Sam Mizrahi The One – Corruption, Unethical Practices Exposed (2023 Update)

Olena Ivanova By Olena Ivanova
42 Min Read

Originally Syndicated on June 12, 2023 @ 8:52 am

File Photo: Sam Mizrahi the One

Sam Mizrahi The One is a Toronto-based Canadian real estate entrepreneur of Iranian descent. Currently, Mizrahi serves as president of several businesses, including Mizrahi Developments, Mizrahi Inc., and Mizrahi Enterprises Inc. The One skyscraper at the crossroads of Yonge and Bloor Streets in Toronto was built by him, and he claims this is what makes him most famous. He was ranked as Toronto’s 45th most important person in 2015 by Toronto Life.

A lawsuit filed by co-owner Jenny Coco, who wants out, has Sam Mizrahi’s opulent Toronto condo building in disarray

The partnership behind Canada’s tallest and most ambitious luxury condominium construction has broken up, igniting a legal battle and casting doubt on the project’s future.

Jenny Coco, a road paving tycoon who collaborated with renowned Toronto developer Sam Mizrahi The One to construct the 85-story skyscraper The One, is requesting that a special investigator be appointed by the courts to look into the operations of their jointly owned business.

The Coco family claims in a recent court suit that Sam Mizrahi The One agreed to buy out their participation in the project by August 30 following years of tension between him and Ms. Coco. The $100 million that was allegedly injected as debt and equity, according to the Cocos, is their purported debt.

The Cocos asserts that Sam Mizrahi The Onei has not succeeded in obtaining money. “The buyout won’t take place. The application claims that Sam cannot close because his funding failed.

Mr. Mizrahi’s attorney, Scott Hutchison, said in a statement that his client will react to the Cocos’ application. “Sam Mizrahi The One respectfully objects to the claims made in the notice of application submitted on Ms. Coco’s behalf. He has continuously operated legally and in the project’s and all of its stakeholders’ best interests, according to Mr. Hutchison.

The Cocos will not comment while the case is in court, according to Nina Perfetto, a lawyer representing the family.

Another significant challenge for The One, which is still under construction and is situated in an upmarket shopping area in Toronto’s Yorkville neighborhood, is the collapse of the partnership. Apple Inc., the world’s largest technology company and the One’s long-planned retail anchor tenant has requested a court order to cancel its contract due to ongoing construction delays. After claims from one of the project’s lenders that Bridging investor funds were used to support its loan, the opulent construction has also been linked to the Bridging Finance crisis that has shaken Bay Street.

Ms. Coco is a co-owner and director of Bridging, a private lender that until it was turned over to a receiver in 2021 at the request of Ontario’s securities regulator managed more than $2 billion on behalf of 26,000 investors, most of whom were retail. David and Natasha Sharpe, Bridging’s former top executives, have been accused of fraud and self-dealing by the Ontario Securities Commission; Ms. Coco has not been accused of any wrongdoing.

The Coco family’s legal complaint against Sam Mizrahi The One describes the two partners’ acrimonious history. Over the past three years, they have sought the help of numerous private mediators and arbitrators, but to no avail. In the document, Ms. Coco accuses Mr. Mizrahi of causing their “strained and acrimonious” relationship by excluding her from crucial choices and failing to update her family on financial problems. The Cocos have invested money in the project since roughly 2015.

According to the court application, Ms. Coco and Sam Mizrahi The One negotiated a deal in 2021 that required Mr. Mizrahi’s holding company to eventually purchase the Coco family’s equity and debt holdings in The One. (The most recent court motion does not specify how much of the supposedly due $100 million to the Cocos is equity or debt; nevertheless, their equity holding has been estimated at roughly $30 million in prior public documents.)

According to court documents, Sam Mizrahi The One and the Cocos came to a second agreement after the buyout agreement that gave Mr. Mizrahi the authority to make some unilateral choices concerning the project as long as the scheduled buyout occurred by August 30, 2022.

The court documents claim that as the deadline drew near, Mr. Mizrahi’s backer for the buyout, a banker who is not named by name in the application, got the cold shoulder and withdrew.

The China-East Resources Import & Export Co., or CERIECO, the fourth-place lender for The One and a state-owned company in China, filed an unexpected bombshell on June 2 at the same time as that judgment.

In its lawsuit, CERIECO claimed that among other things, Ms. Coco had arranged for Bridging to pledge the assets from its flagship fund, the Bridging Income Fund, as part of the collateral package backing CERIECO’s $213 million loan to The One.

It is unclear whether or not investors in the Bridging fund were informed of this assurance or whether Bridging was compensated in any way for the pledge. According to CERIECO’s argument, Bridging had “no business reason” to accept the guarantee.

Additionally, CERIECO accused Sam Mizrahi The One and Ms. Coco of fraud, alleging that they conspired with a CERIECO official in Canada, Bosco Chan, to get releases from the loan guarantees that had been given by Bridging and Coco Paving, the company owned at the time by the Coco family.

CERIECO asserts that it was urged to choose a Canadian resident as a director of the company making the loan when it came time to advance its $213 million loan to The One in 2017. The president of CERIECO in China was also listed as a director, in addition to Mr. Chan, an Ottawa resident who assisted in brokering the loan.

Unbeknownst to CERIECO, Mr. Chan allegedly signed paperwork that removed Coco Paving and Bridging from its promises. The loan deal stated that only CERIECO’s president in China could approve such a move, according to CERIECO, who said Mr. Chan lacked the power to do so.

When the first loan payment of more than $61 million failed to materialize in June 2021, CERIECO allegedly attempted to enforce the guarantees and discovered Mr. Chan’s release. The allegation asserts that when questioned about this, Mr. Chan admitted to negotiating a $7.5 million “release fee” from Coco Paving, which was allegedly intended to go to CERIECO. Instead, according to CERIECO, Mr. Chan retained $4.5 million for himself and sent the remaining $3 million to Mr. Mizrahi’s personal bank account.

The court has not found any of CERIECO’s claims to be true, and defense submissions have not yet been submitted.

The shocking assertion made by CERIECO was bad news for Mr. Mizrahi’s intended acquisition of the Cocos. The Cocos’ court motion states that Mr. Mizrahi’s buyout lender stated it needed to put the loan on hold while it reviewed the unexpected litigation, then ultimately withdrew completely.

The Cocos refused Mr. Mizrahi’s request to prolong the term of their agreement, which grants him sole control of The One because they could not guarantee that he would be able to carry out the buyout, according to court records. The Cocos contend that such control was dependent on a successful transaction. According to their court brief, “Sam is attempting to obtain what he bargained for, without paying for it.”

The Cocos are also asking for a special investigator, complete access to The One’s books and records, and an order requiring the preservation of those records. Additionally, they are asking for a ruling that a resolution authorizing Sam Mizrahi The One to control the project solely is invalid.

The application hearing is slated for December 5, 2022.

In a lawsuit, it is claimed that the CEO of Bridging Finance has a stake in the Sam Mizrahi condominium project.

According to a recent lawsuit, Bridging Finance Inc., a struggling lender, surreptitiously backed The One luxury condo construction with investor cash while Natasha Sharpe, the company’s former chief executive, was a part-owner of the development.

Only two individuals, the developer Sam Mizrahi The One and Jenny Coco, a former road-paving tycoon who co-founded Bridging with Ms. Sharpe in 2012, had been revealed as co-owners of The One up until this point.

But in a recent court document, Bridging’s receiver claimed that Ms. Sharpe had at least a 2.5 percent interest in The One, a Toronto development that is now being built at the crossroads of Yonge and Bloor streets.

When Bridging was reportedly using investor monies from Bridging to guarantee a $213 million loan made to The One and when Bridging was allegedly owing millions of dollars from some of Mr. Mizrahi’s firms, Ms. Sharpe was supposedly an owner in the project.

PricewaterhouseCoopers Inc. claims it has “significant concerns regarding the potential conflicts of interest between Jenny Coco and Natasha Sharpe” in their dual capacities as Bridging officers and condo development owners. The company was appointed as receiver over Bridging in 2021 amid allegations of fraud and mismanagement.

The claims were presented in a court filing by PwC, which is asking for a court-appointed official to supervise three development businesses connected to Sam Mizrahi The One. According to PwC, the three businesses, which were involved in the construction of the condo building at 181 Davenport Road by Mizrahi, owe Bridging a total of around $55 million and are in default.

Both Ms. Sharpe and Ms. Coco did not reply to inquiries for comment made to their attorneys. In his opposition to PwC’s motion, Mr. Mizrahi cites, among other things, the claim that one of the three businesses owes Bridging nothing. When questioned about Ms. Sharpe’s apparent ownership of The One, Mr. Mizrahi remained silent.

When Bridging Finance was taken over by PwC in 2021 by an Ontario judge, it was one of the biggest private lenders in Canada. Bridging extended loans to higher-risk enterprises that had problems getting finance from conventional banks using money primarily given by retail investors. Bridging managed $2.09 billion at its height on behalf of 26,000 investors.

However, allegations made by Ontario’s securities regulator that a number of the company’s loans had questionable ties to the husband-and-wife leadership team of Bridging—Ms. Sharpe, who had previously served as CEO and by that time was Bridging’s chief investment officer—shook Bay Street in April 2021.

Shortly after, both were sacked, and the Ontario Securities Commission has since charged a couple of frauds. Investors in Bridging are expected to lose $1.3 billion.

The One, a long-delayed condominium project that Sam Mizrahi The One has promoted as the tallest condo skyscraper in Canadian history, is unaffected by the OSC’s accusations, though. The investigation by PwC into the project broadens the range of potential legal risks for Bridging’s decision-makers. The private lender was co-owned by Ms. Coco and Ms. Sharpe, and they both served on the credit committee for Bridging, which authorized loans from the lender.

In court, none of the accusations have been established. PwC claims it has records that indicate Ms. Sharpe owns 5% of a holding company that owns 50% of The One, or a 2.5% interest in the condo project, according to recent legal filings. Ms. Coco is the primary owner of the holding business.

According to PwC, Ms. Sharpe made her initial $1.5 million investment in the holding company between 2014 and 2015, when numerous companies associated with the Mizrahi development at 181 Davenport in Toronto had unpaid loans with Bridging.

A 2017 email, according to PwC, reveals Ms. Sharpe was given a bigger ownership position in The One in exchange for a loan guarantee from Bridging.

Around this time, The One needed money and negotiated a $213 million loan with a Chinese state lender called China-East Resources Import & Export Co. (CERIECO). Ms. Coco pledged her family business, Coco Paving, as security for the loan.

But because Coco Paving fell short of the lender’s requirements, Ms. Coco is accused of arranging for the Bridging Income Fund, the company’s principal investor fund, to serve as one of the numerous guarantors.

For its investors at the time, the Bridging Income Fund managed around $650 million. In a second lawsuit, CERIECO claims that Ms. Sharpe signed the paperwork naming the fund as a guarantor, but the name “Bridging Finance” was removed from various versions of the guarantee. This agreement has been redacted, although PwC refers to it as an “alleged secret guarantee.

Sam Mizrahi The One detailed a conversation he had with Ms. Coco regarding their intended offer to Ms. Sharpe in the 2017 email that PwC found: “2.5 percent coming from you and 2.5 percent from me.”

In addition, he stated: “The 5% share being given to Natasha is for Bridging/Sprott putting up its balance sheet and guarantees so that we can get rid of China in the next 18-month period we have with them.”

Yes, as stated, we agree, Ms. Coco retorted. and sent Ms. Sharpe the email conversation.

PwC admits that it is unsure if this additional stake was given, saying that it “continues to investigate whether this additional ownership share was ever provided to Natasha Sharpe.”

Because Sprott Asset Management co-managed the flagship fund at the time, it was known as the Sprott Bridging Income Fund. Around this time, Ninepoint Partners, which is controlled by former Sprott executives, bought the fund. In response to a query on Ms. Sharpe’s apparent ownership of The One, Ninepoint stated in an email to The Globe that “At no point did Bridging disclose any such conflict, nor did Ninepoint have any knowledge of a conflict.”

The Globe has been unable to find any evidence that Ms. Sharpe disclosed her claimed stake in The One to Bridging investors, and PwC’s most recent legal filing does not refer to any such disclosure.

Ms. Sharpe made one of the rare public appearances in connection with the project in November 2017 during the opening of The One’s sales center. A picture of Ms. Sharpe, Ms. Coco, and Mr. Mizrahi soon after the event emerged on the website of Dolce Magazine, which calls itself a luxury lifestyle journal. The Globe was able to secure a copy of the photo before it was removed from Dolce’s website shortly after Bridging was put into receivership.

Whether Ms. Sharpe still has investments in The One is unknown. When arguing with Ms. Sharpe regarding unpaid Sam Mizrahi The One loans, Ms. Coco said in an email dated December 30, 2020, “Allow me to remind you, both Sharpe and Coco… remain investors in The One,” according to PwC.

The Chinese lender is suing because it claims Bridging Finance and Ms. Coco were freed from their guarantees without its knowledge, and the $213 million loan given by CERIECO in 2017 is currently in default. The claims made by CERIECO have not been supported in court.

By claiming that CERIECO and The One’s senior lender, KEB Hana Bank, had an agreement in place that forbade CERIECO from taking any enforcement proceedings that may damage the project before it was finished, Mr. Mizrahi is attempting to have CERIECO’s complaint rejected. Justice Jessica Kimmel of the Ontario Superior Court recently heard arguments in that case in September, but she has not yet issued a decision.

More Information on the Corruption Allegations Against Sam Mizrahi the One

In one of the hottest housing markets in North America, the issue currently before the courts sheds light on the murky world of private condo financing.

One of Canada’s most well-known real estate developers, Sam Mizrahi The One, claims that last year while constructing two opulent apartments in the heart of Toronto, he received a phone call from an unknown person who demanded millions of dollars, threatened to set fire to his home, and threatened to damage his image.

Mahmoud Reza Khavari, the former chairman of Iran’s largest state-owned banking, was the person on the other end of the line, according to Mizrahi’s testimony in court documents. Khavari has been sought out since 2011 for his alleged role in the largest fraud scheme in Iranian history. According to the records, he was also the father of Mizrahi’s business partner and a significant financier for the developer’s two apartment projects.

File photo: Sam Mizrahi the One

In litigation before an Ontario court, it is described how a real estate mogul came to be involved with a wealthy fugitive who is now the focus of a diplomatic row between Canada and Iran. The dispute sheds light on the murky world of private condo financing in one of the hottest housing markets in North America. The case is still pending and the accusations have not been proven in court.

Sam Mizrahi of The One and His Illegal Activities

The major dispute revolves around a deal made between Sam Mizrahi The One and Mahmoud Khavari’s son, Khashayar Khavari, to fund and construct two luxury condos in Toronto’s Yorkville district, a posh area with upmarket stores and restaurants. It describes how their relationship deteriorated and how they ultimately feuded over ownership and profit.

According to Khashayar in court filings, the claim that Mahmoud threatened Mizrahi over the phone is untrue and obscures the facts. According to him in the documents, his 63-year-old father is “mild-mannered” and has never threatened anyone. In an email, he declined to comment on his father. Several phone calls and emails to Mahmoud’s son, son-in-law, and Toronto-based lawyers seeking comment were either ignored or rejected. Mahmoud’s north Toronto location indicated in court filings was unoccupied, and phone directory attempts to reach him were futile.

As executives of Mizrahi’s company, Khashayar and his brother-in-law started the initial case. They claim Mizrahi deceived them by misappropriating money and poor management of the business. The One condo in Toronto, which is slated to be the tallest building in Canada, is one of the projects that Khashayar alleges he worked on with Mizrahi. He claims he is entitled to profit and is suing for at least $105 million in damages.

Initial Agreement Between Sam Mizrahi and Mahmoud

Khashayar and his father Mahmoud “in particular” donated funds for the Yorkville projects, according to Sam Mizrahi The One, who claimed that they are only entitled to 50% of the earnings when the projects are complete as per their original agreement. He claimed that the Khavari family had no financial connection to other endeavors like The One. In addition, he filed a counterclaim in which he demanded at least $50 million for a variety of offenses including defamation, carelessness, intimidation, and contract violation.

I learned what not to do from this experience. I’m moving forward“I’m sticking to what the agreement was,” Mizrahi said in a June 8 interview from his office across the street from one of the condos. “I have never deviated from what the agreements were. We just have to finish the project and you can’t come in before a project is finished and expect to get paid out.”

The Iran Connection of Sam Mizrahi The One

Despite having many differences, the two parties can agree on the beginning: Sam Mizrahi The One met the Khavaris for the first time around six years ago when the family hired him to perform some development work on their investment properties. Mizrahi, like the Khavaris, was born in Iran and immigrated to Canada with his family when he was six years old in 1977. He claims to be an entrepreneur but has never attended postsecondary education. He operated the upscale dry cleaning business DoveCorp Enterprises Inc. until it filed for restructuring in 2007 and had its assets liquidated.

While Mizrahi, whose businesses include Mizrahi Developments, wanted to construct, the Khavaris wanted to invest in real estate. The agreement looked straightforward: Mizrahi would provide the expertise, Khashayar, and his family would provide the finance, and they would split ownership and profits in the properties 50/50. According to court filings, the Khavaris donated at least $14.2 million to the purchase of the property for two complexes, 133 Hazelton Residences with its three dozen individually built units and 181 Davenport with its 68 units.

The Shady Private Funding of Sam Mizrahi the One

Any developer needs first-stage funding of this kind. It is used to cover the initial overhead costs and to buy land, the cost of which has increased to an all-time high in Toronto. For this portion, developers typically use private financing. When it’s time for the more expensive and time-consuming construction, they contact the banks, who want full disclosure of earlier funding and the sale of at least 60% of a building before lending.

According to Mizrahi’s court records, one of the benefits of cooperating with the Khavaris was their assurance that they would finance the entire project, preventing the need for bank funding. “Khash, with the assistance of his family, would contribute the equity required to purchase the lands for development, as well as the necessary construction financing to move forward with the development of the lands,” Mizrahi stated in the court documents. In the interview conducted in his office, Sam Mizrahi The One claimed that “they represented they had vast financial resources to fund these projects.”

Banking Case

The Khavaris held a distinct opinion. “Sam represented to me that he had the resources for development, construction, securing construction financing, and raising funds necessary for the growth of a development company,” Khashayar claimed in an email sent on June 14 through his attorney.

Events halfway around the world endangered the agreement as Sam Mizrahi The One and the Khavaris were getting ready to promote the projects in September 2011. A US$2.6 billion embezzlement case in Iran involved seven state-owned and private banks, including Bank Melli Iran Inc., the largest state-owned bank in the nation.

According to Iranian state media, Mahmoud left for Canada, where he holds dual citizenship, and resigned from his job as chairman and managing director of the Tehran-based lender, stating in his resignation letter that he was doing so “to respect public opinion.” According to the Interpol red alert published at the time, Iran was looking for his whereabouts and arrest for allegedly “assisting and abetting embezzlement and fraud, bribe-taking, illegal acquisition of illicit property through the bank systems.” The advertisement was later taken down.

Cooperation Is Required

According to local media sources, more alleged participants in the Iran bank fraud have received death sentences, life sentences, and floggings. In addition to not having diplomatic links or an extradition arrangement with Iran, Canada refuses to transfer a person to a nation where they risk receiving the death penalty.

According to Khashayar in the court records, “There are those who would wish to physically harm him as a result of my father’s previous career, particularly religious and political extremists.”

The country’s justice minister, Mostafa Pour Mohammadi, reportedly stated in Tehran on June 8 that Canada hasn’t assisted in returning Mahmoud to Iran despite being a signatory to the United Nations Convention against corruption. Pour Mohammadi is cited as saying, “Unfortunately, many countries just like to talk and don’t provide the necessary cooperation or commitment and so far they haven’t cooperated.”

A family gathering

The Iranian judiciary and Bank Melli did not respond to several calls, emails, and faxes requesting comment. Interpol’s office declined to comment on Khavari and directed inquiries to the Iranian government.

Due to the private nature of state-to-state communications, the government is unable to comment on whether it has received an extradition request regarding any specific individual before that person being detained by the Extradition Act, according to Ian McLeod, a spokesman for Canada’s Department of Justice. Requests for comment from the parliamentary secretary for consular affairs in Ottawa were not answered.

In October 2011, as news of Mahmoud’s relocation made waves in Canada, Sam Mizrahi The One reportedly met the family at their Toronto home. According to the court filings, Mizrahi claimed he wanted to break up with the family due to their financial situation after their Canadian bank accounts were frozen. According to court records, the Khavaris deny that their accounts were stopped and claim that the meeting was a private family event. They carried on collaborating.

Exceptional Growth

According to court documents, Sam Mizrahi The One and Khavari say they reached an agreement on new terms in which Mizrahi would have complete authority over the homes and related businesses and the Khavaris would receive 50% of the proceeds. Khashayar declared that his ownership stake in the businesses would be maintained in trust.

The court documents reveal that Mizrahi said he was forced to abruptly borrow $88 million from banks at interest rates as high as 20% to construct the two Yorkville residences because he was unable to access the funds.

Despite a year of unprecedented expansion in the city’s high-rise sector, business as usual continued. A record number of new condo units—more than 28,000—were sold in 2011. In Canada’s largest metropolis, the development of a record-breaking 24,388 units began in 2012. According to emails submitted in court, Khashayar and his brother-in-law continued to serve as executives at Mizrahi’s business, attending presentations and being privy to discussions with lenders for several projects, including The One. Mizrahi said in court documents that the family only took part because they were interested in learning about real estate development and that they made no financial contributions to the other projects.

Suits Filed

According to Khashayar’s claims in the court records, Sam Mizrahi The One eventually conceded he had mismanaged the projects when he started to discover money missing from some accounts and dubious transactions. Last year, when Khashayar sought his ownership stake back, Mizrahi allegedly terminated relations with him and his brother-in-law and locked them out of the office.

Khashayar then brought a lawsuit. He hired PricewaterhouseCoopers, which revealed in a report submitted to the court that Mizrahi took money out of project accounts, which he then used to pay for an executive jet, a child’s tuition, and a $1.9 million custom-built cottage.

In court documents, Mizrahi said that every accusation that he used the money for illicit reasons is wholly false. According to court records, he requested access to the data used to create the report and questioned the researcher’s objectivity. In the interview, he declined to address the report any further.

Condos occupied

Sam Mizrahi The One gave a different account of events. In an affidavit, he claims Mahmoud called him on June 30 of last year and threatened to “burn down my house and everything that I hold dear if I did not allow his family to cash the checks.” He improved the security and changed the locks at his house and place of business. He said that the Khavaris were still involved in the enterprise.

According to the records, Khashayar said that “these accusations are false and, in any case, they are entirely irrelevant to these proceedings.”

Khashayar filed a motion on a legal issue — the scope of their initial agreement — to expedite the case this year. On March 24, a judge in Ontario rejected the case and remanded all parties to the main action with a hearing scheduled for July 29.

Buyers have moved into one of the Yorkville projects while the legal dispute goes on, and the second sold-out building is almost finished. The 80-story, 416-unit tower at Yonge and Bloor Streets, which has more than 2,000 individuals on a waiting list, including for a $30 million penthouse, is another property that Mizrahi plans to start promoting.

“You learn what not to do from every experience—or you try to,” Mizrahi added. “I took away from this experience what not to do. I’m making progress.

Mizrahi v. Khavari: Former allies who are now bitter rivals

A well-known Toronto real estate developer who was in the middle of a significant project last year allegedly got a call from someone threatening to burn down his home and ruin his reputation if a number of demands, including approval for the cashing of checks totaling millions of dollars, weren’t met.

According to court records, Sam Mizrahi The One called from Mahmoud Reza Khavari while working on two upscale condos in midtown Toronto, according to Katia Dmitrieva of Bloomberg News. Khavari is a fraud fugitive sought since 2011 for his alleged role in the biggest scam in Iranian history.

According to court records, the guy played a crucial role in the development project as a significant investor and the father of Mizrahi’s business associate Khashayar Khavari.

In the past, Mizrahi and Khashayar worked together as executives in the latter’s company (together with his brother-in-law).

Khashayar asserted that Mizrahi cheated him and his father out of at least $105 million in addition to shares in several other enterprises. Mahmoud, he continued, is a “mild-mannered” individual who never threatens anyone.

According to court documents, Khashayar continued to claim that Sam Mizrahi The One later admitted to mismanaging the projects but that he was then shut out of his office when he demanded payment for his equity investment. Khashayar further charged Mizrahi with stealing money from projects to pay for an executive jet, a custom villa, and one of his children’s college expenses. Mizrahi refuted the accusations, claiming they were made in error.

Khashayar and Mahmoud contributed money to projects, but Sam Mizrahi argued that since it was their original agreement, they should only be entitled to 50% of the earnings when the structures are finished. In response, the developer demanded $50 million in damages for, among other things, intimidation, slander, negligence, and breach of contract. These allegations were also refuted by the father-and-son team.

Both sides have yet to respond further to one other’s accusations as of the time of publication. They are expected to show up for the main lawsuit’s hearing on July 29.

Apple is suing a Toronto developer to break its lease at “The One.”

According to a report by The Globe and Mail, the people responsible for building what will be Canada’s tallest tower are now the target of a lawsuit from the multinational computer company Apple.

The One, an 85-story supertall tower currently being built at Yonge and Bloor, is expected to be the tallest mixed-use building of its kind when it is finished. Initially, it had an Apple flagship store as the main lease for its at-grade retail, which was undoubtedly a desirable addition to the Mink Mile development.

The computer firm is currently suing builder Sam Mizrahi’s business to terminate their leasing agreement, which was first signed six years ago. They are citing delays and millions of dollars owing as justifications.

In an application submitted on January 28 to Ontario’s Superior Court of Justice, Apple Canada Inc. stated that the company was “profoundly disappointed” with Sam Mizrahi The One and “regrets that Mizrahi’s failures have necessitated Apple taking the step of terminating its relationship with Mizrahi.” 

Apple claims it is enforcing its right under the lease agreement to evict Mizrahi without incurring any fees if specified deadlines were not met. The developer disputes that this has always been the case and claims that a prior application made in October 2021 to stop Apple from departing does not provide Apple the right to terminate its lease.

In the application, Sam Mizrahi The One—which has promoted The One as having a “global flagship anchor tenant”—stated that it would “suffer irreparable harm from losing a world-class tenant who was intended to be an anchor tenant for a world-class property, which is a loss that cannot be compensated in damages.”

Deadline for Completion Pushed twice (More Reasons Behind the Sam Mizrahi The One Controversy)

The skyscraper was supposed to be finished by October 31, 2021, as promised; but, according to court filings from both parties, this completion date had already been changed twice to move forward final completion from the original date of November 30, 2019. Apple claims that 26 things, including the building’s common areas, were not finished by the deadline and prevented the business from assuming retail occupancy in its lawsuit.

Since the developer has certainly missed deadlines, it is suing for $6.9M in damages and asking the court to issue a ruling allowing the lease to be terminated.

It is also asserting that £18,600 is owed in connection with a contract between the tech giant, the developer, and Foster + Partners, the firm that designed a number of Apple’s global flagship shops. 

Mizrahi asserts that delays are the result of outside factors, such as construction delays brought on the COVID-19 and a strike of plumbers and pipefitters that affected all of Ontario in 2019. 

The consequence of this lawsuit on the tower’s completion, which has already reached five stories, including the ground-floor retail mezzanine, is unknown. Sam Mizrahi The One did not respond to STOREYS’ request for comment as of the time of publication.

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