TDB Restructuring appointed over Dundalk, Melancthon and Beeton properties after debt to Dorr Capital rose above $29 million

Flato Greens Inc. et al., seven project-specific companies related to Ontario homebuilder Flato Developments Inc., were placed into receivership on June 23, 2026, on application by Dorr Capital Corporation and Olympia Trust Company, after defaults under 5 cross-defaulted real estate loans with more than $29 million outstanding. The order covers 8 properties in Dundalk, Melancthon and Beeton, Ontario.

The properties are at different stages of development. Dundalk Mixed Use Expansion One Inc. owns approximately 100 acres proposed for an 804-unit residential project. Flato Greens owns the approximately 90-acre EcoPark property, where 50 acres are proposed for 412 residential units, including 226 single-family homes, 146 townhouses and a 40-unit rental building.

The Braemore Dundalk Two Inc. portfolio consists of 2 adjacent properties totalling approximately 30 to 40 acres, while the Melancthon Meadows Inc. properties comprise approximately 125 acres of agricultural land held for long-term development. Patterson Street Holdings Inc. owns a rented home in Beeton that forms part of a larger proposed land assembly.

Dorr Capital began lending directly to Flato in approximately 2021 or 2022 after previously acting as its mortgage broker. The five facilities had an aggregate principal amount of $26 million and were amended in September 2024 so that a default under any loan constituted a default under every loan.

The debtors attributed their difficulties to weaker residential real estate conditions, including purchaser defaults, closing extensions and price reductions. As of March 17, 2026, the loans carried approximately $27.55 million in indebtedness, including approximately $1.06 million in interest arrears.

The $5 million EcoPark loan matured on March 1, 2026, and the $4.93 million Braemore loan matured on May 1, 2026. Dorr Capital delivered repayment demands and notices of intention to enforce security on March 31.

The parties entered a forbearance agreement the same day. Dorr Capital agreed to refrain from enforcement until April 1, 2027, subject to conditions that included an approved sale of part of EcoPark for at least $6 million, a $1 million deposit, an interest arrears cap of $1.2 million and delivery of specified reports.

Those conditions were not satisfied. Interest payments remained unpaid, arrears increased to approximately $1.88 million and total indebtedness reached approximately $29.07 million by June 5, excluding certain legal and third-party costs.

TDB Restructuring is the receiver. Counsel is Blaney McMurtry for Dorr Capital and Olympia Trust, Paliare Roland for the receiver, and Ross Nasseri for the debtors.