Ontario Construction News staff writer
A massive residential project at the busy intersection of Baseline Road and Clyde Avenue has sat as an incomplete concrete skeleton for nearly three years, the casualty of a major Quebec company’s financial collapse.
Originally breaking ground in 2022, the two-tower project at 1357 Baseline Rd. was initially planned as a retirement residence. However, work ground to a halt late that year when the project’s original co-developer, Montreal-based Groupe Sélection, filed for creditor protection under the Companies’ Creditors Arrangement Act (CCAA).
At the time, the project was a 50-50 joint venture between commercial real estate trust SmartCentres and Groupe Sélection, which was one of Canada’s largest private operators of senior living facilities.
According to CCAA filings managed by monitor PricewaterhouseCoopers (PwC), Groupe Sélection was forced into creditor protection in November 2022 after being caught in a perfect economic storm. The company had built a portfolio of over $5 billion in assets during an era of historically low interest rates. When central banks began aggressively hiking rates in 2022 to combat inflation, the developer’s borrowing and refinancing costs skyrocketed.
Simultaneously, the COVID-19 pandemic took a severe toll on the senior living sector, driving up operational and health costs while depressing occupancy rates and slowing pre-leasing for new developments. This squeezed Groupe Sélection’s cash flow precisely when their debt servicing costs were climbing.
The final blow came when a syndicate of major Canadian banks, owed hundreds of millions of dollars, lost confidence in the company’s management and rejected their proposed restructuring plan. The lenders forced a creditor-driven restructuring through the Quebec courts, leading to the liquidation of Groupe Sélection’s assets and immediately unraveling joint ventures across the country — including the Ottawa towers.
Following a complex legal process, SmartCentres — which also owns the adjacent Laurentian Plaza strip mall — took full ownership of the property. According to the trust’s recent financial disclosures, SmartCentres completed the project’s foundational concrete structure to protect the asset before pausing construction.
The developer has since pivoted the project’s scope from a retirement complex to a 402-unit residential apartment building. But getting shovels back in the ground has proven difficult. To resume construction, SmartCentres is securing a new partner and financing, and must navigate a site-plan renewal process with the City of Ottawa to legally accommodate the change in the building’s use.
The lack of progress has frustrated local residents, who see the unfinished structures as a glaring blemish amid an ongoing housing shortage.
“I find it kind of sad. Every time we go by we say, ‘Is anything happening?’ Nothing’s been happening,” one local resident told CTV News Ottawa in a recent broadcast about the site. Another resident characterized the site as an “eyesore,” telling the network that “more could be done and it’s taken too long to do it.”
The stalled towers remain a frequent topic of constituent complaints for River Ward Coun. Riley Brockington.
“These buildings have been empty for way too long. They are now an eyesore within the community,” Brockington told CTV News. “We want to see this project completed. We support SmartCentres advancing with these residential towers. Let’s get it done.”
With the concrete structure left exposed to the harsh Ottawa elements for three winters, some residents have raised questions about the building’s structural integrity. Brockington reassured the community that the site is secure.
“My understanding is the building is sound,” the councillor said. “It is monitored 24 hours a day. There are cameras, and it is visually inspected on a normal frequency.”
While Brockington indicated in recent correspondence with SmartCentres that the municipal site-plan process should be completed this year, there is currently no firm target date for when heavy machinery will return or when the units will finally be ready for occupancy.
