The developer of a 72-unit project on Gorham Street in Newmarket is reassuring buyers that its current financial turmoil will not impact a proposed townhouse development.
Stateview Homes has been named in a $37-million lawsuit by TD. It is also facing a demand for repayment of a more than $23.2 million loan from two corporations after failing to pay the interest due April 1. The loan is secured by land for development in Markham, but the unfolding legal situation has complicated Stateview’s financial picture.
Newmarket resident John Patterson said Stateview was working to address area residents' concerns with the project, but now the development seems more uncertain.
“We were shocked. We, over the last several months, have developed a relationship with their planning department,” he said. “I don’t know what’s going to happen or how it’s going to play out.”
The developer completed an application with the town for 72 units on Gorham and Muriel streets last year, with a public meeting expected sometime this year.
Stateview Homes confirmed that the fiscal situation means several of its properties will be part of receivership. Atrium Mortgage Investment Corporation and Dorr Capital Corporation are both demanding payment, according to an Atrium news release.
But in a new statement, Stateview said the Newmarket project, called Elia, is not part of receivership and will proceed.
“The current status of the project remains unchanged, with construction scheduled to begin in 2024. As of this date, there has been no change to the status of our Elia purchasers’ closing dates given in their agreements of purchase and sale,” the company said.
In a news release, Stateview Homes did not disclose the nature of TD's lawsuit against it or how the fiscal trouble happened. But it is pointing a finger at its chief financial officer and said in a news release that the person was fired, and current ownership had no involvement in what happened. It said an investigation is on the way, and it is working with impacted parties. It identified rumours of insolvency but said it is not declaring bankruptcy.
“We take our financial responsibilities very seriously and are deeply disappointed that this situation occurred,” company president Dino Taurasi said in a news release. “We have taken steps to ensure that this does not happen again and are committed to maintaining the trust of our homeowners, trade partners and stakeholders.”
The organization's website shows that it has already fully reserved its upcoming development in Newmarket.
“Stateview Homes thanks our purchasers and trades for their patience and understanding as we try to recover from this unfortunate situation and get back to doing what we love, building homes we can be proud of and helping our homeowners,” the company said.
Patterson said that despite public concerns about the development, he recognizes the land is likely to be developed at one point or another. He added that if the Stateview proposal cannot go ahead, another development could take its place.
“The land is too valuable to just let it sit forever,” he said. “It could be the best of the worst. If we’re going to have a development there, this makes the most sense in my mind.”
