Receiver appointed over Vancouver SRO hotel after payment defaults and governance concerns

1235922 B.C. Ltd. and Fort Pelly Holdings Ltd., which own and operate a single-room occupancy (SRO) hotel known as the Avalon Hotel at 165 W Pender Street in Vancouver, were placed into receivership on March 9, 2026, following an application by secured creditor Mina Angelicola to enforce a vendor take-back mortgage securing approximately $8.61 million.

The property operates as an SRO housing facility with approximately 88 low-income tenants, many supported through provincial housing programs, generating monthly rent in excess of $50,000.

1235922 B.C. Ltd. holds legal title as nominee, while Fort Pelly Holdings Ltd. operates the business. The acquisition was financed through a vendor take-back mortgage worth $8.375 million at 3% interest, structured as interest-only payments through February 5, 2025.

The structure relied heavily on consistent rental cash flow to service monthly interest obligations. The ground floor commercial units remain vacant despite commitments to lease them, limiting revenue diversification and contributing to underperformance. The nominee entity has not filed annual reports since 2022 and is in the process of dissolution, raising governance concerns alongside the financial distress.

The debtors defaulted under the loan following a June 4, 2025 demand for repayment, with the full amount remaining outstanding. A subsequent forbearance arrangement failed, with defaults including missed expense reimbursements for several months, non-payment of property taxes and a failure to provide financial records to the lender.

The lender also raised concerns that rental income was not being properly managed or applied, and that the debtors were failing to meet ongoing obligations including source deductions and vendor payments.

Unpaid trade obligations were reported at more than $80,000, with collection activity ongoing. At the same time, the property’s assessed value declined to approximately $8.57 million, down from $9.58 million in 2025, narrowing the equity cushion relative to the secured debt.

The lender last received a payment in January 2026, after which the rent stream ceased to support debt service.

BDO is the receiver. Counsel is Farris for Mina Angelicola.