Item - 2023.RA3.5

The Board of Directors of CreateTO:

1.  Approved the approach outlined in Confidential Attachment 1 to the report (March 14, 2023) from the Chief Executive Officer,  CreateTO, as amended in closed session, and authorized the Chief Executive Officer, CreateTO to negotiate the implementing amendments to the agreements for 50 Wilson Heights which include the Ground Lease, Agreements of Purchase and Sale, Project Agreement, Development Agreement and the Contribution Agreement (the "Agreements") and such other terms and conditions deemed appropriate by the Chief Development Officer and Executive Vice-President, Asset Management and the Chief Legal Counsel and Corporate Secretary, subject to the necessary City of Toronto approvals.

2.  Directed the Chief Executive Officer, CreateTO to request the necessary City of Toronto authorities required to execute the amendments to the Agreements and such other documents as may be necessary to finalize the arrangement with the Proponent partners for 50 Wilson Heights Boulevard based on the approach described in Confidential Attachment 1 to the report (March 14, 2023) from the Chief Executive Officer, CreateTO, as amended in closed session.

3.  Directed that the Confidential Attachment 1 to the report (March 14, 2023) from the Chief Executive Officer, CreateTO remain confidential in its entirety as it contains information that relates to and deals with a pending disposition of land by the Board of Directors of CreateTO and the City.

The Board of Directors of CreateTO recessed its public session to meet in closed session to consider the item as it pertains to pending disposition of land by the Board of Directors of CreateTO and the City.

Located at the northwest corner of Wilson Avenue and Wilson Heights Boulevard directly adjacent to the Wilson subway station, this Phase 1 Housing Now site was released to the market for a developer partner in the fall of 2019.

Currently a TTC commuter parking lot, CreateTO had successfully led the re-zoning of the property obtaining approvals in February 2020 to allow for approximately 1,484 residential units, a child care, community use space, a public park, a new public road, retail and office space. 

Following completion of the market offering process in January 2020, the successful proponents, Greenwin Holdings Inc. and Tridel Builders Inc. (the 'Proponent') executed the Ground Lease term sheet as well as the Freehold Transfer term sheet on August 31, 2020.

On October 31, 2020 the due diligence period for the transaction had expired with Greenwin and Tridel waiving conditions to firm up the transaction.

On December 4, 2020, the CreateTO Board of Directors adopted Item RA19.7 and approved negotiated agreements which included the Ground Lease, Agreements of Purchase and Sale, Project Agreement, Development Agreement and the Contribution Agreement (the "Agreements").

In January 2021 senior City management approved entering into signed Agreements with Greenwin Holdings Inc. and Tridel Builders Inc.

On September 17, 2021 the Agreements were executed by both the City of Toronto and the Proponents however the Agreements are still conditional on satisfactory financing. 

While the Proponent has been diligently advancing their subdivision approvals and site plan applications, significant cost inflation in construction and financing since 2021 have substantially reduced the proponent's projected returns from the original proposal. Throughout 2022, Greenwin, Tridel, CreateTO and the Housing Secretariat have been in discussions on how to overcome these obstacles in order to start construction and deliver a substantial amount of affordable rental housing units along with other City building contributions at this site. These obstacles and an approach to resolve these issues are outlined in Confidential Attachment 1. This approach has been approved by Executive Director, Housing Secretariat and senior City Management. 

The proposed amendments to the original terms as outlined in Confidential Attachment 1 have also been reviewed and discussed with the fairness monitor who oversaw the original market offering process.  The fairness monitor was in agreement with the rationale for offering the additional financial supports due to the current market pressures which has changed the dynamics of this project.  The fairness monitor concluded that there were no fairness concerns with amending the original terms due to these factors. 

This report recommends that the CreateTO Board of Directors approve the approach outlined in Confidential Attachment 1, which responds to the significant change in the development and financing markets over the past year and ensures the project's viability and delivery of 383 affordable rental housing units within the first phase of development.  Approximately 520 affordable rental units will be provided at project completion.

The report also recommends that the CreateTO Board of Directors direct the Chief Executive Officer, CreateTO to request the necessary City of Toronto authorities to execute the necessary amendments to the Agreements and any other such documents as may be necessary to finalize the arrangement with the proponent partners for 50 Wilson Heights as described in Confidential Attachment 1.

Subject to approval of this report, CreateTO will collaborate with City legal to make the necessary amendments to the Agreements and prepare for execution of the necessary documents. 

Pending planning approvals, the current schedule is to start site servicing construction in Fourth Quarter 2023.