Appeal court reverses ruling on which developer will finish stalled Coal Harbour luxury condos
The B.C. Court of Appeal has overturned a decision about which developer will deal with a stalled downtown Vancouver luxury condo project that had been highly touted for its Coal Harbour location, prize-winning architecture, and aspirations to be the world’s tallest hybrid timber structure.
It means the project, which has been boarded up in a prime spot on West Hastings between Bute and Jervis, is possibly a step closer to being restarted, though there are still many questions about further financing.
Vancouver developer PortLiving sold presale contracts for the 19-storey Terrace House in 2017 and had finished the construction of the parkade when, in May 2020, its main lender stopped its flow of funding after cost overruns.
At the time, the project had spent about $8 million of the $16 million it had from presale deposits paid for 17 residential units and two commercial units, according to the Court of Appeal ruling. The project also owed $41 million to secured and unsecured creditors and its insurer.
The B.C. Supreme Court put the project under court bankruptcy protection and kicked off a process under the Companies’ Creditors Arrangement Act to find a new buyer or investor.
Three companies made bids. Vancouver-based developers Landa Global Properties and Solterra Development Corp. submitted proposals to take over and sell off the assets. A new company formed by PortLiving CEO Tobi Reyes proposed to refinance and continue the project with new investors, including Domain Mortgage Company, which was willing to contribute $14.7 million.
In June 2021, the B.C. Supreme Court ruled in favour of Solterra.
Justice Shelley Fitzpatrick said that even though the proposal from Reyes’s new company, 1296371 B.C. Ltd., “made sense ‘from a business point of view,’ she was critical of it for several reasons including that ‘crucially,’ there was no suggestion … of a plan or arrangement or compromise,” according to court documents.
