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Nelson Commons go-ahead this fall is 95% certain, says developer

Bill Metcalfe
By Bill Metcalfe
September 9th, 2014

Nelson Commons has sold 29 of the total of 54 units in its proposed downtown retail-residential development, and expects to demolish the old Extra Foods building this fall after it has closed another four sales that are in process.

The number of pre-sales that are needed to break ground has gone down to 33 from last fall’s 46, which was the requirement of the main lender, Citizens Bank (the commercial arm of VanCity). Citizens Bank had agreed to provide $16-million in financing.

But since then, according to project manager Russell Precious, the Nelson and District Credit Union (NDCU) has stepped in and offered to take on up to $5-million of that debt with no pre-sale requirement, thus lowering Citizen’s Bank’s pre-sale requirement to about 33 units.

(The “about” is because the pre-sale requirement is expressed in dollars for units that vary in price, and because the details of the arrangement with the NDCU are still under discussion.)

“We are going ahead,” says Precious. “We are 95% of the way there. Things are progressing nicely and we hope to have a green light by the end of October.”

Expressions of interest from potential buyers came flooding in last summer and fall when the project was first announced, but “when it came time to write cheques,” says Precious, “we suffered a 60% drop-out, and then we were into Christmas and then winter, so we missed a selling season.”

“We had had multiple conversations with some of the people who dropped out, and the fact that they held off at the last minute caught us by surprise,” Precious said.

Now the timeline is “demolition before Christmas, excavation early in the new year,” he says. “We need to get a roof on it by the end of next October, 2015.”

Asked if Kootenay Co-op members have been getting impatient or sceptical because of the longer-than-expected timeline, Co-op general manager Deirdrie Lang said, “Yes, some are sceptical that it will happen. People want to see action. And there are lots of people hovering, that want to buy. But they don’t want to unless they see something happening.”

The selling price of the units runs from $245,000 to $499,000. Three units designated as affordable housing are discounted by 25% and range in price from $198,750 to $276,750.

“People need to know that this is not high end real estate,” says Lang. “There was a letter to the editor about how we are selling real estate for the elite, and where is the affordable housing. We have already (provided for) three restricted resale units, and other than that, it is market price real estate. About two thirds of our buyers are local homeowners who are downsizing.”

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