Last spring the provincial government released a third party review of the Real Estate Council of Alberta (RECA), the arms length body that governs a significant number of real estate professionals from every corner of the industry, including commercial brokers, commercial property managers, residential realtors, residential property managers, and mortgage brokers. The report confirmed what most industry professionals already knew – RECA’s licensing model had become outdated and its governance structure unable to reconcile the conflict and gridlock that unfortunately dominated RECA’s operations in recent years.
The report highlighted a number of issues that the commercial real estate sector in Alberta, represented by the Building Owners Managers Associations of Calgary and Edmonton respectively, identified as challenges to RECA’s role in protecting the public interest and promoting professionalism within the industry. The primary concern was that RECA’s regulatory authority was vested in one Board that sought to regulate professionals engaged in often vastly different segments within real estate. Does it make sense for a residential realtor to be directly involved in regulating a commercial property manager, or determining the educational requirements for their licensing? We believe this led to regulations that were often unrelated or irrelevant to commercial real estate professionals.
To make matters worse, the process of appointing industry representatives to that one Board was inconsistent and even inequitable in giving preferential treatment to certain segments of the real estate industry. In essence, RECA’s model took too broad an approach to real estate that meant mandatory educational courses lacked relevance and that regulatory actions lacked the type of expert input that more focused bodies may have been able to accommodate.
That is why in late 2019 BOMA Calgary and BOMA Edmonton were at the table working with the province to develop common sense changes to RECA’s structure and the way real estate professionals across our province are licensed and regulated. As industry associations BOMA Calgary and BOMA Edmonton have been involved in several consultations on legislative reform, in addition to regularly working with the Cities of Calgary and Edmonton on bylaws and policies impacting our industry. With this experience we can say with confidence that the consultations led by Service Alberta Minister Nate Glubish were a model of effective stakeholder outreach and engagement. Meetings were well focused on the issues at hand as identified by the KPMG report, and conversations were one the relative merits of the various solutions stakeholders and the province put forward. As stakeholders we don’t expect to have all of our concerns addressed, but we do expect to have a fair hearing on behalf of our members. We are pleased to say that we felt heard, and that this collaborative spirit is embodied in the final product of this work, Bill 20, Real Estate Amendment Act 2020.
Tabled earlier this month, Bill 20 addressed the concerns outlined in the KPMG report and in our view goes a long way in ensuring that Albertans can have confidence in real estate professionals. While we applaud the governance changes to better align RECA with regulator best practice, we are most pleased to see that the province is proposing the creation of multiple Industry Councils that will be made up of professionals practicing within that sector as well as public representatives, and will be empowered to establish sector specific education and regulatory actions. In short, real estate professionals will now be governed by bodies that understand their specific sector, education will be established to be more relevant and delivered in more flexible ways, and all sectors will be treated equitably. We expect this will ensure the public interest is better represented, while raising professional standards across the industry. It is also worth noting that this type of sector specific model isn’t novel or new and has served the Safety Codes Council of Alberta well. Far from creating additional bureaucracy or administrative burden, if done right this model leverages the expertise that exists in each industry sector and requires a minimal amount of staff support.
Bill 20 proposes a regulatory regime in Alberta that is more responsive to the public and better serves the industry in which it regulates. It addresses long lingering issues at RECA that successive provincial governments have acknowledged, and as such on behalf of the commercial real estate sector in Alberta we thank the province for their proposed action and urge all MLAs to support its passage through the legislature.
Lloyd Suchet, Executive Director for BOMA Calgary & Percy Woods, President and Chief Executive Officer for BOMA Edmonton