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Olympic village set to launch, already generating big interest and a little controversy

February 16th, 2011 · 23 Comments

Tomorrow is the official announcement but I went down to the sales centre on Sunday, which was hopping. All kinds of people had driven down on a whim to take a look and then parked their cars once they found out they could tour the four presentation suites available. (In contrast to the picture I’m posting here of the sales centre, the gawkers were a very diverse crowd.)

Shierley Chelliah and her parents were scouting them out while I was there. They said they hadn’t even bothered checking the village before, because they thought the prices were too high for them. They — along with quite a few others I stopped and spoke to — had been enticed to take a look by news that units would be 30 per cent lower than before, on average, with some up to 50 per cent.

Those kinds of discounts weren’t in evidence with the four suites being shown off, though there were discounts of up to $350,000. That was on the two-bedroom that was previously $1.3 million. (Picture of the living room posted below.) A larger one bedroom (862 SF) was being listed at 599,900 instead of $695,000 and a smaller one-bedroom (812 SF, with a bedroom not large enough for a queen bed) was $539,000, down from $684,900.

For amateur presentation-suite hounds, the four units have all been decorated by different firms and are very lovely. Wouldn’t look like that if I moved in, is all I know.

Some realtors are disgruntled with the pre-launch activities, though. One called Jeff Lee at the Sun (his blog post and story here, with Mr. Rennie in full flight) and one called me.  Apparently Rennie Marketing invited down some people from the list of interested buyers they’ve been maintaining and gave them a chance to buy in advance on the weekend.

I’m told this is a practice in the development industry used to pre-test prices and make sure they’re pitched right to attract people. That’s what Rennie said he was doing, by getting 25 buyers committed in the four price categories they’re marketing.

But a few realtors were mad because they lost clients and commissions, as a result. The one who phoned me said that, although he’s used to that kind of thing on other developments, he thought a city-owned project would be more above-board.

Just goes to prove my theory that anything that happens at the village becomes news when it wouldn’t be news on another development.

That’s all the bits and pieces of news for today. I’d be interested to hear what people thinking of the prices and suites, if they visited already or visit tomorrow.

Categories: Uncategorized

  • Ron

    It was news back at the height of the condo market when people lined up overnight to buy a condo, only to find that VIPs had already scooped the best or least expensive suites.

  • Joe Just Joe

    I’m a little surprised that they only have 25 purchasers lined up, as they have had a large number of people kicking the tires for a while and have told them to hang on until the price reductions were finallized. Perhaps these are just a selected group from a larger list. Here’s hoping.

  • Frances Bula

    @JJJ. As it’s been explained, yes, it was limited to only 25, just to test whether the pricing was right. It’s not an indication of how many people were willing to buy.

  • Joe Just Joe

    Frances I understand that, I’m still surprised they are only allowing 25… On a project with 480 units to sell, doing 25 presales before opening to the public is quite low.

  • Frances Bula

    @JJJ. Hmm, you might be right on that. But don’t you think it would make the public mad if they thought half the units were gone even before it was opened to them?

  • Joe Just Joe

    It might make~ 24o people unhappy (if those somehow couldn’t convince Rennie to add them to the list) But it would make ~650,000 other people happier. It’s not unusual for 10-25% of units to be gone before they ever reach the public, not sure why this project is limiting itself to ~5%. Either the demand isn’t there at the new prices, or the receiver is setting very different playing rules.

  • Joe Just Joe

    Seems like the ratio has improved, we’re now at 31 offers our of 230 for sale. I knew they were holding back an amount but didn’t realize it was more then half. ~14% is closer to norms.

    “Of 31 offers, 12 were for units costing more than $900,000 and another 11 were for units priced between $600,000 and $900,000. The remaining eight were for units less than $600,000.”

  • Mo

    Hey Frances You didn’t by any chance see Senator Campbell down there looking to pick-up a couple of extra condos or two to average down his costs of his first two that the bought early on? I know he was a big big proponent of the whole Olympic Village i n it’s early days.

  • The Fourth Horseman

    JJJ Yes, that would make me mad, were I in the lovely posish to buy one.

    They are owned by taxpayers. It should be an open process. And the highest bidders get them.

    This sounds very sketchy, and something one would expect of a private deal.

  • rmac

    A lawyer from Harper Grey was interviewed on CBC Radio this evening for his take on the sale of the condos at “the Village”. He mentioned that the City of Vancouver is making all purchasers sign a waiver stating the purchaser will not be able to sue the City of Vancouver for any deficiences in the units, building or Village. The entity that officially “owns” the units is essentially a shell company with no assets so, if there are any problems after a unit is purchased there will be absolutely noone to sue. The lawyer, when asked, said there was no way he would buy into the place. (BTW, the warranty on the buildings is up in September 2011).

  • rf

    I think the real story was Jeff Lee falling under some kind of Bob Rennie jedi mind trick?!
    What the heck was with his piece today?
    He’s provides balanced scrutiny and critical opinions on city hall, yet he writes how “stunned” that Rennie is by interest in the OV without make any reference to his readers to perhaps ‘mind the source’?
    Are there 2 Jeff Lee’s? One who digs and one who shills?

  • Westender1

    I think this quote from Frances summarizes some of the design flaws in this project: “…a smaller one-bedroom (812 SF, with a bedroom not large enough for a queen bed).” Has too much of the floor area been occupied by in-suite storage (at $665 per square foot) and a “spa bathroom” to allow for basic “amenities” like a bed?
    On a broader note – has anyone done a “back of envelope” review on what the reduced prices mean for total sales revenue in the project? Can the sales at 30% off cover the costs of the project?

  • Wendy

    I also toured those suites on the weekend. That unit with the tiny bedroom–barely room for a double bed, no room for a dresser–surprised me as well.

    The other thing that I found odd were the tiny wall ovens, not big enough for a turkey. The appliances were top-of-the-line Miele and Sub Zero, so nice. But if were to spend $1.1 million for a 2 bedroom condo, I’d like something closer to a full sized oven (the kitchens were otherwise good sized for a 2 bedroom suite, so no reason to have a tiny oven).

    The oven and tiny-bedroom issues–as well as other things I saw–make me think that these are suites created by an artistic designer for design’s sake. They are beautiful, but not necessarily practical.

    They will appeal to some, as they are different from the more generic condos of Yaletown. But the generic condos of Yaletown are popular in part because they are practical.

    On another note, we also went into the private liquor store at the OV site. Fantastic selection and display of wines, micro-brew beers from around the world, etc. with great, knowledgeable and fun staff. If you tour condos, be sure to stop in there.

  • IanS

    @rmac #10,

    Really? The offers contain that kind of a clause? That’s pretty extraordinary.

    If so, I’d echo the lawyers’ conclusion about not purchasing.

  • Paul

    @rmac #10… That’s an interesting clause to put into a sales agreement, however I’d tend to say it’s a moot point for 99% of the problems a building may encounter. Major structural components will be warrantied for another 8 years after the Sept 2011 date.

    Several buildings in the downtown core have had (non-major structural) issues arise years after opening and have had to swallow the cost of repairs even though such a clause was not in their sales contracts. The reason is the cost of litigation is extremely high and there’s no guarantee that it will be successful. So being prudent the strata corporations just effected the repairs and carried on. It wasn’t about being right, it was about getting things done.

    Lawyers are free to make any recommendation they want, but the reality is the clause isn’t really putting your investment at any greater risk than had it not been in the contract.

  • IanS

    @Paul #15,

    I haven’t seen the clause in question, but I would STRONGLY

  • IanS

    [bah]

    … recommend getting legal advice on that clause before purchasing. While some guy named “Paul” on the internet may feel that it does not add to the risk, that’s no substitute for having someone with legal training actually review the clause in the context of the agreement.

  • Joe Just Joe

    Any major project is done by a limited company that has no assets. There is nothing new there, the city is only placing itself on equal terms.

  • Paul

    @IanS 16&17. You’re absolutely right. I would also have my lawyer review that clause before I actually went ahead with a purchase. I should hope that no one would take a comment they saw on the internet to the bank. Much like I should hope that no one would take to the bank a comment from a lawyer with no stake in the matter.

    Good clarification though Ian.

  • Bill McCreery

    Agreed JJJ. I am not a lawyer, but my architectural experience has taught me that, as Paul says, the contractors, consultants, suppliers are primarily on the hook for another 7 years by law.

    The City may be clarifying that in their opinion they are out of the loop, but that isn’t necessarily the case just because they say so. A good lawyer, and there are many in construction law in Vancouver, can have the City 3rd partied if there is justification.

  • IanS

    @Bill #20,

    With respect, Bill, I believe you are mixing up a bunch of different issues, most of which are well beyond the scope of this discussion.

    Dealing with the clause described by rmac, if it exists as described, it goes beyond the city clarifying its position or setting out it’s opinion. Rather, it is attempting to obtain a binding agreement from the purchasers not to sue it. That makes sense from the City’s position, but may well limit (or eliminate, if the vendor is a shell) the purchasers’ contractual rights under the purchase and sale agreement.

    Depending on the nature of the lawsuit, a defendant may well be able to third party the City. However, such a clause will potentially make it very difficult to do so.

    I don’t say any of this to be critical of the City. To the extent it’s exposed as a result of the manner in which it dealt with the Project, such a clause makes good sense. However, as a purchaser, such a clause might give me cause for concern.

  • IanS

    In the news story on Global last night, Rennie indicated that there were funds set aside for deficiencies, which might alleviate concerns somewhat.

  • Bill McCreery

    @ Ian 21.

    It sounds as though you know more of the law than I Ian. I defer to your opinion that the City has effectively covered itself.

    I’m not sure my point about the other potential defendants is “beyond the scope of this discussion”, if that’s what you were referring to. People have said they are being scared off from purchasing because after September they think they’d be on their own. That is not my understanding of construction law. There is a 7 year period when, if defects arise the above parties can be sued. That is very relevant to a part of the above discussion as I read it.

    Part of the problem for the OV is that no-one has been living in the units for the better part of the 1 year warranty period. Typically the units are sold before or shortly after the warranty begins, and defects become obvious because the occupants are breaking in their new homes. I wonder if it would be possible legally or otherwise to start the warranty period at OV when a buyer moves in. That would put it on the same playing field as your typical condo development.