Saturday, April 08, 2006

Sky-high Costs Force Condo Cancellation

Plans for a seven-storey condo-retail development in downtown Victoria have been cancelled, and the developer warns that other construction projects could suffer the same fate.

Anthem Properties CEO Eric Carlson says projected construction costs made his Bambu development on Pandora Street unprofitable, despite the fact that it's nearly sold out.

Building costs are soaring in B.C. as the result of the shortage of workers, stemming from the current construction boom.

Carlson believes other developers in Victoria and Greater Vancouver are now taking a second look at their projects, in the wake of his announcement.

"I've heard stories from other sites under construction right now, how they're struggling to get tradesmen, how they're struggling to keep their costs down, some groups taking over their own construction management to reduce their costs.

"Those to me are often quite desperate solutions that only delay the inevitable."

Carlson plans to meet with more than 136 people who have already put deposits down on the now-cancelled Victoria project.

He says they will get their deposits back, with five per cent interest, and an offer of a discount on any future condo development on that site.

Linda Lee Brougham of the Canadian Home Builders Association says B.C. needs to do more to lure back workers who were driven away to Alberta during the province's economic slump.


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