Two men and a numbered company have been ordered to pay more than $57,000 in penalties for their roles in converting part of a Vancouver commercial building into 11 illegal single-room occupancy housing units. The Compliance and Enforcement Unit of B.C.’s Residential Tenancy Branch imposed administrative monetary penalties on Akhtar Nawaz, Sarwar Khan and their company 1460317 B.C. Ltd. on July 10. A redacted version of the decision imposing the penalties was published on the CEU website this week. According to the decision, the company is the registered owner of a mixed-use commercial property in Vancouver with retail space on the ground floor and office space on upper floors. The specific address of the property is redacted from the document. In mid-2025, the City of Vancouver’s Development, Building and Licensing Division became concerned about the building’s “configuration and use,” and conducted inspections. “During these inspections, (the city) documented that portions of the second and third floors had been reconfigured into partitioned rooms consistent with single room accommodation (SRA) units,” the CEU decision reads. “The inspection records indicate that, at the time, individuals were residing in these areas notwithstanding that the space had not been approved for residential occupancy.” The city issued “not safe to occupy” orders on Aug. 18, 2025, and did so again on Oct. 9 and Nov. 20 of that year, according to the decision. Around the same time, Vancouver Fire Rescue Services was also conducting inspections of the property and identified “a number of fire and life safety concerns.” VFRS eventually issued its own “do not occupy” and fire watch orders on Nov. 18, 2025. “Despite the issuance of these orders, occupancy at the rental property continued,” the decision reads. The CEU commenced its own investigation into the property on Nov. 28, 2025, at the request of the city. The decision indicates that the building remained tenanted, without the required permits to allow such a use, until “at least April 13, 2026,” the date on which the CEU’s investigation report recommending the administrative penalties was filed. Landlords respond In their defence, Nawaz, Khan and their company argued that penalties should not be imposed because they were co-operating with regulators and working to achieve compliance. They told the CEU they had retained a structural engineering firm, fire protection and code consultants and mechanical and electrical professionals to help them address the issues raised by the city and VFRS. They rejected the suggestion that they had been ignoring regulatory concerns, claiming instead that they were working to address the issues incrementally, “while maintaining housing for existing occupants.” “The respondents describe their overall approach as one focused on achieving compliance while also considering the impact that immediate displacement would have on individuals residing at the rental property,” the decision reads. Due diligence lacking Scott McGregor, the CEU’s director and the author of the decision, considered the landlords’ submissions, but ultimately determined monetary penalties were necessary. “While I acknowledge that tenant displacement can have significant consequences for affected occupants, I am not persuaded that this explanation meaningfully mitigates the conduct at issue in this matter,” McGregor’s decision reads. He noted that Nawaz, Khan and their company converted the property and commenced the tenancies “without obtaining the necessary permissions or approvals before occupancy.” “The fire, life safety, and occupancy concerns that ultimately gave rise to municipal enforcement action were not unforeseen events that emerged after tenants had been housed,” the decision reads. “Rather, they arose from the respondents’ decision to undertake and operate an unauthorized residential conversion without first ensuring compliance with applicable safety, building, and occupancy requirements.” Elsewhere in the decision, McGregor notes that it is a “reasonable inference” that the landlords received rental income from the 11 tenancies at their non-compliant property. “In these circumstances, the respondents’ reliance on the potential hardship associated with tenant displacement carries limited weight,” the decision reads. “Had appropriate due diligence been undertaken and the necessary approvals obtained before commencing the occupancy of the premises, the circumstances giving rise to the subsequent enforcement actions may have been avoided altogether. I therefore find that the respondents’ submissions do not adequately explain or justify the prolonged non-compliance that followed repeated notices, orders, and opportunities to bring the rental property into compliance.” $57,100 in penalties McGregor concluded that Nawaz, Khan and their company contravened B.C.’s Residential Tenancy Act by converting the commercial building to residential use without authorization, failing to complete remediation work required by the city and VFRS in a timely manner, and failing to comply with orders prohibiting the occupation of the building. He also found that they had violated the act by failing to maintain the building’s electrical system “in a condition that complies with the health, safety, and housing standards required by law.” McGregor found the numbered company liable for the violations because it is the owner of the building, while Nawaz and Khan were liable as directors of the company, who necessarily “permitted or acquiesced in the contraventions.” A third individual, Tayyaba Butt, was found not to have sufficient control over the company to be held liable for the penalties. The electrical violation was considered on a building-wide basis, according to the decision. The other violations applied across the 11 different tenancy agreements the landlords entered. McGregor imposed a $5,000 penalty per tenancy for those violations, plus a $2,100 penalty for the building-wide electrical violation. In all, Nawaz, Khan and the company are collectively liable for $57,100 in administrative monetary penalties, which must be paid to B.C.’s Finance Ministry by Sept. 14.
