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Old Posted Feb 28, 2008, 11:06 PM
vanlaw vanlaw is offline
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2 More Vancouver Condo Projects in Receivership

2 More Vancouver Condo Projects in Receivership

http://www.cbc.ca/canada/british-col...introuble.html

Two more condominium projects in the Vancouver area have run into financial difficulties, leaving dozens of purchasers in limbo.

The Chandler Development Group Inc.'s H&H Yaletown project in Vancouver, and the Garden City building in Richmond have been placed in the hands of a receiver, the CBC has learned.

Almost 250 condominiums in those developments have been presold. Until this week, purchasers had no idea the developer was in trouble.

News that the Chandler Development Group is facing financial challenges comes on the heels of another developer, the Eden Group of Companies, citing financial difficulties for a decision to halt its third development in Vancouver in less than four months.

The Sophia on E11th Avenue and Sophia Street in the city's Mount Pleasant area went into receivership on Feb. 18 and the receiver, The Bowra Group, has 21 days to submit a plan to the courts.

Bowra has also been appointed to make sure that the H&H and Garden City projects get finished, builders get paid, and owners get their condos.

H&H is a 192-unit building, while Garden City is comprised of 108 units, according to a receiver manager's report to the B.C. Supreme Court.

Both projects were scheduled to be completed by the end of June 2008.

"The company was running into cost overruns, they were running out of cash and I think the lenders wanted to complete the project,'' said Bowra Group President David Bowra.

"But they weren't convinced it could be completed without the assistance of a third party. So they decided to apply for a receiver to be appointed."

The receiver has discovered that 23 condos in the Chandler Development Group projects were allegedly sold to insiders at prices well below market value, Bowra said.

They may get to keep their condos, but will likely have to pay today's prices, he said.

It appears that the other buyers will get their condos for the price paid as there is enough money available to finish the job.

Last edited by vanlaw; Feb 28, 2008 at 11:50 PM.
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  #2  
Old Posted Feb 28, 2008, 11:27 PM
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Old Posted Feb 29, 2008, 12:07 AM
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Chandler acutally lost control of all the projects they were running over a year ago, he has a rap sheet for fraud in Arizona on a similar matter. His partner sued him for control of the existing projects but apparently too much damage was already done. The Hills was also one of Chandlers, luckily he won't be the one going forward with it as Holborn took that one over.

He was accused of selling the same unit to multiple people, as well as failing to place the deposits into trust as obligated by law. This isn't really a sign of the market hurting as it is of a dishonest individual. The biggest loser in this is his partner you is left holding the bag and will take a huge loss.
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Old Posted Feb 29, 2008, 12:30 AM
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Yup - Just google the company name. This guy is a top tier fraudster. How the Superint. of Real Estate and FICOM continued to let him operate is beyond me.

But, with Eden going down as well, it may become more apparent in the months to come that the "little guys" are just not able to absorb the cost increases as well as the big guys like polygon, onni, concord etc.
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Old Posted Feb 29, 2008, 12:51 AM
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Quote:
Originally Posted by jlousa View Post
Chandler acutally lost control of all the projects they were running over a year ago, he has a rap sheet for fraud in Arizona on a similar matter. His partner sued him for control of the existing projects but apparently too much damage was already done. The Hills was also one of Chandlers, luckily he won't be the one going forward with it as Holborn took that one over.

He was accused of selling the same unit to multiple people, as well as failing to place the deposits into trust as obligated by law. This isn't really a sign of the market hurting as it is of a dishonest individual. The biggest loser in this is his partner you is left holding the bag and will take a huge loss.
Indeed these are actually signs of a market so strong it is in a sense hurting itself. It is attempting to grow so fast that the workers do not exist to allow it to grow at that pace. This is all causing skyrocketing construction prices, which were not anticipated by some developers, and their profits are disapearing to cover the new construction costs. All this is in turn driving prices higher and will eventually price enough people out of the market so that growth can return to a more sustainable pace.

The olympic (and related infrastructure) projects are not helping the trade market either.
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Old Posted Feb 29, 2008, 2:11 AM
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Do you think there will be a slow down in construction after the next 2 years. If not for the above reasons, only because the downtown is considered built out, and where can new development on this scale take place in the future?
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Old Posted Feb 29, 2008, 2:27 AM
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Yes there will be a slowdown, when I can only guess. I would've told you 2009-2011 if you asked me last year, but now with gateway/rapid transit projects as well as some of the other large scale project all about to start all at the same time, the labour crunch isn't going to end until 2013ish. It's hurting the big guys too.
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Old Posted Feb 29, 2008, 2:57 AM
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And then we have this economic outlook for BC, for the next 5 years, released by the BC Central Credit Union a couple of weeks ago:

B.C. Sees Best Five-Year Outlook Since 1985

February 11, 2008

VANCOUVER – Economic growth in British Columbia is forecast to remain above the long-term historical annual average through 2012, according to the latest five-year economic forecast from Credit Union Central of British Columbia.

"Weakness in U.S. housing, credit derivative and secondary equity markets will continue to dampen the economic outlook into 2009," said Central’s Economist, Dave Hobden. "Growth in B.C.’s real gross domestic product (GDP) will be moderate through 2009, followed by a spike around the 2010 Winter Olympic Games, another moderate year in 2011 and robust growth in 2012."

B.C.’s real GDP is forecast to grow by an average of 3.6 per cent annually through 2012, up from 3.4 per cent over the past five years. This would be the strongest rolling five-year performance since 1985 through 1989.

"Compared with the past five years, growth will depend less on residential, business and government investment, and more on slower growth in imports and resumed growth in exports," said Hobden. "Consumer spending will remain the mainstay of the economy, while B.C.’s trade deficit will be less of a drag on output than in recent years."

The labour market is forecast to remain under-supplied, driving up hours worked, wages and salaries. Total personal income is expected to rise by an average of 6.5 per cent a year through 2012, up from 5.9 per cent over the past five years.

Close to half of forecast growth will come from retail and wholesale trade, finance, real estate, telecommunication, Internet and data processing services. Contributing least will be pulp, paper, metal, wood and machinery manufacturing, along with primary natural gas, forest and agricultural industries.
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