Court-Ordered Sales Reshape Vancouver’s Housing Market: Why Well-Capitalized Developers Are Buying Distressed Sites at Fire Sale Prices

Lower Mainland’s housing market is going through something developers haven’t seen in decades. Court-ordered sales of stalled development projects are becoming a regular feature across Vancouver, Port Coquitlam, Burnaby, and Langley. And while the situation is devastating for over-leveraged developers and their unpaid creditors, it’s creating rare opportunities for the few companies that still have cash to deploy.

The story really starts with NorthStar Developments, a Vancouver-area firm that was already mid-construction on Porthaven, a six-storey apartment building next to Port Coquitlam’s city hall. Gordon Wylie and his partner Jeff Brown had no plans to take on another project while they were finishing that build. But then a nearby development stalled — the kind of thing that’s become routine in the region over the past two years — and the site went to court-ordered sale.

The project, called The Met by its original developer Quarry Rock Development, had crews as far as building the parkade before the whole thing fell apart. Quarry Rock owed $23 million to 57 creditors. The bank that lent the money took a massive hit. Unpaid contractors are still waiting to be made whole. But from an opportunity standpoint, NorthStar picked up the property for just $11.6 million — less than its assessed value and roughly half of what was owed.

“We realized there was a hole in downtown Port Coquitlam that had sat there for two years,” Wylie says. “It was not good for Poco or for downtown.” That empty site was dragging down the whole area. NorthStar saw a chance to fill it and also to offer housing at prices lower than their original Porthaven project, which sold for around $950 to $1,000 per square foot.

What NorthStar is now calling Livy — the rebranded and redesigned Met project — takes a completely different approach. Small studios start at $299,000. The building concept borrows from budget hotels you see popping up across Europe and North America: compact private living spaces combined with extensive communal amenities. Co-working pods, on-floor storage, a wellness spa with cold plunge pool and hot tub, even a virtual golf lounge. The idea is to give residents more social space without charging them for square footage they’ll never use.

It sounds like a win for affordability. And in theory, it should be. Why not replicate this model across the dozens of distressed development properties now on the market? Let well-capitalized developers buy these sites cheaply, finish the projects, and bring more supply — at lower prices — to a market that desperately needs it.

The problem is that even at bargain-basement prices, the court-ordered sale market itself has slowed down dramatically. NorthStar bought the Livy property in November 2024, when there was still hope that declining interest rates would revive buyer confidence. But 2025 turned out to be so bleak that even deeply discounted sites are not enough to tempt healthy developers into bidding wars. Bids on troubled projects are routinely coming in below the debt levels, meaning creditors are going to take losses regardless of who buys.

A “Monumental Reset” That Could Last Years

Mark Goodman, whose brokerage specializes in apartment and multi-family development sites across the Lower Mainland, puts it bluntly. “This is a monumental re-set,” he says. “We’re going to see continuing pain and more distressed sales for at least two years. And the price is going to have to be significantly lower.”

Goodman’s company maintains an active list of court-ordered sales stretching from Vancouver to Langley. The volume alone tells you how widespread this problem has become. Each listing represents a stalled construction crew, a developer facing financial ruin, and dozens of subcontractors whose invoices remain unpaid.

Jennifer Darling, associate vice-president at Vancouver Colliers’ division that handles foreclosures and court-ordered sales, confirms the trend. Until early 2025, distressed land sales in the region attracted multiple competing offers when presented to court for approval. There was genuine optimism that the market would recover. That optimism has evaporated. Now, with pricing direction unclear, even properties offered at steep discounts sit on the market for months.

The 2008 Comparison That Doesn’t Hold Up

Historical parallels keep coming up in conversations with Vancouver developers. When the 2008 global financial crisis hit, Rob Macdonald, a Vancouver developer, actively hunted down attractive half-built and troubled sites — especially in the United States where the crash was far more severe.

But there’s a crucial difference: Vancouver’s housing downturn in 2008 and 2009 was brief. There weren’t many foreclosures locally because the market recovered quickly. Everyone agrees this time is different. Many developers describe the current collapse in construction and pre-sale activity as the worst they’ve experienced in their entire careers. The depth of the market dislocation, combined with prolonged buyer hesitation, has created a situation where distressed sites are not just plentiful but proliferating.

The scale of overbuilding during the boom years also makes this cycle fundamentally different. During the peak construction period, developers across the Lower Mainland broke ground on hundreds of pre-sale condo towers. Many of those projects were overpriced relative to what the market can currently support, and a significant portion have since been cancelled, restructured, or put into receivership. The sheer volume of distressed inventory means the court-ordered sale pipeline will remain active for an extended period.

Who’s Still Buying? The Well-Capitalized Few

Amid all the distress, a small group of well-funded Vancouver-area developers remains active. These are companies that didn’t overextend themselves, didn’t need personal guarantees to secure financing, and avoided the common mistake of taking multiple lines of credit on the same property. Roughly two dozen firms fit this description, according to industry brokers.

Landa Global Properties is one of them. The company has operated in Vancouver for about 15 years, primarily building smaller luxury lower-rise apartment buildings. But it currently has a tower under construction at Alberni and Denman in Vancouver and another project in Surrey. More importantly, Landa has been acquiring distressed properties strategically over the past year.

Kevin Cheung, Landa’s CEO, bought three troubled sites in the last year: Siena, a luxury low-rise building in Burnaby Heights with 38 apartments; Park & Granville in South Vancouver, consisting of 17 upscale townhouses; and Theodore, a long-vacant lot in Kerrisdale that will become a four-storey mixed-use development. Like Wylie at NorthStar, Cheung says his company acquires these sites because they’re close to existing operations or have unique characteristics that make completion viable.

“We have to deal with all the skeletons in any project,” Cheung says. “Even if a project is partway built, it takes the same amount of work to get it to completion as something fresh off the drawing board.” That’s a crucial point that most observers miss. A half-built foundation doesn’t save you money on permits, engineering, architecture, or construction management. The only savings are on the physical structure already poured.

Cheung is also candid about his company’s financial position. His father was a major developer in China, and that family background has helped Landa avoid the leverage traps that have sunk competitors. “The ones who are over-leveraged are the ones who got in trouble,” he says. “We do not have mezz debt or second mortgages.” No mezzanine financing, no second mortgages — just clean balance sheet financing that gives him the flexibility to act when others are forced to sell.

The Pre-Sale Confidence Crisis

Perhaps the most damaging side effect of the court-ordered sales wave is the erosion of buyer confidence in pre-sale purchases. When developers can’t complete their projects, pre-sale buyers are left in limbo — their deposits tied up in legal proceedings, their move timelines disrupted indefinitely. Stories of stalled towers and cancelled projects have spread quickly through social media and word of mouth.

“Right now, people have such a bad feeling about pre-sales,” Cheung acknowledges. That psychological shift is hard to reverse. Buyers who watched developers walk away from projects or saw buildings stall mid-construction are understandably cautious about committing hundreds of thousands of dollars to an unfinished promise. This creates a self-reinforcing cycle: weak pre-sale demand makes new projects harder to finance, which means fewer new projects break ground, which reduces future supply and keeps prices elevated for anyone who does manage to complete a project.

What This Means for the Market

The court-ordered sales wave is reshaping expectations for everyone involved. For buyers, the failure of pre-sale condo projects has created deep skepticism that will take years to overcome. For developers, the message is clear: leverage is a liability in a downturn. The firms that survived without overextending are now positioned to acquire assets at prices that would have been unthinkable two years ago. But even they’re not rushing in.

Darling notes that the well-capitalized firms are “out looking at opportunities, looking for the best deal” — not buying aggressively, but keeping their construction teams intact and preparing for the eventual upturn. This patient approach makes sense. A developer who buys a distressed site at the wrong price during a prolonged downturn can find themselves in the same position as the companies that got over-leveraged in the first place.

For the broader market, the court-ordered sales process is creating a slow, painful price discovery mechanism. Goodman’s prediction of at least two more years of distress suggests that the Lower Mainland’s housing market is in for a prolonged adjustment. Prices on distressed sites will need to fall further before healthy developers see enough value to close the gap between what sellers (or banks) want and what buyers are willing to bid.

When the market does recover — and everyone expects it to eventually — the developers who bought these distressed sites at rock-bottom prices will be in a strong position. But until then, the court-ordered sale listings are likely to keep growing, and the question on everyone’s mind remains the same: where exactly is the bottom?

As Cheung puts it, and as everyone in the industry is doing right now: nobody has a solid answer for that yet.