Open Letter Re: The Cultural Space at 36 Lisgar

June 15, 2015

The state-of-the-art, purpose-built media arts facility we secured in 2011 through a Section 37 deal with condo developer Urbancorp and the City of Toronto has been ripped out from under us just as we were preparing to move in. We are frankly mystified by the lack of support and facilitation the City provided to ensure Urbancorp did not default on this deal.

Interference instead of facilitation

Despite a fully executed purchase agreement that obligated Urbancorp to build and deliver this space to TMAC, Urbancorp failed to complete work and close on the property by its deadline.

With construction nearly done, and TMAC agreeable, there was no reason for Urbancorp not to extend this date in order to give itself time to complete the work and close the transaction.

Instead, the City of Toronto directed Urbancorp to allow the date to pass, apparently because it intended to hand the facility over to real estate developer Artscape in the final hour. [Edited June 26 to add: Indeed, Artscape CEO Tim Jones confirmed in the media that Artscape became involved in our project at the City’s request weeks before the outside date of our agreement, and “recommended ‘a reset’ to city officials and the developer” — despite our rejection of Artscape’s offer of “assistance”]

The role of the City was to facilitate the agreement and ensure Urbancorp delivered on its promises to the community and TMAC. That it failed to do so demonstrates not only bad faith but also a gross breach of community trust.

In what we believe was an attempt to justify this interference and discredit TMAC, our local Councillor Ana Bailão made unreasonable and irrelevant requests — just weeks before Urbancorp’s deadline — under threat of “canceling” our agreement, which she had no power or authority to do.

We obliged, but were in effect ignored.

It is worth noting that Councillor Bailão sits on the Artscape board of directors and Alan Saskin, President of Urbancorp, is the chair of the Artscape Foundation board of directors.

Implications

Urbancorp refused to close the transaction by the deadline, despite acknowledging TMAC was ready, willing and able to close. Because of their failure:

  • The agreement was terminated on an easily amendable point intended to protect TMAC, not punish it
  • Urbancorp is relieved of its obligation to complete and deliver the TMAC space, while still enjoying its lucrative density bonus
  • We have been forced to take legal action against the City of Toronto and Urbancorp in order to protect our rights

While Urbancorp suffers no consequences for its default, and indeed enjoys the profits of its 6-story density increase, TMAC is left to answer to public and private funders who relied on the City’s purported support. Our member organizations are now scrambling to relocate. And four years of cash-strapped arts administrators’ time has been wasted designing, stewarding, and planning a future in a facility that will now be handed over to a different owner.

The disastrous consequences of the City’s bad faith and Urbancorp’s self-interest apply not only to TMAC and its member organizations, but also to all Toronto arts non-profits. Trust between provincial and federal arts funders and the City will be deeply eroded. The impact of public input on community benefit contributions is in doubt. It’s unlikely another deal like this will ever happen again if the termination of our agreement is not reversed.

A gross breach of community trust

The community made its needs clear through the original consultation process in 2011.

Now, despite TMAC’s legal interest in the property, the City of Toronto is attempting to engage the public in a new consultation process to find a different operator for the space — even before responding to our claim.

TMAC remains ready, willing and able to close. All we want is for Urbancorp to deliver on the promises it made and complete the transaction — nothing more, nothing less. The City has the authority and right to compel them to do so, and a responsibility to protect this unique Section 37 benefit in West Queen West by facilitating its stewardship by the rightful and intended owner.