Why did Toronto buy WE's former HQ?

Why did Toronto buy WE's former HQ?

National Post


Nine months ago, Doug Fisher, a longtime resident of Cabbagetown in Toronto, contacted Mayor John Tory’s office about concerns he had regarding the city’s decision to turn a commercial building in his neighbourhood into a women’s shelter.

He found the decision odd — why would the former headquarters of WE Charity, that was smack in the middle of a commercial street and greatly in need of extensive renovations to be converted into a shelter, be picked by the city for this very purpose?

“None of it made much sense to me,” he told the Post.

This was long before WE Charity and the Kielburger brothers became central figures in a political controversy involving a $912-million student grant contract.

This week, the subject of how 233 Carlton Street, the former headquarters of WE Charity, came to be leased by the City of Toronto was back on the agenda as the city councillor for that ward, Kristyn Wong-Tam, tabled a motion questioning how the property first came to the attention of city officials.

“Numerous residents have contacted my office requesting information be made public regarding the City’s lease agreement for 233 Carlton Street and any relationships between the City of Toronto, WE Charity, ME to We Social Enterprise or the Kielburger family,” the motion read.

In a brief interview, Wong-Tam told the Post that she is pushing for full transparency into how and why the location was picked out of numerous buildings in the area that were perhaps more suitable for the purposes of a women’s shelter.

“I was not consulted properly prior to city staff signing the lease agreement. If WE Organization solicited the city to bring this property to their attention, then we should know about it. Is the lease price in line with comparable properties in the area? I don’t think these questions are unreasonable,” she said.

As of Wednesday evening, the motion was adopted, and supported by Tory.

“The Mayor supports Councillor Wong-Tam’s motion and voted to add it to the Council agenda today because he has always been fully accountable and transparent about this issue,” said Don Peat, the mayor’s communications director.

Long before he was mayor, Tory was a friend of the Kielburgers. He attended Craig Kielburger’s wedding in 2016, even posting a picture on Twitter that day saying how “thrilled” he was to sign the register at the wedding.

He was also a volunteer at WE events and travelled to Kenya in late 2008 with WE, along with his sister Jennifer Tory, a former RBC executive. The RBC Foundation was one of WE’s biggest charitable donors, and the bank itself was a major sponsor of WE-related events and programs. It recently cut all sponsorship and donor ties to the beleaguered charity.

The mayor’s office says the decision to sign a lease with 233 Carlton Street was not made by Tory himself, nor did he have any discussions with any of the Kielburgers about the transaction. “Any suggestion or statement suggesting otherwise is false,” said Peat.

233 Carlton Street is owned by 1622774 Ontario Ltd., a numbered company registered to Fred and Theresa Kielburger, and was bought by them for $1.47 million in 2004, property records show. The building was used as WE Charity’s headquarters for 14 years, rent-free, until the charity moved a few blocks south to its sprawling $30 million WE Global Learning Centre headquarters in 2018.

Around the same time, the city was looking for a new home for one of its downtown Toronto women’s shelters, the Adelaide Resource Centre for Women which had outgrown its own premises.

WE Charity says that the Kielburger parents were approached by an independent real estate agent who was hired by the City of Toronto to seek out possible sites to lease. That was confirmed by a city spokesperson, who said the city hired Lennard Commercial Realty Brokerage to scout out locations.

The end result was a 10-year lease starting January 1, 2020 for $6.1 million, and an agreement by the city to take on the cost of a $3.7 million renovation, documents show.

“Planned renovations include the addition of a new elevator for accessibility requirements, kitchen, showers, programming areas and a rooftop patio,” the copy of the lease agreement obtained by the Post, reads.

Fisher, a former co-ordinator of the Cabbagetown Business Improvement Area (BIA), said that the choice to turn 233 Carlton into a women’s shelter was simply odd, because the building’s existing layout as a commercial office building had to be “wrenched out of shape to fit a respite centre’s special needs”.

“There’s a lot of talk about WE’s presence in the area but actually, they kept a lot of businesses afloat because there were all these kids around who needed to go for lunch. They are missed, in that sense. So I don’t have an issue with WE, I want to make that clear,” he said.

“But I was pretty unhappy with what happened with 233 Carlton. There are four other buildings I can think of in the area that would be much more suitable. I would just like more answers on how this building was chosen,” he added.

Fisher’s views were echoed by more than 10 other residents of the Cabbagetown neighbourhood that the Post spoke to over the course of the week, although a few of them said that certain residents just disliked the idea of a shelter being located in what is considered a commercial area of the neighbourhood.

“This is a part of Toronto that certainly has more shelters than perhaps other, more affluent areas, and I think there are some residents who want to change that. However, 233 Carlton being turned into a shelter was certainly unexpected, because it is quite small, and a row house on a street with a whole host of other commercial businesses,” one resident said.

In a statement to the Post, City of Toronto spokesperson Bruce Hawkins said that the city had sought a building for the women’s shelter that was in “close proximity to the current location and was close to transit and related community services” besides having “adequate space” that could be renovated to meet accessibility needs.

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Hawkins said there were just “one or two direct telephone conversations with Marc Kielburger prior to the lease being signed, and the conversations revolved around the “type of program that could be offered” and the “installation of an elevator”.

In her motion, Wong-Tam also raised the need to clarify whether the city had paid a fair market value to rent the building. A previous listing to lease the property, obtained by the Post, showed that 233 Carlton was available for rent from the end of 2018 to March 2019 when the listing expired, for a base rent of $289,484 per year, less than the $331,604 that the City had agreed to pay to the Kielburgers annually for the building.

Hawkins told the Post that the city did not believe it had overpaid to lease the property. “There are a number of factors that determine the price/value of a property.”

Wong-Tam says that she cannot speak to the decisions that city staff might have made to choose the property.

“But the criteria of how it was picked is not clear to me. I think we need to clear the air, once and for all, so we know the decision that was made on 233 Carlton was grounded in proper research and facts.”

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