The sprawling Hedge Road Landing subdivision project in Georgina, Ontario near Lake Simcoe has been placed under creditor protection midway through construction, according to Ontario Superior Court.
The project is planned to consist of three phases. Phase One is located at 6213 Black River Road, and includes 144 cottage-style bungalow homes. According to court documents, 75 units have been completed and sold, 24 units are under construction with 23 pre-sold, and 45 units have yet to commence construction with 13 pre-sold. The remaining two phases are set for vacant land nearby, and are set to include 168 units along the waterfront of Lake Simcoe.
The development website describes the project as an “adult active lifestyle community” with bungalows starting from the low $820,000s “to qualified purchasers,” and several units are listed on the website.
The project is held under 2055226 Ontario Inc. and is beneficially owned by three parties: Alliance (Sutton) Inc., Berkstar Developments Inc., and Rose Sutton Limited Partnership. Each owns a 33.33% interest, according to court documents, with Alliance Homes serving as the construction manager.
For the project, the developers obtained financing from Waterloo-based non-bank real estate lender MarshallZehr, which provided one loan in the principal amount of $48,553,000 for Phase One and another loan in the principal amount of $16,050,000 for the remaining two phases.
The Insolvency
The two loans matured on January 1 and March 1, 2026, respectively, and both were not repaid, with MarshallZehr owed a combined $42,907,636.19 as of August 13, and interest continuing to accrue.
According to MarshallZehr, the developers have also failed to keep up with payments to various contractors and suppliers, and seven liens totalling $5.7 million have been registered against the Phase One property since February.
“Construction Liens have created a significant impediment to the recommencement of construction activities at the Project and construction continues to be delayed,” said the court-appointed Monitor in a report submitted along with MarshallZehr’s creditor protection application. “Construction activities have largely ceased since April 2026. In the Proposed Monitor's view, continued delay in the recommencement of construction increases costs, delays home completions and closings, and may adversely affect the value of the Project.”
An overview of Hedge Road Landing. (Alliance Homes)
In an affidavit dated August 17, Alliance Homes’ President Alex Troop attributed the challenges the project has faced to the market downturn impacting liquidity, which then resulted in construction slowing down — a common sequence of events in this current cycle of insolvencies.
“205 [the ownership entity] has unfortunately been seriously impacted by the downturn in the GTA real estate market, demonstrated both by reduction in land values and a reduction in new home sales,” said Troop. “205 has not sold a new home since January of 2025, which has impacted cash flow and the ability to pay for construction of units already under contract to be sold. As a result, 205’s last closing of a house sale was on March 31, 2026.”
According to Troop, some purchasers have raised their concerns to the Home Construction Regulatory Authority (HCRA) and the HCRA’s review of those concerns is ongoing. Troop said he is also concerned that warranty provider Tarion may take action that could be detrimental to the project. He also said he has personally been advancing funds towards the project — $600,000 — but is unable to continue doing so.
Creditor Protection
The Ontario Superior Court granted MarshallZehr’s application on August 24 and the Hedge Road Landing project was placed under creditor protection, as defined under the federal Companies’ Creditors Arrangement Act (CCAA).
The goal of the proceeding is to put a pause on the various enforcement actions against the project, so the project can be completed.
There are now 10 units in Phase One set to be completed within the next three months that have been pre-sold. According to the Monitor, they retained Daniel Foch of Valery Real Estate (and a STOREYS contributor) to get an opinion on the value of the units, and Foch concluded that price increases of 5% to 10% could potentially be achieved if the units are remarketed (if the presales are terminated), but the Monitor says the assessment “does not take into consideration any negative stigma associated with the CCAA Proceedings, the cost to carry the homes for the staged listing period suggested, the cost and litigation risk in disclaiming the Existing APAs.”
The Monitor thus opted to carry on with the existing presale agreements in place and submitted an application outlining a process to complete the remaining sales that was approved by the court on August 28.
Creditor protection applications are usually granteed for an initial period of 10 days, after which extensions can be obtained upon application as needed. After Hedge Road Landing was placed under creditor protection on August 24, the stay of proceedings has now been extended to November 13, 2026, by which we should get the next update.
