A hospitality group owning controlling shares in one of Richmond’s oldest pubs, as well as eateries across the Lower Mainland, has filed for creditor protection.
The Joseph Richard Hospitality Group — which owns the Buck & Ear and adjoining Steveston Hotel and liquor store in Steveston — filed the petition at the B.C. Supreme Court on July 17.
In the petition, the group blamed the impacts of the COVID-19 pandemic for the decision to file.
The group was founded by Andre Joseph Bourque and Ryan Richard Moreno and owns controlling shares in the Steveston Cafe and Hotel, the Steveston Hotel Liquor Store and the Buck & Ear.
The Steveston businesses currently owe their landlord around $60,760 for rent in June and July. The group is also facing “various lawsuits and enforcement measures from landlords and other creditors,” reads the petition.
The group also owns controlling shares in JRG Foodhall (91原创) Ventures Ltd., which is behind the in the former Canada Post central office on Georgia Street. The food hall is set to open this fall.
The hospitality businesses had taken the brunt of the impact, reads the petition, but many of the other businesses are “borrowers or guarantors on the debt incurred to keep those hospitality businesses in operation.”
As of the date of the petition, the group owes around $34.4 million to its primary secured lender - 91原创 Western Bank. It also owes the Bank of Montreal around $2.3 million and owes around $600,000 in 91原创 Business Business Assistance loans.
Businesses under the group also owe the Canada Revenue Agency around $4.7 million in source deductions, $24,700 in income tax, $440,000 in GST and $912,000 in PST.
The group had almost 1,000 employees in total during pre-pandemic times, and it now has 830 employees consisting mostly of non-management staff paid on hourly rates.
Its only significant realizable assets include the Surrey Clover Building worth $16.4 million and the Pitt Meadows Rooster Building, which could be worth $6.1 upon completion of the development.
Businesses couldn't adapt to pandemic: Petition
According to the petition, the group’s businesses tried their best to adapt to the pandemic by starting liquor delivery services, selling meal kits and offering discounts to healthcare workers and their families, but some businesses closed permanently while others did not finish construction and could not open as planned.
Apart from the pandemic, the group cites economic challenges including increases to minimum wage and additional paid sick days, labour shortages, B.C.’s higher employer health tax, supply chain issues and increases to liquor tax, insurance rates and interest rates.
The group is asking for urgent “breathing room to develop a plan of compromise and arrangement” to be proposed to creditors, which will include the sale of assets.
A hearing for the petition was held before B.C. Supreme Court Justice Shelley Fitzpatrick on July 17, who imposed restrictions on the group’s payment obligations and granted it restructuring rights.
Ernst & Young was appointed to monitor the group's business and financial affairs.
Judge Fitzpatrick also ordered a stay of proceedings until July 27 for any action, suit or proceeding against the group.
A further hearing will be held on Thursday, July 27 to deal with the group’s petition for an extension on the stay of proceedings until Sept. 29.
Other existing Lower Mainland establishments controlled by the Joseph Richard Group include:
- The Henry (Surrey)
- S+L Kitchen & Bar (Abbotsford, Langley, Surrey)
- Livelyhood (Port Moody)
- Oak & Thorne (Langley)
- Whiskey Charlie (Pitt Meadows)
- Blank Canvas Catering (Lower Mainland)
- Tavern on the Green (Abbotsford)
- Hillside Event Space (Abbotsford)
- The Italian Osteria & Cheesebar (Langley)
- Townhall (Abbotsford, Chilliwack, Maple Ridge, Langley)
- Clover Station Liquor Store (Surrey)
- Glass House Estates Winery (Langley)
- Queen’s Liquor Store (New Westminster)
