Olympic Vilage Developer Defaults on Loan Payment
Millennium fails to make full $200-million installment by Aug
. 31
After much conjecture in the media lately about the status of Millennium Waters loan payments to the City of Vancouver, it has become clear that the developer is officially in default on its loanrepayment scheduled for August 31, 2010.
Although this does not come as a surprise, it certainly is a stark 180 degree turnaround from Mayor Gregor Robertson's comments to the press a little more that a fortnight ago. Under a great deal of pressure from his shareholders (taxpayers), the mayor categorically stated that the loan was not in default while trying to explain slow sales in one of the Vancouver condo market's most troubled projects.
According to the
Vancouver Sun article dated 1 October 2010, Millennium Developments paid the City $192 million, $8 million short of the scheduled $200 million repayment. apparently Millennium did come up with a further $6 million by September 20 but the devil is in the details the loan is in default.
Pundits have pointed to a laundry list of reasons for the slow sales -slow Vancouver condo market, HST and high number of very large extravagantly fitted units to mention a few. I hosted an open house at 402,181 West 1st Avenue last weekend (and will do again this weekend) and learned something fundamental about real estate development planning. The most common question I get from prospective buyers is "Is that social housing" as they point across the courtyard to the adjacent building. The buildings are located close together for those of you that have not visited the property.
So this begs the question, are people really going to spend millions of dollars on a high-end luxury condominium that is located right next to social housing? I, for one am not.
Unfortunately for all of us Vancouver taxpayers, unless the project marketers can pull a white rabbit out of a hat, I'm calling for an Olympic Village condo fire sale next spring.
Olympic Vilage Developer Defaults on Loan Payment
By: Greg Mitchell
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