In a way, the exposed rebar at the stalled Capital City Centre development at Colwood Corners resembles metal weeds that have sprouted up from a period of neglect.
With the liquidation of its assets expected to start in earnest soon, it’s clear the League group, which once had a grand vision for the 13.9-acre site, won’t be the developers of the site.
The recent decision to include the Colwood site with League’s other holdings in the court-ordered mass selloff is good news to Colwood Mayor Carol Hamilton.
“We’re still sitting with a hole in the ground,” she said. “But I’m hoping there’s some attraction to it that will bring somebody to the forefront. Hopefully there will be somebody out there who can realize the benefit to what has already been done.”
By the time construction stopped on the project last summer, the only work completed was essentially an underground parking lot.
While investors in the failed company will receive their vastly diluted share of the funds once the company’s assets have been liquidated, Colwood expects to see the outstanding property taxes and fees in full.
It also includes interest that has accrued. The current amount owed, with interest, is approximately $350,000, according to city finance staff. The mayor stressed that “Colwood is not at risk.”
The Capital City Centre situation is far different than when the Lehigh gravel pit closed in 2007-08.
That property, now central to the massive Royal Bay development project, was re-assessed at the time and transformed from a revenue-producing operation to a fallow piece of land.
“It took a million dollars out of the coffers of the city in taxation,” Hamilton said.
A report released last month for stakeholders by court-appointed monitor PricewaterhouseCoopers laid out the reasons for League’s collapse, including the devastating blow to the market value of the Colwood property, on which it embarked upon its first “ground-up” development. League’s property holdings primarily consisted of existing buildings.
The report states that League intends to liquidate all operations and assets by the end of 2014, rather than consider restructuring and attempt some form of development on the Colwood property.
Answering residents who point fingers at the City of Colwood in this scenario, Hamilton said even with staff and council’s best efforts, it’s difficult to foresee the market changes and other factors that can lead to the financial ruin of development companies.
“We would probably be safer to look (only) at small residential subdivisions, but what does that speak to at the end of the day for the overall health of the community? Not much.”
Facilitating economic growth requires taking chances with well-established, well-backed developers who are willing to dig deep and invest in the community, she said.