Some Ottawa homebuyers say a developer has left their lives and their finances hanging by failing to finish — or in some cases, even start — building pre-purchased townhomes that were supposed to be move-in ready before the COVID-19 pandemic.
CBC News has seen the purchase agreements of five individuals who bought homes in a new development called Fresh Towns on Baseline Road in the city’s west end. The builder, Greatwise Developments Corporation, is headquartered in Toronto.
The pre-construction contracts were all signed between 2017 and 2019 for homes priced between $344,000 and $465,000 and scheduled to be completed by early 2020.
But according to the buyers, the townhomes aren’t ready. Four said construction hasn’t even begun.
“I’m devastated. I’m frustrated,” said one buyer who has waited more than five years.
Complainants said they’ve not heard from the company in months, and have no update on the status of their homes.
In some cases, the developer has offered to return deposits, but the homebuyers have refused, believing they deserve additional compensation. Some also suspect Greatwise of wanting to flip the properties for greater profit — a claim the company refutes.
Three homebuyers agreed to share their stories in detail. CBC has agreed to withhold their identities because they fear speaking publicly will give the developer cause to terminate their contracts, which stipulate the vendor may axe the deal in the event of a dispute.
At least one client has filed a consumer complaint to the Home Construction Regulatory Authority, which oversees home builders and vendors in Ontario. The issue was even brought before the Ontario Legislature earlier this month during question period, with no clear resolution.
In a letter emailed to CBC, the company said the last several years have been “extremely difficult.”
Greatwise said its business has been severely hampered by the pandemic and “while the emergency may have faded from the public’s view, its effects continue to be very real, with impacts across all areas.”
Eight of the 15 planned blocks of townhomes have been completed and delivered to buyers, it said.
“We are hopeful that conditions will continue to improve and enable us to proceed with the remaining blocks,” the company wrote, adding it must now proceed “incrementally.”
The site off Baseline Road in Nepean where buyers say their townhomes should have been built three years ago. (Jean Delisle/CBC)
The purchase
One homebuyer — CBC is calling him Alex — said he placed a $60,000 down payment on a two-bed, two-bath townhouse worth about $370,000 at Fresh Towns in the spring of 2019. His initial closing date was scheduled for February 2020.
Alex had recently moved to Ottawa, and said the property was within both his price range and desired neighborhood.
“I was excited. It was brand new,” Alex said. “A freehold within the Greenbelt is great to have.”
Another buyer, John, said he and his relatives wanted to move closer to each other so they purchased multiple properties from the developer in 2018, each worth more than $340,000.
John said he made more than $100,000 in down payments for the homes, which were due to be completed by 2020.
A third homebuyer, James, pre-purchased a $354,000 townhouse in the fall of 2018 and hoped to move in by 2020. He and his wife had just had their first child and this was to be the family’s first home.
“It just had kind of everything that we were looking for in a home. Plus it was new, so I mean it looked all good from the start,” James said.
Delays begin
James, who lived near the building site, would regularly drive by to check on his home’s progress in the months following his purchase. He said it quickly became clear construction was behind schedule.
The developer issued several notices of delay, which CBC has seen, leading up to March 2020. According to one early letter from the Fresh Towns sales team, moving dates needed to be rescheduled because of “some unanticipated directives from the City of Ottawa that caused unforeseen delays beyond our control.”
Alex said he wasn’t worried at first. The homebuyers’ contracts accounted for delays and limited the number of times the developer could move closing dates.
A homebuyer points to his contract with Greatwise Devlopments Corporation. It lists several tentative closing dates in 2020. The latest date Alex expected to be able to move into his new home was June 11, 2021. (Jean Delisle/CBC)
According to the fine print, those restrictions would have pegged the closing date for most clients to mid-2021 at the latest, barring any “unavoidable delay.”
When the pandemic was declared in March 2020, however, homebuyers were told closing dates were delayed indefinitely.
“It is difficult at this stage to be certain if or how long the total delays may be and thus how the construction schedule for your home will be affected,” read a letter delivered that month.
“We [were] kind of just left in the dark by that point,” said James.
Delays continue
Subsequent updates from the company continued to blame the pandemic for the delays.
“Some of our finishing material is not arriving on site on the dates previously committed by suppliers,” one letter dated October 2020 read. “With the second wave of the pandemic, we anticipate there may be even more impacts to the schedule.”
Letters sent in April, May and October the following year pointed to “extremely difficult” supply chain issues.
Another letter sent in June 2022 said building permits for the project had still “not yet been issued by the city due to the delays caused by the COVID-19 pandemic.”
Homebuyers said that was the last official correspondence from Greatwise.
Asked by CBC to clarify the reason for the holdup, the city’s department of planning services said the developer hasn’t filed all the required documentation to issue building permits — specifically, plans to ensure city services and stormwater management wouldn’t be disrupted during construction.
In its response to CBC, Greatwise said “site servicing has not started” on the final three blocks of townhomes. It said the same contractor responsible for the previous phases of construction will file the documents.
“We knew there was going to be some sort of delay and we were expecting it to take, I don’t know, quite a while,” said James. “But five years isn’t what I was expecting.”
An offer turned down
As time dragged on, some homebuyers said they felt the developer was encouraging them to walk away from their purchases.
“Any other correspondence we had with them, they wouldn’t fail to suggest to homebuyers, ‘You know, you can have your money back if you want,'” said Alex.
The homebuyers told CBC they suspect the developer wants to resell the properties at a higher price.
An Instagram post by Greatwise Developments advertising its Fresh Towns development last April. (Instagram.com/greatwisedevelopments)
In April, Greatwise Developments advertised some of the pre-construction homes within the Fresh Towns development for sale, after having announced previously that the units were sold out in 2020.
The prices of those homes are not publicly listed, but MLS listings dating back to 2019 show at least five other completed homes in the Fresh Towns development were sold for approximately $480,000 to $675,000 — significantly higher than the pre-construction prices listed on the contracts shown to CBC.
Those homebuyers feel they deserve to be reimbursed for a portion of the increased market value should they accept their deposits back. Mortgage rates have also crept up since they first signed their contracts.
“Considering the amount of time that we’ve been waiting and how the economy has kind of shifted, having our deposit back isn’t really going to help us out at all,” said James.
Greatwise disputes allegations that it’s trying to flip the delayed homes, pointing to its record of selling and delivering units at their original prices.
The company maintains it only re-lists a home after a purchase agreement falls through.
No help, say homebuyers
Numerous attempts to escalate their complaints have failed, some homebuyers said, leaving them feeling helpless.
Alex filed a complaint to the Home Construction Regulatory Authority (HCRA) two years ago, but said there’s been a lack of communication from the regulator since then.
“The HCRA takes all complaints seriously and is aware of the issue, and an investigation is underway,” according to a statement from the HCRA, adding it doesn’t comment on current investigations.
Generally, “project delays are common and do occur, however delays with no reasonable justification could be considered a breach of contract,” the HCRA said.
Calls for the provincial government to get involved have also gone unanswered, said Alex.
In a statement to CBC, a spokesperson for the minister of Public and Business Service Delivery said “government has zero tolerance for any bad developers making money off the backs of hard-working Ontarians.
“The disciplinary actions the HCRA can now take against unethical developers include the ability to revoke a builder’s licence and the use of administrative penalties upwards of hundreds of thousands of dollars.”
The ministry said it could not comment further while the HCRA investigates complaints made against Greatwise.
A homebuyer surveys the site where his new home is supposed to be. He says he won’t walk away until the developer returns his deposit and compensates him for the increase in value. (Jean Delisle/CBC)
Fresh Towns responds
CBC asked for an interview with the Fresh Towns client care team, which responded with two letters.
“We understand and empathize with some purchasers’ frustrations about the timelines, and we share their frustration and desire to get these units delivered. Unfortunately, it’s not as easy as wishing it to come true,” read one.
The developer said it’s operating within the parameters of its contracts with homebuyers, and through procedures set by Tarion, a consumer protection organization established by the province.
Those include an “unavoidable delay” procedure allowing developers to extend closing dates for as long as there are “direct impacts of the pandemic itself upon the time for delivery of the home,” according to Tarion.
Fresh Towns hasn’t yet met the conditions “for exiting unavoidable delay in respect of all the blocks in the project,” the client care team told CBC.
The team said it has been in regular contact with customers and responds to all requests for information.
Lives on hold
Alex, John and James said more needs to be done to protect homebuyers who are out tens of thousands of dollars and are still nowhere close to moving into the homes they committed to buying five years ago.
Alex said the last few years have been “a nightmare.” He decided to buy another house but it took about 200 viewings and 50 offers before he found one at a much higher price.
“I’m devastated. I’m frustrated,” he said. “I’m surprised that in what you consider a first world country, this is allowed to happen.”
John said the situation forced his family to consider living elsewhere.
James’s family moved in with his parents while waiting for their home, storing furniture there for years. They eventually moved across the country because of work.
“That was also tough because I have this down payment into this property, but now I have to look somewhere else. So it’s just tough financially and in a bunch of other ways, to be honest,” he said.
Ottawa Morning9:13Frustrated homebuyers still waiting for the keys, 5 years later
Five years after placing a down payment, some owners are still waiting for their townhouses that were slated to be built before the pandemic.
Telus Corp. says it is avoiding offering “unprofitable” discounts as fierce competition in the Canadian telecommunications sector shows no sign of slowing down.
The company said Friday it had fewer net new customers during its third quarter compared with the same time last year, as it copes with increasingly “aggressive marketing and promotional pricing” that is prompting more customers to switch providers.
Telus said it added 347,000 net new customers, down around 14.5 per cent compared with last year. The figure includes 130,000 mobile phone subscribers and 34,000 internet customers, down 30,000 and 3,000, respectively, year-over-year.
The company reported its mobile phone churn rate — a metric measuring subscribers who cancelled their services — was 1.09 per cent in the third quarter, up from 1.03 per cent in the third quarter of 2023. That included a postpaid mobile phone churn rate of 0.90 per cent in its latest quarter.
Telus said its focus is on customer retention through its “industry-leading service and network quality, along with successful promotions and bundled offerings.”
“The customers we have are the most important customers we can get,” said chief financial officer Doug French in an interview.
“We’ve, again, just continued to focus on what matters most to our customers, from a product and customer service perspective, while not loading unprofitable customers.”
Meanwhile, Telus reported its net income attributable to common shares more than doubled during its third quarter.
The telecommunications company said it earned $280 million, up 105.9 per cent from the same three-month period in 2023. Earnings per diluted share for the quarter ended Sept. 30 was 19 cents compared with nine cents a year earlier.
It reported adjusted net income was $413 million, up 10.7 per cent year-over-year from $373 million in the same quarter last year. Operating revenue and other income for the quarter was $5.1 billion, up 1.8 per cent from the previous year.
Mobile phone average revenue per user was $58.85 in the third quarter, a decrease of $2.09 or 3.4 per cent from a year ago. Telus said the drop was attributable to customers signing up for base rate plans with lower prices, along with a decline in overage and roaming revenues.
It said customers are increasingly adopting unlimited data and Canada-U.S. plans which provide higher and more stable ARPU on a monthly basis.
“In a tough operating environment and relative to peers, we view Q3 results that were in line to slightly better than forecast as the best of the bunch,” said RBC analyst Drew McReynolds in a note.
Scotiabank analyst Maher Yaghi added that “the telecom industry in Canada remains very challenging for all players, however, Telus has been able to face these pressures” and still deliver growth.
The Big 3 telecom providers — which also include Rogers Communications Inc. and BCE Inc. — have frequently stressed that the market has grown more competitive in recent years, especially after the closing of Quebecor Inc.’s purchase of Freedom Mobile in April 2023.
Hailed as a fourth national carrier, Quebecor has invested in enhancements to Freedom’s network while offering more affordable plans as part of a set of commitments it was mandated by Ottawa to agree to.
The cost of telephone services in September was down eight per cent compared with a year earlier, according to Statistics Canada’s most recent inflation report last month.
“I think competition has been and continues to be, I’d say, quite intense in Canada, and we’ve obviously had to just manage our business the way we see fit,” said French.
Asked how long that environment could last, he said that’s out of Telus’ hands.
“What I can control, though, is how we go to market and how we lead with our products,” he said.
“I think the conditions within the market will have to adjust accordingly over time. We’ve continued to focus on digitization, continued to bring our cost structure down to compete, irrespective of the price and the current market conditions.”
Still, Canada’s telecom regulator continues to warn providers about customers facing more charges on their cellphone and internet bills.
On Tuesday, CRTC vice-president of consumer, analytics and strategy Scott Hutton called on providers to ensure they clearly inform their customers of charges such as early cancellation fees.
That followed statements from the regulator in recent weeks cautioning against rising international roaming fees and “surprise” price increases being found on their bills.
Hutton said the CRTC plans to launch public consultations in the coming weeks that will focus “on ensuring that information is clear and consistent, making it easier to compare offers and switch services or providers.”
“The CRTC is concerned with recent trends, which suggest that Canadians may not be benefiting from the full protections of our codes,” he said.
“We will continue to monitor developments and will take further action if our codes are not being followed.”
French said any initiative to boost transparency is a step in the right direction.
“I can’t say we are perfect across the board, but what I can say is we are absolutely taking it under consideration and trying to be the best at communicating with our customers,” he said.
“I think everyone looking in the mirror would say there’s room for improvement.”
This report by The Canadian Press was first published Nov. 8, 2024.
CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.
It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.
The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.
Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.
TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.
The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 7, 2024.
BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.
The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.
On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.
“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.
“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”
Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.
BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.
The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.
BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.
It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.
The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”
Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.
This report by The Canadian Press was first published Nov. 7, 2024.
