Southeast False Creek 2010 Olympic Village Update - Millennium Developments gets $100-Million Bailout from City of Vancouver
MetroNews Reports that the City of Vancouver Has Taken Over Financing of the Olympic Games Village Development
According to Jeff of Vancouver MetroNews, The City of Vancouver will finance the entire $1 billion Olympic Village along Southeast False creek waterfront proprety development after purchasing a $750 million loan agreement from New York based Fortress Investment Group yesterday morning on February 18, 2009. Vancouver Mayor said that the deal gives the city the best reutn on its investment and allows it to focus on getting the Southeast False Creek Vancouver Olympic Village ready in time for the Games. During a special council meeting yesterday morning, city manager Penny B informed councillors that an hour earlier, the City of Vancouver had transferred $319 million to Fortress Investments to purchase out the loan on the Olympic Village real estate development. The amount represents the money that Fortress Investments loaned to project developer Millennium Group, plus a $4 million early repayment fee. The buyout money for the South East False Creek Olympic Village in Vancouver is a $240 million investment of city money and $90 million of a $400 million line of credit from the Bank of Montreal. Fortress Buyout 'Best Of a Bad Situation' - The latest in the long string of bad news coming from the real estate development of the Vancouver Olympic Village along southeast False Creek property. According to 24 Hours Vancouver, the City will go it along on the struggling Olympic Village real estate project. City manager Penny announced yesterday that city hall bought out financier Fortress Credit Corporation at a cost of almost $319.5 million for the bailout of the Vancouver Olympic Village in order to stay on budget and schedule. The move means the division of struggling New York based hedge fund Fortress Investment Group has been cut out of the Vancouver 2010 Olympic Village real estate development project completely. The City of Vancouver, using a BMO Bank of Montreal line of credit up to $400 million is now the lender on the Southeast False Creek Olympic Village in Vancouver. Millennium Development remains the property developer and ITC and MetroCan the builders. After a special city hall council meeting yesterday, Vancouver Mayor called the Fortress Investment take out a turning point in the drama that has engulfed the 2010 Vancouver Olympic Village fiasco for months now. The waterfront residential project's problems clouded an election campaign that Robertson won handily last fall aft er news leaked of the city's emergency $100 million city loan brought on when Fortress stopped paying for the funding on the Southeast False Creek Vancouver Olympic Village site development. Robertson said holding teh purse strings will give the city better flexibility not and beyond. Under the terms of a tripartite deal with Fortress and Millennium Group, the city of Vancouver was liable for a construction guarantee. It paid $133 million to keep construction on the Olympic Village along Southeast False Creek going. It's estimated $690 million is still need to complete the project in time for the Winter Olympics. This by Bob and Irwin of 24 Hours.
City of Vancouver Mum about $100 Million Bailout for Olympic Village
According to Metro News Vancouver’s Maria C on the secretive bailout by the City of Vancouver for Millennium Developments cost overruns for the Olympic Village 2010. The city of Vancouver yesterday refused to comment on details of a closed door meeting that enabled a $100 million bailout to help offset the mounting costs of the 2010 Olympic Village in False Creek. “It’s not in the taxpayer’s interest to talk about the day-to-day dealings,” said Jody Andrews, the Olympic Village’s deputy manager, and project manager for the southeast False Creek real estate project, adding that the taxpayer’s “risk profile in this project hasn’t changed – the project will be delivered on time.” Furthermore, Andrews said that the “commitment of the city remains unchanged.” Vancouver city coundil approved the money in a closed door session on October 14th, 2008, when the private developer, Millennium Development Group, was struggling with the international credit crunch and cost overruns in a slowing Vancouver real estate housing market, according to new reports. Yesterday, NPA mayoral hopeful Counc. Peter Ladner reamiend tight lipped about the meeting, and was led away by staff when reporters questions him about the loan for the 2010 Olympic Village $100 million bailout plan following the Downtown Vancouver Association’s debate. Earlier, he conceded that the council is “concerned about finances.” “We’ve been prudent with (the Property Endowment Fund),” he said. “It is equipped to take situations like this and make loans like this.” Ladner was also stunned to learn that Vancouver’s director of finance. Estelle Lo, had resigned. Media reports speculate that Lo quit her position after months of expressing concern that the City of Vancouver was taking on too much financial risk in this 2010 Olympic Village southeast False Creek real estate development project. The full cost of the Olympic Village has been estimated at about $1 billion, and as part of the public private partnership some of the units will be made available as affordable or social housing.
$100 Million Handout for the 2010 Olympic Village in Southeast False Creek Vancouver
There are more questions than answers today about the financial future of Vancouver’s Olympic Village after a report emerged suggesting city council had secretly approved a $100 million bailout to the 2010 Olympic Village Southeast False Creek site’s developer. This according to 24Hours Vancouver. Senior city staff yesterday refused to confirm or deny that council had authorized the $100 million loan last month to Millennium Development Corp, which is tasked with building out the site in Southeast False Creek real estate district. And city councilors who are said to have unanimously given the deal a thumbs up, including a mayoral candidate, stayed largely silent on the issue as well. But the senior city official in charge of the Olympic Village site insisted the project was in order, despite acknowledgeing the $1 billion overall plan was roughly seven per cent over budget. “The taxpayer is under no additional exposure and it’s being complete on scheduled,” said deputy city manager, Jody Andrews. But he refused to speculate on the finances of the Southeast False Creek Olympic Village in Vancouver. “What I can say is the overall package remains unchanged,” Andrews said. “The day-to-day transactions on how to get there, we don’t reveal.” What remains to be seen is the extent of any political fallout on the issue with just over one week to go before the November 15th elections. Vision Vancouver mayoral candidate Gregor Robertson, who doesn’t currently sit on council, yesterday called for a public hearing to air out the city’s finances before the election. “The public has a right to know what’s going on before the election,” said Robertson. NPA Coun. Peter Ladner, chair of the city’s finance committee, refused to comment as the story developed yesterday but said in a press release that Robertson’s call for an open discussion on the finances “reveals his lack of experience in how civic government works.” By Irwin L. Right now, it is presumed that the Vancouver City Council has approved a $100-million loan to Millennium for the Olympic Village Southeast False Creek real estate development project.
Vancouver Olympic Housing Worries
A recent study shows previous host cities have seen negative impact on local housing markets. This by Maria for MetroVancouver. A study of seven different Olympic cities around the world found that local residents were the biggest losers when it came to the impact of the Olympic games on local housing markets. “The local people living in a city shouldn’t be adversely affected by a sporting event that lasts for two weeks,” said Clair Mahon, a principal author of the 2007 report entitled Fair Play for Housing Rights: Mega Events, Olympic Games and Housing Events. According to Jenny Kwan, NDP MLA for Vancouver-Mt. Pleasant, since the Winter Olympics were announced for Vancouver-Whistler, more than 1,200 single room occupancy units have been lost. “This is housing that’s been lost to low-income populations and it’s had a direct impact on the increase in homelessness that we’ve seen since the games were awarded to Vancouver,” said Laura Track, a lawyer with Pivot Legal Society. Activist Am Johal added that a funded watchdog group was promised but not set up, as was a civil liberties round table that hasn’t come to fruition. “Many other cities and many other people are watching what happens in Vancouver and hoping this can continue to be an example for the rest of the world in terms of how you organize an Olympic games,” Mahon said. “So the idea is to say, ‘Let’s continue to make it better.’”
Olympic Village Tab Could Rise Even Further
According to 24Hours Bob M. There could be more bailouts on the way if the Vancouver Olympic Village struggles to the finish line. The August 31, 2006 lease agreement between the City of Vancouver and Millennium Southeast False Creek Properties, obtained by 24 Hours calls for substantial completion by September 30, 2009 and VANOC to begin exclusive use November 1, 2009. A clause gives the City of Vancouver the power to order Millennium to accelerate work, but the City of Vancouver would pay the bill for extra wages, materials and heavy equipment. The contract said Millennium Southeast False Creek properties would not be liable for unavoidable delays beyond its control, such as destruction of buildings by explosion, riots or earthquake. Inability to meet financial obligations is not considered an unavoidable delay. If Millennium commits materials default by failing to pay rent or not adhering to project milestones, the City of Vancouver could “re-enter and take possession of the lands and building,” according to the contract. City council approved a $100 million bailout loan for cash-strapped Millennium Southeast False Creek Properties in a secret October 14th meeting. Information was leaked to the Globe and Mail but all NPA, Vision Vancouver and COPE councillors have refused to talk about the meeting. NPA Counc. Peter Ladner, who is running for mayor, was unavailable for comment yesterday. Ladner fought back Friday at Vision Vancouver apponent Gregor Robertson by conceding he is “prepared to lose this election to save this project and protect the city’s taxpapers.”
Vancouver Olympic Village Housing Affordability Out The Window?
According to the latest February update on the 2010 Olympic Village fiasco surrounding affordable housing and recent attempts at refinancing the growing debt, the 24 Hours magazine examines what is actually going on. Written by Irwin for 24 Hours Vancouver. There was a rush to point fingers yesterday as city officials in Vancouver searched for answers to the latest financial conundrum facing the Vancouver 2010 Olympic Village real estate development along the waterfront of South East False Creek. Soaring costs have jeopardized plans to build 252 units of affordable housing at the Olympic Village Southeast False Creek, it was revealed this week, which was a huge part of the sustainability and legacy for the development of this master planned waterfront Vancouver community. “It’s Unfuriating to inherit yet another big problem,” said Vancouver Mayor Gregor Robertston. His Vision Vancouver party has sought to pin the blame on the former ruling party, the NPA, which oversaw the project for three years. But the Vancouver Olympic Village real estate development project and affordable housing part of it was started under a previous Vision/COPE government with more ambitious social housing targets in mind for the Olympic Village along southeast False Creek neighbourhood. “It would be wrong to point to any one decision,” said Suzanne, the lone NPA councillor at city hall. “There were a series of decisions made over eight years.” Now, Vancouver city faces finding up to $77 million more to keep future rents for the Vancouver Olympic Village project affordable, or reducing the level of affordable housing at the site. But given that the affordable housing was a key part of Vancouver’s bid book promises that won the city the 2010 Olympic Games, it appears the city is unlikely to go with the latter option. Robertson suggested the city might look at building out the Olympic Village affordable housing units away from the Olympic Village property itself. Affordable housing in the Southeast False Creek Olympic Village development is at risk now thanks to cost overruns.