All City’s borrowed funds repaid after City’s interest in Olympic Village sold; Debt paid off
The City of Vancouver has officially paid down the entire $630 million debt of the Olympic Village development, as well as recovered an additional $70 million.
Working with the Receiver, Ernst & Young, the City has sold its remaining interest in the last 67 condominium units in the Olympic Village development to the Vancouver-based Aquilini Group (AG) for $91M. This ends the City’s involvement in the Olympic Village project.
“This is a good deal for taxpayers, and pays down the Olympic Village debt that many thought would not happen,” said Vancouver Mayor Gregor Robertson. “As Mayor, I’ve been determined to ensure that taxpayers would not be left on the hook for a single cent. I am proud to say we have achieved that goal, and have done so in a way that has created a thriving waterfront neighbourhood.
“It took a lot of work to get to this point, but it’s great news for Vancouver taxpayers that we’ve paid off the Olympic Village debt and recovered an additional $70 million to go towards community amenities and public infrastructure. We are now officially done with our involvement in the project.”
“The City has shown sound business-like leadership that has made the Olympic Village project an attractive investment and we’re pleased to be investing in such a great neighbourhood,” said Francesco Aquilini, Managing Director of Aquilini Group. “Mayor Robertson and Vancouver City Council have helped finance a vibrant community that is now one of the most popular places to live in Vancouver. The Aquilini Group is pleased we can be part of this neighbourhood.”
The current success of the Village was made possible by the combined efforts of:
- The Receiver, Ernst & Young, who took over the strategic sale and management of the Village in November 2010, including the leasing and occupancy strategy for the Village’s commercial space; and
- Rennie Marketing Systems, who successfully marketed and sold the 737 market condominium units.
The work of Ernst & Young and Rennie Marketing Systems led to the complete 100% occupancy of commercial space in the Village, and 94% occupancy of the residential condominium units.
“The City has worked hard to ensure all the debt from the Olympic Village development was fully paid back and that taxpayers are protected,” said Kevin Brennan, Senior Vice President, Ernst & Young. “The final resolution of this file for the City is a significant achievement, given the extent of the financial risk facing the City in 2009, with the obligation to complete the Athlete’s Village for the 2010 Winter Games.”
Since February 2009, when the City took over the loan from Fortress Credit Corp, a number of steps were taken to ensure taxpayers were protected and that all efforts were made to recover costs. These included:
- obtaining very low interest rates for the City’s borrowed funds used to finance the Village;
- the successful sale by the Receiver of the market rental buildings and the commercial strata space; and
- the recovery and successful sale of 32 properties as part of the settlement of the financial guarantees provided by the Millennium Development Group on the City’s loan.
The Village, which is North America’s first LEED Platinum community, was designed, developed and constructed by the Millennium Development Group led by Peter and Sharam Malek. The project was achieved in a record 30 months from commencement of construction to the opening of the 2010 Olympic Winter Games.
Situated on a former industrial site, it has been a catalyst for the revitalization of the surrounding neighbourhood and has recently been awarded the 2013 Urban Land Institute award for urban open spaces.