Flato setbacks put spotlight on its Kawartha Lakes developments

Flato Developments has seen seven of its project‑specific corporations declared insolvent, with an Ontario court placing all of them into receivership on June 23.

According to Insolvency Insider Canada, including multiple media sources and statements from municipal levels of government, the move follows loan defaults involving major lenders. It marks a financial setback for the developer, which has active projects in Lindsay and Cameron.

While none of the insolvent corporations involve projects in Kawartha Lakes, the development raises questions locally.

The insolvencies were recognized after creditors sought court intervention. The affected properties are concentrated in Dundalk, Melancthon and Beeton, where Flato has been pursuing large subdivision and mixed‑use plans. A court‑appointed receiver, TDB Restructuring Limited, is now overseeing those sites and attempting to stabilize the situation.

Kawartha Lakes Weekly reached out to Flato for comment by phone and email but did not receive a call back before publication time.

The newspaper also contacted two local entities that have been the recipient of large Flato donations and financial commitments – Ross Memorial Hospital and the Flato Academy Theatre.

In a statement from Kim Coulter, manager, community giving and engagement for the RMH Foundation, she said as per “the RMH Foundation’s confidentiality and privacy policies, we are bound by our obligation to protect the confidentiality of donor information. Information about donors cannot be released without the donor’s consent. That includes all information about a donation, as well as all personal and financial details.”

Similarly, Michael Piggott, chair of the Flato Academy Theatre’s board of directors, said “FLATO is the theatre’s naming rights sponsor. We are aware of the recent public reports but we are not involved in FLATO’s business operations and are not in a position to comment on those matters. The theatre remains focused on serving our community delivering great programming and ensuring the long-term strength and sustainability of the organization.”

Flato did a groundbreaking ceremony in Lindsay in May for its 113 townhomes that were sold out, on the east side of Verulam Road near I.E. Weldon Secondary School. At the time, Shakir Rehmatullah, president of Flato, said their goal was to “have the homes completed by sometime next summer.”