ReStays Ottawa and ReResidences Sold in Court-Ordered Sale Amid Financial Struggles

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The ReStays Ottawa boutique luxury hotel and unsold ReResidences condos have been sold as part of a court-ordered sale following financial difficulties faced by the developer, Ashcroft Homes.

The ReStays Ottawa boutique luxury hotel, alongside a block of unsold ReResidences condominiums, has been officially sold as a result of a court-ordered sale, according to filings made in the Ontario Superior Court. This property, located at 101 Queen Street and 108-116 Sparks Street in downtown Ottawa, encompasses 111 hotel suites, 91 condominium units, and over 21,000 square feet of retail space distributed across a six-storey and a 17-storey building, all of which is situated above an underground parking facility. Notably, the land on which the development stands is subject to a ground lease with the National Capital Commission (NCC), a Crown corporation responsible for managing land in the capital region, which is set to expire on November 30, 2076, as detailed in the court documents.
The ReStays hotel commenced operations in September 2021. However, several other projects developed by Ashcroft Homes have faced insolvency in recent years and have similarly been placed under receivership by various lenders, a situation that has been previously reported by STOREYS. The current receivership proceedings for ReStays Ottawa and ReResidences are associated with a first-ranking loan amounting to $65 million, which was registered in August 2021 by non-bank lender CMLS Financial. Equitable Bank and General Bank of Canada are also identified as participants in this loan.
An affidavit submitted by a representative of CMLS Financial indicates that the loan matured on September 1, 2023, leading CMLS to issue a formal demand for payment on November 15, claiming that Ashcroft owed them $58,920,629.31 as of November 9. In response, the parties entered a forbearance agreement on February 23, 2024, designed to delay enforcement actions while allowing Ashcroft time to secure refinancing. This agreement included a $10 million collateral mortgage on a property located at 256 Rideau Street in Ottawa.
Despite the initial forbearance period, Ashcroft was unable to repay the loan. Consequently, the forbearance was extended until September 30, 2024, allowing Ashcroft to sell 256 Rideau Street and utilize the proceeds to repay the loan. However, Ashcroft failed to meet the repayment terms even after this extension, leading to a second extension until March 31, 2025, contingent upon providing a $20 million collateral mortgage on 101 Champagne Avenue South. Ashcroft's inability to provide this collateral prompted CMLS Financial to initiate insolvency proceedings.
Court documents reveal that Ashcroft initially sought creditor protection under the Companies’ Creditors Arrangement Act (CCAA) in December 2024 without lender consent. Following this, lenders pursued interim receivership, culminating in a full receivership order granted on February 24, 2025.
By mid-March 2025, the Ontario Superior Court approved a court-ordered sales process for the property, which encompasses the hotel, retail spaces, and 18 unsold condo units. The property was listed for sale by brokers from TD Cornerstone Commercial Realty and Cushman & Wakefield Ottawa, with marketing commencing in early April 2025. The sales brochure highlighted potential for repositioning the hotel as a luxury rental building. After a thorough bidding process involving 37 interested parties, nine bidders submitted letters of intent, leading to a selection of one bid by June 2025.
However, the selected purchaser raised several issues, necessitating more time for due diligence which ultimately led to the termination of the deal in September. The sales process was relaunched, attracting new bids, including a revised offer from the initial bidder and a competitive bid from CLV Group, a privately-held company founded by Mike McGahan. CLV Group partnered with Singaporean sovereign wealth fund GIC last year to acquire InterRent REIT, previously chaired by McGahan.
On February 2, 2026, CLV Group submitted their letter of intent, waiving most conditions by June 19, pending court approval. The acquisition is being conducted through 1000747194 Ontario Inc., although the purchase price remains undisclosed in court documents. A report from the court-appointed Receiver indicated that as of July 28, the debt owed to CMLS Financial would approximate $59.2 million, with the expectation that there would be a shortfall for the lender. The transaction received approval from the Ontario Superior Court on July 14 and was announced by the brokers shortly thereafter.

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