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Many of those creditors are Saskatchewan-based construction companies and tradespeople. Multiple local firms had, as of Dec. 14, registered more than $4.5 million in builders’ liens against three of the group’s signature properties in Saskatoon.

While its assets are strong, the group has “insufficient cash flow” to meet its operational and construction requirements, Tim Clark, New Summit’s CEO and the sole director of all of the group’s companies, said in a Dec. 22 letter to creditors.

“As this is a cash flow issue and not related to the underlying assets … we found it necessary to initiate the (creditor protection) filing in order to rebalance the (group’s) operations and financial position,” Clark said in the letter.

Creditor protection under the federal Companies’ Creditors Arrangement Act gives companies with deep financial problems an opportunity to avoid bankruptcy while restructuring their assets and paying some or all of their debts.

In its request for protection — which was granted by a judge in a court order dated Dec. 19 — the company said its original plan was to renovate the properties, which were in “a poor state of repair,” and profit from increased rental rates.

That plan was derailed by the slow pace of construction exacerbated by a “changing” provincial economy, which caused the rental market to slow down, the group said in the request.

Three of the group’s properties in Saskatoon are losing money each month, and several have vacancy rates in excess of 20 per cent — nearly double the record-high average vacancy rate among Saskatoon’s roughly 13,500 units, according to court documents.