Vancouver taxpayers likely won’t be directly on the hook for costs associated with the Olympic Village, a well-known urban land use consultant said today.

Bob Ransford of Counterpoint Communications told The Tyee that if the city can’t recover all the costs of the $1 billion project, the first area to take a hit will be the money promised for the land the village sits on.

In 2006, Millennium Development blew away competing developers by offering $193 million for the prime waterfront real estate in Southeast False Creek. The builder put down a deposit of $29 million and agreed to pay the balance in 2010.

“I think there’s a potential [the city] is not going to see the $193 million that they intended getting for the land,” said Ransford, who is also a well-known Non-Partisan Association advisor. “That’s the first area they would lose.”

Because the city already holds the title to the land for the village though, such a loss likely wouldn’t have to be compensated by taxpayer dollars, Ransford said.

“If [the city] loses anywhere less than $193 million then that’s not cash out of the taxpayer’s pockets, that’s assets that have been eroded.”

Ransford said given the valuable location of the athletes’ village condos, the city likely won’t lose more than $193 million on the project. But he conceded that Vancouver’s currently depressed housing market makes predictions difficult.

Also, Ransford said in most financing agreements the lender requires a borrower to estimate when it will pay back the loan. If the loan is not paid back by that date, then the terms of the agreement can change, often resulting in accelerating interest rates while the loan remains outstanding.

Ransford said he doesn’t know the terms of the financing arrangements between financier Fortress Investment and Millennium, but he said such an accelerated interest clause – if it exists – could have a big impact on the costs of the Olympic Village.

“That’s a question that needs to be asked,” he said.

But regardless of the financial outcome of the project, the urban consultant said the most important lesson to take away from the whole fiasco is that Vancouver shouldn’t be dabbling in major real-estate ventures without industry input.

Ransford said many cities have real-estate boards composed of industry professionals, something that Vancouver lacks.

“If the city’s going to venture into an area that it doesn’t have expertise in…then it had better reach out and seek expertise,” he said. “That’s lesson one from this whole mess.”

Geoff Dembicki is a staff reporter for The Hook.