- BC Games
Crowsnest Centre site sold
By Joni MacFarlane
Editor, Crowsnest Pass Promoter
A large construction company has been awarded the sale and contract of the former Crowsnest Centre site.
Council voted unanimously on Jan. 22 to enter into a sale and construction agreement with Medican General Contractors.
The municipality has not released details about the sale or the type of development, although Mayor Bruce Decoux said on CJPR Radio that he believes a hotel is planned.
An appraisal of the site in July 2010 appraised the 6.26 acres of land at $1.4 million. This was based on $225,000 per acre.
Demolition costs were estimated at $673,000 with a fee of $82,000 to remove hazardous waste such as asbestos.
Started in Medicine Hat as a concrete company, Medican began building single-family homes and condominiums and was one of the first builders to introduce luxury condos for seniors.
They expanded across the country with completed condo developments in Quebec, Saskatchewan, B.C. and Alberta but ran into financial problems in 2010 when the combination of a collapsed housing market and massive debt load pushed them towards bankruptcy.
With unsecured creditors owed a total of $29.8 million, Medican entered into the Companies Creditors Arrangement Act (CCAA) in May 2010 and the court appointed a “monitor” to oversee restructure and a payment plan to creditors.
A $10 million settlement was agreed to in January 2012 that allowed creditors to receive a portion of the company’s debts. Payments were to be made semi-annually over a three-year period but this period can be extended if the market continues to be slow.
According to records from the Office of the Superintendent of Bankruptcy Canada, debtors include contractors, newspapers, Canada Revenue Agency as well as various cities, towns and real estate development companies.
Under the agreement, Medican 2012, the corporate entity that emerged from court proceedings, would contribute to a fund by continuing some projects of the former company and taking on new projects.
According to regular reports by Ernst & Young, in its capacity as CCAA Monitor, Medican “continues to act in good faith and with due diligence in respect of implementing its Plan”.
Before leaving office, Crowsnest Pass former municipal council accepted a policy to adopt a development agreement that will provide 100 per cent security of the estimated construction costs for municipal and utility improvements for all applicable developments before work starts.
Details of the sale such as price paid to the municipality and security arrangements were not available.
Calls by The Promoter to Medican in Medicine Hat were not returned as at press time.