Friday, October 7, 2011

Please Look After These Small Contractors... "NOW"

This is not a great situation but it shouldn't be another Minigoo Fisheries where everyone gets stuck and they didn't get a cent because there was no recourse on Indian owned land and there was no conscious on the part of the Minigoo directors... so the little contractors got screwed...
In this case there should be a bunch of backstops to protect these hard working sub-contractors...

The lender (in this case the Province) surely would not have disbursed all of their loans on this building until they had evidence in the form of a statutory declarations stating that all contractors were paid up to date... the lender would have had a project monitor reviewing the loan advances to see that the project was on budget and the contractors were paid... in addition to that I understand Homburg had their own independent Project Management Company on site who would of or should have been monitoring the progress advances and insuring things didn't get out of hand...

I also understand the contractors were working for Dyne Holdings and being paid by Dyne Holdings... as Dyne is owned by Homburg Canada REIT a sound financial company then the "boys" at this REIT should come clean and immediately Pony-up some money to all these contractors who pushed hard to see the project finished... and they need to do it now... the REIT's management group seem more interested in changing their name to "Canmarc" then they have in getting out front and helping the small contractors get this thing sorted out...

Bottom line here is these contractors carried out the work in good faith with the understanding the project was on sound financial footing as our Province as the lender was there to monitor things... these small contractors don't have the time to wait for the accountants, lawyers and courts to settle this mess out... they need action "NOW" and that should come from Canmarc Real Estate Investment Trust who I understand is ultimately responsible for the hotel debt... Canmarc and Dyne shouldn’t be out there trying to “hide” behind some legal “mumbo jumbo” while the little guy sits out in the wind... I’m damn sure if Richard Homburg was still at the wheel he’d be doing everything to look after the little guy first... I'll have more on this later....

Charlottetown hotel contractor fears bankruptcy
CBC News Posted: Oct 7, 2011 1

P.E.I. electrical contractor is worried the financial troubles of Homburg Invest will take down his company too.

Aubrey MacLeod says his company will go bankrupt if he is not paid. CBCHomburg Invest, an international real estate company, filed for creditor protection on Sep. 9. Aubrey MacLeod, owner of DBA Solar Electric told CBC News Thursday Homburg Invest owes his company hundreds of thousands of dollars for work it did on the Holman Grand Hotel in downtown Charlottetown.

MacLeod was contracted for all electrical work on Charlottetown's new 10-storey Holman Grand Hotel, the largest contract for his company ever.

"It was always my biggest fear when we got in business, that some big company or corporation would do this exact thing," said MacLeod.

MacLeod is not the only contractor worried about collecting a big debt from Homburg Invest. Seven other Holman Grand Hotel contractors have filed lien claims against Homburg Invest and an affiliated company, Dyne Holdings, for money owed.

MacLeod filed a lien for $458,000.

"We want to get paid. We want to get the money that's owed to us," he said.

Dyne Holdings paid MacLeod's company throughout the hotel project, on time and in full, until shortly after Homburg Invest filed for creditor protection. He now finds himself on a long list of creditors seeking payment.

The province provided a loan of $16.3 million for the building of the Holman Grand Hotel. CBCThe creditors on P.E.I. are hoping the provincial government will step in. In 2008, the province loaned Dyne Holdings $16.3 million to build the hotel.

"Staff have been asked to write Dyne, Homburg, and the monitor Deloitte and Touche expressing our concern over the situation," Ron Ryder, communications officer for the Department of Innovation told CBC News in an email.

"The provincial government expects them to pay suppliers as their bills come due."

"To us it's a private matter. We will deal with our suppliers," said a representative of Dyne Holdings.

For MacLeod's company the issue is a matter of survival.

"Our lines of credit and stuff are maxed out, and we won't be able to continue doing our day-to-day business without borrowing more money," he said.

If more payments don't come through, he said, DBA Solar Electric will go bankrupt.

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