Calibrex: $1 a property, nine offers, and the mortgagee's credit bid

On August 1, 2025, a representative of Grant Thornton Limited attended at a scatter of properties in Niagara Falls, took possession of the vacant commercial buildings and a motel, and set about protective measures that included boarding up ground-floor windows and doors. The receiver's first report describes "multiple vacant lots, several stand alone commercial buildings, and a non-operational motel," near the VIA Rail station and the Niagara River but not all contiguous, and all of it, with the exception of one parcel, vacant land or vacant buildings First Report of the Receiver, Sept. 11, 2025, paras. 2, 4, 39. The exception, a building at 4551 Zimmerman Avenue, was leased to a company that operates a co-working space Notice of Motion, Sept. 11, 2025, para. 2. Justice J. Kimmel, who appointed the receiver on July 31, had recorded the rest: "The respondents have allowed the properties to sit mostly vacant for years, creating significant safety and financial concerns, including unpaid property taxes, three fires on three of the subject properties due to apparent neglect, and the Construction Lien" Endorsement of Justice Kimmel, July 31, 2025, para. 10 (Second Report, App. B).

On September 22 the receiver's broker, Cushman & Wakefield ULC, listed every one of them for $1, "allowing for the broader market to dictate value." Nine offers arrived by the December 12 deadline. The receiver chose the credit bid of 1001116006 Ontario Inc., the mortgagee that had applied for the receivership, for the whole portfolio at a price that sits in a confidential appendix, and has asked the Commercial List to approve the sale and, on the same motion, to discharge it Second Report of the Receiver, Feb. 9, 2026, paras. 6, 13, 21–22.

Two portfolios, one mortgagee

Corporations affiliated with Calibrex Development Group, the name under which the respondent 2568551 Ontario Inc. carries on business, hold the parcels on River Road, Queen Street, Bridge Street and Zimmerman Avenue. Three others, 2741854 Ontario Limited, 2678514 Ontario Inc. and 2678517 Ontario Inc., hold the Erie Avenue and Park Street parcels and are "connected to Hunter Milborne," in the words of the receiver's factum, which counts 16 parcels in all. Each collection was financed under its own credit facility. Andrzej Roman Kepinski guaranteed the Calibrex mortgages and Mr. Milborne the Milborne debt, and both are respondents Amended Factum of the Receiver, Feb. 13, 2026, paras. 3–6.

The mortgages were registered in 2021 to other lenders, the Calibrex charges on July 5 and the Milborne charges on December 1, and the Milborne security passed to a second lender in January 2023 Draft Sale Approval and Vesting Order, Schs. C1–C3 (Tab 3). On April 9, 2025, 1001 Ontario bought the rights under both loan agreements and took an assignment of the security. By then the Milborne companies had paid none of the interest due from September 30, 2023 on and had not repaid when their loan matured on February 1, 2024, and the Calibrex side had not paid the interest due from September 30, 2024. As of May 7, 2025, property tax arrears were over $420,000 on the Calibrex parcels and nearly $220,000 on the Milborne ones, and "the property tax arrears take priority over the mortgage security that 1001 Ontario holds," the judge noted. All the respondents had confirmed they would not oppose. "There is no reasonable prospect that the respondents will cure their defaults nor complete the intended development," Justice Kimmel wrote, adding that "the respondents involved in the original development plans are suing one another" Endorsement of Justice Kimmel, July 31, 2025, paras. 1, 3, 5, 9–10 (Second Report, App. B).

The receiver has since accepted 1001 Ontario's claim, calculated to December 15, 2025, at $21,209,967.29. Of that, $12,218,520.85 is owed by the Calibrex companies: $10.8 million in principal advanced between May 31 and July 27, 2021, $1,264,779.46 in interest at 8% a year, net of interest-only payments, and legal fees. The Milborne companies owe $8,991,446.44, built on a debt of $8,216,367.93 as of April 9, 2025, and interest continues to accrue. An independent opinion from Miller Thomson LLP dated September 10, 2025, subject to the usual qualifications, confirmed the mortgages and the Milborne companies' personal property security as valid and enforceable. The mortgagee has also funded the receivership, taking receiver's certificates totalling $300,000 at 4.95% a year under a borrowing limit of $750,000 Second Report of the Receiver, Feb. 9, 2026, paras. 38–39, 49–51.

A dollar a property

Of four brokers the receiver invited, two, Cushman and Colliers, submitted complete proposals, and their estimates of value went into a sealed appendix. The receiver preferred Cushman because it was the only broker to have attended the sites and broken down its estimated values, for its local expertise, and because its compensation "provides for a materially reduced commission rate for any portion of the Real Property that is ultimately sold by credit bid" First Report of the Receiver, Sept. 11, 2025, paras. 15–18.

The same report set terms for a bid by the mortgagee, which "may be interested in submitting a credit bid for some or all of the Real Property," and to keep it from any "unfair advantage" the receiver proposed that it give notice of any intention to credit bid by October 1, 2025; that it receive no copies of other bids; that the receiver select the successful bids independently of it; and that any credit bid carry enough cash to pay whatever ranked ahead of its mortgage, with the receiver's certificates allowed as non-cash consideration First Report of the Receiver, Sept. 11, 2025, paras. 37–38. Justice J. Steele authorized the process on September 17, 2025 and sealed the listing-proposal summary until the earlier of a closing or further order Sale Process Order, Sept. 17, 2025, paras. 3, 5 (Second Report, App. D). The mortgagee disclosed its interest in a credit bid at the start of the process, and the receiver says it made sure 1001 Ontario received no information about other potential bidders or interested parties and did not see other bids Second Report of the Receiver, Feb. 9, 2026, para. 30(e).

Cushman sent a brochure, a confidential information memorandum and a non-disclosure agreement to about 76 targeted parties; put the properties on the Toronto Regional Real Estate Board system; and opened a data room to the 18 parties that signed. The broader marketing drew 829 views. On October 30, after early interest and some offers, Cushman set the offer deadline at December 1, to maintain the process's momentum; on December 1 it was extended to 3:00 p.m. on December 12, so that bidders could make their offers on the receiver's standard-form agreement Second Report of the Receiver, Feb. 9, 2026, paras. 15–19.

Nine offerors bid, for single properties, for groups of properties and, in two cases, for all of them Amended Factum of the Receiver, Feb. 13, 2026, para. 10. With its counsel, Cassels Brock & Blackwell LLP, and Cushman, the receiver held further discussions with the bidders behind two of the highest offers, and went back to the second-highest bidder, whose offer was in cash, to see whether it would close the gap; that bidder "increased its bid materially but ultimately was not prepared to provide consideration that was materially close to or greater than that which 1001 Ontario offered" Second Report of the Receiver, Feb. 9, 2026, paras. 22, 30(f)–(g). The factum describes the one other offer for the whole portfolio as "materially less" than 1001 Ontario's, with "numerous conditions" and "multiple downward adjustments of the purchase price" Amended Factum of the Receiver, Feb. 13, 2026, para. 22(b).