VANCOUVER - Vancouver's Olympic Village is at least $131 million over budget and it's unclear how much the city might lose when the $1-billion project is eventually sold on the real estate market, an auditors report has concluded."There seems to be a degree of consensus around the cost to complete ...," says the report by KPMG, which was released today after months of delays at City Hall. "Unfortunately, less clear is the timing and quantum of revenues that will ultimately be generated from the sale of Millennium Water."The business model underlying the city's real estate project is to have the developer, Millennium, build the units and then sell off the condo units after the Games, when Olympic athletes leave. But the steep decline in the real estate market has threatened to slow the rapid sale of the condos.That means some units will not go to the market as quickly as anticipated, creating carrying costs for the already stressed developer. Both the city and the developer need prices to be above construction and loan costs to turn a profit. (more)
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Mayor Robertson slams previous council for Olympic Village budget nightmare
Mayor Gregor Robertson slammed "a total failure of leadership" in previous council moves that could lead to heavy losses on Vancouver's troubled $1-billion Olympic Village project.Robertson was speaking outside city council chambers following the release of a report on project problems, by an auditor, KPMG. The report says the city project is at least $100-million above budget, and lays some blame on lack of financial due diligence by the city in checking whether developer Millennium had the financial capacity to complete the project successfully, before choosing the developer. (more)
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