Surplus Subway Land - Block 81

Northeast Corner of Bloor Street West

and Dufferin Street, 1011 Dufferin Street

(Davenport - Ward 21)

 The Corporate Services Committee recommends the adoption of the following report (April 14, 1998) from the Commissioner of Corporate Services:

 Purpose:

 To seek authority for the City of Toronto to acknowledge and consent to the mortgaging of a leasehold interest in a long term ground lease of property owned by the City of Toronto as per the attached location map.

 Funding Sources, Financial Implications and Impact Statement:

 N/A.

 Recommendations:

 It is recommended that:

(1)authority be granted to execute an acknowledgement/consent to the granting of security from Maor Developments Inc. and 716719 Ontario Limited to President Asian Enterprises Inc.; and

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

 Council Reference/Background/History:

 The Metropolitan Council on November 14, 1972, by the adoption of Clause No. 48 of Report No. 52 of The Metropolitan Executive Committee, approved the lease of approximately 1390.53 square metres (14,968 square feet) of land at the northeast corner of Bloor Street West and Dufferin Street to Fel-Sab Developments Limited at a rental of $11,000.00 per annum for a term of 33 years with rights to renewal for two similar terms, upon rentals to be negotiated or failing agreement to be arbitrated.

 On January 24, 1978, the Metropolitan Council, by adoption of Clause No. 30 of Report No. 1 of The Metropolitan Executive Committee, authorized an amendment to the lease with respect to the type of development to be constructed on these lands which resulted in a three-storey building known as 1011 Dufferin Street being constructed thereon.

 Furthermore, the Metropolitan Council on June 9, 1987, by the adoption of Clause No. 8 of Report No. 17 of The Metropolitan Executive Committee approved the assignment of the lease from Oswanda Investments Limited (formerly Fel-Sab Developments Ltd.) to 481691 Ontario Limited, subject to the assignee assuming all of the obligations under the lease and amendments thereto.

 Subsequently, on September 15, 1987, the Metropolitan Council, by the adoption of Clause No. 10 of Report No. 24 of the Executive Committee, authorized a further assignment of leasehold estate from 481691 Ontario Limited to Maor Developments Inc., and 716719 Ontario Limited, along with a consent to the mortgage of the leasehold estate from these companies to the Prudential Assurance Company Limited.

 Most recently on May 17, 1995, Metropolitan Council, by the adoption of Clause No. 5 of Report No. 16 of The Corporate Administration Committee granted authority to the Commissioner of Corporate Services to execute a consent/acknowledgement to the granting of security from Maor Developments Inc. and 716719 Ontario Limited to the Canadian Imperial Bank of Commerce (ACIBC@) and standing authority to the Commissioner of Corporate Services to provide consent on behalf of the Metropolitan Corporation to mortgages of leasehold interests in Metropolitan-owned property by way of assignment or sublease in favour of a bank, trust company or other registered financial institution.

 Comments and/or Discussion and/or Justification:

A letter has now been received from Daniel Weinryb, Solicitor for the owners of 1011 Dufferin Street, advising that his clients, Maor Developments Inc., and 716719 Ontario Limited requires a consent to the granting of security of the leasehold estate from these companies to President Asian Enterprises Inc. President Asian Enterprises Inc. is neither a bank, trust company or a registered financial institution and subsequently, does not qualify under the standing authority. To accomplish this a form of Consent/Acknowledgement must be executed by the City of Toronto confirming the status of the lease and the City=s consent to the grant of security. As of the date of this report, the Finance Department has confirmed that the rental of the ground lease dated January 31, 1973, between Fel-Sab Developments Limited and the Municipality of Metropolitan Toronto and amendments thereto have been complied with and the Toronto Transit Commission have stated that to the best of its knowledge all covenants in the lease have been complied with.

 Conclusions:

 In my opinion, the granting of consent to execute the Consent/Acknowledgement is fair and reasonable.

 Contact Name:

 Mr. Tony Pittiglio, Manager of Property Services (392-8155).