This press release was sent out by the group of volunteers who are leading the charge on reclaiming our properties from Concrete Equities.
Limited Partners Fight for control of Concrete Equities Investments
Calgary, Alberta Canada, June 1st, 2009 – The ten member Steering Committee and supporting Limited Partners of five (05) commercial investment properties in the Calgary area met today to raise awareness to potential investors to business practices being conducted by Concrete Equities.
The group of investors represent a minimum individual investment ranging from $10,000 to $50,000 and are comprised of individuals from several demographics, including pensioners and people that rely on the distributions from the investments for their income. The net portfolio is valued at approximately $300 million CDN.
Vinnie Aurora and Dave Jones, founders of Concrete Equities Inc., and Vincenzo DePalma, were acting General Partners and/or directors for the commercial real estate investments. On March 12, 2009, they issued a Notice of Special Meeting, Information Circular, Proxy and Extraordinary Resolution to all investors in the SNC Lavalin building, as well the investors in the other Concrete Equities ventures, namely; “Millrise Plaza”, “Deer Valley Station”, “Castleridge Plaza”, “Concrete Equities Place”, and “MEG Place”. The resolution included immediate selling of all properties to the Strategic Group, who would then set up a single fund, the Strategic LP. In exchange, unit owners will receive non-voting Class B shares of the fund and an unsecured subordinated debenture.
Also lumped into the whole scenario are yet to be syndicated Concrete Equities Properties, which hold considerable liabilities in the way of mortgages. With a large list of liabilities proposed, and no audited financial statements or current appraisals on the assets to validate the soundness of the investment, the Limited Partners were unwilling to exchange their hard asset for an unsecured debenture and the resolution was voted down.
Then, on May 20th, 2009, the Limited Partners were made aware that at least one of the five buildings had been without a mortgage since November 2008, and after several extensions granted by Standard Life, the “SNC Lavalin” building was heading for foreclosure. With Concrete Equities unable to secure the mortgage, the Limited Partners lost faith in the investment management being offered, and began seeking an alternate General Partner.
Between May 18th and 28th, 2009, the Steering Committee assembled the Limited Partners and conducted a series of votes to change the General Partner in three of the five buildings included in the investment portfolio. The vote was in excess of 80% in favour of the change, and Steven Butt, of Avenue Commercial Inc., was named as General Partner for “SNC Lavalin”, “Millrise Plaza/Deer Valley Station” and “Castleridge”.
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To date, Concrete Equities have not turned over the information for these projects to the newly elected General Partner. They have not prepared audited financial statements on any of the projects, nor are they currently directing the property managers in making the day to day decisions of running a commercial property. The Property Managers are unable to make decisions on leasing space without express direction by the General Partner.
On Thursday, May 28th, 2009, Concrete Associates III Investment Corporation, under title of the General Partners for the investments, went to court to try to put all five properties into bankruptcy, claiming they were in a state of chaos. Council for the Steering Committee were able to get an adjournment until June 4th, 2009. A member of the Steering Committee confirms that recent statements from the individual Property Managers to the Steering Committee’s building leads indicate that at this time, the buildings are all in a positive cash flow state.
Mike Hansen, an investor in Concrete Equities Place, and a member of the Steering Committee says, “We’re just regular people looking out for our investments, and it feels like we’re swimming in a pool of sharks. The Steering Committee and concerned LPs have spent countless hours trying to make changes and take our investments out of their hands, yet they keep fighting us every step of the way. There’s a feeling that [Concrete Equities] are trying to hide something. We don’t know if it’s co-mingling of funds or other fraudulent activity, but as investors, we have a right to obtain financial details on their management of our investments, and they simply refuse to cooperate.”
Concrete Equities Steering Committee
Founded in April, 2009
Members: Mike Hansen (CEP),
Ph: (403) 875-1120
Mike Hansen, Limited Partner
Ph: (403) 648-1791