted some restraint. Given that employment contracted in July and likely won’t improve significantly over the coming months, and with the added drain of cross-border shopping, retail sales will have difficulty gathering much momentum through the second half of the year.”

mtoneguzzi@calgaryherald.com

CALGARY — Expectations for the homebuilding industry in the Calgary region are positive, according to the Conference Board of Canada.

In its Metropolitan Housing Starts report released Friday, the board said short and long term expectations for housing starts are positive in the Calgary census metropolitan area.

The seasonally-adjusted annual rate of starts for the region was 9,417, up from 6,734 a year ago.

Short-term expectations are based on residential permits while long-term expectations are based on demographic requirements.

mtoneguzzi@calgaryherald.com