Major developer enters bankruptcy

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A large developer is taking steps to “deal with current cash flow issues.”

Toronto-based Urbancorp has started restructuring proceedings under the Bankruptcy and Insolvency Act in a bid to address debt issues.

“We determined, after much consideration and consultation, that a court-supervised process is the best way to deal with current cash flow issues,” chief executive officer Alan Saskin said in a release. “This will allow us to reduce debt in an efficient manner while continuing to focus on our core business.”

Urbancorp has over 1,000 units currently under construction and the bankruptcy proceedings are meant to allow the developer to focus on completing those homes.

“The process is intended to provide the companies with a stabilized environment in which to manage their affair,” Urbancorp said in a release. “The companies will follow a restructuring plan, including seeking Court approval of a sale process for certain of their assets.

“This will support efforts to maximize real estate values for the benefit of creditors and other stakeholders, in an orderly manner.”

Urbancorp and its subsidiaries – Urbancorp Toronto Management, Urbancorp Downsview Park Developments, Urbancorp St. Clair West Village, Urbancorp Lawrence, Urbancorp Mallow and Urbancorp Patricia – are part of a restructuring that will be overseen by trustee KSV Kofman Inc.  
  • Marcy Berg on 2016-04-25 11:01:29 AM

    No surprise here to anyone who ever tried to close one of their client's purchases.

  • Jerry Quigley on 2016-04-25 11:12:01 AM

    Anyone else wondering how a new home builder in Toronto can't make a profit????????

  • Elizabeth Young on 2016-04-25 11:28:40 AM

    Judging from previous articles about how many of their buyers requested their money back when their homes were delayed, this isn't surprising.

    I wonder if this was part of the reason why they stopped cooperating with Realtors.

  • Marcy Berg on 2016-04-25 11:32:16 AM

    This will not surprise anyone who ever tried to close a purchase for a client. They don't make anything easy.

  • Kuldip S Panesar Homeland Mortgage Corp. on 2016-04-25 3:03:26 PM

    Developer may have siphoned away the funds to other projects and when they are not able to give the possession of the units to buyers , they proceed for bankruptcy.

  • TWH on 2016-04-26 4:27:33 PM

    The $60 Million bonds issued by Urbancorp at 8.6% interest were the largest signal recorded on this problem when they had to look to Eygpt to sell them.
    What Canadian bank investment house would not grab that offering up if its GTA home builder was in AOK shape?

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