The 2010 Vancouver Olympic Village, also known as the greenest neighbourhood in North America, can now add to its list of titles the biggest real estate project placed under receivership in the Lower Mainland in 2010.
Ernst and Young was appointed receiver Wednesday afternoon of Millennium Southeast False Creek Properties Ltd., a subsidiary of Millennium Development Corp. that built the financially troubled Millennium Water project.
“They’re done,” said Lawson Lundell partner Heather Ferris on Millennium’s future role in selling the project. “The receiver can do whatever needs to be done to market the development.”
The move also means that any lawsuit against Millennium over any existing purchase of units in the Olympic Village won’t be able to proceed unless plantiffs file for a court order to reinstate the suit.
Placing the project in receivership came after months of negotiations between the City of Vancouver and Millennium over plans to revise the marketing plans for the development and a plan to payback the $740 milliion in loans Millenium still owed to the city.
High unit prices and the slowdown in Metro Vancouver’s real estate market contributed to the crippling of sales at Millennium Water. The majority of units in the project remain unsold. (See “Millennium Water incentives set to boost disappointing sales ” – BIV Business Today, September 8.)
But whether or not Vancouver city taxpayers will get all their money back remains an open question. Mayor Gregor Robertson admitted it will still be difficult to recover its entire investment in the project.
Ferris noted Ernst and Young will have more options available to them to sell the units since they won’t necessarily be tied to any pre-approved price list for the units. The units could be sold in a receivership sale or an auction, if that’s what they think is best to help creditors, such as the city, recover its money.
Whether taxpayers or the general public will be able to obtain reports from the receiver about how the unit sales will proceed also remains an open question.
“The proceeding was commenced by way of a petition, and the only relief sought was the appointment of a receiver, and that’s not usual,” said Ferris. “There is nothing in the order that requires the receiver to report to the court by a certain date. Usually, receivers will issue a report that will be filed with the court, but there is no requirement in this order.”