The developer plans to defend what it alleges is a baseless claim.
A total of five claims have been filed against Fortress Real Capital, bringing the total to $137.5 million.
This fifth claims has been filed by two investors in the Orchard condo project in Calgary, including Arlene McDowell, who is the plaintiff in the other claims.
McDowell claims that she was not made privy to the “undisclosed risks” of investing in syndicated mortgages prior to her decision to invest in April 2012.
The second plaintiff, Bryan Madryga, claims the same.
Sales for the project commenced in 2014 but construction – which was slated to start in 2015 – was delayed until spring 2017.
According to the claim, construction financing has still not been secured.
For its part, Fortress plans to defend itself against the allegations.
“This action, which has been initiated by a familiar cast of characters, is frivolous,” a representative for Fortress told MortgageBrokerNews.ca. “Fortress intends to vigorously defend this baseless claim.”
Lamb development Corp., the developer behind the project, recently told the Globe and Mail it plans to break ground on the project in the next six months.
Statement of claim issued to major syndicated mortgage provider
Fortress responds to proposed suits