If you scroll through the Mizrahi Developments website, it would seem that the company has several ongoing projects (across Ontario, but mostly in Toronto), but as we’ve come to find out, some of those projects have been, or are in, financial trouble in some way.

It’s not just The One — although that’s the development that’s certainly the most high profile — it’s also projects in Yorkville and Vaughan, both of which have now been sold off, as well as Mizrahi’s 12-storey, 93-unit ongoing endeavour at 1451 Wellington in Ottawa, known as The Residences at Island Park Drive.

An October 15 order shows that MNP Ltd. was appointed monitor over the project under the Companies' Creditors Arrangement Act after Mizrahi, it appears, filed for creditor’s protection. The court filings specify “the maximum principal amount of approximately $25M to be made available to the Company by TCC Mortgage Holdings Inc. […] pursuant to a DIP Loan Agreement to be executed prior to the initial hearing.”

In addition, they say that the Mizrahi is seeking “interim financing of up to $2,345,000.”

The filings also make note of “unaudited financial statements” that indicate that most of Mizrahi’s asset base consisted of land acquisition and development costs, and those are valued at $85 million (as of December 31, 2023). It is also stated that the Ottawa project is spread across “formerly two, separate properties,” including 1451 Wellington Street West and 1445 Wellington Street West (both in Ottawa). Those two properties were consolidated on October 26, 2023.

Per the court filings, “the project is currently in the final stages of construction, with the following work remaining to be done” and that approximately 72 of the 93 units have been pre-sold to date. Deposits have been collected from the pre-sales total about $14.8 million.

For some background: the project in Ottawa kicked off in 2015 and was projected to finish by November 2023. Within that window, however, “the project has encountered notable delays and extra costs due to construction challenges, the COVID-19 pandemic, market conditions, and cost overruns for goods and services,” according to the court filings. “As of October 9 […] the project is approximately 85% complete, with much of the structural and mechanical work done.”

STOREYS reached out to Sam Mizrahi for comment on the proceedings and he said that “Mizrahi Development Group is committed to ensuring all its projects and developments consistently exceed customer expectations without compromising standards and quality." He added that his company doesn't "compromise" on their values and will always stay true to its vision.

In addition, Mizrahi underscores that many of his projects “have been successfully completed and registered to date with no claims of warranty or otherwise." He cites 133 Hazelton, 181 Davenport, 128 Hazelton, and the Lytton Park Townhomes, as well as the company's portfolio of single-family residential projects.

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