Another Ashcroft Homes Property In Receivership Over $80M Debt

Ashcroft Homes, a well-known residential developer in Ottawa, is facing financial difficulties as its Eastboro project has entered receivership due to an $80 million debt. This development follows similar issues with other Ashcroft properties earlier this year.

The Eastboro project was planned as a 2,000-home subdivision in Orleans, covering 200 acres with a mix of townhouses and single-family homes. Construction began smoothly after RBC provided a $75 million loan in May 2021, leading to the completion of 25 units.

However, in July 2023, construction hit a major obstacle when workers found poor soil conditions while installing a stormwater trunk main along Navan Road. This discovery required a costly reassessment of plans, with engineers suggesting rerouting the storm drains along the road, increasing costs by an estimated $20 million.

The situation worsened due to a dispute between Ashcroft and the City of Ottawa over funding the stormwater system. The city delayed issuing necessary road closure permits until the disagreement was settled. In July, the city agreed to reimburse Ashcroft over $30 million for related construction and management costs, allowing permits to be issued.

Despite this agreement, the project faced mounting debts and strained relations with RBC. Ashcroft missed interest payments totaling over $4 million and failed to provide required financial statements. In May 2024, RBC demanded full repayment of outstanding debts within 30 days, which Ashcroft could not fulfill, leading to the receivership application.

The receivership has left 83 customers who placed deposits on lots in uncertainty. The future of the Eastboro development remains unclear as stakeholders work to address the financial challenges and determine the project's viability.