Fortress Completes its Participation in Oakville Commercial Project
Monday February 11, 2019
Fortress marks another project complete, having wrapped up its role as a development consultant to the Kingridge Square (Speers) commercial project in Oakville, Ontario.
In a prime location, the 4.95-acre property features four commercial buildings. Unit sales commenced in 2014 and construction started in 2015. The first owners at Kingridge Square took possession of their units in early 2017. Fortress CEO Jawad Rathore commented in a press release published on the completion of construction, “Originally envisioned as a high-rise apartment site, Kingridge immediately recognized the opportunity to shift the use to a low-rise office and commercial condo development. We were fully on board with the shift in built form, and the results speak for themselves.”
The project exited the majority of its stakeholders in July of 2017 and a recent payout resulted in the complete exit of all syndicate mortgage lenders in this commercial asset. The borrower, Kingridge Developments, advised that over 86% of the commercial units had been sold and are occupied.
In its fifth report to court on January 23, 2019, FAAN Mortgage admin (the trustee) stated:
The Trustee has negotiated the Speers Settlement Agreement and has obtained an overwhelming positive response from affected Speers Individual Lenders with respect to the execution and implementation of the terms of the Speers Settlement Agreement. The Speers Settlement Agreement contemplates the payment (when combined with Paid Interest) of the full principal amount due under the Loan Agreement plus a further 14% recovery on that principal.
Learn more about this commercial project in Oakville, Ontario.
The opportunity to invest into the project was offered by mortgage agents who relied on due diligence that included valuations based on the residual and comparable methods. This completed exit is a testament to the quality of the project and the analysis done and even with the additional time needed due to changes in market conditions, lenders realized a positive overall return. Fortress is pleased with its contribution to successful projects like Kingridge Square and continues to focus on bringing the remaining projects in their portfolio across the finish line.
Over the past 10 years, Fortress has completed numerous real estate development projects across Canada. These projects have been funded in part through syndicated mortgages (arranged by mortgage brokerages) to finance early pre-construction or ‘soft’ costs. Fortress has assisted in delivering over 2,000 residential units (almost 2 million square feet) with another 4.1 million square feet currently under construction. In multiple projects where Fortress has completed its role, stakeholders have substantially benefitted from value created. To date, Fortress has completed 33 projects, resulting in the repayment of over $265M to syndicated mortgage lenders.