Developer accused of misusing CRA funds
Two additional condo projects by embattled developer Thind Properties have been placed into receivership, bringing the total to three in recent weeks.
The decision by the BC Supreme Court followed allegations that the developer misappropriated funds intended for the Canada Revenue Agency (CRA), though no criminal accusations have been made.
On Friday, Justice David Masuhara appointed a receiver for unsold units at Burnaby’s Highline condo project and Richmond’s stalled Minoru Square development. Together, the projects carry mortgages totalling $250 million, with defaults accumulating daily interest of $70,000.
These proceedings come on the heels of a similar receivership ruling for Thind’s District Northwest project in Surrey, which defaulted on an $80 million mortgage. The three developments are controlled by entities linked to Thind Properties president Daljit Thind, CBC News reported.
Kingsett Mortgage Corporation, which sought the receivership, alleged during the hearing that funds meant for the CRA had been misused.
However, Kingsett’s lawyer, Emma Newbery, clarified that her client was not alleging “criminal connotations,” against the developers in response to a question from Justice Masuhara.
"When I see that word, it has a connotation on the far end — it suggests something where you need to go to police," said Masuhara.
"I do not think that's the intention," Newbery said.
Concerns have mounted among pre-sale buyers about the safety of their deposits and the future of their units. According to Thind, 90% of units at District Northwest have been pre-sold, with $78 million in deposits held in trust by a law firm.
Thind assured the court that these deposits are “not at risk” because the units were sold below current market value.
"Despite the delay to the start of construction, I do not believe the deposits for the pre-sold units are at risk as they were sold at a price that is below current market value," Thind wrote.
At the Highline, 40 units are occupied, while 163 remain in the developer’s name. The receiver will not take control of the occupied units, and the original marketing firm will handle the sale of unsold units based on pre-agreed pricing.
Thind Properties is also facing mounting legal claims related to the Highline. These include unpaid fees of over $1.1 million to the building’s strata corporation, which has filed liens asserting priority over the mortgage.
Read more: KingSett Mortgage alleges Vancouver developer misappropriated $305m
Additionally, contractors and workers have filed lawsuits seeking payments for services rendered, including $1.7 million for drywall installation, $600,000 for electrical work, and nearly $500,000 for glazing services. A real estate agent has also sued, claiming commissions for brokering a deal to sell $47.2 million worth of units to a hotel company.
Thind Properties has not formally responded to the applications for receivership involving the Highline and Minoru Square properties. However, in court filings, Thind expressed confidence in the viability of its pre-sold units and downplayed risks to depositors.
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