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City expects $200 million from Olympic village condo deposits this year

April 20th, 2010 · 14 Comments

I never imagined, when I was spending my 20s studying the contemporary French novel, that I would enjoy reading financial statements as much as I do. But it turns out they’re just as fun as Boris Vian or Michel Butor, in their own way, like seeing where the millions go at the city.

The city’s financial statements were put out late last Friday afternoon (hmmmmm, what could this mean?) with lots of interesting bits in them. Did you know the city has provided a $12-million line of credit to the PNE? I didn’t but there it is in the statements. Or that the city collected almost $40 million more in taxes in 2009 than in 2008. That’s a hefty jump. That was almost entirely to pay for the increase in costs in policing ($15 million), general government ($17 million) and fire protection ($5 million), as every other sector of city government stayed mostly the same or decreased.

But of course the most fascinating section for us city-hall junkies is the Olympic village (pages 23/24), where we learn:

– the private developer Millennium Developments owes the city $710 million as of March 26, 2010 ($15 million more than on Dec. 31, 2009 — how that interest piles up quickly). That’s, of course, just for the construction loan. It also still owes $170 million for the land that it bought back in 2006.

– Millennium got a $1.5 million bonus for on-time delivery of the village to the Games

– the city is paying only .8 per cent interest on $480 million of the money it borrowed from banks to relend to Millennium, but is charging Millennium somewhere between four and eight per cent, depending on how long the loan goes on — that spread is a guarantee for the city that it will get its money even if not all the condos sell, according to the statements.

– and final fun fact: the city expects to see $200 million in deposits put down on the 500 condos that remain to be sold at the village. That would be as of May 15, when condo marketer Bob Rennie is going to launch a new sales phase with a “street of dreams” marketing campaign. As the mayor said so poignantly prior to the Games, “Go Bob go.”

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  • Bryn

    So overall we have a pretty good chance of making back our money whether they all sell out big time or not?

  • landlord

    A 4-8% spread on the vig, $710 Million loan, that’s up to $60 Million in interest annually. $400K down on a condo, mortgage terms tightened up, interest rates jump at the end of May. Hmmm.
    Where the hell are they going to find five hundred millionaires who like 5-metre high fibreglass songbirds?

  • JP Ratelle

    Landlord,

    500 milionaires…..easy, foreigners. Bob will have these sold in a heartbeat offshore. For a man who supposedly loves the city, he’s almost single handedly screwed every single Vancouverite, while doing his job very successfully.

    Of course Vision talked a mean talk about a speculators tax during the 2008 election amd I believe I heard talk of some type of some other regulation to keep the rents down.

    Now that the city is in fact a quasi-developer with the OV, they of course will not care who the units sell to, so they can get our money back.

    The hypocrasy of the hypocrits in Vision continues unabated.

    Have we ever learned how much Bob Rennie donated to Vision in 2008 yet?

  • jesse

    How does the City plan to squeeze 4-8% blood from a stone? Looks like they learned some tricks from Fortress!

  • Bill Lee

    Foreigners?

    And could we assume that you mean Chinese faces?
    Just as Geller marketed the SFU yuppie slums to the Chinese audience/readers first, so does Rennie.
    And the Chinese (mainlanders) bite, re-rent, indicate a complete negativity to the strata councils, and (those from southern China) sell in January to clean out their account books for the Lunar New Year.
    A new dragon dance.

  • Urbanismo

    Foreigners . . .

    Vancouver real estate has IMO really “jumped the shark.”

    The issue is not going to go away soon: buying a home in the city is out of reach for hard working Vancouver.

    Shelter costs are rising while incomes are either stagnating or dropping; this isn’t exactly a mystery but it is rooted outside our reach.

    For decades the US, to a lesser extent Canada, has been consuming, quite mindlessly, cheap sweatshop stuff from among other places the China coast: Hong Kong, Guangzho and Shanghai.

    Accordingly the US has accumulated dollar debt way beyond its ability to pay.

    The solution evidently, for the US anyway, is to print, minus collateral backing (gold or silver), more and more paper money: thus China is swimming in rapidly devaluing paper. This is not news!

    China has no alternative but to dump worthless stuff in exchange for value: in this case Vancouver real estate.

    Hence the only demand that is inflating our home prices is coming from off shore.

    If the city, Geller and Rennie are aiding and abetting these transaction one could devolve into hyperbolic revere accusing them of treason: or they could accuse me of racism.

    Neither of course work. Suffice it to say, however, I personally do not admire any of the protagonist involved in selling out our city and leave it at that!

    Yes, yes development in the city has truly “jumped the shark.”

    Now we need to take a sober look at what we are going to do with all this worthless paper: it would be foolish to enter it on the credit side!

  • Bill Lee

    Last page of
    http://vancouver.ca/ctyclerk/cclerk/20100422/documents/2009FinancialReportfinal.pdf

    What were the 3 km of lanes that they ‘unpaved’ and why?

    The extra 10 km of sewers don’t mean much if they are going to lead to that non-treatment treatment plant. And how many storm sewers now lead to overflow of sanitary sewers?

    When are we going to get off our asses and stop shitting into the ocean?

  • Bill Lee

    “- and final fun fact: the city expects to see $200 million in deposits put down on the 500 condos that remain to be sold at the village. That would be as of May 15, when condo marketer Bob Rennie is going to launch a new sales phase with …”
    200 mill / 500 = $400,000
    as a deposit!!?

    I’m missing some details here? Deposit!
    Wandering around the cynical http://vancouvercondo.info/ doesn’t enlighten.

  • Frank Murphy

    If I had to make the call I’d label comment #5 racist.

  • landlord

    @ Bill Lee : “When are we going to get off our asses and stop shitting into the ocean?”
    Ask a contortionist.
    China, shmina. They better come from someplace, and quick. Who cares if they pay with VISA, Yankee dollars or krugerrands. Just hand over the cash.

  • landlord

    @ Urbanismo : “…cheap sweatshop stuff …”. That would be your laptop, your printer, your LCD TV, your DVD player, your cell-phone, your GPS gadget, your lightbulbs, furniture, lighting fixtures, drywall, pipes, wires, window glass, carpets, dishes and flatware, your shoes and clothing and on and on.
    You’d rather pay more for everything? I’ll send you a copy of my catalogue.

  • Glissando Remmy

    The Thought of The Day

    “After this Olympic Village Sale, The Deluge.”
    (Bob Rennie on the Olympic Village and future plans)

    Urbanismo,
    If Bobby, Miguel, Centavo and other pen pushing marketers were busily conducting business in the 18th century they would have been remembered as the Louis XV & Madame de Pompadour Club.

    Their last words?
    Most probable: “Après nous, le deluge”
    And I don’t think I’m far off on this one.

    We live in Vancouver and this keeps us busy.

  • Urbanismo

    Yunno landlord, I’m really gettin’ to like you . . .

    We have a lot in common although I wasn’t necessarily into ” your laptop, your printer, your LCD TV, your DVD player, your cell-phone, your GPS gadget, your lightbulbs, furniture, lighting fixtures, drywall, pipes, wires, window glass, carpets, dishes and flatware, your shoes and clothing and on and on.”

    I was more into ballin’ chicks!

  • Urbanismo

    PS . . . http://www.youtube.com/watch?v=ToEPFDIzhNA