Freedom Self Storage: 373 lockers, three buyers and a release the Crown opposed

Three of Freedom Self Storage's four sites are close to St. Francis Xavier University, and the company told its proposed monitor that rentals there have historically ticked higher in the summer, as students move out of residence in the spring and return in the fall. The fourth is at 5 Colford Drive in East Chezzetcook. Together they held about 373 units, run by two part-time employees and an outsourced call centre, per the Pre-Filing Report, Mar. 11, 2026, paras. 19–22. In the year to May 2025 rental revenue was $516,004 and interest on long-term debt was $534,639, so the interest exceeded gross revenue by $18,635; the directors had been lending the companies money so the interest could be paid while other debts, property taxes among them, continued to accrue, per the Pre-Filing Report, Mar. 11, 2026, paras. 25–28.

On March 12, 2026, the Supreme Court of Nova Scotia in Bankruptcy and Insolvency granted Freedom Self Storage Inc. and its wholly owned subsidiary, Honeycomb Self-Storage Limited, protection under the CCAA and appointed Grant Thornton Limited as monitor, per the Third Report of the Monitor, Aug. 17, 2026, paras. 1–2, 42. By August 20 every site had been sold, the monitor was reporting a shortfall to the secured lender, and the Minister of National Revenue had filed submissions opposing a release of three directors. On August 28 both companies filed assignments in bankruptcy, with Grant Thornton as trustee, per the Preliminary Report of the Trustee, Aug. 31, 2026, para. 8.

A portfolio the lender would not split

Apart from a $16,204.30 vehicle loan from the Royal Bank of Canada, the secured debt was one lender's. Ducimus Capital Inc. advanced a loan on May 5, 2023, amended in 2024 and 2025 up to a consolidated $5,425,000, secured by mortgages on all four properties and a second charge on 10 Springhill Road in Dartmouth, a property Michael Burgess, a director and vice-president of both companies, owns personally, per the Initial Affidavit of Michael Burgess, Mar. 3, 2026, paras. 1, 16, 29–30. The companies attribute the insolvency to variable rates that pushed borrowing costs "into the 12–13% range at points," more than $100,000 in extension and administration fees added to the debt, and occupancy that fell from a historical 85–90% to about 70%, per the Initial Affidavit of Michael Burgess, Mar. 3, 2026, paras. 19–21.

Before filing, the companies circulated a refinancing proposal for $5,450,000 at 9% or less, and in or around September 2025 they tried to sell the Colford property. "Ducimus would not agree to have their portfolio severed and as a result, no sale could be completed," Mr. Burgess deposed, per the Initial Affidavit of Michael Burgess, Mar. 3, 2026, paras. 42, 44. That offer was for $2,600,000, about 73% of the $3,540,000 at which CBRE Limited had appraised the site in 2022; CBRE's 2021 and 2022 appraisals put the four properties together at $7,880,000, per the Pre-Filing Report, Mar. 11, 2026, paras. 29, 38–39.

Two interim lenders and a monitor-run sale

The initial order approved interim financing from Pillar Capital Corp. at 1.25% a month, a 16.08% effective annual rate, plus fees. Within days Ducimus offered a $350,000 replacement at 1.00% a month, 12.68% effective, with no facility, monitoring or due-diligence fee, and the companies accepted it; Pillar, which had been paid a $2,500 due-diligence fee, never advanced, per the First Report of the Monitor, Mar. 23, 2026, paras. 27–32. The amended and restated initial order of March 30 approved the Ducimus facility, extended the stay to June 30, and extended a limited, conditional stay to Basin Apartments Ltd., a guarantor of the Ducimus debt owned by Mr. Burgess, although Ducimus had told the monitor it opposed that extension, per the First Report of the Monitor, Mar. 23, 2026, paras. 16, 58(c) and the Third Report of the Monitor, Aug. 17, 2026, para. 4.

Grant Thornton ran the sale process itself, with no sales advisor. It sent the opportunity to 485 parties and opened a data room to 37 qualified bidders. Among them were two directors, Mr. Burgess and Greg Ross, who reserved the right to make an insider bid, and Ducimus, which reserved the right to credit bid; once both had declared, the monitor ran the process without consulting either the companies or the lender, per the Second Report of the Monitor, June 23, 2026, paras. 21–22, 24, 29–30. Bids arrived on June 9, improved bids on June 12, and on June 15 the monitor chose its buyers. Ducimus's bid was rejected, per the Second Report of the Monitor, June 23, 2026, paras. 31–32, 35, 59.

Three buyers, one of them a director

Ron MacGillivray Holdings Ltd. won 215 Beech Hill Road in Antigonish, and Sunrise Storage Ltd. won 86 Angus MacQuarrie Drive in Antigonish and Highway 16, Boylston Lot 2, in Guysborough County. Both bids complied with the procedures, came with 10% deposits and carried no financing condition, per the Second Report of the Monitor, June 23, 2026, paras. 35, 38, 42.

The Colford property went to Mr. Burgess, whose bid contemplated participation by Mr. Ross. That bid departed from the procedures: the 10% deposit was to follow within 24 hours of acceptance, the bid was conditional on financing within 30 days, and if the financing failed the bid would terminate and the deposit would be refunded. The monitor waived those requirements under paragraph 31 of the procedures, received the full deposit, and accepted the bid as the successful one for reasons it placed in a confidential addendum. No back-up bid was selected for Colford, and Ducimus supported the choice, per the Second Report of the Monitor, June 23, 2026, paras. 44–50. Addressing s. 36(4) of the CCAA, the monitor reported that the property had been offered to, and drew bids from, parties unrelated to the companies, and that Mr. Burgess's was the best bid received, per the Second Report of the Monitor, June 23, 2026, para. 62.

On June 30 the court issued three approval and vesting orders and an ancillary order. The ancillary order sealed the confidential addendum until the earliest of the closing of the sales, the end of the proceedings, or August 31; authorized an interim distribution of priority property taxes, repayment of the Ducimus facility and the balance to Ducimus, less a $300,000 holdback; and raised the administration charge from $100,000 to $200,000, per the Third Report of the Monitor, Aug. 17, 2026, para. 5.

The two Freedom sales closed on July 10. Colford took longer: the monitor, in consultation with Ducimus, extended the buyer's deadline to waive its financing condition to July 31 and then to August 5, the condition was waived on August 5, and the sale closed on August 14. By then Mr. Burgess had assigned the agreement, on July 23, to 4833525 Nova Scotia Limited, per the Third Report of the Monitor, Aug. 17, 2026, paras. 16(i), 21, Appendix F. The monitor describes its work coordinating that purchaser's financing and closing as producing "substantial increased recovery to the estate (greater than $750,000)," per the Third Report of the Monitor, Aug. 17, 2026, para. 49(e).

Three days after the last closing, the distribution schedule appended to the monitor's third report set out the gross proceeds: $1,750,000 for Beech Hill, $585,000 for Angus and Boylston, and $2,000,000 for Colford. From those proceeds and the companies' cash, net of the holdback, Ducimus was to receive $3,982,659.14: $205,543.06 in repayment of its interim facility, a first distribution of $1,805,496.66, and a second of $1,971,619.42 from the Colford sale, per the Third Report of the Monitor, Aug. 17, 2026, Appendix I.