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Eron Lenders
Project Name: Gateway Power Centre, Grande Prairie, Alberta
Lender update
16 September 1998
A meeting of all Gateway Power Centre lenders has been scheduled as follows:
Date: Tuesday, September 29th, 1998
Time: 7:00 pm
Place: The Residence Inn by Marriott, Cypress Room
1234 Hornby Street, Vancouver, BC
The project encompasses approximately 137 acres of commercial and residential lands being developed in phases for retail ìbig boxî users. Phase I was developed as a commercial power centre and was sold on May 1, 1998 to Real Fund. The second phase is under construction and Real Fund has exercised their option to purchase Phase II as per the conditions of the sale agreement of Phase I. We estimate that Phase II should close in November or December upon completion.
We have also started construction on the west portion of the site for Future Shop, Glen Tel and Peavey Mart, with anticipation of completing an agreement with Winners or Sport Chek. This Phase of the centre could be sold to Real Fund or another institutional buyer.
There was approximately 66 acres of residual lands included in the project. To date we have received offers to purchase approximately 11.6 acres (see schedule below). These offers to purchase the 11.6 acres are subject to Court approval. We continue to look for potential tenants or owners/users to purchase the remaining lands. The projects development is progressing as scheduled with the under ground services being completed and continued interest being expressed from outside brokers on behalf of the perspective purchasers and/or tenants.
The purpose of this meeting is to discuss the sale of some of the residual lands, which make up part of the abovementioned development. These sales have been in negotiation for many months and we believe they represent fair market sale prices in excess of our current appraisals.
A summary of the sales is as follows:
PURCHASER
599754 Alberta Ltd. (David Will)
DATE: Dec. 17, 1997
SIZE: 3.25 acres
APPRAISAL VALUE: $3.50/$4.00 sq
SALE PRICE/sq: $4.24 sq
SALE PRICE: $600,258
599754 Alberta Ltd. (David Will)
DATE: May 25, 1998
SIZE: 1.0 acres
APPRAISAL VALUE: $3.50/$4.00 sq
SALE PRICE/sq: $4.24 sq
SALE PRICE: $184,694
599754 Alberta Ltd. (David Will)
DATE: June 5, 1998
SIZE: 3.44 acres
APPRAISAL VALUE: $3.50/$4.00 sq
SALE PRICE/sq: $5.00 sq
SALE PRICE: $749,232
220571 Alberta Ltd. (Ford Dealership)
DATE: April 18, 1998
SIZE: 4.0 acres
APPRAISAL VALUE: $3.00-$7.00 sq
SALE PRICE/sq: $5.74 sq
SALE PRICE: $1,000,000+
As noted in the above table, the offers are at prices exceeding the appraisal value and we believe they represent current fair market value.
We will be seeking Court Approval of these sales after the Lendersí meeting.
If you are unable to attend the meeting (we apologize for the short notice), please let us know if you are in favour (or not) of the proposed sales by faxing us at 604-688-6128, Attention: The Gateway Power Centre Project Lead.
Yours truly
Judicial Trustee
PricewaterhouseCoopers is a Canadian member firm of PricewaterhouseCoopers International Limited, an English company limited by guarantee.
PricewaterhouseCoopers Inc.
601 West Hastings Street
Suite 1400
Vancouver, BC
Canada V6B 5A5
Telephone +1 (604) 682 4711
Facsimile +1 (604) 662 5300
Direct phone (604) 669-5087, Ext. 416
Direct fax (604) 688-6128
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