Managing Partner Mark Consiglio’s Sports Mall Idea Propels Kelowna Mountain Forward
KELOWNA – Owners and investors breathed a sigh of relief recently as the mortgage lenders on the three titles of Kelowna Mountain’s 640 acres have finally been paid off.
Over the past year, all three original primary lenders have received all their money back, plus some interest. The owners, including 100 family investors, had spent years nervously watching those lenders try to foreclose and sell off the lands.
Mark Consiglio is Managing Partner of Kelowna Mountain
“They almost lost everything, over $15 million, but now that the lenders have been paid, the 100 investor families are safe and sound,” says Kelowna Mountain Partnership Managing Partner Mark Consiglio. “Together, we have retained 100 per cent ownership of Kelowna Mountain, much to the surprise of many.”
Consiglio has developed close to two dozen projects throughout BC, from the Okanagan to Vancouver Island, including the lower mainland. The 640 acres on Kelowna Mountain were put on the market following the devastating 2003 Okanagan Mountain Park Fire, and Consiglio purchased it in 2006.
To date on the property, Consiglio and his team have built four suspension bridges – one of which is the longest in North America – an award winning $10 million Welcome Centre with a 1,000 seat amphitheater, Canada’s largest sun dial, a cliff walk, and a wine cave that can host intimate 24-person dinners. The property includes a 100-foot waterfall, and panoramic views of Okanagan Lake.
See Kelowna Mountain Video Here
Families invested in the property in anticipation of profiting with the project’s growth and success. However, political obstruction impeded forward progress, effectively turning their dream into a nightmare. Consiglio said a substantial amount of vandalism took place on the property, likely linked to media reports of the project’s predicted demise. Despite all of that, the family kept Kelowna Mountain open for thousands of guests every season.
So far they have constructed a spectacular cliff walk across a 100 foot waterfall, a chairlift and four bridges over vineyards
SPORTS MALL
Two and a half years ago, Consiglio, in a last ditch effort to save Kelowna Mountain, doubled down and decided to move his wife and six children to the Vancouver area to build a “Sports Mall”, his invention that had its roots in the Kelowna Mountain vision. That concept turns industrial sites or shopping malls into recreational centres for winter and summer sports that include ice rinks, swimming pools, indoor soccer space, and a host of up to 100 other sports, cultural, educational, entertainment and retail shops, anchored by National Brands with “learn-to-play” facilities only.
His concept of having a large, “one stop” destination for parents to go to so they don’t need to rush from location to location for their kids’ activities is one of the idea’s major strengths.
He teamed up with Richmond developer Dennis Drummond, who has operated companies and developed throughout the lower mainland for nearly 50 years, who believed in the concept, and Consiglio subsequently delivered long-term tenants such as SkateCanadaBC. He then found a buyer – Toronto-based Nexus REIT (Real Estate Investment Trust) – that purchased Richmond Sports Mall and buildings for $57.4 million in 2018, and also agreed to pay half the increased value from the next phase to Drummond.
“I then asked Dennis Drummond to use the after tax profits of the sale of the Richmond property to pay off the lenders at Kelowna Mountain, which saved the day for all the lenders and investors,” Consiglio notes.
Next, Consiglio plans to send out invites to the Kelowna Mountain investors to attend a meeting in October, at which time he will present an offer from Drummond to buy them all out, using half of the profits of Nexus REIT’s next phase of the Richmond Sports Mall in 2021.
“It truly is good news. Mark made sure the Kelowna Mountain mortgage holders got their money back plus some interest,” notes Drummond. “You don’t very often find people that committed to a project, and still keep soldiering on.”
Drummond is now in negotiations to settle a dispute with a mortgage lender involved in Upper Mission Estates, which is not connected to Kelowna Mountain in any way, but is adjacent to the property.
“If it wasn’t for Mark’s tenacity and efforts to fight for Kelowna Mountain through all the attempted foreclosures to protect the project over time, it would have been gone,” Drummond points out. “He was just a gladiator to protect it.”
Nexus REIT owns a portfolio of 72 properties comprising approximately four million square feet of rentable area across Canada, and Nexus CEO Kelly Hanczyk bought the Richmond Sports Mall and granted 104 Investments Ltd., Drummond’s company, the project management agreement for the now under construction second phase.
Hanczyk has known Consiglio for six years, and they worked closely together on the Richmond project.
“His passion is infectious and that is what made me work with him on our project,” Hanczyk states. “The Richmond project has been excellent for our REIT. The design, vision of the Sports Mall and the ultimate return for our shareholders will be amazing.”
Hanczyk sees great potential in Kelowna Mountain.
“The Kelowna Mountain project is one of the most amazing properties I have seen. . .it’s like Santorini in Canada,” he adds. “Mark has persevered on the project and now will reap the rewards as his eye for design will transform the property into something incredible.”
BOSSYS THRILLED
Lorne and Irene Bossy of Lake Country invested a substantial amount into a mortgage fund that was one of the lenders to Kelowna Mountain.
“Much to our surprise, relief and joy, we have been paid out of our investment at Kelowna Mountain, along with the rest of the mortgage lending group,” Irene notes. “Mark got a lot of negative publicity, which I think was very unfortunate because Mark tried to do something really wonderful for Kelowna.
“We are happy that our investment in Kelowna Mountain was returned, with interest, through the efforts of Mark. Our sincere thanks to the entire Consiglio family for their dedication, ethics and perseverance. I know it’s been a very, very difficult journey for all of us. We have we been through lots, and Mark and his family have been very compassionate to see this project through. We are very fortunate and appreciate what Mark and his family have done.”
Glenn Cho and his family are one of the 100 investor families in the Kelowna Mountain project, who brought in over one third of the investors. He is also a consultant to the Richmond Sports Mall.
“The lenders mortgages were retired so all the investors will be happy that their investments are secured and that they will look forward to some future benefits,” he states. “Hats off to Mark and the rest of the team. His approach has been very noble by making personal sacrifices to bring the project to this point. He has always kept everything moving forward and continues to support unit holders to be in a great position for success.”
Ron Cannan, former Kelowna city councilor and long-time Member of Parliament for Kelowna-Lake Country, states “Mark is a unique, visionary and tenacious entrepreneur. It’s really encouraging to learn that people got their investments back. That’s something that you don’t see very often when a development proposal is voted down.
“I believe this a great statement about Mark’s values and integrity,” he adds. “It’s nice to know that Kelowna Mountain will remain in its natural state and be a beautiful landmark for our community.”
APPLAUDS VISION
Mike Boccio, former managing director and special counsel to a New York based international developer and licensing company, is real estate and finance counsel at Kaye Scholer and Carter, Ledyard and Milburn and investment banker at Prudential Securities, is principal of Boccio & Associates, Inc., is a long-time consultant for Consiglio from New York City, and sees Consiglio as a visionary.
“He is one of a kind in terms of his vision and creative abilities,” Boccio states. “He’s like the Walt Disney of real estate. When you look at his visions and how they pull family and people and activities together, it’s a beautiful sight to see. From an imagination and curiosity point of view, what he does is a very unique thing. He has an uncanny ability to stand on a site and look at a piece of land or a particular design to know which designs to fit on the property to maximize its potential.”
Boccio appreciates Consiglio’s collaborative approach to projects, as they have frequently held brainstorming sessions over the years.
“Mark’s final question to me is always the same, as he asks me: ‘Now, I want you to put on a hat of one of my investors. How will they feel about this decision and how will it affect them long-term.’
“Mark always thinks about the investors and the surrounding community, and I think that is beautiful,” he adds. “Adding to that, when you look at the Kelowna Mountain situation in particular, I think most anybody else would have cut and run a long time ago. Mark has done every single thing possible and is committed to do the right thing for the land and the investors. That perseverance is amazingly unique.
“Mark fought for that land. He fought for the investors, and he fought for the community, and he fought for his family. The world would be a better place if there were more people like Mark Consiglio.”
CREATIVE IDEAS
Peter Gibson is a Senior President with Cushman Wakefield, specializing in investment sales for over 30 years throughout Western Canada, and notes he has known Consiglio for close to 20 years.
Artist’s conception of the finished renovations at Nexus REIT’s 1751 and 1771 Savage Rd. property in Richmond, B.C. (Courtesy Nexus REIT)
“He is definitely one of the most creative investors I have met,” Gibson notes. “Mark has the ability to look at a project from every possible angle and how to maximize its upside. His hands-on approach through all aspects of the transaction is unique.
“In this current downturn in the retail landscape, Mark will be one of only a few that can turn these large scale projects around.”
David Beckingham, President of Dominion Lending Centres Commercial Canada, is one of the top commercial lenders in the country, and he first met Consiglio eight years ago regarding the Savage Road project.
“Mark is very good at real estate, knows what he’s doing and understands it. He’s a quick learner and adapts and overcomes obstacles in a unique and innovative way,” he notes. “I was introduced to Kelowna Mountain several years ago and where I witnessed each lender get paid out of their investments in Kelowna Mountain, from the proceeds of his other ventures. Something Mark did not have to do!”
Beckingham took note that this was a very personal issue for Consiglio.
“Mark had every opportunity to walk away and leave everyone holding the bag, but his integrity wouldn’t allow it,” Beckingham observes. “He goes through a great deal of stress and personal strife to make sure everyone is taken care of, and I’ve witnessed that on many occasions.”
Consiglio is philosophical while summarizing the journey.
“If it wasn’t for the Kelowna Mountain angst, I never would have come up with the Sports Mall idea, and that invention that became the Richmond Sports Mall has resulted in the rescue of Kelowna Mountain, and paid back the lenders and saved the investors,” he muses. “It’s ironic that this bright light, borne out of necessity, came to me during the darkest period of the whole story.”
By Mark MacDonald
Business Examiner
