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A stalled north London housing development has gone to the auction block, and may finally get built.
Construction of a residential development at 865 Kleinburg Dr. in London has stopped amid a $58-million lawsuit from lenders. Photo shot in London on Tuesday Aug. 9, 2022. (Derek Ruttan/The London Free Press)
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A stalled north London development is going to the auction block, and may finally get built.
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Construction of the Applewood project, an ambitious north-end residential and commercial development, shut down this summer when its London builder was placed in receivership because it owed its lender, MarshallZehr, more than $60 million, according to court documents.
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The project, on two one-hectare parcels of land at 865 Kleinburg Dr., has a residential apartment development about 75 per cent complete and adjacent vacant land. There also are more than $11-million in liens owed on both properties.
A filing in Ontario Superior Court in September lays out how the sale of land will proceed, opening it for auction with a deadline of Nov. 8 and a closing date no later than Dec. 15.
“The appointment order authorizes the receiver (Ernst and Young) to market and sell the property,” stated the application in Superior Court, dated Sept. 20.
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“The sale process shall commence . . . and as soon as practical thereafter, the receiver shall prepare a list of prospective bidders.”
Coun. Maureen Cassidy, whose north-end ward includes the Applewood project, recalls the application coming to the city and believed it offers a unique vision for a neighbourhood she hopes eventually will be realized.
“We have to get this going so we can move forward,” she said, welcoming news of the land being ordered to auction.
“It will be a great community, the kind of community that will see mixed use, apartments and townhomes with commercial, restaurants and green space. It will be very welcome,” Cassidysaid.
London Ward 5 Coun. Maureen Cassidy (Mike Hensen/The London Free Press)
Mike Clawson, president of builder Applewood Marketplace, declined comment Thursday. He also is president of Clawson Group Inc. in London.
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Peter Sergautis, president of ExtraRealty in London, sold the land for the Applewood development and still owns more than 52 hectares (130 acres) for future phases of the project.
The sooner Applewood goes to auction and is sold, the faster ExtraRealty can work to develop its nearby sites, said Jennifer Jones, project manager with ExtraRealty.
“This is good, whatever it takes to get this moving forward,” she said of the auction order.
Court documents state loans from MarshallZehr in Waterloo, which specializes in construction and development financing, were in place in October 2020 and construction work ceased June 1 of this year. Applewood has not made a payment to MarshallZehr since April.
Ernst and Young has taken over the project as receivers.
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As for the proposed project, the first phase is a five-storey, mixed-use building with 107 rental apartments, nine rental townhouses and 1,350 square metres (15,000 square feet) of ground-floor commercial space.
Work had not begun on the second phase, an adjacent 4.8-hectare (12-acre) plot of vacant land that would have 468 residential units and about 3,330 square metres (37,000 square feet) of commercial space.
In all, more than six phases of building are proposed that would eventually add about 1,500 homes plus commercial and office space.
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London builder placed in receivership, major development shut down
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22 storeys. 226 apartments. One megaproject at busy north-end spot
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https://lfpress.com/news/local-news/stalled-major-development-in-north-london-to-be-auctioned-off
