Vancouver makes $100M bailout to Olympic Village developer

Vancouver taxpayers are on the hook for an additional $100 million to help cover the costs of completing the Olympic village now that Millennium Development Corp., the U.S. company that (over)bid to build the 1,100 unit village was hit by the credit crunch.

It looked like a sweet deal for the city when it first went through - the land is on lease, not sold to the developer, so the city still owns it. South East False Creek is poor quality land, the high price tag set a new precedent, and it would comprise of a mix of affordable and luxury end properties. Mayoral candidate and sitting councillor Peter Ladner has also called it the greenest project of its kind "anywhere" - although if that were really true then they would have dispensed with all the car spaces.

Different numbers have been quoted in the MSM about how many properties have been pre-sold: 50%? 60%? Ladner has been reluctant to talk about the loan - not surprising with an election a week away.

Whatever the number, it's obviously not good enough from the developer's perspective. Presumably a good number of those presales will be speculative. There's going to be a lot of inventory hitting the market in 2010. I don't believe this real estate slump is going to be a short-term thing, over by Spring 2009 as the industry is suggesting.