You've Earned It, Now Enjoy It...

Recently, I went to a "resort community" near the border between Washington State and Canada. The focus of the resort is a hotel, Semiahmoo, and two golf courses. Clustered around the courses are housing developments, all behind gates. Along the spit of land jutting into the entrance of the Strait of Georgia, is the hotel and several condominiums. It is an area ripe for extensive real estate development.

And indeed, like ship wrecks washed up on the shore, there are two buildings next to the Semiahmoo hotel which are abandoned and in foreclosure. The Marin at Semiahmoo. With prices averaging in the high 600,000's, because, as the web site says, "you've earned it, now enjoy it." The developers, a couple from White Rock, British Columbia, were recently sued over the loan guarantees they made and the property itself is slated for a foreclosure sale in October. The development was intended to be elegant, a statement of good taste and enjoying the good life.

There is a second development, up near the golf courses, away from the marvelous spit and marina, called Horizon. It was supposed to be a planned unit development, placing over 400 hundred units on former pasture land of 140 acres. Oh, but it was going to be sustainable. On this beautiful piece of property are two more ghost buildings, a preview office and apparently a "show" home. There are hinges on rock pillars where apparently the gates were to be hung, wires sticking up from the ground, and pvc pipe everywhere. The self-described country boy developer apparently was put into receivership by his lender late in July.

Meanwhile, the land is torn up, concrete has been poured, and hulking, empty structures sit, attracting pigeons, sea gulls, and other wildlife.

Between these two projects, lenders are holding onto over 50 million dollars in loans. The two primary banks are relatively small and regional. 50 million must be a lot of money to them. The banks were egged on by amped up realtors and developers who, believed that rich Canadians like "hockey players who want to hide their money in the US," and others who desire the good life of the Pacific Northwest, would buy their projects. Bankers, developers, realtors foresaw millions in profits. They spun stories of quality materials, sustainable housing, elegant details, and rich life experiences if only we would buy their product.

There was nothing sustainable, elegant, rich, or of quality in what they produced. They were, like their brethren mortgages and re-finances, collateralized debt obligations, or derivatives, modern day economic Elmer Gantry's, promising something they could never deliver, believing they would be long gone before anyone caught up with them. Hidden behind limited liability corporations controlled by other limited liability corporations, these real people, probably don't even think they are or were part of the problem.

Meanwhile, the wind in Semiahmoo howls the motto of the past decade through the empty buildings: "you've earned it, now enjoy it."