Distressed Deals Are Coming

🤑 Distressed Deals Hit the Market

Source: Globe and Mail

The 411: Canada’s real estate mess is getting uglier. Distressed sales jumped from 119 in 2023 to 252 in 2025, with land taking the biggest hit.

• Canada logged 252 distressed real estate sales in 2025 worth $1.42B, up from 191 deals worth $1.5B in 2024 and 119 worth $767M in 2023, according to Altus Group.

• Development land is the hardest hit asset class because projects are stalled and the land generates no income while carrying costs rise.

• Many troubled projects involve newer developers who entered the market during the boom but lack the capital or experience to weather delays.

• Lenders are now feeling the pressure, with more “credit bids” where banks take ownership of projects rather than accept large losses.

• Some development sites carrying $40M to $60M in debt are now estimated to be worth only $10M to $15M in the current market.

Why This Matters: Distress is creating opportunity, with receivership sales putting land and half-built projects on the market at deep discounts. At the same time, banks are holding assets instead of selling, which shows the industry is still waiting for a rebound rather than accepting today’s pricing. That matters because if the true bottom does not arrive until 2026 or 2027, Canada’s housing slowdown could drag on a lot longer than we expected.

💸 Canada Has a Spending Problem