September 22, 1998

To:Corporate Services Committee

From:Commissioner of Corporate Services

Subject:Welfare Office "A"

1450 O'Connor Drive

(Ward 1 - East York)

Purpose:

To renew the lease with Surrey Plaza Limited at 1450 O'Connor Drive as per the attached location and site maps.

Funding Sources, Financial Implications and Impact Statement:

Funds to cover the expenditures identified in this report are part of the 1998 Social Services Operating Budget estimates. The Commissioner of Finance, in accordance with Provincial regulations, has certified that financing for the expenditure in the amount of $1,350,000.00 is within the Updated Financial Debt and Obligation Limit.

As a result of the renewal, the estimated reduction in annual basic net rent payable is approximately $59,876.25 or a total of $119,752.50 over the two years of the renewal.

Recommendations:

It is recommended that:

(1)the City of Toronto enter into a two year lease renewal with Surrey Plaza Limited on the terms and conditions outlined in this report and in a form acceptable to the City Solicitor;

(2)financing in the amount of $1,350,000.00 be approved; and

(3)the appropriate City of Toronto officials be authorized and directed to take the necessary action to give effect thereto.

Council Reference/Background/History:

By the adoption of Clause No. 3 of Report No. 10 of The Parks, Recreation and Property Committee on August 11 and 12, 1993, the former Metropolitan Council authorized a five-year lease expiring November 31, 1998 with Surrey Plaza Limited for a one-storey, 34,215 square foot building, at an annual net rental rate of $13.75 per square foot net, plus a proportionate share of taxes and operating costs.

Comments and/or Discussion and/or Justification:

The original lease had a renewal clause for a further two years and in a letter dated November 19, 1997, Vincent Scott, Director, Operations Support, requested that the lease be renewed.

A Space Rationalization Team dealing with the various buildings brought into amalgamation was asked if there was any space available in these facilities that can accommodate various City of Toronto Departments that are currently occupying leased premises as tenants. As a result, a canvass has been conducted based on the criteria and catchment area established by the Community and Neighbourhood Services Department for the subject requirement. The survey revealed no suitable City-owned space to accommodate this operation at this time.

Consequently, negotiations were commenced with Mr. Mario Cinelli of Surrey Plaza Limited and an agreement was reached on the following basis. The two-year renewal period will have the minimum rent set at $12.00 per square foot, net, which will result in savings of $59,876.25 per annum and $119,752.50 over the two year term. All other terms of the lease will remain the same as the existing lease.

Conclusion:

In my opinion, these terms and conditions are fair and reasonable and I have been advised that they are acceptable to Community and Neighbourhood Services Department. Another search for suitable City-owned space will be conducted prior to the expiry of the renewal term.

Contact Name:

Mr. Tony Pittiglio, Manager of Property Services; Telephone No. (416)-392-8155; Fax No.: (416)392-4828; E-mail Address: anthony_pittiglio@metrodesk.metrotor.on.ca (cs98184.wpd)

Margaret Rodrigues

Commissioner of Corporate Services

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