I4PG Hastings Street: the lender takes the contamination lawsuit

The site at 4437/4451 Hastings Street in Burnaby covers 17,222 square feet, rezoned for a building its developer called Siena the Heights: 38 residential strata suites over six commercial units, five storeys of concrete and wood frame on a two-level, 71-stall parkade. When Deloitte Restructuring Inc. took control in February 2025, the excavation and shoring were done, the parkade was partly built, 27 of the suites and all six commercial units had been pre-sold, and construction had been stopped since around August 2023, per the Receiver's First Report, Aug. 21, 2025, paras. 1, 15–16, 24. The receiver changed the locks, hired weekly security patrols and had the water pumped out of the excavation so a crane could be removed, per the First Report, para. 27(b), (c), (h).

On September 10, 2026, Justice P. Walker of the Supreme Court of British Columbia signed the order that winds the receivership up. It sends the $282,267 construction holdback into court, where entitlement will be settled among the lien claimants by agreement or on application; pays WorkSafeBC $659; and directs the receiver to assign to Desjardins Financial Security Life Assurance Company, the first mortgagee, the developer's claims for environmental remediation costs as an in-kind distribution. Deloitte is discharged once it files a certificate that the remaining work is done, per the Order Made After Application, Sept. 10, 2026, paras. 6–9, 16. Those claims include a lawsuit filed in 2017, and the receiver estimates Desjardins will finish approximately $4.7 million short, per the Receiver's Second Report, Sept. 2, 2026, paras. 23, 49, 61.

The forbearance, and the developer's plan

Desjardins lent under a credit agreement of March 31, 2022 and a line of credit agreement of April 6, 2022: a first-ranking mortgage loan facility of $29,200,000, including a $500,000 revolving line, and a letter of credit facility of up to $2,500,000. The mortgage was registered on April 12, 2022. The borrowers were I4PG Hastings Street Inc., which held title, and Hastings Street Limited Partnership, the beneficial owner. Myron Calof, the debtors' principal, and I4 Property Group Inc., which owned the titleholder's shares, guaranteed them, per the Affidavit #1 of Benjamin Chua, Nov. 19, 2024, paras. 5–15 and the First Report, paras. 9, 14.

Chua, a managing director of Desjardins, listed the defaults: construction had stopped, the lands carried builders' liens, cost overruns had gone unfunded and the debt was unpaid. A notice of default went out on September 12, 2023, and Desjardins agreed not to take further enforcement steps until December 18, 2023, on terms that required, among other things, a business and financing plan. The forbearance was extended three times and "finally expired on August 30, 2024, without the Respondents providing the Petitioner with an adequately funded solution for the completion of the development of the Project," he deposed, and Desjardins "has lost confidence" in the respondents' ability to complete it. A demand, and a notice of intention to enforce security under s. 244 of the Bankruptcy and Insolvency Act, followed on October 30, 2024, with demands on the guarantors the same day, per the Chua Affidavit, paras. 16–23.

The debtors opposed the petition, and their response, whose first 19 factual paragraphs Calof swore were true, gives the developer's account. The partnership bought the property in 2017, and the development and excavation permits took almost four years. It hired Kerkhoff Construction (2022) Ltd. as general contractor on a fixed price, and the response says the fact that Kerkhoff "was a single purpose corporation incorporated for purposes of this project caused the project considerable difficulties." Kerkhoff had difficulty with the excavation, and by June 2023 the project was in financial trouble. The partnership did not pay the July and August draws because Kerkhoff could not produce statutory declarations that its trades had been paid, and in September 2023 it terminated the contract. A settlement required the partnership to contribute the $281,000 holdback and a further $925,000, and Kerkhoff to pay the trades the balance of about $400,000. Kerkhoff was obliged to try to reduce the liens and did not, the response says, so the developer negotiated with the lienholders itself; all but two agreed to accept 30 cents on the dollar, per the Response to Petition, Dec. 17, 2024, Part 4, paras. 1–9, 17–18 and the Affidavit #1 of Myron Calof, Dec. 17, 2024, para. 2.

The plan to finish rested on a new project budget of $48,850,105.41, funded in part by Desjardins' construction loan and its increase, unchanged; deposit insurance from Travelers Insurance Company of Canada raised to $5,449,000; an $850,000 mezzanine loan from Lane Construction Services Ltd.; $1,637,804.84 from limited partners holding 75% of the capital; and $560,150 from a new investor, per the Response to Petition, Part 4, paras. 10–16. The response argued that a receiver's costs "will be very substantial," that lien claimants and limited partners would likely lose their money, and that the equity of redemption should be given a period to run before any sale, per the Response to Petition, Part 4, paras. 21–22, Part 5, paras. 22–30.

Justice Walker heard the petition on December 19, 2024 and made an order, styled a consent order, appointing Deloitte receiver under s. 243(1) of the BIA and s. 39 of the Law and Equity Act of the lands, the related personal property and the nominee's share, effective at 12:01 a.m. on February 14, 2025 unless Desjardins had by then been paid everything owing under its credit and forbearance agreements. Payment in full would have ended the order, per the Receivership Order, Dec. 19, 2024, para. 1. The appointment took effect on February 14.

A share sale for $12,000,000

Deloitte chose Goodman Commercial Inc. from five realtors' proposals and listed the property on April 1, 2025. Goodman held discussions with 39 groups, 28 signed confidentiality agreements, and by May 26 three had submitted non-binding letters of intent. Landa Global Acquisitions Ltd. made the highest offer, and after the letters were discussed with Desjardins the receiver went ahead with Landa, signing a binding letter of intent on June 9 and a purchase agreement on June 30, per the First Report, paras. 38–54. Goodman's commission was 0.85% of the price rather than the 1.95% payable on a sale to anyone else, "because Landa was a party introduced to the opportunity by Desjardins," per the First Report, para. 42. Details of the letters went into a confidential supplement, sealed until closing, per the Sealing Order, Sept. 4, 2025, para. 1.

The price was $12,000,000, with $1 allocated to the shares of I4PG Hastings Street Inc. and $11,999,999 to the lands, improvements, plans, permits and the cash deposits held by the City of Burnaby. The receiver gave two reasons for a reverse vesting order. A transfer of legal title would have attracted approximately $480,000 in property transfer tax, which a share sale does not; and the purchaser needed the company to keep its Burnaby permits so construction could continue after closing without the delay, expense and uncertainty of transferring them. The pre-sale contracts, the holdback, the city's letters of credit and the contamination claim stayed out of the deal, per the First Report, paras. 58(b)–(e), 60(a).

The receiver's counsel had also concluded the pre-sale contracts would be hard to enforce, their termination clauses already extended to or near their limits. On June 27, 2025 the receiver told the buyers it would consent to termination. By its review, their deposits appeared to be covered by Travelers' $5,000,000 deposit protection policy or by $341,844 held in trust by the partnership's lawyers, Koffman Kalef LLP, per the First Report, paras. 17, 34–36. All 33 contracts have since been terminated, per the Second Report, para. 17.