Vancouver's troubled Olympic Village condominiums are getting a new name and lower prices in an attempt to spur sales and recoup at least part of the city's investment in the project.
A recovery plan was filed in B.C. court Thursday by Ernst and Young LLP, the receiver in charge of selling units at the development that will be called The Village on False Creek.
It started life during the 2010 Games as the Athletes' Village and had been renamed Millennium Water after it was handed over to the city in May 2010 by the Vancouver Olympic Organizing Committee.
The City of Vancouver sank $740 million into the development in early 2010 when the developers' New York financiers cut off funding in the midst of a real estate downturn.
Ernst and Young was brought in late in 2010 when it was clear that Millennium Water sales had stalled at a point where only about 30 per cent of the units had been purchased.
Of the remaining unsold units, 230 will go on sale Feb. 17 with prices reduced "substantially," the Ernst and Young plan said.
Unconfirmed reports put the price reductions at up to 50 per cent, with the average discount about 30 per cent.
Another 127 units will be turned into rentals, while the high-end homes with price tags in the millions of dollars will not be put up for sale until the market for luxury condos improves.
Profit highly unlikely
Profit is not expected and eventually breaking even on this project will equal success, said Vancouver Mayor Gregor Robertson.
"It's going to take several years' combination of sales and rental for taxpayers to … get the investment back and that will depend on the market," Robertson said.
But one critic — Vancouver architect and former city council candidate Michael Geller — predicts taxpayers will take a loss on the project.
"If I had to guess a number, [the loss is] in the order of $150 million dollars," Geller said. "That's at one simplistic level, just assuming there was an equivalent of 30-per-cent discount across the board on around $500 million of inventory."
Potential buyer Louis Guzy is looking to get back into the market after living outside Vancouver for the past 10 years and he smells a bargain.
"The thought of being able to buy something at 30 to 50 percent off is very appealing," said Guzy.
The receiver's plan is not such good news, however, for people who have already purchased.
Isabello Sarmiento's family will watch new neighbours move in who will have paid a lot less than they did.
"[My family] probably feel a bit robbed or a bit cheated," Sarmiento said. "Usually, as the years go on, the prices go up."