Olympic Village & Southeast False Creek Updates Discussion

[deasine]

Originally Posted by jlousa

I think one of the biggest reasons Canwest has been blowing this out of the water is a bit of resentment because they lost out on the games to ctv/bell/globeandmail. I am finding the stories in the globeandmail must more balanced.

I didn't even know CanWest tried for broadcasting of the olympics... =P

[jlousa]

Canwest/global put in a bid with TVA as a partner they lost badly, I believe even CBC came in with a higher bid but as far as I know the official numbers were never released.

[mr.x]

Originally Posted by jlousa

Canwest/global put in a bid with TVA as a partner they lost badly, I believe even CBC came in with a higher bid but as far as I know the official numbers were never released.

I didn't know Global submitted a bid. I never heard about it. They have zero sports broadcasting infrastructure, is that even possible?


We all know CTV/Rogers put in $151-million in the pot, and are now paying dearly for bidding too high. The CBC/The Score bid was rumoured to be at $100-million.


Great posts guys, seriously some of you should submit them to the papers.

[cornholio]

Originally Posted by johnjimbc

This is being pushed as a calamity a bit too strongly. We are talking about marketable and sellable units in a new neighborhood. It's not like there is a billion dollar stadium going to sit empty.

So any reporting showing the total exposure without even attempting to determine sales figures that can be expected in the next 2 to 3 years are just reporting shoddy attention-grabbing headlines. It's no different than me going out to the corner of Robson and Granville and yelling, "The Sky is Falling - Our City is Doomed" at the top of my lungs.

How about this for a worst-case scenario. One or two of the buildings becomes affordable or mixed-income housing? Geez, would that mean they were a "loss" to the city or contributing to assist the affordable housing deficit.

I know it is en vogue to peddle the "end of the universe as we know it" angle (after years of pushing the "a new millennium of wealth of prosperity has dawned" meme), but honestly can't someone report on this with a small tidbit of journalistic integrity.

As for the situation itself, I still get this sense that the financiers on Wall Street are playing the city on this. I just can't shake that sense from anything I do read or hear about the situation. I imagine lead executives looking for ways to eliminate ANY of their risk and still get all the benefits of the huge loan by thinking to themselves, "This is THE Olympic Village. There is NO WAY they are going to let it fail. Tell them we won't pony up any more money unless they take on all the risk. They'll squirm, but in the end they'll pony up. Then we'll get our money with more favorable terms to us, and any risk in the project will be off our books and lower the overall risk of our portfolio."

With that in mind - and if the terms are going to require the city to carry any risk anyway - I'm with the person who just suggested it become a federal government LOAN. May as well have the terms with a government entity. Don't reward the financiers for hanging the city over a barrel. In fact, make them pay in the loss of business.

With a viable alternative, I suspect they'll change their tune and be a bit more amenable to an equitable sharing of risk and more favorable terms to the city.

agree with you an all the points.
the city right now needs to get qualified people in as quickly as possible to fix this mess and hopefully kick Fortres completely out of the loop. If my hunch and your hunch is true then the city should also expose Fortres and their business practices and hopefully sink that company. I think they have good reasons to be a bit woried about the project but I get the feeling that Fortres is taking it to far because they know they have the city by their balls, thats not good business practice if you ask me, and I wouldent want to deal with a company that would take advantage of me if the opportunity presented its self.

[jozero]

I agree that the province should pick up much of this burden for the city. Who would have seen this coming... not them apparently, and what could have been done differently?

How about not accepting the insane high bid, which would require the builder to sell each condo at inflated unreasonable unsustainable prices?

The initial plan for the land was for mixed medium income housing. The city received a decent bid from several builders including Concord. Instead they sold to a company whose entire plan for profit hinged on impossible escalating real estate values and to turn the entire project into high end units. Their estimations for prices were based on zero historical precedence, just a hope the continued euphoria would continue.

Our city engaged in the riskiest sort of real estate speculation, then backed the entire thing with tax payer money. Which company wouldn't sign up for that? Profit if the going is good, bail if its bad. Its a suckers bet.

Montreal payed off the 1976 olympics in .... 2006 !

[officedweller]

Great post Johnjimbc.

Those two conditions were providing a $193-million loan guarantee on the total $750-million loan. The other, and this was the news that came out today, was providing a completion guarantee, i.e. the city guaranteed that if Millennium failed, it would find a way to finish building the project. That completion guarantee stipulated that the project had to be finished according to the original designs.

I read the completion guarantee as the City living up to its [written] obligation to VANOC to deliver an Olympic Village by a given date.
However, a stipulation that the City complete it according to the original designs seems to be an onerous obligation on the City - so either (1) someone at City Hall couldn't live with the project being "dumbed down" in a crisis situation and a sustainable community was a "must have" or (2) the clause was aimed at preventing the City from being forced to mitigate (reduce) the damages that would otherwise be payable by Millennium - i.e. preventing Millennium from obtaining a court order etc. requiring the City to reduce the cost of (dumb down) the project in a default scenario, reducing the drain on Millennium's assets (whether Millennium remains solvent or its assets are being distributed due to insolvency). Of course, if Millennium doesn't have any money to pay up (as is likely), the City's obligation to adhere to the original design works to the City's detriment.

Originally Posted by phesto

Where is Millenium in all of this? Up until about 6 months ago, they were considered one of Vancouver's premier and well-capitalized development companies. Now they are in the midst of this mess, and none of Millenium's principles has spoken one word publicly; meanwhile their two other large development projects (Evelyn Drive and Port of Nanaimo Centre) are basically dead?

I recall an interview on the news with the president or CEO and he came across pathetically at the time - way back before the election - not surprising that he's laying low.

[flight_from_kamakura]

Originally Posted by jlousa

The biggest factor which is the media isn't covering is this, Millenium has put up it's other COV properties as collateral in this deal. Which means even under the worst case scenario the city gets ownership on Millenniums other properties which is a sizable portfolio and includes the Province building downtown (not the pacific press building).

now this is news. that would seem to mitigate a lot of the risk, i wonder why i've not read this anywhere else. it seems almost irresponsible to keep that kind of info on the downlow.

[WarrenC12]

I agree with most here that the news is blowing the dollars out of proportion. However there is a real financial problem, be in the the form of a loan or an outright responsibility.

I hate bailouts, but honestly, why can't the Province and the Feds buck up here and provide the loan? It took a grand total of 2 seconds for Ontario and Ottawa to bend over for 3 American automakers with a proven failed business model to the tune of $4B. Now they can't spend maybe $100m here? I use $100m as a possible real cost once everything is said and done, worst case.

[Yume-sama]

Originally Posted by WarrenC12

I agree with most here that the news is blowing the dollars out of proportion. However there is a real financial problem, be in the the form of a loan or an outright responsibility.

I hate bailouts, but honestly, why can't the Province and the Feds buck up here and provide the loan? It took a grand total of 2 seconds for Ontario and Ottawa to bend over for 3 American automakers with a proven failed business model to the tune of $4B. Now they can't spend maybe $100m here? I use $100m as a possible real cost once everything is said and done, worst case.

They COULD, but there would be no personal gain as it is unlikely the government would gain votes in the area by doing that.

[nickinacan]

Originally Posted by Yume-sama

They COULD, but there would be no personal gain as it is unlikely the government would gain votes in the area by doing that.

Not to mention that there is no union to appease and the job losses are minute in comparison. Like I said before, BC would probably come to the rescue but the Feds definitely will not. That would open up a whole bag of worms in regards to Quebec & Montreal paying off the Olympic Stadium.

[officedweller]

Hmmm so why all the theatrics? Just to make the NPA look bad?

Mayor Not Seeking 2010 Bailout

1/12/2009

Vancouver Mayor Gregor Robertson says he is not going begging to the provincial and federal governments looking for a bailout on the troubled Olympic Athletes Village project.
In a worst-case scenario, the City of Vancouver is on the hook for an 875 million dollar bill.
Robertson says the city needs tools from the provincial government to be able to re-finance this, but he says he is not anticipating government largesse from the province or the federal government to bail this out.
He says Vancouver taxpayers are responsible for shouldering the burden.
Robertson admits the city would consider renting out the condo's if they can't sell them all.

Robertson wants Legislature reconvened to help city find way to refinance Athlete's Village
Won't ask Victoria or Ottawa for 'bailout'
Connie Thiessen / Sonia Aslam VANCOUVER (NEWS1130) 2009-01-12 12:22


Olympic Athlete's Village (News1130 Photo)

VANCOUVER (NEWS1130) - Vancouver Mayor Gregor Robertson is asking for the B.C. Legislature to be reconvened to approve changes to the Vancouver charter, which would allow the city to borrow money to refinance Olympic Village cost overruns. Robertson says he won't ask the federal or provincial governments for a bailout if the city ends up footing the bill for cost overruns on the Olympic Athlete's Village.

Robertson fears Vancouver taxpayers could be on the hook for the entire cost if the developer can't refinance a new deal. Robertson had said the province may have to give the city the ''tools'' to refinance the massive project, but he wouldn't expect any direct assistance from either the B.C. or federal governments. The bill could go as high as $875 million dollars.

Meanwhile, former Mayor Phillip Owen is accusing Robertson and the media of blowing the financing issue out of proportion. Owen insists the facts are being distorted.

[nova9]

I'm finding it really frustrating what populist media always does with complex issues by watering them down. Personally, I've enlightened at least 2 dozen people who were talking about and I've directed them to this forum - all they got from the news was that they are now paying $875million and they were much relieved and saw 2010 in a good light again knowing that that was a worst case scenario, not a foregone conclusion.

Sigh. People need to read deeper and don't reflexively react to numbers!

[flight_from_kamakura]

holy —!

VANCOUVER (NEWS1130) - Vancouver Mayor Gregor Robertson is asking for the B.C. Legislature to be reconvened to approve changes to the Vancouver charter...
Robertson had said the province may have to give the city the ''tools'' to refinance the massive project...

wow. i doubt gordo would go along with the change, but the vision people are framing it as between a bailout and a change to the vancouver charter, and that makes it a little more difficult for him to say no. the significance is obviously that vancouver would be able to borrow significantly more money, and potentially, for a lot of different reasons, in a lot of different ways. this has been a far away desire of virtually all councils for years, so it would be really interesting if gregor and his team used the sefc fiasco to move it forward.

why does it feel like raymond louie's got his fingerprints on this?

[officedweller]

I read that the amendment would be "Olympic Village - specific" so it woud not be a civic loan free-for-all.

[NetMapel]

I don't understand why the city of Vancouver is taking the heat for this. It's not the city's fault that the financing partner from Wall Street suddenly decided to stop the funding. It is also not Vancouver's fault that our real estate market decreased significantly recently due to GLOBAL economic crisis. The city really should be suing the Wall Street firm for not honouring the loan agreement and making a mess out of things.

[ravman]

GO GREGOR GO
GO VANCOUVER GO

BOO NPA/ BC Liberals!

okay... i think this was a bad deal from the previous city council. It is time for a new govt to clean this up and i think Gregor will do an awesome job cleaning the mess of the BC Liberal Jr party (NPA)!

post from Paul Willcocks

First, the NDP government got all enthusiastic about a bid and launched the luge down the icy chute before anyone really thought much about whether we actualy wanted the Games, or why we should.
Second, no one paid too much attention because a) it was just a bid anyway; and b) the Games are a "good thing."
Third, governments got away with too much secrecy and silly claims, as in security costs will only be $175 million.
Fourth, effective oversight was ignored or eliminated. The auditor general's concerns were brushed aside; the public's representatives on the VANOC board reported to political masters.
Fifth, even people like I who raised issues, weren't nearly dogged enough.
Still, I repost a column from before the bid went in that suggests the warning signs were there for all to see.

Tuesday, June 22, 2002

Olympics' bid looking fiercely expensive

British Columbians should be getting mighty nervous about what the Vancouver-Whistler Olympic Games could cost us.
The 2010 Games could turn out to be a great thing for B.C., a chance to showcase the province before the world.
But the Olympic bid is steam-rolling forward without nearly enough public information or consultation on the costs and benefits.
The Olympic bid committee has already sent its proposal off to the IOC, a list of promises of all the things you will do to make these the best Games ever.
Sadly, you won't know what those promises are, the bid committee having decided they should stay secret. That seems a little odd, since Bern, Switzerland, one of B.C.'s top rivals, has posted its proposals on the web site for all to see. Bern also plans a referendum before going further, something citizens in Whistler have unsuccessfully been seeking.
There's much encouraging in B.C.'s Olympic bid. The Games are expected to be officially self-supporting, with revenue covering the operating costs and maybe leaving a little money over. And the province could well score future tourism business and some nice sports facilities.
But the self-supporting claim is misleading.
Organizers already have about $9 million from the province to help make the pitch to get the Games. Ottawa and B.C. have promised $310 million each for new facilities for sports events.
And on top of that, the federal and provincial governments are on the hook for security costs, easily $500 million if recent Games are an indication.
And there's more.
The Games bid requires an expanded convention centre, which would serve as the headquarters for some 10,000 journalists, and cost some $500 million.
There's a strong case for a new convention centre, but it's certainly not clear why those who will benefit - Vancouver hotels and restaurants - shouldn't pay the bill.
Bid chairman Jack Poole also says that without major improvements to the Sea to Sky Highway to Whistler, Vancouver won't win the Games. Figure $1.3 billion for that. And proponents also want a rapid transit line from the airport, another $1.4-billion megaproject.
Add them up, and you'll see that those cost-free Games will really reach into taxpayers' pockets for $5.3 billion.
Of course there will be benefits, including an estimated $2 billion in tax revenue for the two levels of government. But that doesn't come close to the costs.
And that too would be fine if we had decided that the most important capital priorities for B.C. were a better highway to Whistler and rapid transit from the airport.
But we haven't made that decision. And I'm not sure that people bouncing over rutted roads in the northeast would be so keen to know that their tax dollars were being used to make it easier for people to get to their chalets in Whistler. Or that people in the North and Interior facing health care cuts would think that a better way of getting from the airport to downtown Vancouver should be a top priority.
The Olympic bid has crept up on British Columbians. Few people realize that a specific proposal has been submitted, or that in about a year B.C. could have actually won these Games.
That's partly our fault. The Games people have been out talking about their plans, but the public hasn't paid much attention.
But it's also the proponents' fault, for failing to provide enough information about exactly what this will cost and where the money will be found within the finances of a government that says it's too broke to provide a wide range of other services to citizens.
The Games may make sense. But right now, it feels like we're being asked to hand over a lot of money with no clear idea what we're getting, or why we should want it

[Stingray2004]

Originally Posted by ravman

GO GREGOR GO

okay... i think this was a bad deal from the previous city council. It is time for a new govt to clean this up and i think Gregor will do an awesome job cleaning the mess of the BC Liberal Jr party (NPA)!

Well it's not that simple. The mess included Vision Vancouver and COPE unanimously agreeing to the selection of Millennium and the subsequent financial arrangements.

Gregor is now one vote among 11. Furthermore, Gregor is just the straw-man. The real guy carrying the day at city hall is new VV councillor Geoff Meggs.

Do you know who he is? Former communications director for NDP premier Glen Clark, which brought us the 2010 games in the first place. Then Meggs acted as assistant to COPE mayor Larry Campbell who presented the 2010 Bid Book. And do you know what the bid book says:

The City of Vancouver has guaranteed to construct, at its cost, the permanent infrastructure and facilities for the Vancouver Olympic Village.

And that naturally flows to the City of Vancouver's subsequent completion guarantee.

And do you know what Vision Vancouver originally proposed for the Olympic Village site:

Had Council approved the original Vision Vancouver proposal, a City staff report confirms that the project would have cost significantly more for taxpayers.

In fact, Vision had proposed that only 1/3 of the project would be considered market housing. Vision's proposal to increase the overall level of city taxpayer subsidy on this waterfront property would have significantly reduced the viability of the project.

Gregor and his buddy Geoff Meggs are now turning this matter into a huge political and financial mess for the city with their current actions. One doesn't operate like this under business/real world circumstances.

Put it down to neophytes and people trying to play political games. Exactly what COPE and Vision Vancouver have been historically known for.

Frankly, it's unfortunate for the 2010 Olympics and the citizens of Vancouver.

[deasine]

Originally Posted by Stingray2004

Put it down to neophytes and people trying to play political games. Exactly what COPE and Vision Vancouver have been historically known for.

I hate to continue your political posting, but they weren't AS BAD until he came along...

Originally Posted by Stingray2004

Frankly, it's unfortunate for the 2010 Olympics and the citizens of Vancouver.

It is. Like a few financial analysts have told reporters... if it wasn't for the recession and the economy in such dismal shape, we wouldn't be talking about the Olympic Village now...

[flight_from_kamakura]

Originally Posted by Stingray2004

Then Meggs acted as assistant to COPE mayor Larry Campbell who presented the 2010 Bid Book. And do you know what the bid book says:

not to belabor these side issues, but it was owen's council that did all that. campbell's council just let it ride, post referendum.

http://www.vancouver2010.com/dl/00/39/68/-/39680/prop=data/195b559/39680.pdf

[mr.x]

I've been out for the past week, so could somebody please tell me what the hell is going on? How much liability is the city actually holding? (besides the media's sensationalized reports)