Article Repost from therecord.com – October 9th, 2024
https://www.therecord.com/news/waterloo-region/failed-four-tower-kitchener-condo-project-to-proceed-with-new-owners/article_2875a901-c533-5f99-ac94-c032d48c9105.html
Initial focus is on completing partially-finished 15-storey building
An unfinished Kitchener condominium project that went into receivership a year ago now has new owners.
The first of four planned towers at the Elevate development at 1333 Weber St. E. was partially complete when the project ran out of money, court documents showed.
Now, three groups have partnered to purchase the stalled project for approximately $75 million, a release issued late Wednesday afternoon said.
Canadian mortgage lender Dorr Capital Corporation, ELM Developments, and BC’s Gentai Capital Corporation have joined up with the intention of completing the four-tower, 622-unit development.
The deal to acquire the project from a numbered Ontario company was approved by the courts on Tuesday and is expected to close this month, the release said.
“While our plan is to develop all four towers as quickly as possible, our primary focus is to complete the existing tower that stands 65 per cent complete and save the existing sales,” said Brian Dorr, chief executive officer of Dorr Capital Corporation.
“We already know we’ll have to reassess the sales strategy for one of the other towers and rental is not off the table.”
Court documents identified Werner Leuschner and Kamal Patel as the project’s partners when it went into receivership, with more than $100 million owing.
Those documents showed all 177 units in the unfinished tower had been pre-sold, while 325 units had been sold in the other proposed towers.
Some work was undertaken by the receiver to protect the unfinished tower from weather damage, including installing a temporary roof, boarding up openings, and taking steps to protect concrete slabs.
The first two towers are planned at 15 storeys, while towers three and four are planned at 12 storeys, with an attached commercial component.
The 1.46-hectare (3.6-acre) site is located beside Highway 8, and previously housed a Howard Johnson hotel.
“Vancouver’s Gentai Capital Corporation will adopt the role of majority stakeholder by providing a loan on the property, while Dorr Capital focuses on facilitating the transaction alongside ELM Forward, a division of ELM Developments that specializes in the construction and development of distressed assets,” the release said.
“With this new team of construction and development experts, we as partners have a clear vision forward,” said ELM Developments president Elliot Steiner.
“We’re proud to provide over 600 much-needed housing units to the community of Kitchener and are committed to conducting good business to move this project forward.”
With files from Jeff Outhit
Brent Davis covers business and breaking news for Waterloo Region Record.