The Basics of Phase 2 Ownership
Estimated reading time: 16 minutes
Key Takeaways
- There are 14 phase 2 properties in Whistler, with notable options like The Westin, Pan Pacific Hotels, and The Four Seasons Hotel.
- The Owner Management Agreement or Hotel Management Agreement (OMA) outlines rental rules and allows up to 28 days of personal use in summer and 28 days in winter.
- Owners are given their reservation calendar one month before the deadline, after which the hotel has their unit to market to the public for rental pool bookings.
- Summer period: Approximately April 16 to November 15. The owner’s personal allowance requirements must be submitted at the latest by November 15 for the summer period. This is a 6-month in advance of the season.
- Winter period: Approximately November 16 to April 15. The owner’s personal allowance must be submitted at the latest by April 15 for the winter period. This is a 6-month in advance of the season.
- When the condo is not in the personal allowance schedule, it will automatically be placed in the rental pool.
- All revenue generated by the building is placed in a rental pool, and each owner earns a percentage revenue after expenses. The percentage was pre-determined as part of the Insurance Under Destruction (IUD) calculation.
- When purchasing a phase 2 condo, buyers should be aware of the transfer of bookings from the seller, along with deadlines for submission of Owner Use, also called Personal Allotted Allowances (PAA).
- Financing phase 2 properties is possible, but applicants should work with a knowledgeable local mortgage broker who understand how to explain a phase 2 to a banker in Toronto.
- The Four Seasons hotel condos have no kitchen (except townhouse suites); the Westin and the Pan Pacific Mountainside has a full kitchen.
- Investors favor phase 2 due to lower costs, rental pool inclusion, and transparent revenue statements.
Overview
There are 14 properties in Whistler with a phase 2 covenant on title. When buyers think of a phase 2, The Westin, the Pan Pacific Mountainside, and The Four Seasons Hotel, seem to be most popular. On this page, I have covered these phase 2 properties simply because their information is superior. Therefore, there is less room for misinterpretation. However, that does not mean that the remaining phase 2 properties should be ruled out. It may depend on your level of comfort with the management company. Check out the Condo-Hotel Comparison Charts for a great comparison of the differences between the most popular Phase 2 properties.
Table of contents
Investment
Many investors are drawn to phase 2 properties for several reasons:
- The owners want to lock in their personal use dates for the upcoming season.
- Unit cost is lower than a phase 1 or residential unit.
- Phase 2 has the lowest cost/sq. ft.
- The property is typically in a Rental Pool, so owners earn income even if their unit is not rented.
- With the big hotel names, detailed revenue statements are available to Buyers.
- An accountant with an office in the hotel is available to speak to owners.
- Financial checks and balances by the management company’s HQ.
- Income earned from a phase 2 condo hotel is considered business income.
In my experience, the reason most people do not invest in a Phase 2:
- The Buyer already has several options for investments.
- The Buyer has little or no intention of enjoying the property themselves.
- The numbers do not make sense to them against the return from bonds, etc.
Read the Investment page to see the financial analysis on phase 2 property. This should help you determine if this product is for you.
Owner Management Agreement (OMA)
The OMA is also known as the Hotel Management and Rental Pool Agreement. I would suggest that the OMA or a similarly named document is one of the most informative documents to read before you consider writing an offer. Each phase 2 condo hotel OMA varies slightly, but so slightly that for this page, the differences are not vital to know at this stage. The OMA gives you the rules as to how phase 2 properties manage the rentals.
Buyer Acknowledgement
The buyer of a specific unit will be required to sign the equivalent of The Four Seasons’ Owner Management Agreement (OMA), or the Westin Hotel Management and Rental Pool Agreement (HMA). Each Phase 2 has a similar agreement.
Owner Definition
Personal Allotted Allowance (PAA)
- 28 days of owner PAA in the summer period and 28 days of owner PAA in the winter period.
- Summer period: April 16 to November 15. The owner’s PAA requirements must be submitted at the latest by November 15 for the summer period. This is a 6-month notice.
- Winter period: November 16 to April 15. The owner’s PAA must be submitted at the latest by April 15 for the winter period. This is a 6-month notice.
- Each Phase 2 has a variation on the rules for length of stays. The Four Seasons Hotel has restrictions on using the 28 days, and the Westin is more flexible.
Close-in Reservations
Each Phase 2 has its own set of rules for close-in reservations. However, a general rule is when the hotel is running at above 80% occupancy, the chances of the short-notice reservation for the owner is slim.
Changes and Cancellations to PAA
Once the deadline for the upcoming season has begun each Phase 2 has their own set of rules. With changes and cancellations to a reservation, you need to ensure you are aware of the rules so that you can get your condo back into the rental pool if you are not using it.
Friends and Family
Again, this is different for each Phase 2. Rules change, so remember to drill down on the documents provided to understand what the current rules are.
- The Westin offers Owner Rates and Friends and Family Rates
- Pan Pacific encourages Friends and Family to use the Owner’s condo hotel and use up the 56 days.
- Four Seasons details that the owner is the name on title plus spouse, children and parents, including the children and parents of the spouse.
- Blackcomb Springs offers a discount rate.
Owners Association
The OMA or equivalent mentions the Phase 2 Owners Association. How active this association is depends on each Phase 2. The Westin owners are heavily involved with the hotel management, and as of January 2026, they are registered as the Westin Home Owners Association.
Buying a Phase 2
There are many questions about how to handle the personal reservations already made by the seller that the Buyer will inherit. Although at this stage we are relying on the seller doing what is agreed to in the Contract of Purchase and Sale, the reality is that integrity is all we have to go on. The relationship is between the owner and management. Are you going to take the seller to small claims court because he didn’t reserve or cancel the booking identified in the contract? Probably not. However, this is another area of the contract that is important to get right.
Transfer of Personal Bookings
- The OMA states that the seller must notify the buyer of their PAA calendar when the property is listed for sale. If the owner has PAA dates within 30 days of the reservation, these dates may not be able to be cancelled. It is different for each Phase 2.
- The Seller’s PAA calendar automatically transfers to the buyer for the remainder of the season.
- The Rental Pool reservations automatically transfer to the buyer.
- The Seller can cancel the PAA dates a minimum of 30 days before the start of the reservation. There may be a cancellation fee. Again, this varies for each Phase 2.
- Knowing the Seller’s PAA allows the buyer’s realtor to determine a closing date, especially if the buyer wants to use the property for themselves.
Writing the Offer
When you, the Buyer want to reserve personal time within 30 days of completion of the transaction, there are a few options:
- When the offer is written, the seller is required to confirm that upon receipt of the deposit, the seller will book the dates you, the Buyer, the dates want to reserve, and
- Request the seller cancel his PAA dates that are after the completion date, if the buyer does not want these dates.
- The Westin collects revenue for the owners from the commercial space as part of the Rental Pool. This means that there are two adjustment dates to be considered.
Seller’s Personal Booking Status
- Before you can do any of the following, you must know what dates the owner has reserved for PPA.
- There can be a term in the contract that the seller cancels their PAA rather than transferring it to the buyer. The seller is permitted to cancel their PAA 30 days out and the seller assumes the cancellation fee.
- Therefore, the closing is 31-34 days out from the date the seller receives the buyer’s deposit, and the transaction is firm and binding. The 31-34 days are based on whether there is a weekend or a statutory holiday on those dates. These extra 4 days allow the Seller to cancel their dates.
- There can be a request in the contract for the owner to reserve the dates the buyer wants for their own PAA. This would happen once the deposit has been received from the buyer. This would only be necessary if the buyer wanted PAA dates close to the completion date, the buyer can wait and arrange this after completion. However, the further out the PAA for the Buyer is made, the better. Once the occupancy is 80% the buyer will not be able to reserve their PAA on short notice.
Closing Timeframe
- If the deadline for calendar submission for the winter season is April 15th. Closing before this deadline allows you to submit your winter PAA calendar.
- If the deadline for calendar submission for the summer season is November 15th. Closing before this deadline allows you to submit your summer PAA calendar.
- The Westin has revenue from the commercial strata lots as part of the Rental Pool. This means that there is not just one Statement of Adjustment Date, but two.
- Retain a local Whistler lawyer to convey the transaction, this is not the time for you local notary to spend hours getting up to speed on how to convey this commercial transaction.
Home Rescission Buyer Period (HRBP)
The HRBP is a 3 business day, cooling off period for the Buyer to determine whether they acted in haste when writing the offer. However, since phase 2 properties are deemed commercial, the owner can never live in the property. Best read my blog post, What is the Home Buyer Rescission Period?
Insurance of Contents
With phase 2, the hotel purchases insurance of behalf of the owners. The only items not covered by insurance is the contents of the owner’s lockers. However, if you are keeping anything of value in the in-suite locker, you may want to talk with your home insurance company regarding coverage.
Insurance of the condo is taken care of by the management company, making sure that all insurance is in place. This will be charged back to the owner under the strata fees. Or as a separate line item. Coverage under the owner’s home insurance should cover any content insurance for items of value in the lockers or in-suite owner locker.
Revenue
Calculation of Unit Revenue and Expense Share
The following was provided courtesy of the Westin:
“1) For each day that their Hotel Strata Lot is in the rental pool, the Hotel Investor will be entitled to share in the Room Revenue from the Hotel Premises and the operation of the Hotel earned on such day. The share of revenue for such Hotel Strata Lot is calculated by multiplying the Room Revenue earned on such day by the Interest Upon Destruction (IUD) for such Hotel Strata Lot divided by the total Interest Upon Destruction (IUD) of all of the Hotel Strata Lots in the Rental Pool on such day.
“2) For each day that a Hotel Strata Lot is occupied by an owner, the strata lot will not be in the Rental Pool, the owner of such Hotel Strata Lot will be entitled to share in the Gross Revenue less any Room Revenue from the Hotel Premises and the operation of the Hotel earned on such day, by multiplying the Gross Revenue less Room Revenue earned on such day by the Interest Upon Destruction (IUD) for such Hotel Strata Lot divided by the total Interest Upon Destruction (IUD) of all of the Hotel Strata Lots with occupancy permits.
“3) Each owner of a Hotel Strata Lot will be responsible for the payment of all Hotel Expenses, Capital Expenditures exceeding the FF&E Reserve, capital lease payments and the Hotel Manager’s fees payable for all days (whether or not the Hotel Strata Lot is in the Rental Pool). This payment is calculated by multiplying these applicable expenses by the Interest Upon Destruction (IUD) for such Hotel Strata Lot divided by the total Interest Upon Destruction (IUD) of all Hotel Strata Lots with occupancy permits.”
Fixed Expenses
The Owner’s Statement will show you what items are not included in the strata fees. In addition, the statement will show you what is deducted before the cash distribution. This is different for each phase 2 property.
The Westin deducts the items as fixed expenses from the gross operating profit. The benefit to the hotel is that they are in control of paying these expenses: property taxes, strata fees, and Tourism Whistler Fees. This is why when you look at the listing data for the Westin the listing agent has $0 as a strata fee, property taxes, and TW fees, hopefully with an explanation in the description. However, the Pan Pacific owners pay their own property taxes and Tourism Whistler fees.
FF&E Reserve
Management is entitled to withhold from each Owner’s net rental revenue the designated percentage for the FF& E reserve. This is essential to replace or repair equipment and soft goods within the hotel strata lots. Note: The Westin has a line item on the owner’s financials that can change because the week before closing, the funds in the owner’s account were removed to FF& E.
Utilities
Hydro, telephone, cable and internet are included in the monthly strata fees. Check the strata documents for what your strata fees include.
Taxes and Fees
For Canadians, the Taxes and Fees page will provide you will all the information on what to expect when owning a rental property.
This is a huge topic, and it is covered on this website. For non-residents, the page on Taxes and fees will give you all sorts of information on what to expect when owning a rental property in Whistler. Non-residents: Taxes and Fees
GST-Exempt Video
Is there GST on phase 2?
Let’s talk about GST and a hotel-condo, for example, the Westin, known in Whistler as a phase 2 Property. Owners of a phase 2 can use the property for personal use up to 28 days in winter and up to 28 days in summer, but when it’s not in use it must be available to be rented out.
There’s no residential zoning in a phase 2 covenant, and with 56 days of personal allotted allowance, the phase 2 property can never be used as a residence. Therefore, this can make it a little tricky to secure financing. This property is listed as GST non-exempt, and the buyer will automatically defer the GST. When you defer the GST, you must apply for and receive a GST number by the completion date, this application applies to Residents and non-residents of Canada.
Non-Residents: Withholding Tax on rentals
Income tax for non-residents is collected at the source of payment by the rental manager. The Canada Revenue Agency (CRA) has provided a blanket NR6 status, as every owner is earning business income. This means that for phase 2, the Withholding Tax will be reduced to 25% of net income after expenses. Withholding Tax can be considered a pre-payment of tax. Best to read the page, Non-Residents: Taxes and Fees for heaps of information. This collection is best considered as the hotel saving your 25%, which will go towards your April 30th income tax submission.
Strata Documents
The strata documents include the hotel financials, the Depreciation Report, and the Home Owner Agreement. Each of the Phase 2 has a connection with the commercial strata, and in the case of the Four Seasons, the Private Residences. Again, read the strata documents to understand the connection between the hotel strata lots and the commercial lots.
Storage Skis, Boards, and Bikes
Ski Valet service seems to be the preferred method of storing equipment. The hotel takes care of your equipment, and you pick them up and drop them off at the designated areas. Usually if there is a ski/board shop in the hotel, which there is with the Pan Pacific Mountainside and the Westin, the shop is involved in the valet service.
Although the Four Seasons Hotel is not ski-in ski-out, the hotel operates a shuttle service, and they have a shop at the Base of Blackcomb that stores your equipment overnight. They also have a ski-valet service and collect your skis at the end of the day.
Parking
There will be a parking stall(s) allocated to your unit, the larger the unit, the more stalls. These are unassigned stalls and you will be given a parking pass when you check-in. There will always be a parking spot for the owner when they stay in their own hotel-condo.
Financing
Financing is not impossible but you will need to have assets that can be used as collateral. The Four Seasons is the most difficult to get financing on because it does not have a kitchen. For phase 2 it is recommended to retain a local mortgage broker who understands how to present your application to a banker in Toronto who has never heard of Whistler’s Phase 2 zoning.
FAQ
Yes. With the Four Seasons, Whistler, the Registered Owner definition includes spouse, children, parents, and parents of the owner’s spouse, and their use counts towards the 28 days of owner use.
Yes with the Westin. This is different for each Phase 2.
Yes, this may be possible as the rules differ for each Phase 2.
14 phase 2 condo hotels.
No. The zoning is for up to 28 days in winter and up to 28 days in summer.
Yes.
The seller’s personal allotment allowance automatically transfers to the buyer. The Seller may be able to cancel all personal use reservations at least 30 days out.
Yes. The Four Seasons Hotel and Resort and the Pan Pacific Mountainside require the first 21 days of 28 to be booked in weekly increments. The Westin is most lenient.
Yes. The Rental Pool reservations automatically transfer to the buyer for the rest of the season. Remember the Season lasts 6-7 months.
Yes, but each Phase 2 has their own cancellation policy.
The Owner Management Agreement in some phase 2 developments states that the seller must notify the buyer of their PAA calendar when the property is listed for sale.
If the owner does not show up to their personal use dates, these dates still count toward their 28 days of use.
When the hotel is running at less than 80% occupancy, the owner can request to stay in their unit on short notice. This is at the discretion of the hotel.
Next Steps
If you think I would be a good fit to work with you and your family, and you are not already working with a Whistler realtor, please contact me. My name is Marion Anderson, and I help people buy real estate in Whistler.
Marion
Marion Anderson Personal Real Estate Corporation
Sutton Group – West Coast Realty, Whistler
marion@marionanderson.com (604) 938-3885