Tuesday, November 11, 2008

Lo and behold: the $100M Olympic Village bail-out

In a secret meeting on October 14, Vancouver council voted unanimously to lend $100-million to Millennium Development, the private corporation building the $1.1-billion 2010 Olympic Village, for cost over-runs.
Vancouver's Director of Finance, Estelle Lo, who reportedly had concerns about the city's involvement in the Olympic athletes' village and who was stripped of her control over financing decisions related to the athletes' village in April, was not at the meeting.
Ms Lo reportedly resigned on Oct 29.
That's quite a lot of "reportedly"s and no word from the city.
Millenium is also leaking a $65-million cost overrun on its 176 unit Evelyn Drive project above Park Royal in West Van and in danger of default on a 170 room hotel contract in Nanaimo. h/t Bill Tieleman
One of Millenium's backers is private-equity and hedge-fund manager Fortress Investment Group.
G&M :
"Donald Trump is tied up in a legal fight over a Chicago skyscraper that is now worth less at completion than the total value of the loans it took to build it.
The shortfall is about $100-million. Interestingly, one of the lenders in this case is Fortress Investment Group, the primary lender in the athletes' village project."
Ross is on the details of this with a half a dozen posts.
Meanwhile, over in the UK :
"Government ministers have delayed a taxpayer bail-out for the £1bn athletes' village at the London 2012 Olympics until the beginning of next year at the earliest.
The scheme hit trouble when the developer Lend Lease could not raise finance and the possible resale value of the flats slumped. Also at the meeting was John Armitt, the Olympic Delivery Authority chairman, who has said taxpayers might have to bail out the entire £1bn cost."
So. Could it happen here?
Wednesday night update : G&M :
"Vancouver Mayor Sam Sullivan asked the police Wednesday to investigate the "theft" of documents from city hall that revealed that city council had authorized a loan of up to $100-million to the financially strapped developer of the 2010 Olympics athletes village."
Yeah, Sammy, coz that's the really important issue here.


Anonymous said...

How can there be a cost OVERRUN of $65 million on 176 units???? That's about $389,000 A UNIT!!!! Not the cost to BUILD them but the overrun?


Anonymous said...

Well, it is West Van after all.

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