SkyCity Centre Winnipeg | 45F | 575 Ft | 175.26 M | Cancelled

[hexrae]

Isn't heritage landing, a new tower, apartments too?

[Urban recluse]

Referencing condos.

[Wolf13]

Originally Posted by hexrae

Isn't heritage landing, a new tower, apartments too?

It is, but it's very far from a typical apartment. The suites are huge, and in all honesty, very uninspiring in interior finish. Amenties aren't the main focus either. It is quite clearly a family legacy project for the next generation of Crystal Properties to earn their inheritance by securing older, more mature, secure tenants. It will lease up slowly, but when a lease is signed, the tenant will remain there possibly until death or until Crystal will hope to move them to one of their retirement residences. It can be a slow, long play slam dunk for their family. Other projects need to see returns much sooner.

By contrast, 300 Main and rented (from investors) suites at SkyCity/Glashouse are mostly smaller and geared at (though not limited to) a more vibrant, working downtown population. I don't anticipate too much demographic overlap. Furthermore, much more attention is given to vast arrays of amenities and connectivity to other buildings and destinations

Although downtown, I consider Heritage landing and Dcondo perhaps "less downtown" than other projects. Winnipeg isn't quite the walking downtown yet and they are quite removed.

[Cyro]

Originally Posted by Wolf13

I
Although downtown, I consider Heritage landing and Dcondo perhaps "less downtown" than other projects. Winnipeg isn't quite the walking downtown yet and they are quite removed.

This, will take time, strides are being made but were all aware of the size of our inner core and the problems it presents today.

[Canucklehead]

Here is a great article on the sketchiness that is Fortress:

https://www.thestar.com/business/2016/04/29/the-high-risk-world-of-syndicated-mortgages.html

[oftheMoon]

I was at the SkyCity office today and the agent told me they just hit the 160th sale. There were 5 or 6 yellow dot condos in "cooling off" status at the moment.

[esquire]

^ That article writes like it was inspired by some of Simplicity's posts earlier in this thread.

From the perspective of an urbanist and a skyscraper buff I'll be happy to see SkyCity rise, but I have to admit that Simplicity opened my eyes to the super sketchy nature of how the project is being put together.

[bomberjet]

Anyone know what the differences are between Ontario and Manitoba when it comes to syndicated mortgages? It says that Ontario is behind what other provinces are doing in terms of regulating these mortgages.

What is the difference between SkyCity condo purchasers and someone who's purchased a unit in say Glasshouse or dCondo? Is there any difference?

[cheswick]

Originally Posted by Canucklehead

Here is a great article on the sketchiness that is Fortress:

https://www.thestar.com/business/2016/04/29/the-high-risk-world-of-syndicated-mortgages.html

No offence to anybody, but if you're promised 8% returns and you don't know there's significant risk involved, you shouldn't be handling your own investments. That's in excess of junk bond yields.

[esquire]

Originally Posted by bomberjet

Anyone know what the differences are between Ontario and Manitoba when it comes to syndicated mortgages? It says that Ontario is behind what other provinces are doing in terms of regulating these mortgages.

What is the difference between SkyCity condo purchasers and someone who's purchased a unit in say Glasshouse or dCondo? Is there any difference?

Just given the sheer size of their capital markets I'd imagine that Ontario has a more sophisticated securities regulation regime than we do. But the fact that the SkyCity syndicated mortgages are only available in Ontario and Nova Scotia tells you something.

As for unit purchasers, I think they'd be treated more or less the same at SkyCity as with any other condo. The difference is as to how the projects are being financed... the syndicated mortgages are being used to raise the money to get the project started, and that's the sketchy part. The Star's article suggests that the syndicated mortgage buyers would be stuck holding the bag if the project fails... meanwhile the developer gets a full 1/3 of that money right off the top, so even if you factor in the actual development overhead they're still cashing in no matter what happens. The pitch is here:

http://www.fdsbroker.com/portfolio-item/skycity-centre-winnipeg/

[roccerfeller]

Originally Posted by cheswick

No offence to anybody, but if you're promised 8% returns and you don't know there's significant risk involved, you shouldn't be handling your own investments. That's in excess of junk bond yields.

Very true. But many people don't know these things, and the way sales people will get the buyers is simply focus on the amenities, the down payment, and simply throw all that other legal information on a cd or usb drive for the prospective owner and call it a day.

This seems to be how people always get surprised - they just either a) weren't properly informed, because it could have resulted with a lost sale or b) didn't go through the piles and piles of legal documents that are stuffed on the storage device

Sure becoming informed is on the individual but if one doesn't know what to look for in the first place, then that can also pose difficult.

[bomberjet]

^Ya Esquire, I remember going through all that info before. Reading up on Fortress staff who have other "issues", etc, etc. Sketchy group of guys, that's for sure. Sketch all around on SkyCity. The previous land owner wasn't the most reputable person either.

[Canucklehead]

I like how they try to claim they are the savior in that Barrie deal. They took absolutely ZERO risk, raked in $2.8M in fees, and now say they will "try" to pay everyone back if there is a profit, after all fees, charges etc.

So to summarize, they made their profit on the first investment. All investors lost ALL money, they made nearly $2M. Now, if they make enough money/profit/fees on this second investment, they MIGHT pay people back. So they are double dipping, and essentially screw over their investors.

This is as close to a Ponzi scheme as possible. As long as land values rise, and they can convince an appraiser to give a higher value so they can get old investors out with new investors, they are OK. The moment the economy turns, or these projects take longer than expected, investors are screwed.

The fact that the fees on this investment are over 35% is an absolute CRIME. The poor investors.

[esquire]

^ Who the hell is buying the syndicated mortgages then? That's what I don't get. You'd think someone with six figures to invest would have some idea as to what they're doing.

[Canucklehead]

Originally Posted by cheswick

No offence to anybody, but if you're promised 8% returns and you don't know there's significant risk involved, you shouldn't be handling your own investments. That's in excess of junk bond yields.

Not to be rude here - but if you've ever followed the mortgage groups on twitter or social media, you would see the groups of people they are pitching this too. First off, the brokers themselves don't look very smart or sophisticated - basically drinking the Fortess Kool-Aid. The actual investors are often immigrants investing 10 or 20K, which is substantial for them.

Fortress is riding a good market right now. This business model will implode if/when things turn - which is why they have so many projects on the go. They take no risk at the start, and rake in INSANE fees. Who cares if it all fails at the end. They walk away very rich.

[Bluenote]

Originally Posted by bomberjet

^Ya Esquire, I remember going through all that info before. Reading up on Fortress staff who have other "issues", etc, etc. Sketchy group of guys, that's for sure. Sketch all around on SkyCity. The previous land owner wasn't the most reputable person either.

Easy now. That previous owner is a friend of mine.

[Urban recluse]

Like selling goods outta dey trunk? Lol

[Wolf13]

Originally Posted by cheswick

No offence to anybody, but if you're promised 8% returns and you don't know there's significant risk involved, you shouldn't be handling your own investments. That's in excess of junk bond yields.

You're not incorrect, but you'd be surprised what the layperson doesn't know.

What I find amusing is that Fortress claims they "just" made 2.28M from the Colliers Mady centre.

3% on a FAILED $75M project is a lot of money for a consulting position. However, not unfair for a project that succeeds. Fortress made a large fee period, on a project that failed, and as a consultant, avoiding failure is job#1.

I'm just not a fan of syndicated mortgages, atleast not the way Fortress does it. It appears they risk a lot of people's money and potentially speculative projects. Their sales centre alone cost $1M (and it's awesome)... but most developers/builders would have come up with that cash on their own or through bank financing (if they would lend it).

[Cyro]

Unfortunate..buyer beware.

Reminds me of the first SkyCity thread that was deleted, but, the realities of investment should be discussed pros vs cons, risk vs. reward and the feasibility of any project..

Hoping to here the announcement on the 160 mark soon..

[rrskylar]

Sky City bitch!

Sky Sky City bitch!

Sky City bitch!


That's as far as I got on rap song extolling Sky City!