Portage housing development stalls amid court battle

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This article was published 18/09/2023 (759 days ago), so information in it may no longer be current.

A Portage la Prairie housing project expected to add more than 200 three-bedroom units to the city has stalled amid an ongoing shareholders’ dispute within the development company.

Work stopped in June at the Park Drive construction site, and the general contractor alleges tradespeople are owed more than $2.5 million for labour already completed. A court-appointed receiver has taken over the project, after Bokhari Development Inc. defaulted on mortgage payments this summer.

Mayor Sharilyn Knox and city manager Nathan Peto said Portage is working with the court-appointed receiver, KPMG, and there is now 24-7 security on site. (There were concerns about a lack of firetruck access and structures that still don’t have siding.)

Knox said she is hopeful another developer will take on the project.

“We are growing and we do need options for housing in our community,” Knox said last week.

The company, partly owned by Syed Bokhari (brother of former Manitoba Liberal Party leader Rana Bokhari), owes more than $21 million on its loan and mortgage, according to documents filed in Manitoba’s Court of King’s Bench late last month.

The project was initially expected to be complete in March, but the deadline was extended to Sept. 30. Its completion is now uncertain.

The court approved the receivership Aug. 29, after hearing the property — 1801-1825 Park Dr., located beside the Walmart in Portage la Prairie — had been abandoned, was a fire hazard, and the lender had lost confidence in the developer’s ability to complete it while Bokhari Development’s two shareholders continue to battle each other in court.

The shareholders, Syed Bokhari and Darcy Shaver, didn’t respond to requests for comment.

The men were equal shareholders, while Shaver held 50 per cent of shares in trust for Bokhari. On Aug. 9, a judge ordered Shaver to return the shares to Bokhari. Shaver filed a counterclaim against Bokhari, alleging mismanagement and expressing concerns with the construction. The court dispute is ongoing.

In court Aug. 29, general contractor Russell Sawatzky, owner of Gateway Projects, pleaded with King’s Bench Justice Gerald Chartier to do something, saying people haven’t been paid and “are hurting.”

Later reached by phone, Sawatzky said he was disappointed the judge didn’t authorize hold-back payments so the sub-contractors could be paid what they’re owed.

“I feel for these contractors immensely,” he said.

He has a builder’s lien on the project valued at more than $2.5 million. Sawatzky said despite some weather-related delays last spring, the project was on schedule until June.

The housing project was touted in memory of the Bokharis’ father Tahir Bokhari, who died unexpectedly in 2020. His dream was to build spacious affordable housing for families.

Bokhari Development had an agreement to construct 208 units (three-bed, two-bath apartments) of affordable housing and received some financing from the Canada Mortgage and Housing Corp. to do so.

A family spokesperson, who asked not to be publicly identified in connection with the project, said it is working on refinancing and are confident the housing will be built and “the dream won’t die.”

katie.may@winnipegfreepress.com