Recently I receive a message from an out-of-town reader of this blog: Not a Co-op member/owner (M/O) - only vaguely informed but curious about the planned new store and Nelson Commons - she e-mails the Board a few weeks ago, wanting to know if guests are welcome at the upcoming AGM. No reply, and - getting the not-interested/welcome vibe - will pass on this co-operative(?) group! Forthwith!
Now it seems the Co-op may actually build its mythical condos: this based on an announcement banks may lower the required condo-sales to 33 - which the Co-op thinks it may reach easily, currently being at 29 - and once this number is met financing kicking-in.
Deirdrie Lang, GM, tells me the announcement whether-or-not may be made at the end of September, and when I ask why not at the AGM - the logical time and place - she wriggles. Mays for days!
The definitive decision to build will raise several questions needing to be asked by so-called M/Os - the appropriate time and probably only opportunity to nail down witnessed answers: the AGM!
The idea to build condos comes from needing to make as much money as possible as quickly as possible to pay-off incurred debts and build whatever. This via Russell Precious, project-manager of whatever-to-be-built - the inexperienced Board getting in-line behind him. Building condos with a store downstairs is the superficially reasonable way to go: selling 54 units to the most adoring among the flock of Co-op-junkies seems like a walk in the park.
Enough indeed pre-pre-buy - feeding this presumption. But - when actual sales start: many don't take the next step. And when asked in astonishment why not - many say: we want to see it built before we commit.
Which - of course - is horse-puckie!
They pre-pre-buy because for a moment they feel special, closer to the Co-op-thing - the altar! - while not actually having to commit to anything. Heretics! And - this being Nelson - folks will go anywhere anyway, particularly if free food is involved.
But - if any of them genuinely are in condo-mode - they also may be considering the other 2 more recent local developments. In all-around wait-and-see dither.
Yet you can only dither so long: buying-before-building is the way it goes, with banks needing to see buyers' cheque-book commitment before committing themselves. This applies to all 3.
So the Co-op sells one here one there - eventually realizing they'll not meet the original quota of 40+. Soon dropping this condo-gestalt is not an option any longer:
We Must Build This Dammit!!!
Arriving at some understanding with their bankers - the sales-quota is to be lowered to 33.
That's where it stands - teeters - now!
Considering the already too-long gestation-period of this building in a dodgy market: only 33 out of 54 condos sold before breaking ground means enormous risk for banks. Which wouldn't take this risk without a sort-of collateralized debt obligation.
In this situation translating into the current store - its location not belonging to the Co-op; the store-fixtures fund; the far-from-paid-off Extra property.
Giving the store away - literally?
So - what exactly is offered as collateral by the Co-op to satisfy courted lenders?
The 1.7 mill store-fixtures fund - according to fine print - actually can be applied to just about anything the Board decides. And these funds will not be needed for quite some time.
So - how certain exactly can the lenders be that their unsecured-to-begin-with loans will actually be there for outfitting the store - when its time comes eventually?
Just building these condos does not automatically guarantee more buyers. Particularly as some out there - seriously considering a condo-purchase - may be waiting for life to be breathed into the other 2 local projects in the planning: The Crossing at Granite Pointe and Nelson Landing. These 3 currently planned developments may cross-cancel each other - definitely weaken interest.
Also - in the condo-market - unless buying purely for investment-purposes in strong large urban markets - a building too long in the making and then with too many vacancies is considered with suspicion. Condos here would be a very risky non-live-in investment for someone who's not swimming in the stuff!
So - who exactly is expected to buy 21 empties when?
It seems the real problems are only just beginning for the Co-op with this way-lowered quota - thus possibly imminent fixation-construction of vacancies! Once started: financial obligations have to be met consistently, fully. Otherwise banks - and potentially potential buyers - will get tetchy!
A house of cards.....!
With may this and may that and total lack of transparency/accountability thus far - it is still possible the building will not happen after all. Which once again needs raising the question frequently asked before - never answered! - the ONLY one of importance in a no-condos-after-all scenario:
So - how much money in total - a single amount! - has been spent on preparing for the unapproved-by-M/Os Nelson Commons endeavor?
You own this pop-stand! So ask! And don't be satisfied until "they" demonstrably satisfy you! Now! Here!
While you're at it: what's with recently/currently looking for a financial/grocery manager? Key positions!
New Grand Hotel, Vernon St.
Wednesday, Sep. 24