The few residents found walking through the empty streets of the Olympic Village were disappointed, but not surprised, to hear Wednesday that the developer of their condos has gone into receivership.
“Sad to hear that,” said Keith MacPherson, who has lived in the Millennium Water development in False Creek since the summer. “I really like the area, the facilities are great and it’s a good environment.”
Vancouver officials announced Wednesday that the city has a reached a “mutual agreement” that would allow a receiver, auditor Ernst & Young, to manage the development, in place of Millennium.
That company is still on the hook with $740 million in outstanding loans to the city.
How hard taxpayers will feel the heat of the debt will not be deteremined for some time, Mayor Gregor Robertson said, as it will take years for the remaining 454 market condos to sell and the city to recoup its losses.
Marie, a woman walking through the neighbourhood’s main square who did not give her last name, said the news of the receivership comes as no shock.
“I’ve had misgivings right from the beginning,” she said. “There’s just been a few too many concerns.”
Scott Hennig, spokesperson for the Canadian Taxpayers Federation, said he didn’t think the city has much chance of recovering any of their investment, let along making any money off it.
“This is bad news and maybe a bit surprising that taxpayers are going to be left holding a bag,” Hennig said. “It’s unique circumstances, but this is what happens in general when governments come in and bail out companies that can’t make a go of it anymore.”
Nov. 2002: City of Vancouver signs deal with Vancouver Olympic Bid Committee to build an Olympic Village.
July 2003: IOC selects Vancouver/Whistler to host 2010 Winter Olympics.
April 2006: Millennium Group outbids better-known Concord Pacific and Wall Financial to build the village, offering the city a record $193-million for the 2.6-hectare city-owned False Creek development site. Millennium expects to spend $750-million, borrowed from Wall Street’s Fortress Investment Group, to develop 1,100 units, including 200 for rental and 250 for social housing.
Oct. 2007: Millennium pre-sells 222 of 737 available condos ranging in price from $600,000 to $3.4-million. Some of those pre-sale buyers are currently in court trying to get out of the deals.
Oct. 2008: Leaked documents show city council unanimously agreed to lend $100-million to the development to ensure it be built prior to Olympics. The city is liable for delivering the village on time.
Nov. 2008: Issue becomes political hot potato during lead-up to civic election, which ends in landslide win for Gregor Robertson and Vision Vancouver on Nov. 15, 2008. Pundits say the controversy played role in demise of the NPA and its mayoral hopeful Peter Ladner.
Jan 2009: Fortress tightens loan conditions on cost overruns, which Millennium can’t meet. Fortress cuts off funding and city starts process to step in.
Feb. 2009: City votes unanimously to bail out project to ensure completion.
Dec. 2009: Olympic Village completed after city agrees to buy out Millennium’s borrowings.
Feb. 2010: Olympics held.
May 2010: Millennium starts trying to sell 450 remaining units with little luck.
Sept. 2010: Millennium now owes the city $740-million and has sold just 259 units with almost 500 unsold.
Oct. 2010: Millennium defaults on $200-million it owed the city, only paying $192-million.
Nov. 2010: Millennium unable to meet payments and a receiver is appointed with the city owed $740-million. Total project cost was just over $1-billion.
VANCOUVER, B.C. – November 2, 2010 – Greater Vancouver home sales have remained steady over the past four months, indicating stability in the residential housing market. With the MLS® sales to active listing inventory ratio indicating a buyers’ market, properties appropriately priced are selling.
According to the MLSLink® Housing Price Index (HPI), the benchmark price for all residential properties in Greater Vancouver over the last 12 months has increased 4.6 per cent to $579,349 in October 2010 from $553,702 in October 2009. Since June, however, residential home prices in Greater Vancouver have remained relatively unchanged, declining 0.2 per cent.
“We’ve seen a lot more consistency and less volatility in recent months when it comes to both number of sales and pricing, although it’s important to remember that conditions often vary between communities and neighbourhoods,” Jake Moldowan, Real Estate Board of Greater Vancouver (REBGV) president said.
Looking at transactions, the number of residential property sales in Greater Vancouver totalled 2,337 in October 2010. This represents a 5.3 per cent increase compared to September 2010 and a 36.9 per cent decline from the 3,704 sales in October 2009.
More broadly, last month’s residential sales represent a 71.3 per cent increase over the 1,364 residential sales in October 2008, a 22.8 per cent decline compared to October 2007’s 3,028 sales, and a 14.1 per cent decline compared to the 2,722 sales in October 2006.
“As we enter the final two months of the year, buyer demand is in closer alignment with supply than we’ve seen for most of 2010,” Moldowan said. “Those buying today recognize that they still have a chance to enter the market with near-record low interest rates, while gradual reductions in inventory have eased downward pressure on prices.”
Total active listings on the Multiple Listing Service® (MLS®) in Greater Vancouver currently sit at 14,075, an 8.6 per cent decline from last month and a 16.4 per cent increase from October 2009. New listings for detached, attached and apartment properties declined 25.7 per cent to 3,698 in October 2010 compared to October 2009 when 4,977 new units were listed.
Sales of detached properties in October 2010 reached 976, a decrease of 34.4 per cent from the 1,487 detached sales recorded in October 2009, and a 98 per cent increase from the 493 units sold in October 2008. The benchmark price for detached properties increased 6.3 per cent from October 2009 to $796,883.
Sales of apartment properties reached 984 in October 2010, a decline of 38.8 per cent compared to the 1,607 sales in October 2009, and an increase of 52.1 per cent compared to the 647 sales in October 2008.The benchmark price of an apartment property increased 2.4 per cent from October 2009 to $390,074.
Attached property sales in October 2010 totalled 377, a decline of 38.2 per cent compared to the 610 sales in October 2009, and a 68.3 per cent increase from the 224 attached properties sold in October 2008. The benchmark price of an attached unit increased 4 per cent between October 2009 and 2010 to $487,530.
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