A sprawling real estate investment enterprise in Northern Ontario run by a former child actor has filed for creditor protection as it struggles to pay off debts of $144-million, largely from hundreds of individual private lenders including some who used retirement funds.
Court records show that Robert “Robby” Clark – a U.S.-born actor who as a 13-year-old starred in YTV’s The Zack Files between 2000-02 – used a network of companies with names such as Balboa Inc., Happy Gilmore Inc., Horses In The Back Inc., Joint Captain Real Estate Inc. and The Pink Flamingo Inc. to build up a rapidly expanding real estate portfolio beginning in 2020. The enterprise owns 405 rental properties in Northern Ontario cities and towns such as Sudbury, Sault Ste. Marie, and Timmins.
Mr. Clark recently applied to Ontario’s Superior Court for protection under the Companies’ Creditors Arrangement Act. The application says the companies are facing “a severe liquidity crisis, have less than $100,000 of cash on hand, are in default of substantially all of” its loans.
A Superior Court judge issued an interim order on Jan. 23 that provided a stay of proceedings and also appointed KSV Consulting Inc. as a monitor to explore ways to refinance or reorganize the companies.
Mr. Clark and his legal counsel did not respond to requests for comment.
The enterprise’s financial troubles have tied up millions of dollars loaned by hundreds of private lenders and prompted concerns that a rapid sell-off of Mr. Clark’s holdings could unleash chaos on the rental and resale markets in the small cities where he operates.
In an affidavit filed with court, Mr. Clark describes the companies as “specializing in the acquisition, renovation and leasing of distressed residential real estate in undervalued markets throughout Ontario.” Court documents claim that the companies purchased and sold more than 800 properties, many of them single-family homes. The enterprise’s current portfolio includes 631 individual rental units, 424 of which are rented.
Mr. Clark services all of the properties and collects fees using companies operating under the names SID Development, SID Renos and SID Management, court records show. Three other people are listed in the filing and corporate records as key owners and directors of the holding companies: real estate agent Thomas Dylan Paul Suitor, who is with Keller Williams Signature Brokerage in Oakville; Aruba Butt; and Ryan Molony.
Mr. Suitor, Ms. Butt and Mr. Molony did not respond to requests for comment.
To finance these purchases, the companies obtained more than 390 mortgages worth $89-million; 120 second mortgages worth $8-million; and 802 unsecured promissory notes worth $54-million.
The interest rates on these loans and promissory notes vary between 8 per cent and 20 per cent.
The majority of the lending was brokered by one company – Hamilton-based Windrose Capital — that paired many of the more than 300 private lenders with Mr. Clark’s companies. Windrose Capital’s principal broker, Claire Drage, did not respond to a request for comment.
One private lender who spoke to The Globe said she feels misled and she wasn’t kept in the loop on the scale of the operation she was lending to.
“At no time were we told that they are part of this conglomerate of all these companies … we would never have done that,” said Cathy Hugh, 57, a retired bank employee living near Ottawa.
Ms. Hugh loaned $184,000 at 8 per cent interest in 2022 to what she believed was a sole-operator to purchase a single-family home in Sault Ste. Marie. “I only wanted to do individuals, I felt more protected because I could have gone in for a repossession.”
However, the stay of proceedings issued as part of the creditor protection process means lenders cannot turn to repossession, or power of sale, to recoup their money.
The stay period was set to last until Feb. 2, but has been extended to Feb. 16.
Some of the affected lenders extended mortgages for as little as $65,000 or as much as $600,000, describing in court documents that they used retirement funds to do so. There are so many claimants that the court appointed Chaitons LLP as representative counsel to lenders to help co-ordinate the welter of claims and demands.
The quickest way to pay back lenders in such a situation is typically to sell the properties. But according to a KSV report to creditors, the scale of the real estate portfolio suggests a “sale of the properties will result in depressed recoveries for Investors and/or will take several years to complete as a result of current depressed market conditions.”
For example, the report cites data from Canadian Real Estate Association that in December, Timmins had 285 active listings and only 39 sales, Sault Ste. Marie had 125 sales on 425 active listings. Mr. Clark’s companies own 199 rental properties in Timmins. If they were all liquidated at once it would increase available inventory by 70 per cent, which in turn could both depress sale prices and cause the sales to take longer. The report estimates a “controlled” sale process where 15 per cent of the properties were listed at a time would take 49 months to complete in Timmins, and 23 months in Sault Ste. Marie (where the companies own 152 properties).
The companies do collect significant revenue from rents: the report contains an updated cashflow estimate filed with the court for Jan. 27 to March 28 shows rental collections of $1.062-million and operating costs of $959,000. However, the net loss is projected to be $8.87-million with $3-million being spent on renovations, $2.2-million being paid to property tax arrears and $2-million for “professional fees” related to the insolvency which include fees to the monitor, lawyers and a financial adviser that’s been hired for $75,000 a month.
Mr. Clark’s business model of buying and renting mainly single-family homes bears resemblance to one employed by Toronto-based Core Development Group Ltd., which has promoted plans – in the face of significant controversy – to spend $1-billion buying single-family homes for the rental market. According to Mr. Clark’s affidavit, his network of companies offloaded 223 of his rental properties to Core in 2022, which represents about half of Core’s current portfolio of more than 550 homes.
Core’s CEO, Corey Hawtin, said his company may explore options to buy some or all of the Balboa/Happy Gilmore properties out of the receivership.
“We hope to be part of the solution, we hope we can acquire the portfolio and keep the tenants in place,” Mr. Hawtin said in an interview. Mr. Hawtin noted that when Core purchased the group of homes from Mr. Clark’s companies in 2022, it paid off the mortgage lenders.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
MONTREAL – The Quebec Professional Association of Real Estate Brokers says Montreal-area home sales rose 9.3 per cent in August compared with the same month last year, with levels slightly higher than the historical average for this time of year.
The association says home sales in the region totalled 2,991 for the month, up from 2,737 in August 2023.
The median price for all housing types was up year-over-year, led by a six per cent increase for the price of a plex at $763,000 last month.
The median price for a single-family home rose 5.2 per cent to $590,000 and the median price for a condominium rose 4.4 per cent to $407,100.
QPAREB market analysis director Charles Brant says the strength of the Montreal resale market contrasts with declines in many other Canadian cities struggling with higher levels of household debt, lower savings and diminishing purchasing power.
Active listings for August jumped 18 per cent compared with a year earlier to 17,200, while new listings rose 1.7 per cent to 4,840.
This report by The Canadian Press was first published Sept. 6, 2024.
In the quest to find cities where renters can enjoy the best of all worlds, a recent study analyzed 24 metrics across three key categories—Housing & Economy, Quality of Life, and Community. The study ranked the 100 largest cities in Canada to determine which ones offer the most to their renters.
Here are the top 10 cities that emerged as the best for renters in 2024:
St. John’s, NL
St. John’s, Newfoundland and Labrador, stand out as the top city for renters in Canada for 2024. Known for its vibrant cultural scene, stunning natural beauty, and welcoming community, St. John’s offers an exceptional quality of life. The city boasts affordable housing, a robust economy, and low unemployment rates, making it an attractive option for those seeking a balanced and enriching living experience. Its rich history, picturesque harbour, and dynamic arts scene further enhance its appeal, ensuring that renters can enjoy both comfort and excitement in this charming coastal city.
Sherbrooke, QC
Sherbrooke, Quebec, emerges as a leading city for renters in Canada for 2024, offering a blend of affordability and quality of life. Nestled in the heart of the Eastern Townships, Sherbrooke is known for its picturesque landscapes, vibrant cultural scene, and strong community spirit. The city provides affordable rental options, low living costs, and a thriving local economy, making it an ideal destination for those seeking both comfort and economic stability. With its rich history, numerous parks, and dynamic arts and education sectors, Sherbrooke presents an inviting environment for renters looking for a well-rounded lifestyle.
Québec City, QC
Québec City, the capital of Quebec, stands out as a premier destination for renters in Canada for 2024. Known for its rich history, stunning architecture, and vibrant cultural heritage, this city offers an exceptional quality of life. Renters benefit from affordable housing, excellent public services, and a robust economy. The city’s charming streets, historic sites, and diverse culinary scene provide a unique living experience. With top-notch education institutions, numerous parks, and a strong sense of community, Québec City is an ideal choice for those seeking a dynamic and fulfilling lifestyle.
Trois-Rivières, QC
Trois-Rivières, nestled between Montreal and Quebec City, emerges as a top choice for renters in Canada. This historic city, known for its picturesque riverside views and rich cultural scene, offers an appealing blend of affordability and quality of life. Renters in Trois-Rivières enjoy reasonable housing costs, a low unemployment rate, and a vibrant community atmosphere. The city’s well-preserved historic sites, bustling arts community, and excellent educational institutions make it an attractive destination for those seeking a balanced and enriching lifestyle.
Saguenay, QC
Saguenay, located in the stunning Saguenay–Lac-Saint-Jean region of Quebec, is a prime destination for renters seeking affordable living amidst breathtaking natural beauty. Known for its picturesque fjords and vibrant cultural scene, Saguenay offers residents a high quality of life with lower housing costs compared to major urban centers. The city boasts a strong sense of community, excellent recreational opportunities, and a growing economy. For those looking to combine affordability with a rich cultural and natural environment, Saguenay stands out as an ideal choice.
Granby, QC
Granby, nestled in the heart of Quebec’s Eastern Townships, offers renters a delightful blend of small-town charm and ample opportunities. Known for its beautiful parks, vibrant cultural scene, and family-friendly environment, Granby provides an exceptional quality of life. The city’s affordable housing market and strong sense of community make it an attractive option for those seeking a peaceful yet dynamic place to live. With its renowned zoo, bustling downtown, and numerous outdoor activities, Granby is a hidden gem that caters to a diverse range of lifestyles.
Fredericton, NB
Fredericton, the capital city of New Brunswick, offers renters a harmonious blend of historical charm and modern amenities. Known for its vibrant arts scene, beautiful riverfront, and welcoming community, Fredericton provides an excellent quality of life. The city boasts affordable housing options, scenic parks, and a strong educational presence with institutions like the University of New Brunswick. Its rich cultural heritage, coupled with a thriving local economy, makes Fredericton an attractive destination for those seeking a balanced and fulfilling lifestyle.
Saint John, NB
Saint John, New Brunswick’s largest city, is a coastal gem known for its stunning waterfront and rich heritage. Nestled on the Bay of Fundy, it offers renters an affordable cost of living with a unique blend of historic architecture and modern conveniences. The city’s vibrant uptown area is bustling with shops, restaurants, and cultural attractions, while its scenic parks and outdoor spaces provide ample opportunities for recreation. Saint John’s strong sense of community and economic growth make it an inviting place for those looking to enjoy both urban and natural beauty.
Saint-Hyacinthe, QC
Saint-Hyacinthe, located in the Montérégie region of Quebec, is a vibrant city known for its strong agricultural roots and innovative spirit. Often referred to as the “Agricultural Technopolis,” it is home to numerous research centers and educational institutions. Renters in Saint-Hyacinthe benefit from a high quality of life with access to excellent local amenities, including parks, cultural events, and a thriving local food scene. The city’s affordable housing and close-knit community atmosphere make it an attractive option for those seeking a balanced and enriching lifestyle.
Lévis, QC
Lévis, located on the southern shore of the St. Lawrence River across from Quebec City, offers a unique blend of historical charm and modern conveniences. Known for its picturesque views and well-preserved heritage sites, Lévis is a city where history meets contemporary living. Residents enjoy a high quality of life with excellent public services, green spaces, and cultural activities. The city’s affordable housing options and strong sense of community make it a desirable place for renters looking for both tranquility and easy access to urban amenities.
This category looked at factors such as average rent, housing costs, rental availability, and unemployment rates. Québec stood out with 10 cities ranking at the top, demonstrating strong economic stability and affordable housing options, which are critical for renters looking for cost-effective living conditions.
Québec again led the pack in this category, with five cities in the top 10. Ontario followed closely with three cities. British Columbia excelled in walkability, with four cities achieving the highest walk scores, while Caledon topped the list for its extensive green spaces. These factors contribute significantly to the overall quality of life, making these cities attractive for renters.
Victoria, BC, emerged as the leader in this category due to its rich array of restaurants, museums, and educational institutions, offering a vibrant community life. St. John’s, NL, and Vancouver, BC, also ranked highly. Québec City, QC, and Lévis, QC, scored the highest in life satisfaction, reflecting a strong sense of community and well-being. Additionally, Saskatoon, SK, and Oshawa, ON, were noted for having residents with lower stress levels.
For a comprehensive view of the rankings and detailed interactive visuals, you can visit the full study by Point2Homes.
While no city can provide a perfect living experience for every renter, the cities highlighted in this study come remarkably close by excelling in key areas such as housing affordability, quality of life, and community engagement. These findings offer valuable insights for renters seeking the best places to live in Canada in 2024.
