- What Sam Mizrahi’s one-third interest in a multi-tower project is up for sale as part of receivership proceedings
- Why Constantine Enterprises alleges Mizrahi owes $29m in outstanding debt, resulting in a receivership order last month
- What next CBRE is marketing the stake
Developer Sam Mizrahi’s ownership stake in a proposed multi-tower development in Vaughan, Ont., is on the market.
Mizrahi holds a one-third interest in the project at 180 Steeles Avenue West, with the other two-thirds held by Constantine Enterprises, a real estate investment firm owned by businessman Robert Hiscox and Edward Rogers of Rogers Communications.
Mizrahi’s portion of the partnership was placed under receivership in June after Constantine requested the proceedings, claiming Mizrahi owes nearly $29m in unpaid debts. Mizrahi’s 50% share of a general partnership with Constantine that oversees their economic interest in the project also was placed under receivership and will be included in the sale. CBRE has the listing.
Constantine has made a stalking-horse bid of $8m, which takes into consideration the $78m and $20m mortgages from Canadian Western Bank and Trez Capital, respectively, that have been taken out on the property. Any competing bids are required to be at least $8.1m and will need to provide a 10% deposit.
The proposed development, which is awaiting zoning approval, would be a live/work community with two midrise and four high-rise buildings containing over 2,000 units as well as retail spaces. The property, across the street from Centerpoint Mall, is occupied by the Steeles Square strip mall.
This isn’t the first receivership involving Mizrahi and Constantine. A joint project at 128 Hazelton Avenue in Toronto’s Yorkville neighbourhood was placed under receivership in June. Mizrahi allegedly owed $47m in outstanding debt to Constantine. The receivership initially was sought in January by first-ranking lender Duca Financial Services Credit Union, but Constantine later bought out that debt.
Court documents describe a “breakdown in the relationship between [Constantine] and Mizrahi, to the detriment of stakeholders.” Mizrahi has filed a civil lawsuit against Constantine, Hiscox and Rogers, alleging bad faith and a breach of duties on the part of Constantine.
Mizrahi is also in receivership proceedings for the One, an under-construction skyscraper at 1 Bloor Street West of which he is a 50% partner. Roughly $1.5bn is owed on the project. A sales process is underway with a minimum bid price of $1.2bn.
