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View Full Version : 12 Hamilton Ave | 17m | 5fl | U/C


rocketphish
Apr 7, 2017, 3:01 AM
Surface Developments has submitted a Site Plan application to construct a five storey apartment building containing 25 dwelling units. The site is located on the west side of Hamilton Avenue, north of Wellington Street West, south of Armstrong Street and directly across from the Parkdale Park and Market within the Hintonburg community.

The proposed five storey apartment building is 17.2 metres in height and consists of 25 dwelling units comprising one to two bedroom units. A total of 233 square metres of amenity area is proposed, consisting of a 96.7 square metre rooftop patio as well as rear yard terraces and balconies. No vehicle resident or visitor parking is proposed, however, there are 13 interior bicycle parking spaces proposed.

Project site:
http://www.surfacecondos.com/parkdale-market

Development application:
http://app01.ottawa.ca/postingplans/appDetails.jsf?lang=en&appId=__0ECSBT

Streetview:
https://www.google.ca/maps/@45.4012301,-75.7305115,3a,65.3y,279.37h,89.16t/data=!3m6!1e1!3m4!1sCOMZTh2JgfSUVxFm1tq89A!2e0!7i13312!8i6656


Rendering:

https://c1.staticflickr.com/3/2933/33756170141_e9277945c7_o.jpg


Siteplan:

https://c1.staticflickr.com/3/2851/33041817654_3feabd2ea3_o.jpg


Floorplan:

https://c1.staticflickr.com/3/2871/33041817494_3d66a999d2_o.jpg

Paige
Aug 1, 2018, 12:43 AM
Progress update: the foundation on this seems to be complete to ground level.

MattRichling
Nov 29, 2019, 4:58 PM
If you or a friend has purchased a unit in this building and would like to chat about your current options and how to proceed, please feel free to reach out. I understand that this is a difficult decision to make and want to make sure you are aware of the possible outcomes and how it impacts your deposit and upgrades monies.

Multi-modal
Nov 29, 2019, 5:20 PM
If you or a friend has purchased a unit in this building and would like to chat about your current options and how to proceed, please feel free to reach out. I understand that this is a difficult decision to make and want to make sure you are aware of the possible outcomes and how it impacts your deposit and upgrades monies.

What happened?

waterloowarrior
Nov 30, 2019, 3:47 AM
revised render
https://surfacecondos.com/wp-content/uploads/2018/08/Surface_developments_Parkdale_Market_Lofts_Condos_Hintonburg_front_view-1920px-1.jpg

Pic I took a couple of weeks ago, forgot to post

https://live.staticflickr.com/65535/49144205383_6dd0700675_b.jpg

https://live.staticflickr.com/65535/49144204128_e25da91423_b.jpg

kwoldtimer
Nov 30, 2019, 2:55 PM
Has construction stopped? :shrug:

MattRichling
Dec 16, 2019, 10:33 PM
This was just sent out to those who purchased. Lots of current rumours going around. Note: if you purchased, please get in touch with me.

Good afternoon ***,

It is with deep regret that we are emailing you today to advise that the delivery of your condo is no longer going to be possible.  We have run out of funds to continue the building as our lending partner is no longer willing to continue financing the condominium project and we have not been able to find alternate sources of funding.  At this time, we have no choice but to cancel the remaining agreements at the Parkdale Market Lofts. I hope you understand that this is not a decision that was taken lightly and that extensive review of options was undertaken, with no viable way for the building to be completed and delivered to you.

We ask that you contact us at info@surfacedevelopments.com as soon as possible to arrange for the completion of the paperwork required to release all of your deposits back to you as quickly as possible.

A formal written notice will follow in due course.


Sincerely,
Dan Nixon

J.OT13
Dec 16, 2019, 11:45 PM
Have all their projects been halted?

kwoldtimer
Dec 16, 2019, 11:52 PM
This was just sent out to those who purchased. Lots of current rumours going around. Note: if you purchased, please get in touch with me.

Good afternoon ***,

It is with deep regret that we are emailing you today to advise that the delivery of your condo is no longer going to be possible.  We have run out of funds to continue the building as our lending partner is no longer willing to continue financing the condominium project and we have not been able to find alternate sources of funding.  At this time, we have no choice but to cancel the remaining agreements at the Parkdale Market Lofts. I hope you understand that this is not a decision that was taken lightly and that extensive review of options was undertaken, with no viable way for the building to be completed and delivered to you.

We ask that you contact us at info@surfacedevelopments.com as soon as possible to arrange for the completion of the paperwork required to release all of your deposits back to you as quickly as possible.

A formal written notice will follow in due course.


Sincerely,
Dan Nixon

So now somebody gets to finish the apartments and sell them at much higher prices? :shrug:

Urbanarchit
Dec 17, 2019, 2:47 AM
Oof, not such great news. What does this mean for their Westboro Lofts project which is a much larger building than this?

Wilsky25
Dec 17, 2019, 3:52 AM
Oof, not such great news. What does this mean for their Westboro Lofts project which is a much larger building than this?

Just got off the phone with Surface - they say this will not affect Wellington Lofts, and can assume the same for Westboro Lofts

Wilsky25
Dec 17, 2019, 3:53 AM
What does this mean for the developer - Surface? Do they sell the building as is to another developer? Do they transition it to a rental? How does this affect their upcoming projects like Wellington Lofts and Westboro Lofts?

Any information would be greatly appreciated.

MattRichling
Dec 17, 2019, 11:46 AM
I usually don’t get into rumours on here but I really hate what is going on. It sounds like from everything we have heard, Surface is changing the building to rentals. This looks like it was the intent for a number of weeks or even months if not longer, based on the information that people have been telling me. I haven’t seen any evidence myself but have heard this from numerous sources.

If you purchased in this building, there are a group of owners who are trying to assemble. Please get in touch so that I can connect you.

Wilsky25
Dec 17, 2019, 12:30 PM
I usually don’t get into rumours on here but I really hate what is going on. It sounds like from everything we have heard, Surface is changing the building to rentals. This looks like it was the intent for a number of weeks or even months if not longer, based on the information that people have been telling me. I haven’t seen any evidence myself but have heard this from numerous sources.

If you purchased in this building, there are a group of owners who are trying to assemble. Please get in touch so that I can connect you.

Interesting. Also seems they converted their Westboro Lofts on 1946 Scott to apartments in October even though that building was stated as 90% sold.

rocketphish
Dec 17, 2019, 12:46 PM
Just got off the phone with Surface - they say this will not affect Wellington Lofts, and can assume the same for Westboro Lofts

Welcome to the forum :cheers: Did you purchase in one of the Surface buildings?

Wilsky25
Dec 17, 2019, 2:32 PM
Welcome to the forum :cheers: Did you purchase in one of the Surface buildings?

Yes, I purchased a unit in 16-20 Hamilton ie Wellington West Lofts.

This is a great forum, definitely went down a rabbit hole on some of the other buildings I know around the city like Icon, SOBA and Gotham.

As I'm sure you can understand, having the developer of the condo you purchased convert two of their recent projects from condos to rentals is deeply concerning. I spoke with a representative from Surface yesterday, but obviously they will verbally smooth everything over rather than divulging any significant details.

Jim613
Dec 17, 2019, 4:23 PM
How does this happen? Even on their own website, they claim all units sold out in one day


Press release: Ottawa condo project sells out in one day

OTTAWA, ON: Surface Developments defies all odds in a stagnant condo market and sells out their Parkdale Market Lofts project in less than a day.



https://surfacecondos.com/blog/parkdale-market-lofts-sells-out-in-one-day/

Richard Eade
Dec 17, 2019, 5:41 PM
Gosh, I wonder if this sudden switch by builders to want rental buildings instead of condominiums has anything to do with Ontario’s Rent Controls not being applied to buildings built after Nov. 15, 2018? Or is it just a normal pendulum swing after builders were concentrating so hard on Condominiums that they feel like that market is saturated?

waterloowarrior
Dec 17, 2019, 5:48 PM
How does this happen? Even on their own website, they claim all units sold out in one day

Selling out in one day = priced too low!

Wilsky25
Dec 17, 2019, 9:06 PM
How does this happen? Even on their own website, they claim all units sold out in one day

What they told me is that basically the units were sold in 2016, then there was a delay with one contractor, because that was delayed the other contractors took it as a sign to work elsewhere.

Once this was all cleaned up, the contractors came back in 2018 asking 2018 prices, which according to multiple sources were 30-40% higher than when the units were sold.

So the developer, and i am not giving them a break here but, is in a situation where they sold the building at 2016 prices, construction cost went up significantly due to delays (not sure if on behalf of the developer or the trades) and then are faced with 2018 building costs.

Wilsky25
Dec 17, 2019, 9:09 PM
Gosh, I wonder if this sudden switch by builders to want rental buildings instead of condominiums has anything to do with Ontario’s Rent Controls not being applied to buildings built after Nov. 15, 2018? Or is it just a normal pendulum swing after builders were concentrating so hard on Condominiums that they feel like that market is saturated?

It happened with Nuovo, is currently happening here. I believe because rents are so high, they can make more money renting vs selling the condo. Especially because rents can be raised over time whereas a sale price remains the same.

A $350,000 unit over 25 years pays out $1170 to the developer per month. That same one bedroom rents for around 1700 at today's prices.

J.OT13
Dec 17, 2019, 9:15 PM
What they told me is that basically the units were sold in 2016, then there was a delay with one contractor, because that was delayed the other contractors took it as a sign to work elsewhere.

Once this was all cleaned up, the contractors came back in 2018 asking 2018 prices, which according to multiple sources were 30-40% higher than when the units were sold.

So the developer, and i am not giving them a break here but, is in a situation where they sold the building at 2016 prices, construction cost went up significantly due to delays (not sure if on behalf of the developer or the trades) and then are faced with 2018 building costs.

I guess I could understand that. As long as everyone gets their full deposit back, though this would still have an impact on the public's perception of the developer.


It happened with Nuovo, is currently happening here. I believe because rents are so high, they can make more money renting vs selling the condo. Especially because rents can be raised over time whereas a sale price remains the same.

A $350,000 unit over 25 years pays out $1170 to the developer per month. That same one bedroom rents for around 1700 at today's prices.

Same happened with SoBa, SoHo Italia (now u/c after nearly a decade) and that new one on Bronson. Many others I'm sure.

Once the entire building is sold, the developer takes the money and walks away, no? The condo board is then responsible for the maintenance. As rentals, the developer will be responsible for maintenance in perpetuity or until they sell to another property management company.

c_speed3108
Dec 17, 2019, 9:29 PM
I guess I could understand that. As long as everyone gets their full deposit back, though this would still have an impact on the public's perception of the developer.




Same happened with SoBa, SoHo Italia (now u/c after nearly a decade) and that new one on Bronson. Many others I'm sure.

Once the entire building is sold, the developer takes the money and walks away, no? The condo board is then responsible for the maintenance. As rentals, the developer will be responsible for maintenance in perpetuity or until they sell to another property management company.

They can also work to get the building mostly rented and then flip to someone else to take care of over the long term. Groupe Lépine seems to work that way with the various rentals they built around town. I imagine a rented building is worth a bit more than an empty one.

phil235
Dec 17, 2019, 9:35 PM
Same happened with SoBa, SoHo Italia (now u/c after nearly a decade) and that new one on Bronson. Many others I'm sure.


I didn't realize that SoBa was rentals. When did that happen?

J.OT13
Dec 17, 2019, 9:40 PM
I didn't realize that SoBa was rentals. When did that happen?

Just before construction started. I might be wrong.

c_speed3108
Dec 17, 2019, 10:48 PM
Just before construction started. I might be wrong.

Based on geoOttawa, no condo corp has been registered, at least so far. They might still be working on it.

Jayday23
Dec 18, 2019, 12:43 AM
Just before construction started. I might be wrong.

can confirm that soba is NOT rentals. Many units for sale on MLS.

Wilsky25
Dec 18, 2019, 1:07 AM
Just before construction started. I might be wrong.

Soba is not rentals it is regular units.

And that is what I am worried about as a purchaser in the upcoming Surface project, that if they flipped their previous 2 units to rentals, what says they aren't going to do the same to mine come next year?

waterloowarrior
Dec 18, 2019, 1:24 AM
What they told me is that basically the units were sold in 2016, then there was a delay with one contractor, because that was delayed the other contractors took it as a sign to work elsewhere.

Once this was all cleaned up, the contractors came back in 2018 asking 2018 prices, which according to multiple sources were 30-40% higher than when the units were sold.

So the developer, and i am not giving them a break here but, is in a situation where they sold the building at 2016 prices, construction cost went up significantly due to delays (not sure if on behalf of the developer or the trades) and then are faced with 2018 building costs.

I thought it was a little closer than that

Sold out in one day April 5, 2017
https://surfacecondos.com/blog/parkdale-market-lofts-sells-out-in-one-day/

Building permit issued April 13, 2018
https://open.ottawa.ca/datasets/construction-demolition-and-pool-enclosure-permits-monthly-2018

c_speed3108
Dec 18, 2019, 2:48 AM
can confirm that soba is NOT rentals. Many units for sale on MLS.

I guess they just have not gotten through the legal paperwork to actually get the condo declared yet.

Aren't "phantom mortgages" a joy!?! :uhh:

Wilsky25
Dec 18, 2019, 11:59 PM
I thought it was a little closer than that

Sold out in one day April 5, 2017
https://surfacecondos.com/blog/parkdale-market-lofts-sells-out-in-one-day/

Building permit issued April 13, 2018
https://open.ottawa.ca/datasets/construction-demolition-and-pool-enclosure-permits-monthly-2018

You are right I was only estimating dates

Jaguarmeister
Jan 17, 2020, 2:27 AM
Hello all,

Joined to contribute to this thread.

I purchased a unit here and have confirmation that they turned it into rentals to secure funding to keep the project alive. They claimed we have no claim to our unit as "they do not exist" and there are no financial settlements offered.

Frankly, I'm surprised media haven't picked this up.

Over 2 years of delays and no financial gain... what a first-time buyer experience this has been.

Parkdale and Westboro were cancelled on similar terms.

Hard to believe a building that's near 80% done has gotten this bad.

rocketphish
Jan 17, 2020, 2:31 AM
Hello all,

Joined to contribute to this thread.

I purchased a unit here and have confirmation that they turned it into rentals to secure funding to keep the project alive. They claimed we have no claim to our unit as "they do not exist" and there are no financial settlements offered.

Frankly, I'm surprised media haven't picked this up.

Over 2 years of delays and no financial gain... what a first-time buyer experience this has been.

Parkdale and Westboro were cancelled on similar terms.

Hard to believe a building that's near 80% done has gotten this bad.

Thank you for the update. And welcome to the forum! :cheers:

Skynet
Jan 23, 2020, 4:39 PM
Hello all,

Joined to contribute to this thread.

I purchased a unit here and have confirmation that they turned it into rentals to secure funding to keep the project alive. They claimed we have no claim to our unit as "they do not exist" and there are no financial settlements offered.

Frankly, I'm surprised media haven't picked this up.

Over 2 years of delays and no financial gain... what a first-time buyer experience this has been.

Parkdale and Westboro were cancelled on similar terms.

Hard to believe a building that's near 80% done has gotten this bad.

Sorry to hear about that. Hope you've been able to get in touch with Surface to sort things out.

MattRichling
Feb 5, 2020, 9:17 PM
"The Foundry, an inspired collection of 30 boutique luxury rental apartments in Hintonburg. Only a few meters from Wellington yet uniquely situated on a quiet street facing Parkdale Park, the Foundry is Ottawa's most enviable address.

Now renting — occupancy starting April 1st, 2020. Contact us for more information on living at The Foundry."

https://static1.squarespace.com/static/534c8a1fe4b0259491342174/t/5e3b31370076e8516838f86e/1580937537222/Screen+Shot+2020-02-05+at+4.18.01+PM.png?format=500w

Urbanarchit
Feb 5, 2020, 11:52 PM
"The Foundry, an inspired collection of 30 boutique luxury rental apartments in Hintonburg. Only a few meters from Wellington yet uniquely situated on a quiet street facing Parkdale Park, the Foundry is Ottawa's most enviable address.

Now renting — occupancy starting April 1st, 2020. Contact us for more information on living at The Foundry."

https://static1.squarespace.com/static/534c8a1fe4b0259491342174/t/5e3b31370076e8516838f86e/1580937537222/Screen+Shot+2020-02-05+at+4.18.01+PM.png?format=500w

Ottawa doesn't need anymore "luxury" apartments or condos, we need regular, affordable ones badly. There's never anything that is actually luxurious whenever they claim it's luxury - it's just a way to overcharge people.

Wilsky25
Apr 7, 2020, 1:16 AM
Hello all,

Joined to contribute to this thread.

I purchased a unit here and have confirmation that they turned it into rentals to secure funding to keep the project alive. They claimed we have no claim to our unit as "they do not exist" and there are no financial settlements offered.

Frankly, I'm surprised media haven't picked this up.

Over 2 years of delays and no financial gain... what a first-time buyer experience this has been.

Parkdale and Westboro were cancelled on similar terms.

Hard to believe a building that's near 80% done has gotten this bad.

What has your experience been like dealing with Surface since the news?

waterloowarrior
May 31, 2020, 8:18 PM
https://live.staticflickr.com/65535/49957165671_9aff5bb11b_b.jpg

Still needs landscaping and the facade

https://liveatfoundry.ca/

Urbanarchit
May 31, 2020, 8:42 PM
https://live.staticflickr.com/65535/49957165671_9aff5bb11b_b.jpg

Still needs landscaping and the facade

https://liveatfoundry.ca/

So the built structure is 6 floors instead of 5, doing away with the roof terrace. Also, they didn't use brick in this. I find this bait-and-switch to be kind of a bummer. I'm hoping the shrubbery will be tall enough to hide those ugly pipes.

Original rendering: https://c1.staticflickr.com/3/2933/33756170141_e9277945c7_o.jpg

CityTech
May 31, 2020, 8:52 PM
Ottawa doesn't need anymore "luxury" apartments or condos, we need regular, affordable ones badly. There's never anything that is actually luxurious whenever they claim it's luxury - it's just a way to overcharge people.

The word "luxury", in real estate, just means "new". It means nothing else. Conventional affordable housing will be called "luxury" if it's new.

Urbanarchit
May 31, 2020, 9:31 PM
The word "luxury", in real estate, just means "new". It means nothing else. Conventional affordable housing will be called "luxury" if it's new.

That is not true. "Luxury" does not mean "new" even in marketing. "Luxury" means "high-quality, finest, rich, opulence", and to consumers looking into buying or renting housing that is what it means. Developers and marketers use that term in their marketing to convince and mislead people into thinking that what they're presenting to clients are high quality condos, apartments, homes to justify their high prices for such tiny and awkward units. There are tonnes of other synonyms of "new" that they could be using, but "new". In fact, I would say that I associate luxury with older, prettier furnishings while new stuff are not as well-made or may be cheap. This is luxury (https://images.metadata.sky.com/pd-image/8599caae-71fe-4a5d-b6ac-f80c9217e490/16-9/900); this is regular (https://i.cbc.ca/1.3586298.1463511350!/fileImage/httpImage/image.PNG_gen/derivatives/16x9_780/decade-group-artist-rendering.PNG).

Wilsky25
Jun 2, 2020, 1:32 AM
Renters are in. Would love to hear from any renters on their opinion and experience with the building.

rocketphish
Jul 27, 2020, 2:50 AM
Broken dreams: They signed on to buy condos in Hintonburg. Almost three years and many delays later, the units were put up for rent

Joanne Laucius, Ottawa Citizen
Publishing date: Jul 26, 2020 • Last Updated 6 hours ago • 11 minute read

https://smartcdn.prod.postmedia.digital/ottawacitizen/wp-content/uploads/2020/07/ottcondojuly23-5.jpg?quality=100&strip=all&w=750

In March 2017, Carlo Cassone put down a $24,000 deposit and signed a contract to buy a condo in a building that would go up in Hintonburg.

The 25-unit “boutique” Parkdale Market Lofts condo building featured open-concept New York-style lofts “geared towards empty nesters and millennials looking to live in an affordable place close to everything,” according to the developer, Surface Developments.

The project at 12 Hamilton Ave. was in a hip location across from the Parkdale Market. The price was attractive — units were listed as low as $217,900 — and Surface promised low condo fees.

“It was a pretty exciting time for me. It was going to be my first place,” said Cassone, now 27, who decided to stay at home and save more money for a down payment. He chose a $234,900 one-bedroom unit and deposited about $5,000 more for upgrades.

Greg Dillon, now 28, was also impressed with what he saw. Surface said it would custom-design the units for the buyers. If Surface didn’t have a fixture or finish available in its design centre, the developers would source it for the buyer.

“Their marketing is phenomenal,” said Dillon. “Their design centre is flawless. You had more choices than anywhere else in the city.”

Dillon and his fiancée chose a one-bedroom unit at $235,900, with an additional $15,000 for upgrades. They put down $23,590 to secure the unit.

According to a press release from Surface dated April 5, 2017, the project had defied all odds in a then-stagnant condo market and sold out in a day.

“I expected a good response, but we had to start cancelling appointments with potential buyers the afternoon we launched; that’s how quickly the units sold, a lot of people were left disappointed,” said Surface’s president and founder, Jakub Ulak, in the press release.

Friends had warned Cassone to expect hiccups in the condo-building schedule. And indeed there were. But construction delays were all dismissed by Surface, which supplied buyers with chirpy updates and photos of crews hard at work.

In December 2017, Dillon got an email from Surface assuring him that things would improve.

“We are committed to delivering an incredible product that you will fall in love with the day you move in.”

Two years later, buyers learned the project was being cancelled. They then watched in disbelief as construction continued after the project was cancelled — and the units were put up for rent with the building renamed The Foundry.

“I found it ironic that it was finished and occupied in April,” said Dillon. April was when he had been slated to move into his new home.

Buying a condo before construction has its advantages, said Denise Lash, a Toronto lawyer who often speaks and writes on condo legal issues.

“It’s a great investment because you can buy something and two years later it has appreciated in value,” she said.

On the negative side, there’s risk. Often an agreement to purchase includes a condition that a certain percentage of units must be sold in a given window of time.

But cancelling a condo project usually happens before shovels even hit the ground, said Lash. Cancelling a project and then continuing with construction and renting it out? That’s unusual, she said. In previous court cases involving cancelled projects, developers had to demonstrate that they had taken steps in reasonable and good faith to satisfy the conditions in the purchase agreement.

The Parkdale Market Lofts saga unspooled over the space of almost three years. There were delays in 2017. In 2018, there were upbeat updates to buyers from Surface. The project had a building permit, demolition had been completed and construction had moved ahead.

In November 2018 came a hint of uncertainty. The walls were going up, the floors were being installed and the stairs would be installed within a week, but an email to buyers also noted that the city was going through a construction boom.

“While this is great for the value of your condo, it is a bit of a double-edged sword. There is a skilled labour shortage in the city, trades are overwhelmed by the amount of work available, which sadly means will (sic) be delayed in constructing Parkdale Market Lofts,” warned Surface.

In January 2019, Surface said construction was “moving along really well. The third-floor is almost framed and we are getting ready to pour the fourth-floor slab. Even though we are only halfway up the building the views are already proving to be fantastic!”

In February 2019, Dillon received an email that suggested buyers were getting frustrated over delays — but Surface said it was willing to return deposits.

“Our priority remains your satisfaction even if it means allowing you to explore alternative options,” said the email.

“If you would like us to consider offering you a release from your purchase with a full refund on your deposit and upgrades, please reach out to us at your earliest convenience and we will see if it is something that we can accommodate for you. This is being offered on a limited and first come first serve basis and we reserve the right to deny any request for release.”

As the months went by, good news trickled in. On June 13, 2019, buyers received a list of completed construction. On June 26, an email to Dillon told him he would be able to watch the Canada Day fireworks from his rooftop deck in 2020, but also revised the tentative occupancy date to Oct. 15.

On July 12, 2019, Surface said the project would be roof tight within two weeks. An Aug. 2 email said construction was progressing, “albeit slower than we had hoped.”

Soon after, the occupancy date was revised to Dec. 15.

Dillon was getting increasingly frustrated over emails that started out promising exciting news and ending with discouraging news. Dillon had broken the lease on his apartment over a year previously, thinking he would be in his new condo soon. He asked Surface if the project was at risk.

“We are struggling to keep trades on the site due to the competitive nature of the market,” said a response from Surface’s comptroller, Dan Nixon.

“We signed contracts, and have had trades abandon them due to some of the delays we’ve run into. This means they’ve left the project for bigger value contracts elsewhere, so we now have to try to find contractors who can come in and do the work for us at a cost that makes sense, a very tough task in this market.”

The occupancy date was later revised to April 30, 2020.

“When the project was sold it was released below market value and unfortunately since that time the costs of construction have increased from 30 to 40 per cent,” said Ulak in an email to Dillon.

“These increases have been driven principally by labour shortages, commodity prices, the trade war with the US, and tariffs. Cost increases, along with delays by some trades in completing their work have allowed other contracted trades to walk away from their obligations to the project. The result has been a spiral of more delays and further cost escalation. This has put us in an unfortunate position where the project ran out of financing.”

Ulak said Surface had been trying for the last few months to secure additional sources of funding, “but are finding it challenging to find someone willing to risk lending money on a project that is financially insolvent. While we will keep trying it is possible that we may have no choice but to cancel the project.”

However, the buyers’ deposits were safe, Ulak said. “You may continue to wait in case we are successful in securing some form of financing that would allow us to continue with the project but if instead, you’d like to receive your deposit and upgrades back now, we can send you the forms and get your funds back to you within the next 14 days to ensure your money is not at risk.”

Cassone started to get worried his deposit might be in some danger and felt pressured to take his money back.

“I was fearful they would keep my money,” he said. “My lawyer said they could cancel the contract. It was like a slap in the face.”

Dillon was also shocked. He had been in the neighbourhood and thought the building looked to be 70 to 80 per cent complete.

“You obviously don’t just leave a near-complete building standing vacant in prime real-estate, so what is the plan?” he said in an email to Surface.

Dillon also noted that condo units in Hintonburg had increased significantly in cost since he has had signed on. Would he be compensated at fair market value? he asked Ulak.

In response, Ulak apologized and said he took full responsibility. There was no deadline for buyers to request refunds and the money would be refunded to him automatically if the project was cancelled.

“Getting my deposit back is one thing, but I would have lost all equity gains, legal fees, and there’s nothing comparable on the market at the value I entered at,” responded Dillon on Nov. 29.

He had heard the building was to be converted to a rental and asked Ulak is this was true.

“The options we have for the building are to do nothing which would bankrupt the project, find a lending partner willing to inject additional capital into the project, or to bail it out as a rental,” Ulak responded on Dec 2.

Dillon wanted to know if he could pay more to secure the unit. “How far away are we from what you need to keep this afloat?”

Surface had explored all these options “and some of them would have been viable earlier on. Unfortunately we are now almost $3,000,000 over budget,” Ulak replied.

It was about $100,000 a unit. “It’s an insurmountable sum. We’ll keep seeking options but it’s unlikely we’ll find any solutions,” Ulak told Dillon.

And how could completing a rental build be a success if it could not go forward as a condo building? Dillon wanted to know.

“The primary difference is that there is sufficient revenue in (the rental) project to support its costs,” Ulak replied.

“That unfortunately turned out not to be the case with 12 Hamilton. Everyone is free to wait as long as they want but once we exhaust our options we’ll be forced to cancel the project. At that point your deposits will automatically be returned to you.”

Dillon declined to sign the release. Two cheques were forwarded to his lawyer anyway.

Westboro Lofts, another Surface Developments condo project, was also cancelled in December, according to Tarion, which provides new home warranties for Ontario homes, including condos.

In an email sent in response to questions from this newspaper, Ulak said there were “significant and unforeseen” cost escalations throughout the course of construction.

“Once we exceeded our budget and had no additional sources of financing we began injecting our own capital into the project to ensure its completion. We allocated all the capital that we had available and were prepared to lose well over $1 million in order to ensure the project was finished.”

Ulak said construction costs continued to escalate well beyond this and the only option Surface had available was to find additional sources of financing.

“The only way to get a bank to provide additional financing was to increase revenues. No bank will lend you money if it is certain that you have no ability to pay them back. No one will give you $10 million if you’re showing $6 million in revenues,” he said.

“This was the unfortunate challenge that we faced and the only way to provide those additional revenues was to convert the building to a rental. Today’s rental rates, as opposed to selling prices from three years ago, were sufficient enough to provide a valuation that was adequate for our lender. If this was kept as a condominium the project would have gone bankrupt and our purchasers were certain to not receive their units. We had absolutely no option whatsoever to continue the project as a condominium.”

In Ontario, a buyer’s deposit is protected and returned to the purchaser if a condo project fails, triggered by a condition in the purchase and sale agreement. In the case of Parkdale Market Lofts, there were three conditions — unconditional sales of at least 80 per cent by Aug. 20, 2017; site plan approval from the city and confirmation of financing “on terms satisfactory to the vendor at its sole discretion.”

The buyers got their money back, but it was cold comfort as they had to pay the opportunity cost of not buying something else.

The average price of an apartment condo in Ottawa was $269,000 in 2017. As of June 2020, it was $367,137.

For Dillon, the lesson learned is that if the price is too good to be true, it probably is.

“There was a certain sexiness to the boutique aspect (of the project),” he said. “But with that comes the risk that they’re not as established.”

Dillon has purchased a unit in a stacked townhouse that will be ready in April 2022. He has found himself in the midst of a hot housing market, where prices have increased significantly.

“Their actions put us in a vulnerable position,” he said.

By the time he gets in the door almost two years from now, his home-buying journey will have lasted five years.

Cassone also ended up buying somewhere else.

“I’m still happy to be in the market. But it was a tough pill to swallow,” he said. “I just don’t want other people to end up in the same situation.”

“A change in intended tenure is not a rare occurrence,” said city planner Allison Hamlin. “There are other examples of planning approvals for developments originally planned to be condominiums instead being constructed as rental buildings.”

Ulak called the circumstances “a tragic situation” that has had negative consequences for Surface, the purchasers and himself personally.

“I’m immensely regretful that the project could not be delivered as intended and sympathize with the fact that our purchasers have been unduly affected.”

Both Cassone and Dillon have spoken to their lawyers and learned that pursuing the matter in the courts would be expensive. Cassone has contemplated the possibility of a class action lawsuit.

“I feel like there are no real consequences for their actions,” said Dillon. “It was a traumatic experience. It was like a dream out there. It felt like mourning a loss.”

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