Hundreds of <a href="https://industrymovement.com/howard-hanna-left-out-of-open-real-estate-plans-ceo-says/" title="Howard Hanna left out of Open Real Estate plans, CEO says”>real estate investors in a company run by a media-savvy realtor who owns dozens of buildings across Ontario got a shock over the weekend when they were told their rent payments were in limbo.
The realtor, Todd C. Slater, is known as the Simple Investor through advertising, a radio show he once hosted on Newstalk 1010 and a series of podcasts.
Now, however, the condo management company, estimated to be worth more than $100 million, seems to be anything but simple.
“We put a lot of trust in Todd, and I trusted him for a long time. We trusted him for a long time. That trust is gone, obviously,” said Billie-Jo Newman, an investor who owns six properties in four Ontario cities through Slater’s company, The Simple Investor.
Newman said she got good returns for 13 years from a company whose business model was to buy apartment buildings, turn them into condos, sell the condos and provide a hands-off investment for the owners by managing the properties for a fee.
In January, however, she said she was confused when she got a $41,000 water bill for a condo complex in Perth County.
Then, she said, there was a change in payment deadlines, a $100 increase in the per-condo management fee and, this month, her rent money didn’t come in at all, putting her ability to make mortgage payments in doubt.
“I’m trying to look at this in steps, because if I look at the whole thing it’s very overwhelming,” Newman said.
Sireg, the company that manages the Simple Investor properties, told investors in a letter last week that it’s working on solutions.
“The Company is currently experiencing market and liquidity challenges that are affecting our ability to make timely rental payments. We recognize how serious this is, particularly for investors who rely on these payments to meet financial obligations. The Company is working with advisors to evaluate alternatives and address these challenges,” the letter says.
The company didn’t respond to emails from CTV News, and when CTV News reached out to Slater directly, an automated email said, “I am away on medical leave with no date of return at this time.”
Some buildings managed by Sireg have had problems, with one complex on Kipps Lane in London without hot water for a period of time this summer and another building in Brockville without a working elevator.
Investor Marcin Migdal, operator of AiCanadianSolutions.ca, said he panicked when he realized the payments would not be coming in. He later started a website to organize investors with SIREG and Simple Investor.
He said he has already heard from more than 79 investors with some $26 million in assets. He said he had heard there are approximately 1,800 total investors.
“I didn’t want to sit around and wait. So I just sprang into action to rally other investors and try to get to the bottom of what is happening with Todd,” Migdal said in an interview, recalling that he met Slater many times and calling him a “very nice person.”
Migdal said he isn’t sure what has happened, but wondered if Slater overextended himself in real estate during a period of contraction in the wake of the COVID-19 pandemic and a downturn in condo values in Toronto.
The condo ownership has not changed, and the tenants are likely still paying rent. But one challenge for the owners is that, because the investment was so hands-off, many don’t have contact information to reach the tenants.
He said the first piece of advice he has for worried investors is that they can call their bank and ask to defer their mortgage for a few months. Investors will still be paying interest, but without paying the principal, their payments will be reduced, he said.
