A Kelowna townhouse development has entered receivership after several months of financial challenges.
Control of Boynton Developments Ltd. was handed to MNP on Aug. 15 after a B.C. Supreme Court order due to millions in unpaid debts.
Boynton Developments was building a 120-unit townhouse development at 665-685 Boynton Pl., marketed as Promontory by the Cynterra Group.
Documents published by MNP show the developer owed mortgage holder KV Capital $7.6 million as of June 6, which was accruing interest at a rate of 11% per year.
“The borrower has no credible funding, investment, or sale opportunities available to address its cash needs within the requisite timeframe and has no acceptable go-forward plan to fulfil obligations as they become due,” said KV Capital in its court application.
“The borrower’s inability to stabilize its operations or service its debt has placed its operations and its stakeholders at risk.”
The documents also detail over $3.6 million in builders lien claimants, including $1.76 million owed to Ice Constructors Ltd. and $968,925 owed to Canex Building Supplies Ltd.
Last year, a pair of arrest warrants were briefly issued for Cynterra Group CEO Bob Fraser for failing to appear in court after a pair of default judgments over unpaid bills related to the Promontory project. At the time, Fraser told the Investigative Journalism Foundation that everyone involved in the project would be paid.
Under the terms of the receivership, MNP will have the authority “to manage, operate and carry on the business of the debtors.” The value of the real estate assets now in the control of MNP is listed as “unknown.”
The Cynterra Group’s website says the Promontory development is 60% complete. Many of the units from prior phases of construction are already occupied.
