A Vancouver developer that has accumulated more than $700 million in debt, according to court records, appears to be pushing back on media reports about its efforts to seek creditor protection and the potential impact on presale buyers.
Coromandel Properties has been acquiring land and developing multi-family residential towers and townhomes around Vancouver since 2013. But the company is struggling to make payments on its 16 properties — most of which are unfinished — according to a petition filed last week in B.C. Supreme Court that asks for time to sort through a maze of financial problems due to difficulty servicing its debts amid rising interest rates.
The statement, posted in Chinese, said some reports inaccurately reported the company owed more than $1 billion. The statement said the company’s Frame project, which is located in East Vancouver on Kingsway, is running according to plan.
The Frame project, which includes over 200 units, is being developed by Coromandel and Vancouver-based real estate company Peterson Group.
The statement directs buyers to call a sales centre.
The statement also mentions the Oak 52 project, which it says can be seen by anyone passing 6778 Oak St, which it said is proceeding on schedule and expected to complete at the end of the year.
More relevant information will be reported to buyers and real estate agents about these two projects as soon as they become available, the statement read, adding that the rest of the projects involve land that is to be developed.
The statement also said that no presale contracts have been sold for the rest of their projects and that they will not become a “rotten tail,” meaning they won’t be dropped or abandoned.
In closing, the statement said the company’s lawyers have made clear that the company reserves the right to take action against media and others who are spreading false claims, that there is evidence of this, and the company is collecting examples or files to make its case.
Coromandel has not asked Postmedia News for any corrections, retractions or clarifications in its reporting to date.
When asked about the Chinese-language statement on WeChat, a representative for Coromandel sent an emailed statement saying: “Coromandel cannot provide any further commentary. However, we will submit a secondary statement later this week.”
At a career development event co-hosted by Tsinghua and Fudan University alumni associations at Simon Fraser University’s downtown campus on Sunday, Vancouver Mayor Ken Sim was asked about shortening the time it takes to develop projects in the context of a question about news of a local developer’s financial troubles.
“Our permitting process is way too long and if we don’t make it faster, this whole thing falls apart because we will not be able to provide enough housing faster,” said Sim.
However, he also added that Coromandel was in “business knowing full well that the process is too long. Coromandel is suffering right now and I don’t want to belittle it. There are also a lot of developers that have gone through the same challenges that are still in business. What we do at the City of Vancouver is we provide an environment for businesses to succeed and businesses need to step up and operate.”
Some companies don’t make it, Sim said.
“That’s the fairness of free-market economies. By default, some (companies) go out of business.”
A hearing is scheduled at B.C. Supreme Court on Thursday.
