The Promontory: four approvals, one closing, and KV's mortgage stays

The Promontory was planned as 120 townhomes in 14 buildings on a parcel at 665-685 Boynton Place in Kelowna, zoned for townhouses under the city's land use bylaw. The first phase, six buildings, sold out and was finished. Buildings 7 and 8, about 20 units over an underground parkade, were partly framed when construction stopped in the summer of 2024, which the receiver attributes to "the Debtors' financial challenges and inability to continue funding construction." Nothing was ever built on the sites of buildings 9 through 14, per the Receiver's Fourth Report to Court, Sept. 15, 2026, paras. 7–11. A year of weather later, the project's structural engineer told the receiver the two open buildings needed remedial work but not demolition, per the Receiver's First Report to Court, Sept. 23, 2025, para. 21.

On September 15, 2026, MNP Ltd. filed what its senior vice-president calls its "fourth and final Report," asking the Supreme Court of British Columbia to approve its fees, pay what is left to the secured lender and discharge it, per the Affidavit #1 of D. Chivers, Sept. 15, 2026, paras. 2, 11. The property is gone, sold on the fourth approved attempt. Three earlier sales, each approved by the court, never closed.

A $19,455,000 loan and a consent receivership

KV Capital Inc., an Alberta corporation, committed a mortgage loan of $19,455,000 to Boynton Developments (Kelowna) Ltd. by letter of July 21, 2023, secured by a mortgage and assignment of rents registered December 1, 2023, a general security agreement, and an unlimited guarantee from Boynton (Kelowna) Limited Partnership, Promintory Developments Inc., Promintory Developments Limited Partnership and the companies' director. KV served demand and notice of intention to enforce on November 6, 2024, and put the debt at $7,583,290.88 as of June 6, 2025, accruing at 11 per cent a year compounded monthly, per the Petition to the Court, July 14, 2025, Part 2, paras. 1–10. Travelers Insurance Company of Canada, which provided the project's deposit protection facility, holds a mortgage that its December 5, 2023 priority agreement ranks behind KV's, except as to presale deposits, per the Receiver's Fourth Report to Court, Sept. 15, 2026, paras. 6, 20–21.

The petition names more than two dozen respondents behind KV, almost all of them builders' lien claimants — trades from framing and trusses to roofing, electrical and concrete — along with a judgment creditor and a later mortgage in favour of Evest Real Estate Nominee Corp. It also discloses a forbearance agreement of June 13, 2025, among KV, the borrower, the guarantors and a group of new guarantors, "conditional upon, inter alia, a consent order for the appointment of a receiver." KV's stated grounds were that the borrower "is facing an ongoing liquidity crisis" and that KV "has lost confidence in the management of the Borrower," per the Petition to the Court, July 14, 2025, Part 2, paras. 11, 13–15.

Justice Wilkinson appointed MNP as receiver of all four entities on August 15, 2025, under s. 243(1) of the Bankruptcy and Insolvency Act and s. 39 of the Law and Equity Act. The order let the receiver draw up to $300,000 more under KV's loan, repayable ahead of every other creditor including the lien claimants, per the Receivership Order, Aug. 15, 2025, paras. 1, 2(t). The receiver estimated unsecured debts at more than $3,200,000, per the Receiver's Fourth Report to Court, Sept. 15, 2026, para. 18.

Lock-up first, then the market

The receiver took possession on August 19, 2025. It sent the debtors a request for information and, a month later, reported that they had neither answered it nor given access to their books. It also judged that buildings 7 and 8 had to be closed in before the wet season. LTA Consultants Inc. priced the lock-up work at $1,047,711 including GST, and the receiver asked to raise its borrowing limit from $300,000 to $1,500,000, warning that without the work the two buildings "will significantly deteriorate," per the Receiver's First Report to Court, Sept. 23, 2025, paras. 19–20, 30–37. Justice Weatherill granted the increase on October 1, 2025, in an amended and restated receivership order whose borrowings charge ranks ahead of registered and future builders' liens, per the Amended and Restated Receivership Order, Oct. 1, 2025, para. 25. Millennial Developments Corp. did the work under a CCDC 5A contract, per the Receiver's Second Report to Court, Mar. 24, 2026, para. 23(ii).

The receiver listed the lands with Colliers Macaulay Nicolls Inc. and Royal LePage Kelowna on November 13, 2025. The campaign reached about 2,900 investor and developer contacts, sent broker e-blasts to more than 1,500 recipients and made direct calls to more than 60 targeted buyers, with a bid deadline of December 17, 2025. Two offers came in, per the Receiver's Second Report to Court, Mar. 24, 2026, paras. 23, 33–39. One was from 1568306 B.C. Ltd., whose principal had made an unsolicited offer on substantially the same terms before marketing began. The other was a proposal from Highland Promontory Development Limited Partnership.

The receiver preferred 1568306's. Highland's offer carried a higher price on its face, but the receiver called it "highly complex and conditional"; it required KV to provide significant financing, which KV would not accept, and it contemplated paying a significant part of the price by credit-bidding debt "purportedly secured by a third-ranking mortgage" in favour of Evest Real Estate Nominee Corp., "held in trust for the benefit of Promontory LP." The receiver said it had limited information about that debt, that "several stakeholders have raised concerns with respect to its priority, validity and enforceability," and that it could not put a value on the credit bid, per the Receiver's Second Report to Court, Mar. 24, 2026, paras. 30, 39–42. The 1568306 offer exceeded an as-is appraisal by Colliers International Realty Advisors Inc. The prices, the appraisal and a cost-to-complete analysis for buildings 7 and 8 are all in a sealed supplement. The receiver projected that on closing it would repay its borrowings of $1,300,000 plus interest, pay the Canada Revenue Agency $65,348 on a source-deduction property claim, pay KV $8,363,013 plus interest "for payment in full of their secured indebtedness," and still hold about $1,400,000 for a later distribution application, per the Receiver's Second Report to Court, Mar. 24, 2026, paras. 47, 53–54, 61–62, 65–66.

No sale contemplated keeping the presale contracts. The receiver knew of 11 presale agreements at the date of the receivership; ten deposits totalling $365,151 were held in trust by Gowling WLG (Canada) LLP for the purchasers, nine purchasers had rescinded and been refunded $329,661, and the receiver asked to disclaim the last two, paying one $35,490 deposit into court because it could not confirm who was entitled to it, per the Receiver's Second Report to Court, Mar. 24, 2026, paras. 44, 50–52.