Question That Require Answers In The Commonwealth Matter
Friday, November 30, 2012 @ 4:00 AM
Priince George, B.C. – The property that is now being foreclosed on in the downtown core has been the subject of much discussion over the past few years, none more than now.
The Northern Development Initiative Trust is seeking an order that Commonwealth Campus Corporation is in default of the mortgage on six properties and NDI Trust is foreclosing on the property. You may recalll, the properties were purchased by Commonwealth Campuses as part of its "New Downtown" project. (click here for the series 250News did on the proposal )
The money was due on October 31st. The sum is $1,451,860.00 plus interest at 6.8%. The foreclosure proceedings were filed on November 28th, less than one month after the money became due.
The total assessed value of the property in question is $838,000.00 leaving a difference of $613,860.00 if the assessed value of the property is the final sale figure.
You may recall the balance of the site was occupied by the Prince George Hotel, which was sold to Commonwealth and then flipped to the City giving Commonwealth a gross profit of around $500,000 dollars. That property has been earmarked for the new Wood Innovation Center for Prince George.
Also named in the Foreclosure are Daniel McLaren, Don Kehler, David McWalter, Heather Oland, Gordon Langer and the estate of Dan Gialleonardo. They were the Directors of Commonwealth Campus when the Mortgages were let and reviewing the old documents at the time of the loan, the NDI Trust was seeking personal guarantees for any short fall in paying out those mortgages.
There are now several questions that should be answered;
1. Why did NDI Trust move so quickly to begin foreclosure, less than a month after the funds were due?
2. If the NDI Trust is successful in obtaining the property, would they then offer it up to the Province which would take Commonwealth out of the equation?
3. Will the Province make an offer to the Courts to purchase these properties , thereby taking the matter out of the hands of Commonwealth and NDI Trust and just what would that offer be?
4. If the Directors at the time signed personal guarantees, how can they continue to operate in the positions that they now hold?
(a) Heather Oland is the CEO of Initiatives Prince George; she resigned as a Director of Commonwealth as part of her employment agreement. Is continuing to maintain a personal guarantee a contravention of that agreement, given that the courts may seek personal funds should there be a shortfall in the sale of the property?
(b) Judy Kehler, wife of Don Kehler is employed with the City of Prince George in the real estate department. What checks are in place to ensure that any City property sale is transparent?
5. What assurance can be given to the taxpayers that their investment through NDI Trust does not result in the taxpayer (whether local or provincial) is not required to fund any shortfall?
6. City Mayor Shari Green sits on the Board of the NDI Trust. She, along with Heather Oland, recently completed a trip to China together. Was there any discussion in regard to the foreclosure proceedings?
7. When did the Board of the NDI Trust make their decision to foreclose on the properties?.
8. Was there sufficient due diligence done when NDI Trust approved the initial loan?
These are questions that require answers to ensure the public, (taxpayers) that this matter is being handled in an open and transparent way not only by the NDI Trust and the City of Prince George but the Province as well.
Comments
Not easy being a “developer” when one has no money, is it?
Ethics ? We don’t need no stinkin’ ethics!
We were upset when the City overpaid Commonwealth for the PG Hotel. We were upset when the City overpaid Commonwealth for an air lease.
Would we be upset if the City or Province paid more than assessed value for these six properties? We should be.
I’m concerned that the foreclosure proceedings are just a clever way of ‘washing’ dirty money. Think about it.
Instead of the City/Province buying the property directly from Commonwealth, the parties can have Northern Trust initiate foreclosure proceedings and make it look like the City/Province is buying the property from Northern Trust. The thought would be that we, the public, wouldn’t have a problem if the City/Province paid Northern Trust an inflated price.
The net effect is still the same though. Any money paid for the property is applied to Commonwealth’s outstanding loan. So the City/Province would still be buying the land from Commonwealth at an inflated Price.
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6. City Mayor Shari Green sits on the Board of the NDI Trust. She, along with Heather Oland, recently completed a trip to China together. Was there any discussion in regard to the foreclosure proceeding?
Oh Oh
How did some council vote on buying the Prince George Hotel, which was sold to Commonwealth and then flipped to the City giving Commonwealth a gross profit of around $500,000?
I can say this with confidence, this makes ex Toronto Mayor Ford look like an angle.
I say they all got caught with their hands in the cookie jar. Yes they should be held accountable as in personal guarantees. This looks like big mess at this time.
This whole arrangement stinks to high heaven…I hope the authorities are investigating….
Anyone got the number for the new municipal auditors office? Just want to tell them to pack an extra bag as they are going to be here a while, might want to thinks about leasing an apartment rather than a hotel room.
There should be no offers made above the assessed values of the properties with the commonwealth people making up the difference. They have had enough breaks with the city paying 900k for the air rights for the building on 6th when they could have got it for a buck and more recently an extension on the adjacent condos.
I just realized that Derek Bates is a lot smarter than I gave him credit for, will be well out of dodge when the shite hits the fan.
That is the problem when you build a house with cards. One card knocks it all down.
Seems a little shady to us taxpayers.
What was Heather Oland thinking, I always thought she was smarter than that. This will cost her a lot of respect in the community. Resigning as a director does not resign her from being financially involved.
I think some heads are going to roll, really should think hard and understand arms length involvement.
City Council Mission and Vision
Council’s VisionTo be a high functioning, focused, effective, efficient, responsive, productive and accountable Council.
Council’s MissionTo provide high quality services and good governance for the City of Prince George within available resources.
Mayors in Quebec are dropping like flies after shady deals another one bit the dust today…just saying
lonesome, you are so correct. Go after commonwealth now. They had free money and what did they do with it. That just aint right.
What I dont get is if the city bought the property from Commonwealth, wouldn’t it have been free and clear. If that is the case, than how does NDIT have any claim on the property?
If this is the case, wouldn’t NDIT just go after Commonwealth Campus. Shouldn’t the lawyers have paid out the NDIT mortgage when the transaction come thru with the city?
If all is going sideways, and lot of things did not happen, than what happened to the 1.5 million dollars? Who has it.
Charles….that news surprises you? I havent believed the words of politicians of any stripe for quite some time now and I am sure I am not alone on that. They used to at least TRY to hide the corruption from the taxpayers, now it is in your face and they act like they are untouchable, and quite frankly, until our system of recall changes and something is put into place on the municipal level, they are essentially right.
He spoke,
The City doesn’t presently own the properties that are being foreclosed right now. These properties surround the property that the City owns, but are still owned by Commonwealth.
Let’s hope the city does not open the vault one more time and pay inflated prices for downtown property. Seems we always have money for land purchases but the vault is empty when is comes to infrastructure improvements.
Certainly appears from Ben’s article there is far to cozy a relationship between parties at city hall and Commonwealth. The quick flip on the PG hotel property and a 1/2 million dollar profit for Commonwealth certainly solidifies this thought.
It would be a smart idea if Mayor and all council – including city staff not touch anything else that comes in front of them from anyone of the people and companies mentioned above in the future until the court case is settled there could be more problems in the future..
Love Dan’s comments on the front page of the paper that he was “genuinely dumbfounded” that NDI would “call the loan” IMO he got the dumb part right, they are not “calling the loan” if it is past due and in arrears.
Loan was due Oct 31 so NDI is doing the proper thing to protect their interests.
Get a rope!
If every thing goes to plan the City will buy the properties in question. Anyone care to bet?
Cheers
“to steward the people’s money responsibly”
This comment from NDI Trust is laughable because public money should never have been given for a land flip in the first place.
Want to know how they are responsibly using public money? Go to the NDI offices and view the opulence for yourself
This is a biggar problem than it appears on the surface.
Firstly the money that NDI Trust uses to loan out, initially came to them through the Provincial Government. This amounted to some $185 Million dollars from the sale of BC Rail. NDI loans money to different business and groups, however the underlying premise of the loan is to created employment in the area.
Seems to me that the situation goes something like this.
1. Province gives money to NDI
2. NDI loans money to Commonwealth to buy property.
3. Commonwealth intends to sell the property to the Province, and one would assume make a profit.
4. Where are the jobs that should have been created???
5. Does the initial loan fall within the perameters of NDI’s mandate??
6. If NDI calls the loan, what happens to the property,
a. Does Commonwealth sell it privately and pay the loan?
b. Does the land go to NDI, and then given to the Province?
c. Does all these machinations mean that in effect the Wood Innovation Building will not be built and everyone who has money invested in and around the project are now running for cover??
Lets remember that NDI loaned some $11 Million to the Airport Authority, and as I recall the first payment came due in 2011. Seems to me that NDI extended the first payment date for a further 3 years. So it seems that they do in fact have some flexibility when it comes to collecting their money.
Hopefully people will keep their eye on the ball with this situation, and maybe, just maybe, we will get the real story.
From the story in the paper the properties are in the process of being sold, just not finalized yet… with a second potential buyer waiting in the wings.
The bigger question is “who are these potential purchasers, and how are they related to the rest of the players in this scheme”?????
I’m surprised that no one has commented on the fact that Pat Bell is making no comments, in light of the fact that he is the government spokesman for the Wood Innovation Project, and that the Land was accumulated to compliment that project!
I think we should all know by now that this complex is not and will not be realized.
Another promise unfulfilled by the Government.
Maybe McLaren is not the culprit here, and that Pat should Man Up…
Icicle, I agree that you post at 5:58 AM is bang on. Let’s see if you are right.
As far as I can tell from what has even become public by now, it has been evident that the province is interested in most or all of that block for some time. The interest in the PG Hotel did not happen out of the blue.
Commonwealth knew about that, but did not have enough money to act on assembling the land in order to take the risk that the intended location for the WIC may not actually be realized.
NDI, (remembering that the Directors include several Mayors from across northern BC, including the Mayor of PG) likely loaned the money based on the same knowledge that this was not a deal which was likely to fall through.
The thing we do not know is how much the asking price is for the property. If the price was too high, this may have been an astute move by the province. There has been some added value, in that the land, except for one building, has been cleared. Other than that, pay a 10% transaction fee and be done with it.
The design phase is about to switch to awarding no more than 3 proponents an award to do a schematic design for the property and present a turnkey and likely building operating proposal in a 3P context. In order to do that, those proponents will need to know the actual property. So the property will need to be secured either by purchase or irrevocable offer to purchase pending some conditions including a successful outcome of the next design phase.
In my view, this move has just given the province the upper hand unless Commonwealth can bring in another investor with actual money or the security to raise such money and pay the loan. Where others have fallen in one way or another, the province may not have done so.
Of course, this is all just conjecture since everyone in that kind of game keeps cards close to their chests, especially in this City. Not always the best approach, in my opinion.
“Money makes the world go around
The world go around
The world go around
Money makes the world go around
It makes the world go ’round.”
Now let’s all sing the following chorus at home at our computers ….. :-)
Money money money money money money
Money money money money money money
Money money money money money money
Money money
I read the Citizen this morning. NDIT is suing Heather Oland personally in BC Supreme Court.
It’s hard to understand how Oland can say that this is only a formality and that she severed all ties with Commonwealth. Does she really expect us to believe that it was all a mistake that she’s being sued.
Clearly she’s tied to this.
May I suggest the next mayor have an obvious tape recorder on the top of their desk. (If they’re honest). I would.
Having a tape recorder on the desk would not help, Harbinger, everyone knows all the shady deals are made in a back room:)
The laws need to be changed for anyone in public office miss managing tax dollars should have serious consequence or jail time.
Anyone seeks to be elected needs a rigorous course in politics. In this course these people need to be taught that you are not joining a mafia or a criminal organization. Now you may not need a recorder Harbinger.
govsux, “Get a Rope”
That’s way to funny ;).
If it was those times, that is what would happen when this kind of BS happened.
Not defending the mills but it looks like the province, WorkSafe, are using the mills as scapegoats for their lack of due diligence.
What has the city done with the last overdue contract from Commonwealth? Did they not help Commonwealth with yet another extension? I do not see a purchase price of $1.00 for that fiasco…
Mmmmmmm this is getting interesting.
So Dan says he was “dumfounded” Methinks he’s trying to make us believe that NDIT gave him no warning at all. The way it goes with loan repayments is that the money owing must be paid back within a certain timeframe. If that timeframe is violated for any reason, the lender would contact the debtor and have a “friendly” chat about the fact that the last payment deadline was missed….the debtor and lender would likely (still friendly) work out a new final payment date. NOW IF THE MONEY ISNT PAID BY THAT DATE, THEN A LITTLE LESS FRIENDLY CONVERSATION GOES ON BETWEEN THE LENDER AND DEBTOR… at which the debtor will once again make a promise to pay..if that date isnt kept, then things get serious and the lender says that the debt MUST be paid by (OCT 31st in this case). THEN if THAT date is not kept…the foreclosure papers are filed….
OK all of this is just to indicate that Dan’s comment of “being dumbfounded” is just blowing smoke… fact is..he would have been well aware that his company’s debt was due. So Dan..quit trying to smoke us with your dumbfounded nonsense.
Your house of cards is falling….couldnt happen to a nicer guy.
Don Kehler, Dan Mclaren and John Majors. Special people in PG. S’funny how that works.
All great questions! I don’t know much about this mess, but what I’ve learned and all those big names have got me suspicious. I’m interested to know more! Do some investigative journalism?
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