A Calgary judge has ordered more than 50 Strategic Group properties in Calgary and Edmonton into receivership.
The decision comes after the Calgary-based real estate developer sought protection from creditors under the Companies’ Creditors Arrangement Act or (CCAA).
The move would have allowed the group to restructure its business and financial affairs, while at the same time, maintain control of its assets.
However, the courts went in another direction and appointed Alvarez & Marsal Canada as receiver and manager of the properties.
Strategic Group said 56 of its properties in Alberta are affected, including The Ship and Anchor building on 17 Avenue S.W. and Avenida Place Shopping Centre on Macleod Trail.
The appointment means the receiver has the power to “manage, operate and carry on the business of the debtors in connection with the property,” according to documents.
In December, Strategic Group CEO Riaz Mamdani said the company continues to “battle the storm” and looked to restructure its real estate portfolio — a move to counteract the high office vacancy rate in downtown office buildings, adding its “sizable exposure to the office market is a significant risk for the longevity of the company.”
The company said since mid-2014, it had lost 78 tenants — some of which are no longer in business — occupying almost 54,000 square metres, with the situation expected to worsen in 2020.
Despite the receivership decision, Strategic Group maintains while the process has changed, the end goal remains the same and that is “to have an orderly disposition of some of our real estate assets to maximize recovery for our stakeholders and ensure our company is stronger moving forward.”
The statement goes on to say the group will work “closely and collaboratively with the receiver” to ensure a smooth transition and reduce the impact on its clients.
The Ship and Anchor management said it’s aware of the “unfortunate news” but said it will have no effect on pub operations, saying it will be “business as usual for the Ship.”
“Whatever happens in the change of ownership of the property, it will have no effect on the operations of the pub. We are comforted by the fact that the pub has a long-term lease and thus is protected,” general manager Samantha Baldwin said.