The lawyer representing troubled Langley condo builder Newmark is confident that buyers will eventually move into their units.
“We are working hard on all fronts to resolve those issues,” Grant Sutherland told the Langley Advance this week.
Murrayville House was a project of developer Mark Chandler, who runs the Newmark firm headquartered in Willoughby.
The 92-unit condo complex was scheduled for completion in early 2016. Although it was finally given final inspections in early August, the condos remain empty as legal issues have dogged the development firm.
The Murrayville House project is currently facing a lawsuit by mortgage holders who say the developer is in default, a lawsuit by a group who said they put money down for “wholesale” units who have received neither money nor deeds to condos, and an emergency order by the B.C. Office of the Superintendent of Real Estate (OSRE).
Sutherland said he’s confident that an agreement can be reached with the group of mortgage holders, which will lift certificates of pending liens against at least some of the condos, allowing the completion of sales. If that happens, the ordinary buyers could move in.
“At least the home buyers will be in their rightful places,” Sutherland said.
He said the other group of creditors only loaned money to the project, and he expected a settlement to be reached. None of that group expected to actually purchase a condo, Sutherland said.
“Everybody knows that the arrangement was that the units would be sold to arms-length retail buyers in due course,” said Sutherland.
Most, but not all of those who invested at “wholesale” prices expected that their units would be sold again at retail price. But at least one would-be buyer, who asked that her name not be used, believed it was an ordinary purchase.
She invested $50,000 in early 2015 towards one unit with the impression that she would be taking possession when the Murrayville House condos were complete.
“I just learned today [Sept. 12] that my unit was sold to someone else in the fall of 2016 and assigned to someone else in the spring of 2017,” she said in an email to the Langley Advance. “Meanwhile, I was granted a first walk through in October 2016.”
She is speaking to a lawyer about the matter, but is not a participant in any of the lawsuits against Newmark yet.
She forwarded copies of the two contracts she was given to sign – one is labelled “Property Presale Agreement” and the other is a promisory note.
It says that the second contract, the promissory note, is there as security for the buyer.
Sutherland was asked why someone giving the company a loan would also receive a property presale agreement.
“I wasn’t involved when that transaction was done,” Sutherland said. “To tell you the truth, I don’t know that there were lawyers involved in that. At the same time, I guess I could turn around and ask you, why would someone get a promissory not when they’re buying property?”
“We have compelling evidence that shows that these are loans,” he added later.
According to the OSRE order, at least $3.2 million of the $4.5 million in deposits or loans from the group suing the project was not put into trusts.
“It was used for a variety of purposes,” said Sutherland of the money.
He could not be specific about those purposes.
Sutherland said the company was meeting with the OSRE and is confident they can get an agreement to allow the transfer of units.
As for Chandler’s possible extradition to the United States, as the result of an FBI investigation, Sutherland said it was “very much a red herring.”
“That doesn’t really have any bearing on this at all,” Sutherland said.
Newmark has other assets aside from Murrayville House, Sutherland said. He was brought in to deal only with the Murrayville House legal issues, he said.
Newmark was previously preparing to develop a condo project at 208th Street and 80th Avenue, but gave up much of the land there in a court-ordered sale. Another builder is now proceeding on that project.
There are no other Newmark projects under development in Langley Township or Langley City, according to municipal officials.