A dispute with a landlord over a steep rent hike for one of its shelters in Scarborough is forcing the city to look into other options to save the facility — including expropriating the property.
Toronto's Shelter, Support and Housing Administration (SSHA) has been a tenant of 1229 Ellesmere Road since 1996. It operates Birkdale Residence out of the building, a shelter for women and children that can accommodate 65 families.
According to city documents, Toronto recently paid nearly $96,000 a month to rent the building until its contract expired last September. At that point, the landlord wanted the city to renew its lease at $125,000 a month — an increase of nearly $29,000.
Staff agreed to a six-month extension at that price, which expired Friday. Coun. Michael Thompson, who represents Ward 37, Scarborough Centre, said the city is unwilling to continue paying that much.
"Staff have been directed to meet with the owner of the building in order to negotiate a lease that would be much more conducive to the city and the tenants," Thompson told CBC Toronto.
In January, the city issued a report which recommended staff start the expropriation process if negotiations with the property owner were unsuccessful. "Due to the sensitive use of the site," the report states, "this property acquisition is necessary to ensure its continued use as an emergency shelter."
"The shelter is extremely important, and we unfortunately have great demand for its services," Thompson said. "The city has an obligation to provide those services, and the city also has an obligation to make sure it's paying an appropriate price."
CBC Toronto confirmed the city's Real Estate Services department is still in talks with the landlord to renegotiate a lease. The January report states the owner "anticipates being able to receive a higher price elsewhere."
Still, Thompson said the shelter will continue to operate as normal while the talks continue.
"The shelter will not be closed anytime, but we certainly are hopeful that both sides could reach an amicable agreement that would be favourable to the landlord and to the city, and by extension the taxpayers of Toronto," he said. "Clearly we will not allow a situation where we are not able to provide the service to women who are in need of shelters."
If both parties are unable to reach an agreement, city staff will then look into moving forward in the expropriation process, which Thompson says is a last resort.
"It's something the city takes seriously when we utilize that type of measure," he said.
"It usually means we're in a condition where there's a need to act."