Concord Pacific and Lehman Brothers Complete $125M Restructuring of Condo Project

On May 29, 2009, affiliates of Concord Pacific of Vancouver and Lehman Brothers Holdings Inc. completed the restructuring of the ownership and financing of a 700-unit condominium development under construction in Surrey, British Columbia. The development, Park Place Towers, was previously called “Infinity 2.” Approximately $125 million of debt was restructured in the transaction.

The project consists of twin 36-storey towers, which were originally part of a planned 2,100 unit condominium development located at the end of the King George SkyTrain line. Construction of the project was halted at the 18th and 20th storeys of the two tower development in October 2008 when the original developer, Jung Developments Inc., failed to obtain construction financing.

The restructuring of the project involved proceedings under the Companies' Creditors Arrangement Act: the appointment of a receiver over the project and over the interests of the shareholders of Jung Developments Inc. in the project under the security over the project held by Lehman Brothers; the appointment of a trustee in bankruptcy for Jung Developments; orders of the court vesting title to the project in affiliates of Concord Pacific and the interest of the shareholders in Jung Developments in other affiliates of Concord Pacific and other parties; and the approval of a Proposal in Bankruptcy for Jung Developments. The proceedings began on October 15, 2008.

Concord Pacific of Vancouver was represented by Mitchell Gropper, QC, Robert Sloman, Gordon Love, Kieran Siddall, Rebecca Morse and Jamie Matthews of Farris, Vaughan, Wills & Murphy LLP.

Lehman Brothers was represented by David Gruber, Greg Umbach and Jeffrey Oliver of Blake, Cassels & Graydon LLP.

PricewaterhouseCoopers Inc, as monitor in the CCAA proceedings and receiver and trustee in bankruptcy, was represented by Clive Bird and Martha Martindale of Borden Ladner Gervais LLP.

Jung Developments was represented by Robert Millar and Edmond Luke of Fasken Martineau DuMoulin LLP.