More Condo Developers Filing for Bankruptcy

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Real estate sales may be up from the number of sales in February but they're still well below last year's levels which has caused a spike in the number of condominium developers seeking creditor protection and/or going into receivership.

One of the appointed receivers for these failed developers, Bowra Group, has been involved in 12 seperate developments that are either in receivership or are struggling and have sought creditor protection.

“I think it’s just a sign of the economy. The forest industry has been in trouble for some time and has its casualties, and the real estate industry has been challenged for a while now,” Bowra group president David Bowra said in an interview with the Vancouver Sun today.

Across the Lower Mainland more and more developments are running out of money and being forced to have a receiver appointed. The receiver finishes the building and gets the best price it can for the units.

Others seek creditor protection, asking the court for time to get their financial houses in order before the lender comes knocking.

As we noted last week, there are currently 2,391 unabsorbed housing units on the market in the Lower Mainland with another 25,907 under construction.

Look for more and more developers to go under as the year moves along.