Proposed resort now site of court-ordered sale

SCOTT TRUDEAU Wednesday, July 15, 2009 Penticton Herald:

A prime Penticton property where a proposed five-star luxury condominium resort was to adorn the landscape is up for sale. The nearly 10-acre chunk of land at the corner of Skaha Lake Road and Yorkton Avenue that was to be transformed into the Skaha Beach Club & Spa is now part of a court-ordered sale. My Second Home Developments Ltd. had announced in May of 2008 that plans for the resort at the former site of Wonderful Waterworld waterslide were being terminated. Kelowna realtor Joe Ungaro of Royal LePage, who is looking after the property listing, said My Second Home Developments had earlier listed the property for sale for $22 million. The property has been listed with Royal LePage since May 13. Ungaro said the court order gives the lender the authority to step in and take title of the property if a buyer is not found within the listing period, although he would not say when the listing period expires.
Ungaro said he doesn’t know if the court-ordered sale means the company is in receivership. Earlier this year, the Alysen Place highrise residential development at Skaha Lake Road and Guelph Avenue - practically across the street from the Skaha Beach Club property - was placed into receivership, as its second and third phases were put on hold. He noted that the Beach Club property is presently in a redemption stage, meaning that if My Second Home Developments is able to sell the land within a certain time frame, and pay off any amounts owing, it would be able to redeem the property. "In that same period, there is an order of sale, granted to the lenders involved," said Ungaro, adding that if an offer comes in that is acceptable to the lenders, then the offer would be taken to court for the approval of a judge. "At the same time, anybody else that’s got an interest in the title, including the owner could apply to the court and put their case forward," he said. "It’s there to protect the owner and everybody else on title." If the property does not sell within the listing period, then the lenders could make an application for an "order absolute" which would result in them taking ownership of the property. "Usually there’s a sale if there’s a market for something and it doesn’t go there," Ungaro said.

"It’s certainly a different economic environment than it was two years ago to sell stuff like this. Two years ago this would have flown off the shelf and today, it takes somebody that can make sense of it." That means a potential purchaser might consider applying to change the zoning to something more feasible and in step with the current economy. "There’s not a lot of sites in the Okanagan that are nine or 10 acres left anymore," said Ungaro, adding that given the size, the site could be subdivided into four smaller lots. Mel Reeves, chief executive officer for My Second Home Developments, declined comment on the court-ordered sale. However, when announcing the demise of the Skaha Beach Club project last year, Reeves blamed the worldwide sub-prime mortgage crisis, saying the financing markets began to recoil with all the billion dollar write-downs that began in the summer of 2007. The company tried to present the project to financial institutions, hedge funds, private investors and financing groups but in the end, fell short. Plans were to showcase a full-service kitchen, a health and fitness club, a wine bistro, a cafe, convention and meeting rooms, a yoga theatre and a man-made lake.