The purchase agreements for almost every condo that has been sold at troubled luxury development One Bloor West (formerly The One) will be cancelled, following a court ruling on Monday.
Justice Peter Osborne approved a request by the project’s monitor, Alvarez & Marsal, to rescind 314 out of 329 buyer contracts. The other 15 were deemed “economically viable” by the monitor.
The majority of the condos were bought in 2017 and 2018 when the project was under the Mizrahi Developments brand, according to court filings.
A handful of disgruntled unit purchasers attended Monday’s hearing, with four strongly opposing the monitor’s motion.
One by one, they went up to the podium at the centre of the room and argued they wanted to keep their units — despite years of construction delays, the project’s insolvency and the legal battles surrounding it.
Daljit Singh’s daughter was one of the early purchasers at One Bloor West. She died one year later, Singh told Justice Osborne, all eyes on her.
“I really, really want that condo. No matter what,” Singh said in tears. “I don’t want to give it to anybody. It’s my daughter’s condo.”
Alvarez & Marsal’s lawyers later said that Singh’s unit is already built, and she, like other buyers with cancelled agreements, will have an opportunity to repurchase a condo before it is listed to the general public for sale.
Alvarez & Marsal’s plan is to then resell the condos at significantly higher prices.
To that end, the monitor will work with project manager Tridel to reconfigure the design of some units, reducing the number of “small, investor-type” units and increase the number of “ultra-luxury” ones. It is also looking to partner with a luxury hotel brand to deliver a product similar to Four Seasons Private Residences or the Ritz-Carlton Residences in downtown Toronto.
According to court filings, this plan is expected to generate more than $200 million in proceeds for the project.
Also on Monday, Justice Osborne approved a protocol for the return of deposits and accrued interest to the original unit buyers.
Former purchasers will receive communications from Aviva Insurance Company of Canada with additional information regarding the process, a spokesperson for Tridel said in a statement, adding that the return of the deposits “is anticipated to occur in short order.”
In his closing remarks, Justice Osborne acknowledged that his decision is “by no means a perfect solution.”
“I fully appreciate … the impact of this and the impact of the delays this has had on your lives and those of your families and partners,” he said.
“The reality with which I am faced is that we have an insolvent developer here,” he added.
“As you know, we have significant funds advanced by secured creditors” — a category that does not include the condo buyers — “that have not been repaid and are very unlikely to be repaid.”
Justice Osborne emphasized that buyers don’t always get their deposits back when a developer goes bankrupt.
“It’s a great deal,” he said, “better than nothing.”
Buyer Movin Mokbel was, like Singh, gutted to have his contracts cancelled. The portfolio manager told Justice Osborne that he bought three units at One Bloor West in 2017.
Every time he drove south on the Don Valley Parkway from North York, he was happy to see the tower slowly taking over the skyline, he said.
In June, One Bloor West officially became the city’s tallest building after reaching the 85th floor, its final level. Construction is expected to be concluded in 2028, more than a decade after many purchasers first bought the units.
“Tridel wants to run this as a hotel brand. I don’t want that,” said Mokbel. “I just want a regular condo unit like the one I purchased.”
Later, Mokbel told the Star he was disappointed, but at least he would be leaving with a sense of closure.
