“In 2008 and 2009, Vancouver property developers Michael Knight and Jeff Wiegel were riding a wave of upbeat publicity over their condo project in the Delbrook area of North Vancouver.
“The Brook” was being built to LEED platinum standards, the highest certification for environmentally friendly residency, and was being financed by equity investors, rather than pre-sales, which allowed the developer and his partners to share in future price gains.
The project garnered favourable publicity in The Vancouver Sun, the Globe and Mail and the North Shore News. What these media outlets didn’t know was Knight had had a history of run-ins with the Financial Institutions Commission (FICOM) and the B.C. Securities Commission (BCSC), and had been slapped with cease-and-desist and suspension orders and financial penalties.”
“Acting on complaints, FICOM conducted an investigation and found Knight had committed multiple breaches:
He had provided real estate services without being registered under the Real Estate Services Act.
He had marketed the units without preparing and filing a disclosure statement with the B.C. Superintendent of Real Estate.
He had received money from at least two people to secure an interest in a unit, but did not deposit those funds in a trust account, contrary to the Real Estate Development Marketing Act.”
“Beneath the technical breaches are heavy financial losses and much investor grief. The Brook was delayed, ran into financial problems and ended up in receivership. The other two projects never got off the ground. Investors in all three projects have lost most if not all of their money. Many have filed lawsuits.
I think that it’s clear real estate investors should look beneath these pleasing green exteriors and sunny media reports and do their own due diligence before they invest.”
- from ‘Baines: Green property developers charged with multiple offences’, David Baines, Vancouver Sun, 21 Sep 2012
Hats-off to David Baines for the article, and for pointing out that the Vancouver Sun itself had promoted a shifty RE project.
Recent stories of unsavoury players in the Vancouver RE business can’t be helping sentiment.