September 23, 1998
To:Corporate Services Committee
From:Commissioner of Corporate Services
Subject:Financial Incentive for Tenants to vacate surplus houses in the Scarborough
Transportation Corridor (Ward 13 - Scarborough Bluffs, Ward 14 - Scarborough Highland
Creek and Ward 26 - East Toronto)
Purpose:
This report recommends that the City extend the same financial incentives to tenants of
houses in the Scarborough Transportation Corridor as have been approved for tenants within
the Spadina Corridor.
Funding Sources, Financial Implications and Impact Statement:
The cost of the financial incentives recommended in this report are to be deducted from the
revenue of the sale of the properties.
Recommendations:
It is recommended that:
(1)City Council affirm the former Metro Council's position that tenants within the
Scarborough Transportation Corridor be given the first opportunity to purchase the
City-owned houses they rent at current market value;
(2)the tenants who do not wish to purchase the property be offered a financial incentive to
provide vacant possession of the property, as follows:
(i)two months rent for tenants with less than three years occupancy;
(ii)three months rent for tenants with three or more years occupancy.
(3)the appropriate City Officials be authorized and directed to take the necessary action to
give effect thereto.
Council Reference/Background/History:
The former Metropolitan Toronto Council directed that surplus residential properties within
both the Scarborough Transportation Corridor and Spadina Expressway Corridor be offered
for sale first to the existing tenants, and then on the open market
A staff report dated May 13, 1998, and considered by Council on July 8, 9, and 10, outlined a
process for disposing of the surplus residential properties within these two projects. Included
as part of the staff recommendations was a proposal to offer tenants who did not wish to
purchase their leased property, a financial incentive equivalent to either one or two months
rent, depending upon length of tenure, in order to obtain vacant possession.
Corporate Services Committee amended the staff recommendation vis a vis the financial
incentive by recommending to Council that tenants in the Spadina Corridor be offered the
equivalent of two months rent for those with less than three years tenure, and three months for
longer occupancy. Council's adoption of the Committee recommendations had the effect of
providing different financial incentives to tenants in the two transportation projects.
Comments and/or Discussion and/or Justification:
Experience has shown that most purchasers of residential property want to occupy the
property themselves, and therefore properties to be sold which are subject to an existing
tenancy generally sell for a lower price and take longer to sell.
The Spadina and Scarborough corridors contain a majority of the surplus residential properties
the City owns. Marketing efforts in these two projects, where the direction has been to first
offer the property to the tenant, should include similar financial incentives to obtain vacant
possession.
Conclusion:
Providing a financial incentive to the City's tenants in the Scarborough Transportation
Corridor to vacate the properties will make the City's properties more attractive to prospective
purchasers, and will result in a higher net return than selling the properties subject to the
existing tenancies.
Contact Name:
R. Mayr, AACI, Director of Real Estate, Telephone (416) 396-4930, Fax (416) 396-4241
mayr@city.scarborough.on.ca (cs98185.wpd)
Margaret Rodrigues
Commissioner of Corporate Services
