Item - 2021.PA24.4

The Board of Directors of Toronto Parking Authority:

1.  Authorized the President, Toronto Parking Authority to make additional expenditures of not more than $135,011 excluding Harmonized Sales Tax to cover additional construction build out costs, closing costs, and any other unforeseen final closing related costs related to 9 Wellesley Street West for a total acquisition cost of up to $7,405,382 excluding Harmonized Sales Tax.

2.  Directed that Confidential Attachment 1 to the report (May 10, 2021), from the President, Toronto Parking Authority remain confidential in its entirety as it relates to a position to be applied to negotiations being carried out by Toronto Parking Authority.

Toronto Parking Authority entered into an Agreement of Purchase and Sale with Lanterra Developments (Bay Wellesley) Limited (referred to as the Vendor) for the acquisition of a municipal parking facility containing 134 parking spaces at 9 Wellesley Street West (the Property, Car Park 304). The transaction involves the acquisition by the City of a stratified interest in a below-grade portion of the Property within which a municipal parking facility is to be located and form part of a mixed commercial/retail/residential development.

Construction of the development, including the municipal parking facility, is completed and the parking facility was turned over to Toronto Parking Authority on May 6, 2021. Operation of the facility is planned to commence on May 10, 2021. Toronto Parking Authority has undertaken a comprehensive physical review of the parking garage and has confirmed that the garage has been constructed in accordance with the Agreement of Purchase and Sale and Toronto Parking Authority standards and specifications except where variances to requirements may have otherwise been agreed.

The purpose of this report is to request approval from Toronto Parking Authority Board of Directors for additional funding of $135,011, excluding Harmonized Sales Tax, to act as a modest contingency allowance to cover build-out, closing costs, as well as any other unforeseen final closing related expenditures. The additional project costs will result in the total project costs increasing from $7,270,371 to an amount not exceeding $7,405,382 excluding Harmonized Sales Tax.

Toronto Parking Authority has updated its financial analysis of the acquisition to include a conservative estimate of the additional costs and is satisfied that Toronto Parking Authority’s Internal Rate of Return on the acquisition will continue to exceed its benchmark.