Langara West condo buyers contest developer’s offer
About 25 who paid deposits on cancelled project want larger payout for losses
Over a third of pre-sale condo buyers at the cancelled Langara West project in the Cambie Street corridor are challenging the developer’s offer to return their deposits, plus interest and an additional 50 per cent of their down payment, in exchange for a release.
It is the latest in a Vancouver real estate saga with a bit of everything: a property developer in southern China, a mysteriously felled tree, city hall defending its permitting process, and land values that have nearly tripled in just under three and a half years.
In an opening salvo, a set of buyers is preparing a so-called position statement for Vancouver-based Vivagrand, according to Timothy Peters at law firm Jenkins Marzban Logan. He has been retained by about 25 of the 71 buyers.
The one-, two- and three-bedroom condos they bought, starting two years ago, were pre-sold from as low as $700 to $900 a square foot in a hot neighbourhood where prices are now going for between $1,200 to $1,400 a square foot.
Many buyers feel they are now priced out of other condos in the area, either for use as homes or investments, given the appreciation in recent years.
The developer ended the project in August, telling buyers the land — which it bought in March 2014 for $12.5 million — will be sold.
Permitting delays by the city, exacerbated when a tree on the corner of the development was cut down without permission, plus rising costs and the loss of project financing, were to blame, the developer said.
The group of buyers intends to argue there has been a “fundamental breach of contract” that invalidates any “limitation of liability” cited in their purchase and sale contracts. They believe the developer’s offer of the deposit, plus interest and 50 per cent, is based on this clause.
“You can breach a contract in many ways: By delivering the project late, or the condo size may be different,” Peters said. “But the essence of the contract is to deliver a strata lot with common property. If you don’t do that, you are breaching it in a more fundamental way.”
If this is the case, “What is the measure of damages from the developer to the buyers? Is it the difference between what they paid and the current market value at the time of the breach of the contract?” Peters asked.
The group will also turn to consumer protection legislation set out by the province’s Real Estate Development Marketing Act (REDMA). It regulates the pre-sale of condo units and sets obligations for what developers must disclose, including updates about the strata site and financing, Peters said.
For example, as late as January 2017, the developer told buyers there was a firm commitment by lenders to proceed with the project. Eight months later, however, buyers were told in termination letters that delays in the project led to banks walking away from financing the project.
He adds the buyers “remain hopeful that the developer will appreciate the position they now find themselves in through no fault of their own and understand that the current offer that’s on the table is a fraction of their anticipated losses.”
Vivagrand has offices on West Broadway and describes itself as linked to Guangzhou-based real estate firm Xiang Li.