Contractors claim developer Andrew Marquess owes them $1.5 million

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This article was published 17/04/2018 (2197 days ago), so information in it may no longer be current.

Local developer Andrew Marquess is dealing with more legal troubles after three contractors went to court to stop a mortgage sale on portions of a McPhillips Street condominium development.

The three firms — Thor Electric, Top Pro Roofing and McMunn & Yates — have filed an application in court to stop the mortgage sale for about 40 units in the Terra Commons condominium project to First National Financial, Marquess’s frequent mortgage lender and sometime business partner.

The documents allege Marquess, through the company Terra Commons owes a combined $1.58 million to the three contractors for work they did on the project but were not paid.

The allegations have not been proven in court. A trial date to hear the application has not been set.

Marquess declined to comment on the court action. Officials from First National Financial did not respond to a request for comment.

According to documents, the three contractors took out separate liens on the project in 2016.

The documents state that in early December 2017, First National Financial filed a notice exercising power of sale under the first and second mortgages held on about 40 of the units in the complex, including the same units subject to the contractors’ liens.

In a separate legal action, Thor is suing Marquess and his related companies for the value of the amount of the lien it had placed on the property: $685,324. McMunn & Yates had previously filed legal action for $176,340 it alleges it is owed.

Terra Commons is a 19-building complex with 340 condominium units located west of McPhillips Street between Troy and Chamberlain avenues. Marquess bought the property, which included 12 buildings, and constructed another seven buildings.

Marquess had a reputation as one of the city’s most ambitious and innovative developers, known for incorporating geothermal heating-and-cooling systems and other energy-efficient features into many of his projects, and pursing rental projects when few others are doing it. He launched the conversion of the former downtown Sheraton Winnipeg hotel — which was later sold to another firm — into rental apartments and renovated several other downtown properties.

But his financial troubles are well-documented in court records. He and his various companies, B&M Land Company and Gem Equities, have been repeatedly sued for non-payment.

In 2014, Marquess forfeited $100,000 and paid a $70,000 penalty to city hall for work on the Terra Commons project after he constructed two buildings larger than stipulated on permits and encroached on designated park land he owned within the complex.

Marquess is currently involved in a dispute with city hall over the massive 1,900-unit residential development known as Fulton Grove in the area known as the Parker lands.

Marquess wants to proceed with a rezoning and subdivision plan and a secondary plan for the project, but city officials won’t allow a public hearing on the rezoning and subdivision until council approves the secondary plan for the area.

The Parker project will be back before the property and development committee on May 7.

Marquess is also involved in the Jubilee South Osborne residential development on the property known as the Fort Rouge Yards. The extent of Marquess’s continuing involvement in the project was put in doubt in August 2016 when it was reported that First National Financial, Marquess’s partner on the project, had brought in a second developer to begin construction and see the project to its completion.

First National Financial had provided city council an indemnity agreement for the project.

However, Marquess later said he had not surrendered or lost control of the development and that he agreed with First National’s decision to bring in a second developer.

According to court documents, First National Financial holds two mortgages on the Terra Commons property with a combined value of $19.5 million.

In its application to block the mortgage sale, the three firms request the court to order First National Financial to set aside the combined value of the liens if the sale were to go ahead.

The three firms are also requesting the court for Marquess and First National Financial to produce copies of all project-related transactions and payments in regards to the two mortgages held by First National Financial.

aldo.santin@freepress.mb.ca