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  #3701  
Old Posted Jun 4, 2018, 2:09 PM
The Unknown Poster The Unknown Poster is offline
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Originally Posted by cheswick View Post
Both of those projects are rentals.
Yes but if the desire was to live downtown, getting their deposits back allows them some cash to rent. Or look at one of the other condos in the area.
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  #3702  
Old Posted Jun 4, 2018, 2:59 PM
Finessing Finessing is offline
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Real estate developer Fortress faces foreclosure battles as mortgage lenders circle

https://www.theglobeandmail.com/busi...s-as-mortgage/
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  #3703  
Old Posted Jun 4, 2018, 7:41 PM
Naive Naive is offline
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They need to move in and seize all fortress assets so these guys don't run. Pay back what ever you can to the lenders and throw these assholes in jail where they belong.
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  #3704  
Old Posted Jun 4, 2018, 8:00 PM
Wolf13 Wolf13 is offline
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Originally Posted by GlassCity View Post
Honestly, I never liked this project since I first saw it on SSP years ago. The tower is ugly, certainly too much so to be Winnipeg's tallest. I'll be interested in seeing what new thing Fortress dreams up.
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Originally Posted by Urban recluse View Post
Height is great, design is blah.
I kinda liked it. Perhaps the tall fin was a bit too self-indulgent, but it was neat.


Still, while nobody found much to like about Fortress, I think we all wanted something of this scale to happen. The entire city wanted it.
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  #3705  
Old Posted Jun 5, 2018, 6:21 PM
Pi3141592654 Pi3141592654 is offline
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Sound the Price Is Right horn:
https://www.mortgagebrokernews.ca/ne...es-243405.aspx
Syndicated mortgage fraud litigation unlikely to recoup monies

Lenders are pushing hard for repayment from Fortress Real Developments, but only those designated as primary investors are likely to be successful.

The Globe and Mail yesterday reported that mortgage lenders on at least four Fortress Real developments have initiated legal action after the embattled developer defaulted on payments.

Lawyer David Franklin, who’s representing investors allegedly swindled by Fortress Real (but none of whom are involved in the litigation reported by the Globe), believes that the layers of hefty mortgages make repayment of all parties unlikely.

“On the Collier Centre, the initial valuation projected the sale price of the whole project at around $72mln, and that’s with having the retail space all rented and the office space and condo all occupied,” he said. “Now, the condominium has been sold and that reduced David Morrison’s mortgage. He’s down to $25-28mln and there’s a second mortgage of $7.225mln and then a third mortgage of $3mln. The fourth mortgage was syndicated and worth about $10mln, and then there’s a fifth mortgage, also syndicated, worth of about $17mln plus interest from the original investors.”

Fortress Collier Centre Ltd., which is developing a commercial tower in Barrie, Ont., owes money to Morrison Financial, and has a narrow window in which to sell the property before Morrison steps in to claim power of sale.

“Definitively, in relation to the Collier Centre, they are in discussion to sell the property and to recover as much money as they can, and I think they are doing that in good faith,” David Morrison of Morrison Financial told MortgageBrokerNews.ca. “I don’t think they’re game playing, but whether they recover enough to repay investors is unlikely.

“I don’t think they believe they will get enough to recover all investors’ funds, but I think they’re acting in good faith. If they complete a transaction before proceedings go full course, we’ll allow them to because we don’t have an axe to grind. If they do not complete the transaction in the time allowed, we will proceed with power of sale. We just want to protect our own loan and to do the best for everybody in that situation.”

Ron Butler of Butler Mortgage doesn’t believe anybody will recover their money on the Fortress projects, save for maybe the primary lenders. Moreover, he doesn’t believe those projects will come back to life, either.

“I don’t believe, personally, that the economics of those projects will ever allow them to come back to life with Fortress,” said Butler. “Fortress, in the Globe and Mail article, suggests they have eminent new buyers, but, personally, I don’t think that will happen. I’m not a Fortress insider, but I believe it will not happen. If the City of Regina is suing them to fill in the hole in the ground they made [for a project called Capital Pointe], I don’t believe there will ever be a condominium tower there.”

In April, the RCMP executed search warrants that targeted, among others, Fortress Real’s headquarters.
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  #3706  
Old Posted Jun 5, 2018, 6:23 PM
Wolf13 Wolf13 is offline
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This is aggravating but expected.

While everyone knows this is fortress, hopefully it doesn't sour enough public opinion about the idea of large downtown projects.
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  #3707  
Old Posted Jun 25, 2018, 1:25 PM
Pi3141592654 Pi3141592654 is offline
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https://www.theglobeandmail.com/busi...erable-stress/

Fortress investors could face ‘significant losses’
Janet McFarland
6-8 minutes

Syndicated mortgage loans for real estate projects developed by Fortress Real Developments Inc. are “under considerable stress,” and lenders could face “significant losses,” according to a new report from a court-appointed receiver.

In its first update since it was appointed in April, FAAN Mortgage Administrators Inc. said some of the largest loans provided for Fortress projects are at risk because senior mortgage lenders are moving to foreclose on the properties.

For example, the senior lender for a proposed office complex at the Collier Centre site in Barrie, Ont., has issued a notice of sale for the property, saying the period set to repay its loan has expired. Syndicated mortgage lenders provided $53-million in loans to the project, but senior lenders’ claims on the land have higher priority.

FAAN said it is in talks to find other options to address the default, and said it is possible the commercial tower plan could be converted into a residential development.

“However, the trustee notes that despite its efforts, a sale of the property could result in significant losses to the investors,” FAAN warned in its update report.

The report contains more precise details and numbers on the outstanding loans than were previously available. More than 11,000 investors – most in Ontario – invested $560-million to provide syndicated mortgage loans to Building and Development Mortgages Canada Inc., which raised the money to help finance 44 development projects for Fortress and its partners.

BDMC is owned by Ildina Galati, a former mortgage broker who surrendered her broker license in February as part of a settlement deal with Ontario’s financial regulator. BDMC was the principal mortgage broker for Fortress, and operates from the same office address. Vince Petrozza, co-founder and chief operating officer of Fortress, was also a registered mortgage broker with BDMC until his registration was revoked in February.

In its update, FAAN said it has spent much of its time as receiver dealing with applications from senior lenders who have priority claims on many of the development projects and are seeking to foreclose or seize the properties because of non-payment of their loans.

FAAN said it needs more time and money to do more appraisals of the projects to find the best potential outcomes for the syndicated lenders, whose loans often rank in third place or lower to those of other lenders.

It said it is trying to get Fortress to finance some of its work because BDMC has no cash coming in and is “functionally insolvent.” It said BDMC’s professional costs should not be borne solely by investors, noting Fortress previously covered BDMC’s costs when it had insufficient revenue.

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FAAN is also asking the court to appoint law firm Chaitons LLP to represent the individual syndicated mortgage lenders, saying it has received many questions from investors about their options, and is required to tell them to seek independent legal advice.

It said a court-appointed lawyer could protect investors’ individual interests while sparing them the cost of hiring their own lawyers. It recommends paying the law firm a portion of distributions made to investors as projects are wrapped up, and said investors could opt out of representation.

The update report also said Fortress’s Brookdale condominium project in Toronto – which has almost $25-million of syndicated mortgage loans outstanding – is subject to two enforcement actions by a senior lender, which has issued a notice of sale for the land. The syndicated loans rank fourth and fifth behind senior lenders.

FAAN said settlement negotiations with Brookdale’s lenders have “stalled” and the senior lender is looking to enforce its loan and sell the property. FAAN warned investors could face “significant losses.”

“At this time, it is unclear what the outcome for the Brookdale project will be due to the existing defaults under senior loans in excess of $23-million and the numerous additional construction liens that have been asserted,” FAAN said.

It said lenders are also seeking to take control of the Glens of Halton Hills project in Georgetown, north of Toronto, which could result in “significant losses” for syndicated investors owed $14.4-million.

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A development in Guelph known as the Dunsire project was put into receivership in December, FAAN said, and ownership of the property is being transferred. Syndicated lenders owed $1.7-million will see “very little recovery,” but some HST refunds may be available to provide “a least a partial recovery,” the report said.

FAAN’s update also said about 35 per cent of the money raised from syndicated lenders was used to pay “development consultant fees,” about half going to the brokers who raised the funds from individual investors, and the other half paid to BDMC in its capacity as the borrowers’ broker and to Fortress.

Some of the syndicated loan money was also retained in reserve by BDMC to make the required interest payments to the same investors who provided the loans, FAAN said.

However, FAAN said it “has become aware” that some of that money intended for interest payments to the syndicated lenders was used for other purposes, including interest payments to higher-ranking lenders and paying expenses for the projects. It provided no further details on the amounts paid for other purposes.

In more positive news, FAAN said it appears a development project in Bowmanville, Ont., will be refinanced with new senior lenders, but $5.3-million of syndicated loans will remain outstanding and subordinated to the new senior lenders.

FAAN also said a Victoria building project has been sold, and the full amount owed to the syndicated lenders has been collected. However, FAAN is seeking court approval to repay lenders only half the amount of their loans and to put the other half in a separate reserve account.

It said it will report to the court by Oct. 31 on its progress on the Fortress projects and its recommended proposal for the use of the reserved funds.

FAAN said senior loans on many other projects have matured or come due, and it is facing multiple requests to agree to further postpone BDMC’s subordinated loans to allow the senior loans to be refinanced. It said it is still seeking information to decide how to deal with the requests, but added that many of the projects will fail if the lending cannot be secured, and many of the syndicated loan agreements required BDMC to grant senior debt refinancing postponements.
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  #3708  
Old Posted Jul 19, 2018, 8:56 PM
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cheswick cheswick is offline
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Some recent developments on the RCMP investigation:
https://www.cbc.ca/news/canada/manit...tion-1.4751867
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  #3709  
Old Posted Jul 20, 2018, 6:02 PM
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esquire esquire is offline
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I noticed a clever billboard for Glasshouse on the Skycity site... it was advertising a special deal for Skycity buyers.

Tagline for Glasshouse read "the real thing"... tee hee
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  #3710  
Old Posted Jul 21, 2018, 1:33 AM
buzzg buzzg is offline
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Originally Posted by esquire View Post
I noticed a clever billboard for Glasshouse on the Skycity site... it was advertising a special deal for Skycity buyers.

Tagline for Glasshouse read "the real thing"... tee hee
Lol was just about to post that.
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  #3711  
Old Posted Jul 21, 2018, 12:40 PM
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Jets4Life Jets4Life is offline
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Lol was just about to post that.
It is not funny. These crooks depleted people of their life savings. I hope they die painfully.
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  #3712  
Old Posted Jul 21, 2018, 3:25 PM
Naive Naive is offline
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Agreed

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Originally Posted by Jets4Life View Post
It is not funny. These crooks depleted people of their life savings. I hope they die painfully.
I am one of those people but fortunately losing my investment will not be life altering however some of these folks are going to lose a lot of money including their retirement savings. Please folks spare us the buyer beware speeches, most of us were duped by being sold on the fact that our investments were secured against lands that were way over valued. I am hoping that charges are layed, not just to fortress but to the lawyers that were involved in all of this and the greedy brokers that threw their clients under the bus. The best case scenario would see the law/government step in and take hold of all of Fortress's assets but we know that will never happen. The FSCO is a complete joke with the all the info they had on these crooks they should have put a stop to this a lot sooner.
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  #3713  
Old Posted Jul 21, 2018, 7:56 PM
buzzg buzzg is offline
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Originally Posted by Jets4Life View Post
It is not funny. These crooks depleted people of their life savings. I hope they die painfully.
Mmm, I'd argue the billboard is pretty funny.
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  #3714  
Old Posted Jul 22, 2018, 10:06 AM
Ando Ando is offline
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Whatever happened to the St. Regis site issue? Has the city taken over?
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  #3715  
Old Posted Jul 22, 2018, 3:48 PM
buzzg buzzg is offline
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^Believe it's in the courts' hands. Who knows how long it could take to get it reverted to city or someone else. It'll be interesting to see if the out clauses enable the city to take it back over soon, or if the banks will try and argue its theirs to re-sell and recoup some money.
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  #3716  
Old Posted Jul 23, 2018, 10:13 AM
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Originally Posted by buzzg View Post
^Believe it's in the courts' hands. Who knows how long it could take to get it reverted to city or someone else. It'll be interesting to see if the out clauses enable the city to take it back over soon, or if the banks will try and argue its theirs to re-sell and recoup some money.
In an ideal world, they would build a Sobey's there as to attract people to live downtown. the area really can use a grocery store.
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  #3717  
Old Posted Jul 23, 2018, 8:22 PM
CoryB CoryB is offline
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Originally Posted by Jets4Life View Post
In an ideal world, they would build a Sobey's there
With the current state of grocery retailing in Canada you are far more likely to see Fortress complete SkyCity Centre as originally proposed and hit the original target date than you are to see any national chain open a grocery store in downtown Winnipeg, not just now but ever.

The reality of the situation is grocery retailing is about to have its major ecommerce moment as most of the pieces have been figured out. No one with any sense of the market is going to risk a large investment for a store in what has always been an extremely tight margin sector. Further, part of the whole shift to a different market is the younger adult set including Millenials.
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  #3718  
Old Posted Jul 23, 2018, 9:12 PM
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Sobeys is building a larger store to replace our small Foodland in our neighbourhood. So they are still building new stores where there is demand.
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  #3719  
Old Posted Jul 23, 2018, 9:13 PM
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Probably of some interest to investors in either this of the Capital Pointe project: How Capital Pointe Buyers Can Get Their Money Back from the Regina Leader Post. This also illustrates the difference between investors and buyers in a project.
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