ABSTRACT
In the not too distant past, the process by which a residential suburb, shopping plaza or commercial office tower was built was relatively straightforward. A developer would acquire a parcel of land; line up financing from a bank or insurance company; obtain approvals plus, more often than not, a package of subsidies, tax breaks and improvements from various levels of government; and, in the case of retail and commercial projects, organize a roster of tenants. Profits flowed from a combination of rents and leases, percentages of sales, land appreciation, tax writedowns and concessions. These last two profit boosters refer to measures which allowed developers to claim depreciation on their projects, even as they were rising in market value. The capital cost allowance (CCA) concession in Canada during the 1960s and 1970s, for example, allowed developers to show huge paper losses on their income properties on their corporate tax returns, even though their audited financial statements indicated considerable profits (see Lorimer 1978: 64–5).
