The latestJust thought I'd share the lates "Jurock" letter with you.
Foreclosure Action Shows Ski And Golf Resorts Not Immune
Two high profile foreclosures in the eastern Fraser Valley show that, despite the buoyant real estate market, even apparently solid investments are vulnerable. The latest is Blackburn Developments Ltd., the owner and developer of the lands called The Falls Golf and Country Club in Chilliwack, British Columbia. In a foreclosure action this month, Concentra Trust is seeking from Blackburn the re-payment of a loan in the amount of $1,732,074.64, plus interest at a rate of $591.66 per day. The foreclosure action discloses that there are more than 75 additional mortgage interests registered against the property. The foreclosure action involves the Falls Golf and Country Club and the leasehold interest held by Blackburn Developments Ltd. in the property at Nixon Road. A Limited Partnership, that is not named or directly involved in the foreclosure action against Blackburn Developments! Ltd., has an agreement that Blackburn would deliver 58 single-family lots, 230 multi family lots and 70 town home lots around The Falls, all the subject of contractual agreements. The foreclosure action could impact 10-year golf playing privileges that were to be included along with all lots at both The Falls site and the Nixon Road property, and it could lead to the termination of the clubhouse lease which generates revenue for the Limited Partnership. (The Limited Partnership is composed of DiGiT Development Inc. and general partner of HLD Land Development Limited Partnership, owned by Home Equity.)
Chilliwack real estate observers asked to comment on the action shared a common refrain: "Good time for it to happen, because now someone will step in and do it right." The Falls, after all, is a very nice golf course and is in the centre of one of the fastest growing areas in the province. But location and potential are not automatic success formulas in the eastern Valley. Four months ago, the Hemlock Valley Resorts Inc., owner and operator of the Hemlock Valley Ski Resort near Chilliwack, went into receivership, in a petition from the Business Development Bank of Canada and the B.C. Ministry of Tourism, Sports and the Arts. The Ski Resort did not open for this season and may not open again unless a backer is found. The resort's owner, Joe Peters, failed to make improvements he had agreed to make when he signed a 50-year lease in 2003 with the province. He stalled the province until mid-December of 2005, saying he had potential buyers in the wing! s. Peters had been shopping the resort for $7 million last year, but despite expressions of interest, no buyer ever stepped forward. The bankruptcy agent is David MacDonald of MacKay & Co. Ltd., 604-689-3928. The big losers right now are those who have bought recreational homes at Hemlock Valley and were counting on using them for ski vacations or renting them out during the ski season. Lots at the resort were selling for an average of $113,000 as late as last summer. For current real estate price information, contact HomeLife (Hemlock Valley) realtor Stewart Green (604-797-4444).
Major Point: Always look past the hype to the fundamentals of any resort property.
|