Great Gulf Homes is taking over the "1 Bloor" project. Since original developer could not come up with the financing it left it up for grabs and re-developing. Gulf Homes are planning to make it more versatile: commercial, residential and maybe hotel suites. For more information please read the article below...
From Friday's Globe and Mail Aug. 21, 2009
One of Toronto's largest home builders will start fresh and develop a new mixed-use condominium at the site of the 1 Bloor luxury condo project after buying the property from its cash-strapped developer.
Great Gulf Homes confirmed Thursday it will take ownership of the site from Kazakhstan-based Bazis International Inc. in mid-September, writing a new chapter in a cautionary tale of marketing hype, frenzied sales and the crush of the global credit crisis.
Toronto's real estate world buzzed with word of the sale, as realtors fielded calls from anxious buyers concerned about deposits and the future of the project – once envisioned as Canada's tallest residential building – at the corner of Yonge and Bloor Streets.
"An affiliate of Great Gulf Homes has entered into an agreement to purchase the property and it will be closing mid-September," said Bruce Freeman, executive vice-president of Great Gulf. "We are presently developing plans for a mixed-use project."
He declined to elaborate, saying more details would be released after the deal closes, but The Globe has confirmed the purchase is strictly for the land and does not involve the previous owner's obligations, contracts or design.
In a terse statement, Bazis said all buyer deposits are protected in an escrow account, as required under Ontario's Condominium Act. A spokeswoman said neither she nor Michael Gold, the developer's Canadian president, could comment further because of a confidentiality agreement.
Buyers lined up for days in 2007 when units in the planned 80-storey, $450-million skyscraper first went on the block. About 500 purchasers signed deals ranging from $400,000 to several million. The average buyer has $80,000 to $120,000 invested.
Anna Cass of Royal LePage Your Community Realty was one of 1 Bloor's top sellers, and bought a unit for herself. To guarantee herself a piece of the project, she rented hotel rooms, dressed in disguise and hired students to camp out in the days before it went on sale.
Ms. Cass said people still want the prestigious corner location. She urged Great Gulf to "be fair" and consider 1 Bloor buyers first for its new project.
"If Great Gulf is smart ... they will offer all the agents and their buyers first crack and first discount, at a very good rate," she said.
Great Gulf has been involved in about 10 major condominium projects in the Greater Toronto Area in recent years.
Garth Juriansz of Re/Max Realtron Realty, who also bought for himself at 1 Bloor and sold several units to clients, said he'd take his buyers elsewhere if Great Gulf starts anew with "inflated" prices.
"It will be a significant mistake to throw all the people out and start again," he said.
1 Bloor's problems began last fall amid the U.S. subprime mortgage crisis and credit crunch, when Bazis' partner in the land purchase, Lehman Brothers, went bankrupt. Mr. Gold sought new financing partners. In December 2008, he stopped making payments on a multimillion-dollar loan.
Local lenders bought the loan, then tried to place the project in receivership.
Last month, Mr. Gold agreed to sell the property as part of a court-approved plan to keep it out of receivership.
Gerry Miller, a real estate lawyer and partner at Gardiner Miller Arnold, said it's uncommon in Toronto for a condo project that has been fully conceptualized and well sold to falter suddenly. However, he said he would have steered his own clients away from 1 Bloor. "It was too expensive and unlikely viable ... it was just too big, too grand," he said.