Update on Utilization of Unexpected Revenue Surplus

Alberta’s regulated real estate industries have experienced unprecedented growth over the last few years. This growth is due to an unforeseen increase of new licensees and individuals moving from across the country to take advantage of Alberta’s favourable economic climate. As a not-for-profit organization, RECA is focused on ensuring licensing revenue is sufficient only for operations to meet our mandate. This volatile and transient surge in active licensees has resulted in an unplanned revenue surplus, presenting a unique opportunity to make financially prudent decisions that benefit all stakeholders.

Fee Credit

RECA’s Board of Directors approved and issued a $250 fee credit for all licensees who renewed their licence for the 2024/2025 year. To qualify for the credit, licensees must have renewed their licence by the September 30, 2024, deadline.

Prepayment of Building Mortgage

After careful consideration, the RECA Board has completed the prepayment of the RECA building mortgage. This decision underscores our commitment to sound financial management and ensuring the long-term sustainability of our operations.

The RECA Board of Directors, in collaboration with the Finance and Audit Committee, identified several compelling reasons for the mortgage prepayment:

• Savings of approximately $5 million in interest payments: by paying off the mortgage early, RECA stands to save a substantial amount of operating revenue that would otherwise be spent on interest. These savings can be redirected towards our services, including enhancing consumer awareness.
• Reduced future operating costs: future operating costs will no longer include the cost burden of the mortgage principal and interest, allowing RECA to remain conservative with registration and other fees as we move forward. In addition, revenues generated from tenants in the building provide reliable sources of revenue that can also be used to keep RECA’s costs (and fees) down.

This decision strengthens RECA’s financial position, provides greater flexibility to fund future initiatives, and ensures we can continue our mandate to protect consumers while offering affordable licensing fees.