Work on Sierras Michener Hill could soon resume after a judge approved a refinancing agreement related to the Medican project on Wednesday.
Located next to Extendicare Canada’s continuing care facility at Michener Hill Village in Red Deer, Sierras Michener Hill is being developed as a 148-unit condominium and 38 duplexes. Construction began late last year but stalled after Medican was granted court-ordered protection under the Companies’ Creditors Arrangement Act on May 26.
A Court of Queen’s Bench judge in Calgary has now OK’d an agreement between Medican and T & E Ventures Inc., under which T & E will lend up to $42 million to finance the completion of Sierras Michener Hill.
T & E Ventures will provide an initial advance of $6 million, of which $2.6 million is to go to Paragon Capital Corp. and $1.4 million to 933680 Alberta Ltd. — both secured creditors related to the Sierras Michener Hill project. Nearly $1.8 million more is available for payment to “lien and critical trade creditors.”
A Sept. 3 report by RSM Richter, Medican’s court-appointed monitor, said payment to these latter creditors “will ensure a timely and efficient continuation of the construction of the Michener Project.”
It added that if work on the condominium resumes promptly, units could be completed by early 2011.
An official with RSM Richter told the Advocate that money from T & E Ventures could be paid next week.
Last month, Medican was authorized by the court to sell a quarter section of land east of Secondary Hwy 781 on Sylvan Lake’s southern outskirts to Lamont Lands Inc., developer of Ryders Ridge. Previously, it sold the Sylvan Lake Marina to a numbered company.
Medican owed $226.8 million, including $64.7 million to unsecured creditors, as of July 30. Dozens of the unsecured creditors are in Central Alberta.
In addition to Sierras Michener Hill, Medican projects in Central Alberta include the 169-unit Axxess Sylvan Lake condominium project — the first phase of which has been completed.
Medican is involved in more than 30 projects in British Columbia, Alberta, Manitoba and Quebec — some as developer and others as a contract builder. Founded in 1974 as a concrete company, Medican has constructed more than 10,000 homes in Western Canada.