Onni Group has scooped up two bankrupt Vancouver Island real estate developments, paying less than $30 million for high-profile projects once thought to be worth well over a billion.
The latest purchase is the failed 360-acre oceanfront Wyndansea golf resort near Pacific Rim National Park. It was potentially valued at $650 million in 2006 when sports legend Jack Nicklaus flew in to put his signature on an18-hole golf course that was to be flanked by an eco-luxury hotel and 500 homes. But Wyndansea’s developer sank into receivership owing creditors $110 million.
In 2009, the site was listed at $37 million in a court-ordered sale.
This January Onni paid $7.95 million for the site, reports the Westerly, a Tofino-based newspaper. Onni’s acquisition was contingent on at least 50% of the development's 178 creditors voting in favour of the offer.
Onni spokesman Kevin Carpenter confirmed the deal has now closed, but said Onni’s plans for the fully zoned and partially serviced site “are not finalized.”
"The Onni Group is a large development company with a proven record of delivering large-scale property developments," according to statement from Wyndansea receiver Ernst Young. "The Onni Group has the skill set and financial wherewithal to restore confidence and provide much needed stability to the Wyndansea development."
As part of the development's restructuring plan, many creditors can expect to receive only 2% of the amount owed.
Thomas Petrowitz of Ucluelet Sand Gravel is owed about $2,500 and expects to get about $58 of that. But Petrowitz welcomes Onni’s ambition for the Wyndansea, a spectacular piece of real estate with roads, utilities and building lots carved into West Coast rainforest with a pristine beach.
"[This way]’ something might happen down the road. It's not going to sit there and fester and be an eyesore for the district," Petrowitz said.
(Image: Wyndansea site on the west coast of Vancouver Island | Photo: JLL Realty)
That is also the sentiment of Coldwell mayor Carol Hamilton after Onni bought a failed real estate project that has left a big hole in the centre of her town.
”I will be glad to see something being done,” Hamilton said of what was once touted as the largest real estate project on Vancouver Island.
The site has been idle since spring 2013 when developer League Assets filed for bankruptcy. League had envisioned a $1.2-billion mixed-use development that was to include 12 residential high-rise towers; four office towers, a shopping centre and a public plaza.
At this point, a water-filled concrete foundation is the only structure.
In October 2014, Onni bought the Colwood Corner site for $17.5 million.
It has paid Colwood $719,000 owed in taxes from the site and is working on a redevelopment proposal.
(Colwood Corner site near Victoria: concrete hole only reminder of planned $1 billion project | Photo: Victoria Colonist)
“I am encouraged to see what Onni brings forward and what they see that development could look like, but I’m pretty sure it is not going to be to the density and level League had previously portrayed,” Hamilton said. “I’m hoping they have an eye for that mixed-use opportunity.”
Carpenter said Onni will work with Colwood council and Colwood residents as it finalizes plans for the project.
In the past 10 years, Onni has built 6,000 homes. It owns and manages about five million square feet of commercial space and 4,600 apartments.
- With files from Victoria Colonist, Westerly News
