Clawback Provision

Understand clawback provisions in Canadian real estate — what they are, how they work, and their role in protecting parties in agreements.

Clawback Provision

August 07, 2025


What is a Clawback Provision?

A clawback provision is a contractual clause that allows a party to recover previously granted money, benefits, or rights under certain conditions.

Why Clawback Provisions Matter in Real Estate

In Canadian real estate and development agreements, clawback provisions protect parties if expectations or obligations are not met.



Examples:
  • Recovering development incentives if performance targets aren’t met
  • Reclaiming funds from a partner in breach of contract
  • Adjusting land purchase prices based on future rezoning



Understanding clawback provisions helps developers and investors mitigate risk.

Example of a Clawback Provision in Action

The municipality included a clawback provision to recover tax incentives if the developer did not complete the project by the deadline.

Key Takeaways

  • Allows recovery of money or benefits under conditions
  • Protects parties in development and financial agreements
  • Common in incentive and partnership deals
  • Helps manage performance and compliance risk
  • Should be clearly defined in contracts

Related Terms

Additional Terms

Public Realm Improvements

Public realm improvements are enhancements to public spaces such as sidewalks, parks, plazas, and streetscapes, often funded or contributed by. more

Mortgagee in Possession

A mortgagee in possession is a lender who takes control of a property after borrower default, but before foreclosure or power of sale. The lender. more

Lease Surrender Agreement

A lease surrender agreement is a negotiated contract between a landlord and tenant that ends a lease before its scheduled expiration. Terms may. more

Green Infrastructure

Green infrastructure refers to natural or engineered systems that manage stormwater, reduce heat, and improve sustainability in developments.. more

Escrow Holdback

An escrow holdback is a portion of funds withheld at closing and held in escrow until specific conditions are met, such as completion of repairs,. more

Underused Housing Tax

The Underused Housing Tax (UHT) is a federal annual 1% tax on the value of vacant or underused residential property owned by non-resident,. more

More For You

OpenForm, Alabaster Planning 32-And 28-Storey Towers In Metrotown

OpenForm, Alabaster Planning 32-And 28-Storey Towers In Metrotown

The proposal for 6470 and 6508 Silver Avenue in Burnaby. (OpenForm Properties, Alabaster Homes, Arcadis)

Vancouver-based developers OpenForm Properties and Alabaster Homes are partnering on a two-tower project in the Metrotown neighbourhood of Burnaby, according to a rezoning application set to be considered by Council this week.

The subject site of the proposal is 6470 and 6508 Silver Avenue, which is located directly across the street from Maywood Park and half a block away from Metrotown Station.

Keep Reading Show less

GTA Low-Rise Sales Top 10-Year Average For Second Month

GTA Low-Rise Sales Top 10-Year Average For Second Month
Aerial photo of Toronto skyline

GTA new home sales aren't out of the woods yet — but the low-rise market is making a strong case for optimism.

For the second consecutive month, single-family home sales in the Greater Toronto Area surpassed the 10-year average, buoyed by the enhanced HST rebate program introduced in April 2026. According to new data from BILD and market intelligence firm Altus Group, 830 single-family homes sold in the GTA in May — 26% above the segment's 10-year average, and a significant jump from the same month in 2025.

Keep Reading Show less
IN THE KNOW: GTA Low-Rise Sales Top 10-Year Average For Second Month

Canderel Breaks Ground On Forêt Forest Hill With Five-Bank Financing In Place

Canderel Breaks Ground On Forêt Forest Hill With Five-Bank Financing In Place

(liveatforet.ca)

At Bathurst and St. Clair, Canderel has officially started construction on Forêt Forest Hill — its three-tower, master-planned community in midtown Toronto.

The development has secured construction financing from a consortium of five major Canadian banks led by CIBC, with National Bank, TD, Desjardins, and Laurentian Bank rounding out the group.

Keep Reading Show less

Ontario Brokerages Required To File Finances With RECO Starting This Fall

Ontario Brokerages Required To File Finances With RECO Starting This Fall
Shutterstock

Ontario real estate brokerages are getting a new piece of homework, courtesy of their regulator.

Starting October 1, 2026, every brokerage in the province will have to attest to and submit an annual financial filing to the Real Estate Council of Ontario (RECO) — a requirement meant to give RECO a clearer, more consistent look at how brokerages manage money, and specifically the funds they're holding in trust on behalf of buyers and sellers.

Keep Reading Show less

Spring Market At Last? Canadian Home Sales Jumped 5.5% In May

Spring Market At Last? Canadian Home Sales Jumped 5.5% In May
Shutterstock

After a spring that never quite got going, the Canadian housing market found a gear in May.

Home sales across Canadian MLS® Systems rose 5.5% from April, according to the Canadian Real Estate Association (CREA) — the first month in 2026 to post any meaningful upward momentum in headline demand.

Keep Reading Show less

Peterson Revises 3-Building Metrotown Project To 1,065 Units

Peterson Revises 3-Building Metrotown Project To 1,065 Units

A rendering of the proposal for 6645, 6659, 6675, 6691 and 6707 Dow Avenue in Burnaby. (Peterson, BOP Architects)

The Metrotown neighbourhood of Burnaby has seen a tremendous amount of redevelopment over the years, and several projects are currently under construction, but one project has remained idle for over six years now.

The subject site is 6645, 6659, 6675, 6691 and 6707 Dow Avenue, just off of Beresford Street and Central Boulevard, across the street from the Metropolis at Metrotown shopping centre.

Keep Reading Show less

Toronto Rail Yards Would Bring 4,000 Homes To Downtown Rail Corridor

Toronto Rail Yards Would Bring 4,000 Homes To Downtown Rail Corridor

Fengate

What do New York City’s Hudson Yards, Chicago’s Millennium Park, and Paris’s Rive Gauche have in common? They’re all built directly on top of active railway lines. And Toronto has fresh plans to do the same – this time, as a brand-new mixed-use community rather than a standalone park.

For years, what to do with the airspace above the Union Station rail corridor has been a hot topic. Former Toronto mayor John Tory famously proposed Rail Deck Park – a 21-acre green space with a $1.7 billion price tag – back in 2016. Now, following several years of planning and ownership consolidation, the LiUNA Pension Fund of Central and Eastern Canada and master developer Fengate Asset Management have unveiled reworked plans for an entire mixed-use community called Toronto Rail Yards.

Keep Reading Show less

Coast Mental Health Planning 29-Storey Social Housing Tower In Mount Pleasant

Coast Mental Health Planning 29-Storey Social Housing Tower In Mount Pleasant

The proposal for 259-293 E 11th Ave and 216 Kingsway in Vancouver. (Diamond Schmitt Architects, Coast Mental Health)

A rezoning application has been submitted for a high-rise mixed-use tower in Vancouver that's residential space would consist entirely of social housing.

The subject site of the proposal is 259-293 East 11th Avenue and 216 Kingsway, located on the western side of Sophia Street in the Mount Pleasant neighbourhood, and is part of the Broadway Plan area.

Keep Reading Show less
TRENDING: Coast Mental Health Planning 29-Storey Social Housing In Mount Pleasant
Privacy Policy About Us Terms of Use Advertise with Us Jobs Contact Us RSS Feed
All rights reserved SiteMedia © 2026.