In January 2007, The City reviewed methods to maximize revenue and began the process of investigating options for 9 Madison which included designating the property as surplus available for sale. The staff report “Expiration of Parking Lease with Tartu College at City owned 9 Madison Ave” outlined the general understanding between the parties:
Since October 15th, 1968, the City has been leasing the premises to Tartu, solely for parking use for Tartu’s residents and visitors. Tartu exercised its right to renew the lease for a second term of 31 years in 1999, such that the lease now expires on Oct. 14th, 2030. Tartu currently pays $2,097.00 per month net as rent, together with all taxes. The rent and realty taxes are paid by the tenant and are up to date. The lease provides that the Landlord may terminate the Lease on 6 months written notice to the tenant “if the lands or any part thereof are at any time required for municipal purposes, of which the Council of the Lessor shall be the sole judge”.
Subsequently, the City determined that it was more advantageous to terminate the lease with Tartu College and sell the property under certain development conditions that were later specified in 2011.
In the last quarter of 2011 the City of Toronto laid out terms and conditions for selling a number of surplus sites including 9 Madison Ave. An excerpt of the mandate given to Build Toronto is provided in the attached “2011 Mandate to Build Toronto with 9 Madison Ave.” Those familiar with the proposed design of the new Estonian House, or cultural centre, may appreciate that the design properly accounts for an important condition pegged to the sale of the land. In section 5 (a), page 3 of the document, the City stipulates that: “The City will reserve an above-grade easement to protect the TTC infrastructure.” From a density standpoint, a ground floor which could have potentially provided substantial revenue generating commercial space will not be possible because of the subway tunnels and the ongoing access the City requires.
In April 2015, Build Toronto released a document explaining the general process and policies surrounding their sale of properties on behalf of the City of Toronto. As a City-owned corporation, Build Toronto’s has a specific mission to sell “surplus and underused City land to attract commercial development, create desirable jobs and improve the livability of the City.” The “2015 Apr 21 Build Toronto-Purchase Policy and Procedure” document provided below also sheds light on the due diligence process (Page 3 of 8) from the perspective of Build Toronto.
In November 2016, the City of Toronto issued the “Bloor Corridor/ Annex Block Planning Study, Official Plan Amendment – Final Report.” At 32 pages the report provides an expansive policy statement on proposed development plans for the “Annex” district, it’s composition of mixed use facilities, heritage properties, traffic patterns, parks, transit and other neighborhood infrastructure. Specific to the properties under consideration for the new Estonian House, the document states:
“This policy is intended to provide support for moderate redevelopment on the 9 Madison Avenue site (surface parking lot) based on recent discussions with representatives of Tartu College, which also owns 11 Madison Avenue. Tartu College is developing plans that incorporate a mid–block pedestrian access across a Privately-Owned, Publicly Accessible open Space (POPS) pedestrian square, framed by retail and institutional uses added to the rear of both the Tartu College building and 11 Madison Avenue.”
The wording included in this November 2016 release would suggest that the City was provided some details of the proposed Tartu plans in advance of the report’s authorship. Even though it might have been caused by an over-generalization or misunderstanding, it is also interesting that 11 Madison is referenced as a “Tartu” property. The timeline for composing all of the report’s information would have been prior to date that the Estonian House Board publicly declared that the arrangement with Alterra was terminated and prior to the date when the “3 Orgs” approached the Estonian House Board with the concept of partnering in the development.
EWR will continue the due diligence series over the coming weeks.
2007 Jan 30 City Of Toronto Staff Report re Tartu parking lease
2011 Mandate to Build Toronto with 9 Madison Ave
2015 Apr 21 Build Toronto-Purchase Policy and Procedure
2016 Nov Bloor Corridor Final City Report
Related: Toronto Eesti Maja Tulevik