NBC obtains CCAA, receivership order over Surrey Mortise Nova Project

National Bank of Canada obtained an initial CCAA and receivership order over the Mortise Nova strata project in Surrey, BC on May 25, 2026, after alleging that the borrower group defaulted on a $47.8 million construction financing package and left the partially-completed project exposed to further value erosion. The CCAA order covers 0993006 B.C. Ltd. and 1014669 B.C. Ltd., while the project-related interests of 670805 B.C. Ltd. and 0859116 B.C. Ltd. were placed into receivership.

The project, known as Mortise Nova, is a 6-storey residential strata development with 93 units, a commercial space and future development lands at 8140, 8148 and 8158 166th Street in Surrey. The companies are related entities involved in the development, with 0993006 and 1014669 holding legal title to the real property in trust for the beneficial owners under a May 25, 2021 beneficial charge agreement.

NBC’s credit relationship dates to a May 5, 2021 loan agreement, later amended 13 times through December 3, 2025. The facilities included a $47.8 million uncommitted interim construction loan, a $1 million overdraft sublimit and a $1.5 million letter of credit facility. The loan was due on the earlier of demand and January 15, 2026, and was not repaid at maturity.

The creditor listing prepared as at May 25 lists secured claims of $60.38 million, including NBC at $48.48 million, Bancorp-related lenders at $8.98 million and Westmount West Services Inc. at $2.91 million. It also lists unsecured claims of $1.70 million.

The project’s pre-sale structure is central to the case. NBC said the borrowers began marketing units in 2019 and, as an earlier outside date approached in November 2025, filed a new disclosure statement and asked purchasers either to rewrite and ratify their contracts or terminate and receive deposit refunds. Of the 93 units, 62 are now subject to pre-sale agreements, with the balance unsold. Most contracts provide for automatic termination and return of deposits if the relevant unit is not completed within 12 months after the estimated completion date, subject in most cases to a vendor extension of up to four months. The vast majority of unextended outside dates fall in October 2026.

NBC alleged multiple defaults, including non-payment at maturity, missed monthly interest payments from January 2026, failure to maintain required qualifying pre-sales of $31.5 million after pre-sale lapses left the current amount at approximately $26 million, failure to maintain a holdback account, project cost and construction changes made without lender approval, failure to discharge liens, failure to inject cost overrun equity, failure to provide property tax evidence and failure to provide 2025 financial statements.

The record also points to construction and reporting problems. NBC said construction liens totalling approximately $800,000 had already been registered against title. On April 15, the lender attended the site and found no active work, a lack of security and an amenity building exposed to the elements. The situation had not improved by May 20, when management advised construction had halted because of a lack of liquidity, with only minimal completion-related planning by certain trades.

A&M was appointed monitor with enhanced powers over the CCAA debtors and receiver over the project-related entities. The process is intended to allow the monitor to determine the best route forward, including stabilizing the project, completing it, overseeing closing of the pre-sold units and selling the remaining unsold units. NBC is providing a DIP loan.

Counsel includes McCarthy Tétrault for NBC, Fasken for the monitor, McQuarrie for the debtors, Koffman Kalef for Bancorp-related lenders, and Lawson Lundell for Westmount West Services.