SkyCity developer's attempt to save a troubled condo project in Barrie fails
While Fortress Real Developments was busy pre-selling suites for its SkyCity condo development in Winnipeg last week, it was also struggling with a financing deal that was falling apart in Barrie, Ont.
Fortress ran out of time to complete a deal with Laurentian Bank of Canada for the purchase of the partially built Collier Centre in Barrie.
The building, which is supposed to be a mixed-use commercial/condo complex, is not finished and has yet to fully lease the space.
Initially, Fortress was just a lending partner in the Collier Centre. But when the project's developer, Mady Development, filed for creditor protection in January 2015, Fortress put in a bid to buy the condo project, which owes more than $50 million to creditors.
"The intent of Fortress is to complete construction of the condominiums and re-engage the tenants under the now mostly expired offers to lease," noted Jonathan Kreiger, senior vice-president of Grant Thornton Limited, the court-ordered monitor in the Collier Centre creditor protection filing.
Fortress requested several extensions to pay the seller, but time ran out late last week.
"Fortress requested a further extension of the closing date to pursue alternative arrangement to finance the purchase price but was not prepared to increase the deposit," said Kreiger.
Fortress lost its deposit of $1.7 million when the sale fell through.
"Fortress was unable to come to terms with Laurentian [Bank] and ended negotiations with them on their financing offer; so our current offer is not being extended," Vince Petrozza, COO of Fortress Real Developments, said in an email to CBC News.
Fortress said it is still working hard to find other lenders to replace Laurentian Bank and expects to share more news in the next week.
"Laurentian is now free to seek other purchasers and we are free to seek other financing," said Petrozza.
Kreiger said will he will immediately go back to the other companies that bid on the building to see if they are still interested in buying.
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