Ontario court orders receivership of stalled Markham condo project owing $57.7 million to Meridian

Sher Markham Inc. and Sher Holdings Inc. were placed into receivership on October 14, 2026, on application by Meridian Credit Union Limited, after construction stalled on a 131-unit condominium development in Markham, Ontario, leaving the lender owed approximately $57.7 million and contractors asserting more than $11.4 million in construction liens. Justice Sean Dunphy of the Ontario Superior Court of Justice rejected the companies' request for a 30-day adjournment to pursue CCAA protection supported by a proposed $21.15 million DIP financing facility, finding that the restructuring proposal was not sufficiently advanced to justify further delay.

The proceedings concern Everhome, a condominium development at 9704 McCowan Road comprising 131 residential units and one commercial unit. The project was approximately 86% complete, with 103 of the 131 residential units pre-sold as of July 2026. Shakeel Walji, the principal and founder of both companies, is also their sole director, president and secretary and personally guaranteed the Meridian indebtedness. Although the building structures were substantially completed, interior work remained unfinished.

The companies' financial difficulties followed repeated loan defaults, construction cost overruns and a breakdown in site operations. Meridian issued default notices in April and October 2025 and April 2026, citing missed repayment deadlines, budget overruns and the developers' failure to fund additional costs. Construction stopped in mid-May 2026 after the construction manager withdrew following a safety inspection identifying serious deficiencies. Meridian subsequently demanded repayment in August, but the debt remained outstanding. The lender also paid overdue insurance premiums to protect its security. By October 7, 21 construction lien claims totalling approximately $11.4 million had been registered against the property, while the estimated cost to complete the project exceeded $17.3 million.

The developers opposed the receivership and sought additional time to finalize a CCAA filing backed by Safe Harbour Global Capital, which had delivered a $21.15 million financing commitment on October 13. The proposed facility would fund construction completion, certain outstanding project costs and professional expenses without displacing Meridian's existing secured priority. However, the financing remained conditional on Meridian's consent and the commencement of CCAA proceedings. Justice Dunphy concluded that the proposed restructuring was not ready to proceed and that further delay would expose Meridian to additional losses. He declined the adjournment and granted the receivership order, while preserving the ability of construction lien claimants to contest the validity, amount and priority of competing claims.

Grant Thornton was appointed receiver, manager and construction lien trustee. Counsel includes Gowling WLG for Meridian, Loopstra Nixon for the receiver and Cassels for the debtors. Albert Gelman was the proposed monitor.