Thanks to all the previous posters for their thoughtful and extremely detailed analysis of the economics of this project. I think we have pretty much all agreed here that we don’t have enough specifics to be able to truly understand what is going on financially with the project in terms of construction costs or the future sales prices of the condos.
Thank you to Michael for the information that the Millennium/Fortress loan was intended to cover the cost of more than just the market portion of the the construction.
I should just say, before I go on, that it’s interesting to see the debate divided between those who see apocalypse and those who see a not-great deal that’s been made worse by unprecedented market/housing conditions. You’re likely not going to change your opinions, but it does seem interesting to me that, for every person who thought the condo bubble was going to go on forever, there seems to be another person who is convinced that housing prices have tanked in such a dire fashion that they will never come back.
Being a fence-sitter, as my loving critics like to call me, I find myself as unconvinced by those who say (with considerable glee) that the housing market as we knew it will never EVER return to anything near what it was as by those who thought condos would keep selling like cheap underwear at Wal-Mart.
Okay, enough about me.
As a public service, I’ve been going back through old staff reports to try to figure out how much actual space was permitted for the Olympic village site. This staff report, the CD-1 rezoning from September 2006, seems to be the final report setting out the space allowed.
You can read it yourself, but it seems to be that staff recommended at that point that the Olympic village site get:
1,179,884 SF for residential
which include 213,000 SF for social/affordable housing
and 89,800 SF for modest-market housing
In addition, 63,640 SF was given for commercial floor space. As well, there was 14,000 SF allowed for the community centre and the plaza (which Millennium is building for the city) and 26,500 SF for the Salt Building, which a consortium is handling.
If those numbers weren’t tweaked at some later date, that would mean (unless my famously bad math is wrong) that there was 877,084 SF left for market condos. Michael or Bob could probably tell us how much of that would actually be saleable square footage and how much of that is lobbies, hallways, etc.
As well, I’ve checked the floor plans posted on the Millennium sites and previous reporting on the sale prices. Early promotional stories said the market units would sell for between $450,000 and $6 million. The smallest condo is 574 SF or thereabout and the largest is 4,600 (plus a lot of deck space). That means the smallest, which likely sold for the lowest price, came in at just under $800 a SF in price. The highest is $1,300 if you match space to price, though there could well be some units that are higher because of their height or view. (Some enterprising person should hop down to the Millennium showroom to pick up their materials and prices as historic artifacts.)
Also, while I was scanning the website for more information I came across this news release from the city sometime in 2008. I can’t tell if it was early in the year or during the campaign, when the city was trying to put out some information to calm the troubled election waters.
At any rate, reading it does make me think that we reporters are indeed developmentally disabled.
That’s because, to me and almost everybody, I think, the big news out of Friday was that the city is on the hook to complete the village if Millennium can’t do it. I hadn’t heard that before and it made me think differently about the whole deal. But this fact sheet clearly states that the city gave Fortress a completion guarantee. Not a single media person picked up on what this was and what it meant.
Many more thoughts and tidbits, but I’m off to other things right now. Looking forward to more observations.