Many large-scale properties in the Birch Bay area have been sold at a relative steal after Bellingham-based Trillium Corporation defaulted on numerous land development loans.
Most recently, Ocean View Farms of Delano, California, bought a 353-acre property in the Birch Point area, once valued at $11.8 million, for $3.8 million, Birch Bay realtor Mike Kent said. Polygon Financial, out of Bow, Washington, had acquired the property in lieu of foreclosure after Trillium defaulted on a multi-million dollar loan.
Richmond, B.C.-based developer Jun Yu Development II, LLC, has acquired its third large-scale holding in the area after purchasing a 498-acre property on Birch Point for $4.5 million. Trillium owed $10.4 million on this property before Tumwater-based DaPaul, Inc, and Sandy Investments, LLC, took possession of it in lieu of foreclosure.
In December of last year, Jun Yu Development picked up a 231-acre property in the central Birch Point area for $2.6 million. Trillium also lost this property in lieu of foreclosure to local investment company DBW Whatcom in August 2010, Kent said. Jun Yu also owns the Birch Bay Waterslides, which they bought last September for approximately $2.3 million.
The recent multi-million-dollar sales represent keen-eyed developers taking advantage of a real estate environment that was once dominated by Trillium, Kent said. He predicted the coming months will bring with them intense interest in distressed Birch Bay properties, especially from development companies outside of Washington.
“Without the outside interests, it would have been a very different real estate picture for the north county,” Kent said. “The way things are right now will be the quietest it will be in a while.”
Kent said properties to watch in the coming months will be the Seagrass condominiums and Semiahmoo marina expansion, both once owned by Trillium, and the Horizons at Semiahmoo housing development. Union Bank acquired the Horizons project from lead developer Fred Bovenkamp after Bovenkamp’s firm defaulted on $43 million in unpaid loans.
Bovenkamp had envisioned a 143-acre planned community due north of the Birch Bay Village housing development with multi-million dollar homes until the real estate market took a dive in 2007. Kent said a potential developer could turn a large profit on this property by using the streets and utilities already installed on the site to build a smaller-scale housing community with homes selling for around $400,000.
On a smaller scale, Kent said there has also been interest in the two major commercial properties in Birch Bay once owned by Lynden-based development firm Homestead Northwest, which recently declared bankruptcy. CJ Wijn’s, a wine bar and deli, was listed at $341,500 and has a pending offer on it, though Kent could not comment further. CJ’s Beach House, which closed last September, has also been receiving interest, though Kent was unable to offer any more details.
Kent said the housing real estate market in the Birch Bay area will also see interest from outside parties, especially Canadian homebuyers. If the loonie stays at par with the U.S. dollar, Kent said Canadians will take advantage of gas prices that are already cheaper in the states and start buying American homes at a bargain compared to home prices in Canada.