1. Pre-Offer Stage
The remote resort facilities (Fly-In) are accessible only from mid May to the mid November and viewing must take place during that time period. All tourism facilities require operating permits which provide for such things as use and occupancy and are subject to various tourism and conservation requirements. It is generally advisable to make some contact with the appropriate conservation officials to discuss any particular issues or plans you may have. The Realtor and/or your legal counsel should be able to assist you in that regard. While some of your concerns may be addressed prior to an offer being made, the offer itself can contain various conditions that need to be satisfied before the transaction is closed and fully completed.
2. Offer to Purchase
Once you have selected a facility that you are interested in purchasing, an offer to purchase can be drawn up by the Realtor or your legal counsel for presentation to the vendor. While
offers are sometimes accepted as presented, there usually is a negotiation stage which ultimately results in a purchase and sale agreement. The purchase and sale agreement then forms the basis for any financing and other applications and the ultimate conclusion of the transaction.
3. Interim Period
The time between the date of the execution and delivery of a purchase and sale agreement and the actual closing varies and depends in part upon the nature of the facility. Transfers
of tourism licences and permits are subject to approval of the Licencing Advisory Committee and that process can take at least 2 months. If facilities are situated on Crown Land that is not in a park any assignment of the Crown Land Permit or Lease is subject to approval of the Crown Land Agency and that approval process can take several months.
During this period any other due diligence requirements can be completed so that a closing can occur once the approvals have been obtained for the transfer of operating authority and assignment of Crown Land Permits. The process varies somewhat if the facilities are on private land or located within a park.
4. Timing of the Offer
- Given the time frame between the offer and actual closing, it is advisable to make your offer as soon as possible after the close of the tourism season in order to enable the purchase to be completed before the commencement of the following tourism season While it is possible to have a closing during the tourism season, there will be other issues that have to be addressed.
5. Costs to Complete
- Aside from the purchase price the additional costs to complete may include any one or more of the following;
- A. Legal Fees –These need to be addressed with your legal
counsel. The total cost can vary based on the hourly
rate charged, the complexity of the transaction and
the number of facilities involved.
- B. Financing Fees – these are dependent on the financial institution.
- C. Application/Transfers Fees - These are fees charged on each application and are based upon the number of facilities. This applies to all tourism licences, permits and licence transfers and range from $15.00 per facility to $150. If the facility is situated on private land, land transfer taxes are payable based on the fair market value of the property.
- D. Adjustments - There may be adjustments for such matters as property taxes and annual permit and licence fees.
- E. GST-
Goods and Services Tax of 5 % may apply if there is no exemption available, usually an exemption would be available.
- F. PST- Retail Sales Tax of 7% is payable in respect of tangible personal property. (Items such as vehicles, inventory, machinery and equipment, some boats and motors etc.)