Sale of Surplus Spadina Project Property at

132 Everden Road (Ward 28 - York-Eglinton)

The Corporate Services Committee recommends:

(1)the adoption of the following report (January 22, 1999) from the Commissioner of Corporate Services, subject to the purchase price of $225,000.00 being reduced by four (4) per cent, being the equivalent of what would have been charged for the real estate commission fee; and

(2)that with respect to any properties to be purchased by those appearing on Schedule "A", embodied in Clause No.4 of Report No. 9 of The Corporate Services Committee, entitled "Surplus Property Within the 'Spadina Corridor' and 'Scarborough Transportation Corridor', which was approved by City Council on July 8, 9 and 10, 1998, as amended, a similar criteria of deducting the equivalent of a 4 per cent real estate commission also apply:

Purpose:

To authorize the disposal of the property municipally known as 132 Everden Road.

Financial Implications:

Revenue of $225,000.00, less closing costs and the usual adjustments, subject to the revenue sharing agreement with the Province pursuant to Clause No. 1 of Report No. 25 of the former Metropolitan Corporate Administration Committee, approved on December 4, 1996.

Recommendations:

It is recommended that:

(1)the Commissioner of Corporate Services be authorized to accept an offer in the amount of $225,000.00 as detailed herein;

(2)Council, pursuant to Clause No. 14 of Report No. 27 of the former Metropolitan Management Committee adopted on September 28, 1994, waive the minimum required deposit of 10 per cent of the purchase price;

(3)authority be granted to direct a portion of the sale proceeds on closing to fund the outstanding balance of Costing Unit No. CP300J56152;

(4)the City Solicitor be authorized and directed to take the appropriate action, in conjunction with Province of Ontario Officials and/or agents, to complete the transaction on behalf of the Corporation and he be further authorized to amend the closing date to such earlier or later date as he considers reasonable; and

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

Council Reference/Background:

The Province of Ontario is the owner of 132 Everden Road, subject to a ninety-nine year lease in favour of the City of Toronto. By its adoption of Clause No. 1 of Report No. 3 of The Corporate Administration Committee on February 12 and 13, 1997, Metropolitan Council declared the property surplus pursuant to By-law No. 56-95 and authorized its disposal. The procedures with respect to By-law No. 56-95 have been complied with, a utility canvass has been completed and the easement requirement detailed herein has been identified.

By its adoption of Clause No. 4 of Report No. 9 of The Corporate Services Committee on July 8, 9, and 10, 1998, Toronto Council authorized that properties listed in Schedule "A", including the subject, be sold to sitting tenants at market value determined as at the date of expression of their interest and further that such sale be subject to an option to repurchase at that purchase price (unadjusted) for a period of two years. Accordingly, the tenant was provided with our February 25, 1997 appraisal estimating the fair market value of this property at $230,000.00 together with an agreement of purchase and sale.

Comments:

The tenant, Mr. Gabriel Heti, rejected the City's appraised value, and requested the matter of market value be referred to arbitration in conformance with Council's directive to have a third party arbitrator attempt to bring the parties together. (Clause No. 4 of Report 9 of the Corporate Services Committee adopted as amended by Council at the meeting held on July 8, 9, and 10, 1998). An arbitration hearing was held on December 11, 1998, at which time both parties presented oral and written submissions in support of their respective estimates of market value. In a written decision, the arbitrator, Ms. Patricia Dunn stated that a sale of the property on the open market at the valuation date would have resulted in a purchase price in the range of $225,000.00 to $230,000.00.

Subsequent to the arbitrator's decision, Mr. Heti submitted the following offer:

Property Address:132 Everden Road .

Legal Description:Lot 20, Registered Plan 2339, City of Toronto (formerly City of York).

Lot Size:7.62 metres (25 feet) fronting onto Everden Road,

32.3 metres (106 feet) depth.

Location:West side of Everden Road, north of Gloucester Grove.

Improvements:Detached, brick 2-storey dwelling.

Right-of-Way:Subject to a mutual right-of-way.

Easement:Title to the property will be conveyed subject to a sewer easement in favour of the City of Toronto registered on Part 4, 64R-7314 as set out in Instrument Nos. CA493046 and CA510705.

Occupancy Status:Tenanted.

Date Interest Expressed:February 25, 1997.

Amount of Offer:$225,000.00.

Deposit:$7,000.00 (bank draft).

Purchaser:Gabriel Heti.

Closing Date:March 31, 1999.

Terms:Cash on closing, subject to the usual adjustments and registration of an option to purchase.

The third party arbitrator having received written and oral submissions relative to the value of the property has rendered a written decision in which she expresses that fair market value is in the range of $225,000.00 to $230,000.00. It is therefore recommended that Mr. Heti's offer be accepted.

This is a proposed sale to an existing tenant and is based on market value as at February 25, 1997. Council directed that comparable sales data be provided for property sales in the Spadina corridor. Appendix "A" identifies three comparable sales located in the vicinity of the subject.

The revenue sharing agreement with the Province as regards the Spadina corridor properties (former Metropolitan Corporate Administration Committee, Report 25, Clause No. 1, approved December4, 1996) stipulates that the properties are to be sold at current market value and the revenues are to be shared on that basis. An appraisal report with an effective date of October 6, 1998 estimates the value of the property at $280,000.00 which is the basis upon which the revenues are to be shared. The provincial share of the net proceeds from this sale will therefore be approximately $93,333.33, less administrative costs and normal adjustments.

Conclusion:

The sale of this property at $225,000.00 is considered fair and reasonable, reflecting market value as at February 25, 1997 in accordance with Council directives.

Contact Name:

S. Badin, Valuator-Negotiator, Real Estate Services, (416) 392-8142, Fax No. (416) 392-4828 E-Mail Address: sheryl_badin@metrodesk.metrotor.on.ca.

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Appendix "A"

132 Everden Road - Comparable Sales

The following three addresses represent recent comparable sales of properties that are similar to the residence which forms the subject matter of this report. These three properties consist of brick bungalows located in the vicinity of the subject property.

Approximate

AddressLot SizeSale PriceDate of Sale

38 Gloucester Grove 25 x 100$255,000.00August 15, 1997

117 Everden Road25 x 132$268,000.00October 9, 1997

527 Rushton Road 25 x 120$217,500.00May 28, 1997

The Corporate Services Committee reports, for the information of Council, having also had before it a communication (February 2, 1999) from Mr. Gabriel Heti, requesting an opportunity to appear before the Corporate Services Committee respecting his offer to purchase the property located at 132Everden Road; and outlining events that have occurred over the last two years respecting the sale of the Spadina Properties.

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The following persons appeared before the Corporate Services Committee respecting the Sale of Surplus Spadina Project Properties:

-Mr. Gilbert Zamonsky, and gave an overhead presentation in regard thereto;

-Ms. Judy Eversen;

-Ms. Eleanor Lavender, and submitted a brief in regard thereto;

-Ms. Maria Vertolli;

-Mr. Gabriel Heti, and submitted appraisal figures respecting 132 Everden Road; and

-Councillor Howard Moscoe - North York Spadina.

(A copy of the map attached to the aforementioned report was forwarded to all Members of Council with the February15, 1999, agenda of the Corporate Services Committee and a copy thereof is also on file in the office of the City Clerk.)