King David: the Cathedraltown parcel goes to market unpriced

When HF Markham (CC2) LP agreed in September 2023 to lend $5 million against 100 Cathedral High Street in Markham, one of its conditions was a site inspection confirming "that there is no fill present, equipment or materials stored on the Real Property and that the Real Property grounds are flat and graded level," per the commitment letter of Sept. 18, 2023, Application Record, May 25, 2026, Tab 2C, s. 16(a). The land is a vacant 1.48-acre block in the Cathedraltown development, "Cathedraltown Courtyard 2" in the letter's address line, owned by King David Inc., an Ontario company with its head office at 212 King Street West in Toronto that took its present form in a September 1, 2021 amalgamation. The receiver now in charge of it understands the parcel to be approved for a mid-rise residential condominium building, per the Affidavit of Jonathan Tkatch, May 14, 2026, paras. 3–4 and Ex. "A", pp. 37, 41 and the First Report of the Receiver, July 23, 2026, s. 2.0, para. 2.

On July 9, 2026, Justice Myers of the Ontario Superior Court of Justice (Commercial List), in Court File No. CL-26-00000233-0000, appointed AlixPartners Restructuring, Inc. receiver and manager of the parcel under s. 243(1) of the Bankruptcy and Insolvency Act and s. 101 of the Courts of Justice Act. The applicant was CC2 (100) GP Inc., which had taken an assignment of the loan and its security on April 21, per the Order (Appointing Receiver), July 9, 2026, para. 2 and the Affidavit of Jonathan Tkatch, May 14, 2026, para. 18. Three weeks later Justice Steele approved the receiver's plan to sell the land: an unpriced listing with Cushman & Wakefield ULC, run through the summer, with offers tentatively due September 17, 2026.

A thirteen-month loan

The commitment letter of September 18, 2023, on Harlo Financial letterhead, set out a single $5 million advance for a term of thirteen months, interest-only, at the greater of 12.25% or CIBC prime plus 5.05% for the first twelve months and the greater of 20.25% or prime plus 13.05% after that. An interest reserve of $612,500 was held back from the advance, from which the lender would pay itself interest as it fell due, and the commitment fee was 2%, or $100,000. The money was "to re-finance the Property and payout the existing first mortgage," which the letter identifies as First Source Financial Management Inc.'s. Helen Roman-Barber, King David's president and one of its two directors, gave an unlimited guarantee, per the commitment letter, Application Record, May 25, 2026, Tab 2C, ss. 2–6, 9–12, 14(a), 15(b), 16(j) and the Aide Memoire of the Applicant, June 5, 2026, para. 3.

The letter also required King David, Ms. Roman-Barber and all of their related entities with an ownership interest in lands adjacent to or near the parcel to agree that, on a default, they would not object to (and if asked, would consent to) changes to its zoning, architectural plans, site plan or subdivision, or to development applications by the lender or future owners, per the commitment letter, Application Record, May 25, 2026, Tab 2C, s. 15(n).

The lender's $5,000,000 charge was registered on October 17, 2023, in favour of Harlo Financial GP Inc. and HF Markham (CC2) LP, and First Source's charge was discharged on October 18. On October 17 a $3,500,000 second charge was also registered in favour of Romandale Farms Limited and transferred the same day to AFC Mortgage Administration Inc. and Brexit Holdings Inc.; it was transferred back to Romandale on January 23, 2025, per the parcel register, Application Record, May 25, 2026, Tab 2B, pp. 52–53 and the Affidavit of Jonathan Tkatch, May 14, 2026, paras. 7, 10–12. Royal Bank of Canada, The Sovereign General Insurance Company and First Source hold personal property registrations against the company, per the same affidavit, para. 13.

The lands across the street

On December 21, 2023, on First Source's application in Court File No. CV-23-00710411-00CL, Justice Steele appointed RSM Canada Limited receiver of other lands owned by King David; the order names both the company and Ms. Roman-Barber as respondents, per the Order (appointing Receiver), Dec. 21, 2023, Application Record, May 25, 2026, Tab 2O, p. 208. Those lands are four parcels in Cathedraltown to the east of 100 Cathedral High Street, "across the street" in the applicant's words, and the receiver there is now named TDB Restructuring Limited. Justice Steele approved a stalking horse sale process for them on September 11, 2025, and when CC2's affidavit was sworn a motion for an approval and vesting order was scheduled for May 25, 2026, per the Affidavit of Jonathan Tkatch, May 14, 2026, paras. 22–25 and the Aide Memoire of the Applicant, June 5, 2026, para. 4. This record does not say how that motion ended. CC2's factum put the other receivership among its grounds, as "demonstrating broader financial challenges affecting the Debtor's operations and assets," per the Factum of the Applicant, July 7, 2026, para. 33.

Maturity, forbearance, assignment

The loan matured on December 1, 2024 and was not repaid. On January 16, 2025 the lender, through its lawyers, demanded $5,139,127.42 from King David and Ms. Roman-Barber and issued a notice of intention to enforce security under s. 244 of the BIA. On February 4, 2025 the three signed a forbearance agreement: the company and its guarantor acknowledged $5,184,544.66 owing as at February 1, 2025, agreed there was no dispute about the amount or their liability, and accepted the security as good and valid, and the lender agreed to hold off until December 1, 2025, per the Affidavit of Jonathan Tkatch, May 14, 2026, paras. 14–17.

The agreement's terms called for, among other payments, a $120,000 forbearance fee from Ms. Roman-Barber, a $500,000 principal payment from her on signing, the lender's expenses, and a further $500,000 principal payment from her by 4 p.m. on July 2, 2025. If its conditions were met, interest from November 1, 2024 to October 31, 2025 would run at the greater of 12.25% or a prime-based rate, and at the greater of 20.25% or a prime-based rate after that. The agreement also recorded that First Source held judgments against both King David and Ms. Roman-Barber in that file, and provided that those judgments and steps by First Source or its receiver would not trigger a default, unless "First Source or the Receiver takes any enforcement action against the Property," per the Forbearance Agreement, Feb. 4, 2025, Application Record, May 25, 2026, Tab 2L, ss. 3.1, 3.2(f), 4.1–4.2, 5.1(o), 8.1(g)–(h).

The forbearance period expired on December 1, 2025 with the loan unpaid. The April 21, 2026 transfer moved the charge and the related security from HF Markham (CC2) LP to CC2, per the Affidavit of Jonathan Tkatch, May 14, 2026, paras. 18–20 and Ex. "M", p. 204. The statement of account attached to the affidavit put the debt at $4,498,916.21 as at April 30, 2026, before legal fees. Beside principal it charges, among other items, interest at 20.25%, compounded monthly, for each month from November 2025 through April 2026 ($68,343.75 for the first, $74,308.19 for the last), six $200 missed-payment fees, a $2,000 "Receivership Application Fee," and $15,000 of estimated planning costs "in connection with drawings and plans related to marketing of property in connection with enforcement," per the statement of account, Application Record, May 25, 2026, Tab 2N, p. 206.