Item - 2019.PA10.1

The Board of Directors of Toronto Parking Authority:

1.  Approved that the property transaction be directed through the real estate approval process, as outlined in Section 8.1 (Delegated Real Estate Authority) of the City of Toronto Municipal Code Chapter 179, Toronto Parking Authority, to seek City delegated authority approval of the property transaction, which will involve:

a.  purchasing the portions of an underground public parking garage located at 400-420 King Street West on the P1 level to accommodate a minimum of 22 spaces and a maximum of 25 spaces at a cost of $75,000 per space plus Harmonized Sales Tax under a Purchase and Sale Agreement for total costs ranging from $1,650,000 (plus Harmonized Sales Tax) for a minimum of 22 spaces and up to $1,875,000 (plus Harmonized Sales Tax) for the maximum of 25 spaces;

b.  entering into all ancillary agreements, including, but not limited to, reciprocal cost-sharing agreements, along with all necessary transfers, easements, and undertakings; and

c.  incurring additional Toronto Parking Authority expenditures of up to $150,000 to cover ancillary costs associated with this project, such as legal fees, Harmonized Sales Tax, and Land Transfer Tax;

substantially on the terms and conditions in Appendix B to the report (November 8, 2019) from the Acting President, Toronto Parking Authority, and on such other terms and conditions deemed acceptable to the President, Toronto Parking Authority, and the Deputy City Manager, Corporate Services, in consultation with CreateTO.

Toronto Parking Authority (TPA), CreateTO, and City Real Estate Services (City RES) are proposing major business terms of a property transaction that involves the acquisition of underground parking spaces located at 400-420 King Street West (collectively, the Property) from Charlotte King Residents Corp. (the Developer) in connection with a rezoning application for the Property. The proposed transaction involves the acquisition of a strata area that is sufficient to accommodate the portions of an underground parking garage that will provide a minimum of 22 spaces, up to a maximum of 25 spaces, on the Property.

Charlotte King Residents Corp., the owners of 400-420 King Street West (the Property), have submitted an application to amend the City of Toronto's Zoning By-law to permit a 49-storey mixed-use building with approximately 633 residential condominium units, 10,391.9 metres square of retail and office space, and 136 underground parking spaces.

Following lengthy negotiations between the Developer, City Planning, and CreateTO, an opportunity has been identified to add municipal parking in this location to offset some of the 180 on-street spaces that were removed as part of the King Street Transit Priority Corridor, including 31 spaces within one block of the subject site.

The proposed transaction forms part of a proposed settlement between the City and the Developer that was endorsed by City Council at its meeting of July 16, 17, and 18, 2019. The settlement will be further considered by the Local Planning Appeal Tribunal.

TPA has conducted a business case analysis to support the acquisition of the public parking spaces. The business case analysis identifies an Internal Rate of Return (IRR) of 9.1 percent, which meets the 5 percent benchmark criteria established by TPA policies and guidelines for the acquisition of new facilities.

This report is requesting that TPA Board of Directors approve that the property transaction be directed through the City RES delegated approval process to authorize a Purchase and Sale Agreement to acquire 22-25 underground parking spaces at 400-420 King Street West from the Developer for a purchase price of between $1,650,000 and $1,875,000 ($75,000 per space). Additional funding of up to $150,000 in associated closing costs are also required. Sufficient funding is available in TPA's 2019 Capital Budget and 2020-2028 Capital Plan for this purchase.