December 10, 2003

Well ladies and gentlemen, once again consumers have received the “Minnesota Shuffle” with respect to the investment that they make in Developers through the developments they bring on stream.

In August 2002 a greatly heralded arrival of The Hudson was announced with flashy full page newspaper and condo magazine ads, press releases, television commercials and the whole nine yards. The announcement was following the completion of the Morgan at Richmond and Spadina, the company’s most recent multi-residence development at the time. Great Gulf is best known for its years of building single family residences but moved into condominiums a few years back.

As most of my frequent readers already know, I was one of the first purchasers in The Hudson. I liked the location and the package that was being offered. The Developers both have a good reputation (as mid market developers), were local and had just finished a building just around the corner.

When I bought (back in June 2002) I was told that “Occupancy was Spring 2005”. Last week, after 18 months of marketing they sent me a subtle notification that the occupancy date was now Spring 2006.

This delay cannot be as a result of outside sources as there has yet to be any construction undertaken. They have sold 60% or so and have assured me that they have their construction financing (regulated by 60% sales). As a Realtor, I am limited to the information made public by the Developers. I have no inside track or preferred relationship with Developers. They simply agree to pay for my professional fees for referring my clients to them and they don’t necessarily like having to pay me for making sure my buyers are fully protected. It is a strange relationship but one of absolute necessity thus we tolerate one another.

I am not convinced that Developers in general but Great Gulf in specific fully understand the burden that delays pass onto their buyers, those who have entrusted their money and trust into. I have buyers who had decided, based specifically on Great Gulf’s representations of a year and a half occupancy cycle (standard in the industry) in the Month of November 2004 only to announce a couple weeks later that another year was being added.

These clients had chosen to buy new and rent for the 18 months represented to them. I fully supported their decision as economically it made sense. The adding of a full year to their equation significantly affected their bottom line not to mention their lifestyle. There are no apology letters sent out, and actually not even notification to previous buyers (I have not received any formal notice of delay from Great Gulf).

It is absolutely imperative to those considering buying new that they be aware of delays in delivery. When you purchase a presale you are given a “tentative completion date” for “Occupancy”. Occupancy is the time at which you will take control of your condo home and when the Developer relieves himself of the financial burden (Phantom Mortgage) of carrying costs on the unit.

As with all material things in life, the devil is in the small print and with condos, all documents are prepared by the Developer’s Lawyers so understand that they are, by nature, one sided in favour of the Developer. From a layman’s perspective, condo sales agreements are “take it or leave it documents requiring that the purchaser bear all of or as many of the burdens as possible”. To most condo lawyers these documents constitute the same thing although there are clauses that will be changed that cap small levies, taxes and assessments.

A brief glance through these “packages of documents” tells you that you are responsible for everything, yet everything therein is “subject to change without notice” and “room sizes may vary” and “square footage not assured” and “plans may be changed at the discretion of the developer” and the list goes on, and on, and on.

Don’t get me wrong, there are legitimate delays that occur that are beyond the control of the developer, however delays before anything is started is suspect!

Let’s take a look at the entire scenario to hopefully allow us to see the flaws to hopefully enable us all to make the adjustments necessary to bring control over to the Buyer’s side of the equation.

Most purchasers just walk into a condo sales site after seeing a glitzy ad (tv, newspaper, radio, magazines, billboards, hording, etc.). The first thing that you are required to do is “Register” (or whatever they call it - I’ve seen them say they can’t give you any information or let you even look unless you complete the form).

The moment that you “Register” with them they relieve themselves of the burden of honoring their offer to underwrite a Buyer’s Agent’s Fee for you. People just keep walking in and voiding their access to FREE professional council, advice and opinion. Heck, I still have clients calling me after having visited the developers sales site and Registered even after finding it from my web site (where it is made abundantly clear “not to go to the sites without me“). Then, of course they all want my professional assistance to help them convince themselves that they are making the right decision.

That piece of mind alone is justification of why you want to Register ONLY WITH ME and then visit the sites WITH ME. You have a FREE negotiator who knows all the developers (good and bad) who is familiar with every possible perk that can be negotiated on your behalf. I read and understand floor plans like few other Realtors (I’ve been at it since the 80’s) and can juxtapose your potential suite into the existing environment to enable you to understand your view, light and noise factors.

The solution is actually quite simple and clear. Whenever you find disparity you seek out a means of balancing the equation. Pooling resources through a Buyer’s Association or Exclusive Buyer’s Agency would shift the power from the Developers to the Purchasers.

This can be achieved quite easily through ALL Realtors Registering with simplycondos.com. With time, these collectives of condo buyers would force developers to respond more to buyer issues insuring a more superior product. At present you really get what a developer gives you.

So, when is Hudson scheduled for delivery? . . . Well, the most recent published completion date as of December 10, 2003 is Fall 2006 (tune in and I’ll keep you informed).

To those clients who were buying and renting for the represented year to year and a half I apologize for having stood behind Great Gulf’s published representations. This is unique conduct based on my knowledge of them in the past and will form an integral element of my presentation to future clients when dealing with Great Gulf projects.

Don’t get me wrong though, Great Gulf delivers a quality product. I remain confident in my endorsement of this developer and development and believe me, my endorsements are not easily attained. Money won’t buy one (much to the chagrin of many developers) and I won’t allow any to advertise on my site (even though I frequently receive inquiries).

What you find on my website is the bottom line truth on the market. Remember, every development has premier suites, middle of the road suites and “dog suites” (every development) so you cannot get upset with site sales people helping you to buy “dog suites” when you show up on your own. For the ultimate in protection REGISTER WITH ME TODAY!