Massive condo development in Surrey seeks refinancing
The developer of a $350-million residential/retail complex in Surrey, B.C., has filed for protection from creditors and is seeking major refinancing.
The Infinity, developed by Jung Developments Inc., is the largest real estate project in the city's history, comprising five towers with 1,400 units.
The law firm representing the South Korean developer Hee Yong Yang said on Wednesday its client applied for financial protection under the Companies' Creditors Arrangement Act and was granted interim relief from its creditors.
"We want to first tell the 560 pre-sale buyers that their deposits are safe and that we are confident we will arrive at new financial partnership that will ensure this project is completed on time and on budget and that the buyers get the units they purchased," Robert Millar, a partner at Fasken Martineau DuMoulin LLP, said in a news release.
"There are currently no cost overruns on the project, and there is a quality builder on site," he added.
The first of the five 36-storey towers was completed and occupied. Two towers are under construction, and the final two have zoning approval in place but have not come to the market.
Cameron McNeill of MAC Marketing Solutions Inc., which handled the pre-sales and marketing of the central Surrey project, said another $100 million is required to complete the whole development.
"What the developer has done is taken the necessary steps to try to see the project move forward by replacing Lehman Brothers with a new developer," said McNeill, president and CEO of MAC.
"It's a high degree of certainty that the project is going to be moving forward," he told CBC News Wednesday.
The whole project will likely take another year to complete, McNeill said.
PriceWaterhouseCoopers is now responsible for attracting new developers to finance the project, Millar said.
Three Vancouver development companies, whose names are not disclosed, have been identified and already expressed interest in the venture, he said.
"Project sales for the towers under construction are expected to yield $170 million, including the pre-sale agreements with the cost to complete the construction estimated to be less than $100 million," Millar said.
With files from Kirk Williams