Toronto Trump condo delays sale closing date amid buyer lawsuits
By Andrea Hopkins
TORONTO (Reuters) - Developers of the Trump International Hotel in Toronto have pushed back the closing date for the sale of luxury condo units at the project, the latest delay in a venture plagued by bad press and lawsuits by and against disgruntled investors.
Talon International Inc, which developed the 65-story granite and glass hotel-condominium tower that opened this year in Toronto's business district, said it was pushing back the closing date by two weeks to December 13 to respond to an investigation by the Ontario Securities Commission.
Unhappy buyers, who have complained the project has been far costlier and less profitable than the developers promised, asked for an investigation by Canada's top securities regulator, arguing Talon sold them an investment rather than a condominium.
While they may have bought into the glitzy Trump project to make money on condos that would be rented out to hotel guests, the buyers have struggled to secure mortgages on the units. Banks and tax authorities view them as commercial rather than residential properties, subject to far higher tax rates and riskier and more expensive lending rates.
"The extension (of the closing date) has been made to allow more time for Talon to respond to recent inquiries made by the Ontario Securities Commission," Talon said in a statement, adding it was cooperating fully with the OSC.
The project, one of a handful of luxury hotel-condominium hybrids managed by the Trump Hotel Collection around the world, hit the market at the same time as three other five-star hotel projects in Toronto. The city's red-hot condo market peaked early in the year, sparking concern about a bubble, but has since begun to cool.
A lawyer for some four dozen buyers said the delay is good news for his clients, who have struggled to find financing for the condominiums, many of which were marketed and sold years before the project's ribbon-cutting in April.
"I think (Talon) realizes that the investigation by the securities commission is a serious one and, under the circumstances, it might not be best to force people to close on November 29," said Javad Heydary. Continued...