Category: Kamloops Real Estate News

This article appeared in the Kamloops Daily News on April 21st, 2011 and was written by Cam Fortems.

A meeting is set for next week for creditors to approve a deal to resume construction of the incomplete Mission Hill project so it can be marketed and sold this spring.

The creditors meeting April 26 is part of a restructuring of more than $100 million in real estate debt by Kamloops developer Mike Rink.

Christopher Ramsay, the Vancouver lawyer representing Rink’s New Future Group of companies under the Companies’ Creditors Arrangement Act (CCAA) proceeding, said the vote will allow mortgage holders and contractors owed millions to determine the project’s future.

A project evaluation done late last year said even if the first two phases of Mission Hill, a condominium project off Summit Drive, are completed and sold, there is only enough equity to pay the first mortgage from Harbour Capital.

Despite the grim financial prognosis, creditors are being asked to OK new financing to finish the project in hopes it will be more profitable and they will receive some proceeds.

Under the proposal, Harbour receives all proceeds until its $21-million loan is repaid. Other financing and legal costs will be added.

Under the proposal to be voted on, second mortgage holders and contractors owed another $15 million will be given promissory notes that may be redeemed if units are ultimately sold for more than the estimated value.

“The current market value appraisal and the Monitor’s description of costs to complete suggest that there will be no realization for creditors beyond Harbour,” states a report from an accounting firm presented to the B.C. Supreme Court this week.

Despite that forecast, Rink’s lawyer said approval is the most practical measure.

“At the end of the day it’s better to approve an agreement where creditors get something (promissory note) rather than going into bankruptcy, where they get nothing.”

In order for the plan to be approved, a majority of creditors in each class, representing two-thirds of the value, must vote in favour. If it fails, Rink can go back to court to ask for the court to OK it instead.

Ramsay said if the deal is approved, construction will resume quickly with marketing and sales this spring or summer.

City of Kamloops chief building inspector Kundun Bubbar said Rink must show he has financing, along with a project time to complete construction, before construction can resume.

Rink’s companies sought protection from creditors late in 2010. Since then, lawyers and financiers have manoeuvered to refinance, complete construction and avoid bankruptcy on each of seven troubled projects.

A restructuring at one Shuswap project owned by Rink, Carmel Cove, has already been approved. Special financing has also been arranged to complete a condominium project in Kelowna as well as the West Beach RV park in the North Shuswap. Those will come next for creditor restructuring approval.

Ramsay said creditors are being asked to approve restructuring separately in each of the seven projects. If all are successful, Rink and his companies will avoid bankruptcy.

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This article came from the Kamloops Daily News and was written by Michelle Young on April 8th, 2011.

Steady. If there was one word that described both home construction and real estate sales in Kamloops, it’s steady.

City construction figures for March show permits were issued that month for 17 houses and 38 apartment style multi-family units, as well as two secondary suites and two single multi-family units.

That brings the year-to-date total to 84 housing units, matching the number from March of 2010. The difference is, last year’s housing included more single-family and less multi-family.

Kamloops and District Real Estate Association president Brian Ledoux said Friday the numbers reflect what he’s seeing and hearing about in the buying and selling market.

For sale signs are sprouting like tulips and daffodils (and this year, federal election signs) around town as homeowners come out of hibernation and turn their thoughts to upgrading or moving, he said.

Some of them are relisting after taking their houses off the market for the winter. “Right now, we’re tipping on more listings than sales, so it’s a slight buyer’s market,” he said.

Real estate agents are seeing the median price of house sales rise slightly, which indicates that more high-end homes are selling.

He recently had a client who moved here from Vancouver after selling in the hot market down there.

But there are still lots of first-time buyers shopping, too.

Ledoux said the economists that his association consults are predicting exactly what appears to be happening.

“It’ll be pretty steady for the next few years,” he said.

On the commercial construction side, the City’s permit numbers show there is still some lagging behind last year’s pace.

The first three months of this year saw $16.1 million spent on commercial and industrial projects, compared with $19.2 million in the same period in 2010.

Paul Fabri, market analyst with Canada Mortgage and Housing Corp., predicted detached housing construction will pick up later this year.

The best word to describe the forecast for 2011 in the Thompson Okanagan is “stable,” he said. “I expect a strong market in Kamloops.”

That strong market has led him to anticipate 550 housing units being built in town this year. So far, the City has issued permits for 84.

More severe winter conditions than usual have slowed construction in the region, he noted.

City building inspector Kundan Bubbar said at this point, multi family housing is up because of affordability.

A few large multi-family projects are expected to start later this year, including a commercial and 38-unit residential project by Mike Culos at Summit and McGill, and 38 apartments on Harrison Way in Aberdeen.

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This article came from Venture Kamloops on April 12, 2011.

Kamloops, BC – Kamloops, British Columbia has received a prestigious recognition from Foreign Direct Investment Magazine. The first ever Americas Cities of the Future 2010/11 competition which publishes a ranking of the economic business and financial strengths of cities across the American Continent (both North and South) has recognized Kamloops as 9th overall in their Micro Cities Category, 2nd for its Foreign Direct Investment Strategy and 5th for its Cost Competitiveness in their Micro Cities categories. Micro cities have a population of less than 100,000.

Foreign Direct Investment Magazine – Americas Cities of the Future 2010/11 shortlists were created by independent data collected by fDi Intelligence division across 405 cities across North and South America. Six categories were evaluated: Economic Potential, Human Resources, Cost Effectiveness, Quality of Life, Infrastructure and Business Friendliness. A seventh category was added to the scoring – FDI promotion strategy. In this category, 100 cities submitted details about their promotion strategy and this was judged and scored by our independent judging panel.

“This recognition of Kamloops’ efforts is well deserved. Our growth in infrastructure and business opportunities, our ideal location as a transportation hub as well as our superior quality of life amenities all contribute to Kamloops being a great place to invest. Having such a prestigious ranking will only enhance our efforts to attract international investment into our community,” said Dan Sulz, Executive Director Venture Kamloops.

A more detailed list of the winners and categories can be found in this month’s Foreign Direct Investment Magazine – April 2011 or on their website at www.fdiintelligence.com.

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Have you been wondering about the status of the Mission Hill development on Summit Drive and West Victoria Street? Here is an article published by the Kamloops Daily News. It was written by Cam Fortems on March 11th, 2011.

Kamloops developer Mike Rink has a July deadline to come up with millions in new financing to complete Mission Hill or the project will fall into the lender’s hands.

But that lender, Harbour Mortgage, may loan the money itself — keeping Rink out of bankruptcy and in control of his debt-ridden real estate empire.

The information is contained in court documents as part of a Companies Creditors Arrangement Act process. Rink’s New Future Group of companies was granted protection from creditors last year in a bid to restructure more than $100 million worth of debt.

An independent analysis found only two projects, Westbeach in the Shuswap and another resort project in Nelson, have prospects for making a profit. The others, including Mission Hill, will not be able to pay back all creditors even if they are completed.

Rink, as well as his lawyer, Chris Ramsay, could not be reached for comment Friday.

David McMillan, a city lawyer acting for contractors on another Rink project, said a creditors meeting is scheduled for March 16. A vote on the plan is structured so major lenders have weight. “This says to lien claimants we’re holding out the remote possibility of you getting paid versus certainty you won’t get paid —  you pick.”

If the plan proceeds, Rink will get more financing to complete at least Mission Hill’s first building, now about 75 per cent complete. Liens will be cancelled and promissory notes that expire in three years will be issued. If there is money from real estate sales after all lenders are paid, promissory notes will then be honoured. “This allows the principals to carry on without the stigma of bankruptcy,” said McMillan. “If these proposals are passed it will allow people like Mike Rink to stave off bankruptcy.”

One of those contractors, Barb Gorrill, owner of Falcann Septic, said she doesn’t know if the company will ever receive the $7,000 owed to it. Rink owes more than $2.5 million alone to small contractors, who are unsecured and will be paid last, if at all. “We’ve done work for Mike before,” she said. “We knew going in the risk. (But) we’ve always gotten paid.” Gorrill said the loss hurts the small business but she said Rink, like any developer, had to take on risk. “Without guys willing to take risk, how would these developments ever get done?”

If financing is in place the Mission Hill building should be back under construction this summer. “It all depends if your view of the world is optimistic or not,” McMillan said of prospects that lenders and contractors will be paid. “For people who put time and labour and materials into it, they’re powerless to affect the outcome.”

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