Posted on 18 April 2012 by Keith Lacey
Despite the many problems that have been associated with the Regal Ridge development over the past two years, the new owners of 3,300 acres of land on Anarchist Mountain believe the future looks very bright moving forward.
Ron Palmer, the managing partner with the newly-formed Osoyoos Mountain Estates Inc. (OMEI), a wholly-owned subsidiary of Alberta’s Ventures North Financial Group Inc., said he has worked in real estate development for many years and is convinced future development on Anarchist Mountain can be prosperous and without controversy.
Ventures North, the parent company of OMEI, was a major lender to Regal Ridge, but neither were previously involved in either the management or ownership of the Regal Ridge development, said Palmer.
The deal to acquire 3,300 acres of land within the Regal Ridge development is part of an agreement with the numbered company 590335 B.C. Ltd., a company owned by Adrian Erickson. The acquisition includes nearly all of the conservation area, which is a key Regal Ridge community amenity, said Palmer.
The deal will see Ventures North take back a large chunk of land from Erickson in lieu of debt the company still owes to lenders, said Palmer.
“We’re taking land back in lieu of debt,” he said. “The message I want to send out is, like a lot of other people, we’ve been damaged and we’ve lost a lot of money.
“We’ve come in and took back this land and we plan on developing it slowly and methodically and we’re going to do it right. We’re also going to pay all of our bills.”
Palmer acknowledged “it’s going to take several years” to recoup the money it has already invested in Regal Ridge, but done properly, he believes OMEI and Ventures North can make future development on Anarchist Mountain something special.
“We have the best climate in the country and this is one of the most beautiful settings in the country,” he said. “I’ve been involved in real estate development for a large chunk of my life and this real estate right, will be successful moving forward.
“We’re in this for the long term and we’re going to do things right, so we’re very confident about a very bright future on Anarchist Mountain,” he said.
Palmer was brought in by Ventures North to assess and monitor the financial position and management of the Regal Ridge development and he conducted that assessment until November. This land acquisition announcement of 3,300 acres is part of an agreement reached between Erickson, Ventures North and OMEI during that time frame and is designed to allow Ventures North to recoup the significant investment it has made in Regal Ridge over the past several years, said Palmer.
“We lost a lot of money and we obviously want to try and get that money back,” he said. “It’s no secret Regal Ridge was in financial trouble … it has been a long, difficult process to get our land back, but now we’ve signed this deal and we have our land back and now we move forward.
“Our plan is simple. We now have the opportunity to recoup the significant investment we’ve already made in this development. Our company has been badly damaged and we’ve lost a lot of money, but we still believe this is a good project and we will continue to work to make this a world-class project moving forward.”
The complicated transaction “was all done on consent” between Ventures North and Erickson, he said.
“Mr. Erickson co-operated throughout the entire process.”
The purchase includes only four current lots – only one with power – so it’s going to take a significant capital investment to built new lots on this land, said Palmer.
“This year is going to be very challenging for us, nevertheless, we have committed to paying for the first leg of a triple-phase power upgrade that will benefit everyone on the mountain,” he said. “We have also been in very preliminary discussions with the Anarchist Mountain Community Society on potential projects of community benefit. We recognize this is a long-term investment for us.”
His company also plans on investing significant dollars by working with Telus to dramatically improve communications options for property owners on the mountain, he said.
His company is not willing to pay the bills for the 80 to 120 property owners who have not had electricity provided to their lots as promised when they purchased the lots from Regal Ridge, said Palmer.
“That would cost in excess of one million dollars and we’re simply not prepared to write a cheque for a million bucks,” he said. “That being said, we are willing to work with the affected property owners as a cohesive unit to try and come up with a plan. We want to try and be part of the solution.”
His company will be seeking to bring stability and sustainability to the area after far too many months of controversy, said Palmer.
“Osoyoos Mountain Estates will move forward in developing the Regal Ridge project, but it’s going to be one careful step at a time,” he said.
His company intends to continue with development, incorporating many of the previous design principles and will keep the promised Conservation Area intact, he said.
“We also plan to consult widely on all major issues and to foster an open, respectful and understanding relationship with everyone involved in the Regal Ridge community,” he said. “We simply ask for patience and co-operation, and in exchange, promise a sincere willingness to seek solutions for the good of the community.”
Palmer said he and Joe Cardoso, manager of community relations for OMEI, plan on visiting every single homeowner in Regal Ridge to answer questions about this purchase and plans moving forward.
Within the next two weeks, Palmer said he hopes to have the payroll increase to near 20 as construction will begin to build new lots.
The plan for slow and steady growth will not alter, he said.
“If we could sell 20 lots a year, we’d be very happy,” he said. “Of course, that’s not going to happen in 2012 as we settle in, but 20 lots per year is our goal moving forward and there’s no reason we can’t achieve those numbers.”
Ventures North has an outstanding reputation as a developer and it will be his job to ensure that reputation is enhanced with its new role on Anarchist Mountain, he said.
Erickson said he’s very pleased OMEI and Ventures North have been able to reach this agreement.
“I have spent a decade of goodwill and hard work trying to build the mountain into something special and I don’t want to see that work die,” he said. “This deal is the best deal for this project moving forward for everyone involved.”
Erickson said he’s “very very close” to finalizing a deal with another lender to provide funding to Regal Ridge so he can provide electricity to the affected property owners in question.
“Actions speak louder than words and all I will say is I expect to see the power going in sometime this spring,” he said.
While he won’t be developing any future lots on Anarchist Mountain, there are still numerous lots for sale owned by Regal Ridge and his company will continue to operate, said Erickson.
Palmer said work to bring power and improved telecommunications to the mountain will begin this week.