Lake Placid River Landing Village: 100 days later and Parcel “Y” is still empty; ‘we now have financing in place,’ Lobsinger to Cheveldayoff on May 28

Today marks 100 days since Saskatoon city council officially caved in to Lake Placid Developments request to re-open the sale agreement for Parcel “Y” and adjacent lane that died October 30, 2009, when the developer failed to meet a firm payment deadline for the full balances owning on the land.

On June 14, 2010, council voted 9-2 in favour of entering into a sale agreement with Lake Placid to sell the land for $5.24 million – less than half the appraised market value of $11 million.

The agreement gives Lake Placid until November 1, 2010, to supply the city with a copy of a commitment letter from a financial institution or other lender, or such other documentation satisfactory to the city, which shows that it has obtained financing in an amount sufficient to complete construction of the proposed River Landing Village to grade level, including excavation and shoring footings and foundation and all levels of the underground parking structure.

The deal reversed a decision by councillors on August 19, 2009, that if the developer failed to meet the October 30 deadline the sale agreements for Parcel “Y” and lane would be terminated without a further resolution of council.

Delays and missed deadlines have plagued the development since Lake Placid submitted its request for proposals in September 2007.

As of September 22, 2010, the Lake Placid sales trailer located on the site of the former Royal Canadian Legion, Branch #63 building next to Parcel “Y” remains closed, on blocks, and without power.

Lake Placid CEO Michael Lobsinger and his partner, Dr. Karim Nasser of Victory Majors Investments Corporation, have repeatedly assured that financing is in place and the project ready to go.

Lobsinger and Nasser addressed council on March 22, 2010, hoping to resurrect the long dead sale agreements.

NewsTalk 650 reported Lobsinger saying that with council’s approval, the massive condo-hotel-residential-retail complex could be completed in 36, to 38 months.

“We are in position, along with Dr. Nasser, are in a position to close on the land immediately,” said Lobsinger. “And start excavation on the site within 45 days.” [Lake Placid Developer Ready to Build (NewsTalk 650, March 22, 2010)]

CBC News has Nasser on record as saying pretty much the same thing that work on the project could begin 45 days after the city sells the land, and the development could be completed within three years. [Saskatoon gives River Landing bid another chance (CBC News, March 23, 2010)]

According to the StarPhoenix, Lobsinger told reporters after the March 22 meeting that he wasn’t interested in another request for proposals.

“We’re ready to get going literally in May. We can start now instead of two years from now,” he said.

Lobsinger was asked about the elusive signature that he said was forthcoming within days when he spoke to council last year on financing the project, but said it was “not an issue for the public.”

“Nothing has happened, I’m one signature away,” he said. [Developers tout plan (StarPhoenix, March 23, 2010)]

That was six months ago.

On May 26, 2010, the StarPhoenix reported that the city had reached an agreement with Lake Placid, in partnership with Nasser’s company, on the price of Parcel “Y”: $5,240,494. The deal was struck at a closed door meeting of city council, sitting as an executive committee, the previous day. However, the agreement still needed council’s formal approval, set for June 14, 2010, because the purchase price was for less than market value.

“We’re ready, willing and able now to proceed with the $200-million project,” Lobsinger said on May 25. “We have financing in place . . . and are ready to move dirt in June or July.

“We’re going to be going forward with all phases of the project right away.” [City sets Parcel Y price (StarPhoenix, May 26, 2010)]

The terms of the sale agreement were released the week of June 7, 2010.

On June 11, 2010, the StarPhoenix reported Nasser saying that a deal approved by city council to sell the land will allow the company to complete financing commitments.

“We need the land before anybody will say yes, 100 per cent,” Nasser said. “Once the land title is in our hands, it should only take a couple of weeks.”

StarPhoenix reporter David Hutton revealed that Lobsinger and several business groups circulated a letter soliciting support, a call that was met with dozens of letters to city hall, including one from the then Enterprise Minister Ken Cheveldayoff, who urged council to move forward on the sale, a rare move for a cabinet minister. [Minister backs deal (StarPhoenix, June 11, 2010)]

“As the Minister of Enterprise, the Minister Responsible for Trade and the Minister Responsible for SaskEnergy I am pleased to forward this letter to you in support of the Lake Placid project in Saskatoon,” Cheveldayoff said in the letter dated June 8, 2010.

“I understand that City Council will vote on the final approval of this project on June 14, 2010. I strongly encourage the Mayor and all Councillors to support the Lake Placid project so we can continue to build our city for a very bright future.”

Cheveldayoff lives in Saskatoon. You’d think by now he would be aware of the project’s history and have more sense than to get drawn into the controversy. Apparently that’s not the case.

The minister’s letter was in response to an email from Lake Placid on May 28, 2010, seeking his support. A copy of the email was recently obtained from Enterprise Saskatchewan through an access to information request.

In the message, Lobsinger notes “we now have financing in place, a new partner in Dr. K. Nasser and we can now move forward with this project.”

Lobsinger further states that, “The last hurdle that we need to climb is for final approval of this project which will be voted on June 14th, 2010 at City Council.”

In saying that ‘we now have financing in place,’ Lobsinger seems to be implying that the funds weren’t there earlier even though that’s what his company advised the city last year.

In March 2009, Mayor Don Atchison told the StarPhoenix that Lake Placid had assured city administration it has financing in place for the project and was awaiting the change in provincial legislation that would introduce “strata” land titles to allow for separate condo corporations to operate on the same site. Lake Placid required the legislative change in order to move forward. [Construction delay (StarPhoenix, March 12, 2009)]

With Lake Placid there seems to be no such a thing as a last hurdle. Almost from Day 1, the project has been mired in problems. The only thing keeping it alive appears to be city council’s desperation to get something, anything, built. Bending the rules, favouritism and deadline extensions now seem to be the norm.

Lobsinger and Nasser addressed council again on June 14, 2010. This time they were accompanied by an army of local business weasels declaring their undying support for the project. The parade of suits included: Keith Moen, executive director of the North Saskatoon Business Association; Randy Pshybelo, executive director of the Riversdale Business Improvement District; Terry Scaddan, executive director of The Partnership; Dale Botting, the former CEO of Enterprise Saskatchewan; Brian Chalmers, president of the Greater Saskatoon Chamber of Commerce; and, Alan Thomarat, executive director of the Saskatoon & Region Homebuilders’ Association.

Of course, if the Lake Placid project fails to materialize these folks will likely disappear into the woodwork when it comes time to clean up the mess.

According to the meeting minutes, Lobsinger indicated “that the financing is in place for the proposed project.” Nasser said “that the project is ready to move forward.”

In the StarPhoenix the next day, reporter David Hutton wrote: ‘Lake Placid CEO Michael Lobsinger said the agreement for the sale of the land paves the way for the company to secure financing.

‘Lake Placid will be putting out tenders for surface excavation and going through the legal hoops to get title to the land, a process Nasser hopes could be completed in three to six weeks, depending on land titles.

‘“We can move forward and move forward quickly,” Lobsinger told council.’ [City backs Lake Placid (StarPhoenix, June 15, 2010)]

And the wait continues.

Not everyone is enamoured with Lake Placid. In council’s agenda package that evening was a letter from James Polley of Allan’s Landscaping Ltd. in Saskatoon recommending that the developer’s project not be approved because of an outstanding account. It seems Allan’s did some work for Lake Placid in the summer of 2008 but did not receive payment for it. The balance due was $8,739.76.

“If this is how they deal with small companies, by not paying their bills, and have failed to follow through with their first agreement with the City of Saskatoon. How do we see they are going to be a better corporate citizen in the future?” said Polley.

In an email on September 17, 2010, Polley confirmed that the bill remains unpaid and Lake Placid still on the books as a bad account.

Then, on July 13, 2010, a Saskatoon resident posted a message on SkyscraperPage.com, an Internet forum discussing development news and construction activity on projects from around the world, alleging they received an email update from Lake Placid. The message reads, in part: “Recently the City of Saskatoon gave final approval to Lake Placid Developments (SK) Inc. and its partner Dr. Nasser to proceed with the River Landing Village. We are proceeding with consolidating the land title and will be announcing our sod turning event in the very near future.

“We will be relocating our sales trailer to an adjacent property near our construction site. As a registrant you are considered our VIP and will be given top priority at our upcoming sales event. All registrants will be sent personal invitations and will be given the opportunity to review the suites and select the units of their choice in advance of any public offering. Please stay connected for information updates that will be posted on our website.”

To date, no sod turning ceremony has been announced and the sales trailer hasn’t moved an inch since last fall. The 1-888 number advertised on the front of the trailer does not appear to be in service either.

Back in October 2008, it was reported that sales manager Richard Lobsinger, the CEO’s son, had moved to Saskatoon. The company at the time was preparing to take deposits on condos. [Fingers crossed for financing (StarPhoenix, October 17, 2008)]

Now when you check the Lake Placid website Richard Lobsinger no longer seems to be part of the team.

And finally, an unsettling news story has emerged out of Calgary concerning Lake Placid’s stalled Centuria on the Park project at 13th Avenue and 2nd Street S.W., which has reportedly been plagued with problems for nearly three years.

According to the Calgary Herald, the city’s building inspection department on September 10, 2010, ordered the developer to fill the empty excavation pit by November.

That follows a previous order this summer, urging the company to build the site up to ground level, said reporter Sherri Zickefoose.

Uncertain about the safety of shoring walls around a large construction hole, the city declared the site itself is creating endangerment to the public as well as potentially damaging properties adjacent to it.

A company spokesperson could not be reached for comment.

The city has given Lake Placid two weeks to start the backfilling and until November 15, 2010, to finish. [Beltline condo developer ordered to fill excavation pit by November (Calgary Herald, September 12, 2010)]

At least Saskatoon doesn’t have to worry about that. Not yet anyway. But council will find a way to make it happen.

Lake Placid sales trailer, Sept. 2010