Toronto IMMIX | 131.06m | 38s | QuadReal | a—A

Three Toronto high-rise condo projects started by Cresford Developments in receivership

SHANE DINGMAN REAL ESTATE REPORTER

BCIMC is owed more than $320-million on the three projects. Its $3.6-billion construction mortgage portfolio is managed by QuadReal Finance LP.

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David Mann, chief financial officer of Cresford, in a responding affidavit expressed surprise at the speed of the push to receivership and claimed the coronavirus pandemic was responsible for some of the project delays, as some of the subcontractors at 33 Yorkville have suspended construction work. Mr. Mann said Cresford has a letter of intent from “an entity backed by a renowned Canadian entrepreneur” to buy the Yorkville site, enabling Cresford to repay its debts. Mr. Mann also described efforts to sell a number of Cresford-owned condo townhouses to raise about $10-million.“

We tried to put forth a restructuring for Halo and Clover that we thought was in the best interest of a whole panoply of stakeholders,” said Steven Graff, a partner with Aird & Berlis who is acting as Cresford’s counsel. “We were targeting to have something far more concrete in terms of the plan within three to six weeks.”

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Halo and 33 Yorkville are more than likely to be cancelled completely,” as they have not yet begun substantial construction, said Ms. Lierman, who tracks progress on dozens of condo projects in the Greater Toronto Area. Clover, which owes $145.9-million to QuadReal, is nearly completed.

Ms. Lierman said that of Cresford’s four active sites, three are currently just excavations, and only one of those is not in receivership. “Three pits on or near Yonge Street in downtown Toronto that are going to be stagnant for whatever stage … that doesn’t look great for the industry.”
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www.theglobeandmail.com

Three Toronto high-rise condo projects started by Cresford Developments in receivership

As many as 1,800 presold units are in jeopardy as the court moves on Cresford towers
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1,805 Cresford purchasers in limbo as receivership process wears on

May 13, 2020

“In my opinion, the statement by PwC that they will no longer be accepting deposits is sensible and the only way forward at this stage,” said Jillian Siskind, Principal Counsel of Jillian M. Siskind & Associates, a boutique law firm specializing in construction and real estate litigation. “Taking additional deposits at this point would be irresponsible since there is no active project underway.”

Siskind explained that it may be possible for another developer to purchase the project’s land and work in place, a distinct action from the projects being purchased. If bought just for the construction and land, Siskind said that a new developer would likely want to start the process from scratch, meaning old project deposits would be returned through Tarion or Cresford’s insurer, and new agreements would be created.

Two of the projects in question, Halo Residences and 33 Yorkville, are in the early stages of construction, with most work still at grade-level, according to photos recently published online. The Clover, however, is nearly finished. While a developer could take over the project, Siskind explains that it is uncertain how that would happen with The Clover and whether old purchase agreements would be transferred over. Financial viability, among other factors, would influence the purchasing decision of the project or its assets.

“A new developer will examine the financial viability of the project including its assets and debt. It will also consider the purchase price for the units,” said Siskind. “It may well be that the new developer could not get those same prices in today’s market, or to the contrary, maybe they could get more.”

With The Clover nearing completion, Lierman said that the project may need to be almost comparable to resale price points now that it has phased out of preconstruction over time. In terms of what purchasers may receive at the end of the process would depend on what the purchaser decides, Lierman explained.

“You have to expect that on Yonge Street, you’re going to want to get a certain level of revenue on this site, and the gap between what your owners paid for the units versus now,” said Lierman. “At the very least, they should be getting their deposits back if they’re going to go the clean-slate route, with interest.”
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www.livabl.com

1,805 Cresford purchasers in limbo as receivership process wears on

As no firm decisions have been made yet on the fate of any of these projects, the roadmap for what could happen to them may vary.
www.livabl.com
 
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