Owners anxious over delayed $6.2M sale of condemned Edmonton condo building

Owners of a north Edmonton condo building evacuated in 2023 due to the risk of collapse are hopeful the troubled property will soon be sold, following months of delays in getting the deal done. 

Cormode and Dickson Construction Ltd., an Edmonton-based commercial construction company, has made an offer to purchase Castledowns Pointe, as is, for $6.25 million.

The building at 12618 152nd Ave. has sat vacant since September 2023 when engineers investigating damage caused by a fire that March uncovered dangerous structural flaws unrelated to the flames. 

Owners decided in January 2024 to sell the building and the land it sits on, rather than rebuild. 

The court-sanctioned sale was originally expected to close in November but remains pending.

Officials with Cormode have denied that the deal is at risk but the condo board's legal team is making backup plans in case the sale falls through.

Lisa Brown, who owned a unit on the first floor where cracks had formed along the entry hallways, hopes the property can be sold quickly. 

She and other owners have been left in limbo and their debts are mounting, she said.

"We were told that it was going to be over and done with and we could stop the bleeding," Brown said. "And really, the bleeding will continue until we get a final answer as to whether this is closing or not.

"It really just puts us on edge. And we've been on edge for coming up two years now."

'Highly distressing'

Cormode's unconditional offer was formally accepted in the Court of King's Bench during a hearing in early October but the company has since asked for repeated extensions, the first of which pushed the closing date to the end of December.

The company later requested an additional extension to Jan. 31, which was accepted by the board following an emergency meeting with owners.

As part of the agreement, Cormode paid $31,000 to help the board cover the ongoing costs of maintaining the vacant building.

The sale will return to court for review on Jan. 17.

The condo board's lawyer, Hugh Willis, asked for the hearing to discuss the extension, and also to assess if the property could be re-listed or if an alternate offer could be accepted in the event the deal falls through. 

In correspondence he shared with owners in late December, Willis advised that despite the "as-is" offer, Cormode's lender was now requiring an engineering opinion on the building.

The board will seek permission from court to immediately re-list the property should the sale fail to close on Jan 31. 

"The sale of the property has the potential not to close," Willis wrote in a letter to the court dated Dec. 19.

Cormode's failure to close on the November and December closing dates is "highly distressing," Willis said. 

"These people need the financial relief," he told CBC. "These circumstances are so severe and the personal consequences on the owners are measured daily."

Willis said he would be relieved if the deal closed this month but he needs to mitigate the risk to owners.

"There is a genuine desire from many owners, if not the large majority, to put this chapter of their lives behind them. So we very much want to see the transaction closed … and hopefully 2025 will provide some relief and resolution."

Ben Elzen, Cormode's owner and CEO, told CBC that financing has been secured but the company and the lawyers simply needed more time to smooth out the details.

"There's a lot of players," Elzen told CBC on Jan. 2.  "We have been granted an extension until the end of January and we intend to close.

"Financing has been secured. We're just waiting on logistics."

Elzen said engineering firms have been on site since November to complete the necessary inspections.

He declined to comment on the company's plans for the property. 

'Frustrated and discouraged'

There is a sense of urgency to the sale. 

The board is paying out funds to maintain, secure and insure the property.

Condo board president Susan Strebchuk said owners have been saddled with mortgage payments on homes they can longer return to, and ongoing condo fees, leaving many on the brink of bankruptcy.

"We're frustrated and discouraged," Strebchuk said. "You think you've got an end in sight and then not."

"We are very concerned because if this falls apart, we're back again to listing or going back to court."

The 83-unit structure, constructed in 1999, does not match the architectural designs on record and does not comply with the building code. Repairing the structural flaws would cost an estimated $7.5 million. 

The corporation was granted court approval in May 2024 to market the building and worked with commercial real estate firm Avison Young to test the market. 

The property was listed with an asking price of $16,950,000. Court documents show four parties made formal purchase offers starting at $3.8 million.

The sale is being sought through a process known as termination. Once termination is formalized, the titles on each condo unit would be cancelled, creating a single parcel of land that can be sold.

Sale proceeds would first be used to pay down the board's outstanding debts, including legal fees, the cost of emergency scaffolding erected to shore up the building, and the bill for hiring security to patrol the vacated property.

Court records from October show the corporation then owed more than $85,000 for the scaffolding and more than $221,000 in security costs.

Proceeds would then be distributed to owners based on their ownership share and outstanding debts to the board. As part of the termination proceedings, the condo would eventually dissolve.

Even if a sale is approved, Brown said she would have no choice but to pursue foreclosure.

Following the evacuation, she could no longer afford to pay her mortgage or the special assessments levied by the board.

Brown said owners are exhausted and still seeking answers over who could be held accountable for the construction flaws that forced them from their homes.

"This has crippled me. And I know I can speak for dozens of owners who are just at a complete and utter loss."