A B.C. Supreme Court judge extended court protection on Wednesday for the troubled company behind the Prima condo development in Richmond.
Formerly known as Alfa, the 6833 Buswell St. tower consists of 109 residential strata units — nearly half of which are unsold — and 10 commercial strata lots.
Anderson Square Holdings Ltd. filed a Nov. 27 notice of intention to make a proposal to restructure under the Bankruptcy and Insolvency Act. Deloitte was appointed the trustee. On Dec. 22, Justice Michael Stephens ordered the stay of proceedings be extended to Feb. 10.
Stephens agreed to extend the stay of proceedings again, to March 26, which is also the deadline for the company’s proposal.
“The project experienced delays and cost overruns as a result of various issues including a delayed building permit, replacement of the general contractor part-way through construction and lien claims, amongst other things,” said the Feb. 6 application for another extension. “As a result, the Prima project was not completed on schedule and the residential occupancy permit was not issued until September 2022 (not April 2019 as originally anticipated).”
That resulted in several liens, including a claim from builder Scott Construction, which were cancelled by court order on Nov. 2 when Anderson Square deposited almost $5.4 million into the court as security funds.
A report to the court said that the company’s one known potential secured creditor is Anderson Plaza Holdings Inc., which demanded repayment of $64.1 million in loans last Nov. 20.
“The sale of the remaining units in the project have been slower than anticipated for a number of reasons, largely due to the rapidly increasing interest rates from April 2023 onwards that has made it very difficult for buyers to secure mortgages from the banks as they are facing greater difficulties passing the mortgage stress test,” said the court filing.
It also said the units, which have a lower per square foot price than competitors, have larger units and higher end finishings, meaning they are generally more expensive than competitors.
The company has rented eight of the units deemed affordable housing, but 48 of the one-to-three bedroom condos remain listed for sale through Re/Max WestCoast Realty for a combined total of $51.28 million.
Two additional residential units subject to unconditional sales contracts are considered sold. Two commercial units are listed for sale for approximately $4.6 million. The assets also include unsold parking spots with and without electric chargers. The company also has $17.8 million cash on hand.
Anderson Square Holdings Ltd. sought the extension in order to finalize the claims process and work with Deloitte about terms of the proposal to creditors. The filing said that Deloitte was satisfied the company is acting in good faith and would make a better proposal with an extension than if it were liquidated. It also said no creditor would be materially prejudiced by a delay.
The company is also awaiting judgment in a separate B.C. Supreme Court matter. A breach of contract trial was heard in December and January, after 37 disappointed pre-sale buyers sued Anderson Square Holdings Ltd. and directors Keung Sun Sunny Ho and Jia An Jeremy Liang in late 2019.
