As his real estate empire showed signs of trouble, a robed Robby Clark appeared in a promotional video, standing at the bow of a yacht, arms raised to the sky as a camera circled overhead.
“You can stick me in the desert with nothing and I’m going to come out owning the desert,” Clark is heard saying at another point in the three-minute video.
It was posted to several Instagram accounts like “billonaireclassy” in March 2022 and shows the former YTV child actor- turned-real estate investor living a life of luxury.
He’s shown getting into sports cars and relaxing in private jets, smiling next to famous rappers like Kanye West and Rick Ross, and taking in the view from a California mansion.
Maps of Sault Ste. Marie and Sudbury appear — they’re among the Ontario communities where he owned an estimated 800 properties and thousands of tenants lived.
“I’m going to have a billion dollars in holdings,” Clark says.
Clark’s business partners from the Hamilton area — Dylan Suitor, Ryan Molony and Aruba Butt — also make appearances.
In the video, Molony and Suitor dance with Clark in nightclubs, and Suitor and Clark take selfies on the sidelines of an NFL game. Butt and Clark stand side by side on the yacht, wearing designer robes and raising their matching tumblers to the camera.
“Ultimately if you’re going to work with lenders, and we work with a lot of private lenders on acquisitions, they gotta know you know what you’re doing,” Clark says in the video.
But behind the scenes, Clark’s business, SID Developments, and 11 connected corporations owned by Molony, Suitor and Butt had taken on millions of dollars in debt and were struggling to keep up with payments to lenders, according to documents filed with the Ontario Superior Court of Justice.
Meanwhile, rundown properties sat vacant, and utility bills, property taxes and contractors went unpaid.
By early 2024, the corporations had only $100,000 in the bank and owed $144 million to lenders, faced dozens of lawsuits from creditors and received court-ordered bankruptcy protection.
Since CBC Hamilton reported on the court proceedings last week, Clark, Suitor, Molony and Butt have made many of their social media accounts private, and have not responded to requests for comment.
But court documents and interviews with experts help explain how they became one of the largest holders of residential real estate in Ontario, and now are on the verge of losing it all.
Hamilton mortgage broker arranged many loans
This isn’t the first time Clark has faced financial trouble.
He lost the money he earned from acting as a child because of “a lack of financial education,” Clark told YouTuber David Meltzer in a 2021 video.
Clark declared bankruptcy in 2009 and then started a meal-kit business, which also failed, he said. He then turned to real estate investing, but his credit score “was a joke,” so he had to get “other people to sign on the dotted line” when purchasing his first properties.
In recent years, Clark’s company — through Butt, Molony and Suitor’s corporations — acquired, renovated and leased or sold over 800 properties, mainly single-family homes, fuelled by more than 1,300 loans, the court documents say.
The vast majority came from Hamilton mortgage broker Claire Drage, according to the documents. Through her companies, Windrose Capital and The Lion’s Share Group, she brought on private lenders to invest in Butt’s, Molony’s and Suitor’s corporations.
She provided their corporations with secured mortgage loans, which give lenders collateral if borrowers don’t meet their debt obligations, according to the court documents. She also provided them with unsecured promissory notes — loans not tied to any collateral.
Drage did not respond to a request for comment, but said in a Facebook post last October that “our borrower eligibility criteria are rigorously upheld, ensuring sound lending practices.”
In one instance, she supplied Suitor’s corporation, Interlude, with $23 million in mortgages and another $29 million in promissory notes.
In another, she arranged $6.5 million in mortgages for Butt’s corporation, Joint Captain Real Estate. Her son, Sam Drage and daughter-in-law Bronwyn Bullen are shareholders.
She then lent them a further $3 million in promissory notes.
Sam Drage and Bullen did not respond to requests for comment.
Toronto mortgage broker Ron Butler, who is not connected with the case, said the family ties are a conflict of interest that Drage would be required to disclose to investors.
He described the huge number of loans arranged by Drage as “frightening,” and said while it’s not illegal for mortgage brokers to issue riskier promissory notes, he believes it’s improper because it puts lenders in “such a bad position” if something happens to their investment.
“I wouldn’t touch them with a 10-foot pole,” Butler said of promissory notes.
When the Financial Services Regulatory Authority of Ontario — which governs mortgage brokers — was asked if it is investigating Drage, it said in a statement that it is “thoroughly reviewing related concerns.”
Many homes ‘unsalvageable’: Sault Ste. Marie mayor
Despite generating “significant annual revenues” from rental income and the sale of some properties, the corporations didn’t have enough money to make their debt payments, the court documents say.
“I don’t keep [any capital] in the accounts,” Clark said in the YouTube video from 2021.
By that fall, Clark had begun negotiating selling off about a quarter of their properties to another real estate investment and property management company, Core Developments, chief executive officer Corey Hawtin told CBC Hamilton.
The sale closed in May 2022, but Clark’s business continued to default on loans and couldn’t find a refinancing option, say the court documents. But as interest rates increased and property values fell, Suitor, Molony and Butt continued to take on new debt, the court documents show.
Patty Vanminnen invested in mortgages for Suitor to buy two Sudbury homes last year, but wasn’t made aware of everything else going on, she said in an affidavit as part of the bankruptcy protection proceedings.
“We were not advised by Suitor that these mortgages were being granted as part of a larger enterprise,” Vanminnen said, “or that there were hundreds of other lenders being granted mortgages as part of a larger business, or that any of the alleged problems being raised in this proceeding existed.”
At the end of the six-month mortgage term, Interlude defaulted on the mortgages, she said.
Vanminnen moved to recoup her money, but then Suitor, Molony and Butt filed for bankruptcy protection. The three now have protection from lawsuits until at least mid-February.
In Sault Ste. Marie, a northern Ontario city of about 73,000, the corporations own about 200 homes, or one per cent of the housing stock, Mayor Matthew Shoemaker told CBC Hamilton. The impact has been overwhelmingly negative.
“I would be happy never to deal with these companies again,” he said.
Almost half the homes they own in Sault Ste Marie are in an “unsalvageable” state of disrepair and sit vacant, Shoemaker said. They’ve fought the city on property standard and fire code violations, and owe $645,000 in unpaid taxes, say the court documents.
“I think our community will be better off if the assets that they own in Sault Ste. Marie end up in the hands of other landlords, preferably local landlords,” Shoemaker said.
Hawtin, Core Developments’ CEO, said his company is interested in buying more of the properties and limiting the number of tenants displaced.
While Core has a similar business model to SID Developments, owning 550 properties, it has “appropriate debt-equity ratios,” said Hawtin.
Tenants could face eviction if homes are sold to people who want to live in them, lenders want them vacated and it’s ordered by the court, or if court proceedings drag on and SID Developments can’t afford to keep them in a livable condition, Hawtin said.
“I really hope the renters don’t get displaced through this process,” he said.