Price cuts coming for remaining Olympic Village condos

Buyers of 452 empty condos at the $1-billion Olympic Village will be offered a bundle of goodies in a bid to get sales moving.

But Vancouver Coun. Geoff Meggs warned Thursday that simply reducing prices won’t be enough, unless the developer can prove it can repay the $730 million the city is still owed.

If the council gives the incentive plan the go-ahead, it could include price adjustments and an HST holiday, as well as forgiving two years of property taxes and maintenance fees, said condo marketer Bob Rennie.

The taxes and maintenance fees alone could mean about $140,000 in savings on a $1-million condo.

Under the original sales plan, condo prices ranged from $400,000 to $5 million but only about one-third of the 737 units have sold.

Rennie planned to relaunch the condo sales in September but says he’ll likely announce the incentives in about three weeks and relaunch sales around Nov. 13.

Asked if prices will be reduced, Rennie said they will be “adjusted with sensitivity.”

“We have a huge problem with the Olympic Village that it’s not for speculators, it’s for a community of homeowners,” he said. “I’ve lost that buyer who says, ‘I’ll buy it today and over the next two or three years I’ll figure out whether I’m a passive investor or whether mom lives in it or whether we live in it and sell our house.’ ”

He said people should remember that the condos will always be sitting on the edge of False Creek.

“It’s not milk,” he added. “It doesn’t expire.”

Rennie said the condo prices are part of the loan agreement with the city and both sides have to sign off on any changes.

Shahram Malek of Millennium Development Corp. said Thursday his company is working with the city on a plan to ensure that the next payment of $75 million will be met in January.

“We have an incentive program we are working on, which will ensure that we will meet that payment,” he said. “We are very confident because we have many people who want to buy and are waiting for this program to be announced.”

The city has warned Millennium it must make its scheduled loan payments, after the developer struggled to pay a $200-million instalment in August.

Millennium only scraped together $192 million, plus another $5 million, by Sept. 20.

“Our primary goal is to give the buyer confidence that the HST can be dealt with on this project,” added Malek.

He said Millennium is hoping for “a large degree of co-operation” from the city “to ensure the taxpayer’s investment is paid.”

He said he and his brother Peter Malek hope they don’t lose money on the project “because we have put several years of our lives and resources and passion and pride into this and we hope it will be a win-win for everyone.”

He said Rennie has plans “to create momentum” on sales.

But Meggs cautioned a simple marketing plan won’t be enough to satisfy the city.

“The fundamental question is: If they reduce prices, will they be able to pay the loan?” he said. “If there appears to be a gap there, then they have to add in security to make it up.”

He said council isn’t trying to force a confrontation but is insisting that Millennium produce a plan that covers the taxpayer for the entire amount of the loan.

Meggs said city staff are working with Millennium and will present a report to council which includes both marketing and a security strategy to protect taxpayers.

dinwood@theprovince.com