Special auction held for golf course condos

A Manitoba-based mortgage company is sellingits remaining shares in a condominium project at Moncton's Royal Oaks Golf course at a special auction.

Montrose Mortgage will be asking for at least $1.6 million for the 18 units at the condominium project that sits on the golf course during the Friday morning auction at city hall.

This is a separate company from the one that put the golf course and its clubhouse into receivership in June.

Montrose Mortgage had a $5-million mortgage on the 40-unit condominium projectin 2007. Those units normally sell for between $150,000 and $250,000.

Just more than half of those condos have been soldand now the mortgage company wants to get its money back on the empty homes.

No one from the company or people on the golf course wantedto be interviewed on the record until after the sale was completed.

One man who bought one of the units told CBC News that his building has not been finished.

He said there is major landscaping to be done and the air conditioning was never connected.

Latest financial problem

This is the latest financial problem for the Moncton golf course.

C.A.B. Realty Finance L.P., a Toronto-based financial institution, has called its loan from the golf course in late June.

That decision could put in jeopardy almost $5 million worth of provincial funds invested in the course.

The New Brunswick government's financial dealings with the Moncton golf and real estate complex date back to the late 1990s, when the province extended the company a $4.8-million loan guarantee.

That arrangement, reached in 1998, became a direct loan in 2002.

In 2008, that financial help was changed again into preferred shares, an arrangement that would give the province a claim to 50 per cent of the company's net profits until the investment was repaid.

The province is not the only level of government that has cut a deal for the golf course. Two years ago the City of Moncton paid $1.2 million to pave part of the road at the development.

It was promised that property tax on the $25-million housing development around the golf course would recover this money.

The links-style golf course has received a certain amount of prestige since its first tee-off. Former premier Frank McKenna brought former U.S. president George H.W. Bush and a handful of other dignitaries to golf at Royal Oaks at one of his annual corporate retreats.