Toronto Community Housing’s interim CEO defended the proposed sale of a whopping 706 houses on Friday, arguing that although 2,600 tenants will be forced into subsidized apartment buildings, the proceeds will improve units for many more of the agency’s residents.
“This plan is going to provide existing tenants with better quality housing … it’s going to improve the value of our housing assets. It’s going to help a larger number of citizens of Toronto,’’ interim CEO Len Koroneos said in an interview.
Toronto Community Housing Corp. staff are proposing the city sell 706 houses and other “stand-alone units” currently home to 2,638 tenants in more than 30 neighbourhoods across Toronto.
The tenants would be moved into apartment buildings as the houses are sold over time. The hundreds of millions of dollars in forecast profits are to be invested in repairing multiple-unit buildings, which are cheaper to maintain.
City council’s permission will be needed for the sale, and the provincial government would also have to agree to the sale of all but 20 of the buildings. The province has yet to approve the sale of 22 TCHC homes council voted to get rid of earlier this year.
Because the latest homes are to be sold over several years, TCHC says there’s no risk of flooding the market and devaluing properties, the report says. TCHC will be able to control when to list them.
An equivalent number of existing market units will have to be converted to rent-geared-to-income.
TCHC is considering investing proceeds in an endowment-style fund or low-risk investment portfolio that would allow the principal to remain intact, while interest earned is used to reduce the repair backlog.
The proposal, in a report going to the TCHC board Oct. 21, was swiftly condemned by Councillor Paula Fletcher, whose Toronto-Danforth ward includes many of the units.
“This is the Fords’ ‘for sale’ strategy, this is the ‘everything must go’ strategy and we’ll worry about the people affected later,” Fletcher said.
“This is the end of the mixed-income model, the Toronto model, and is sending the message that low-income people are not to live in communities with higher-income people.”
In fact, TCHC is revitalizing its Regent Park housing project and has done so at its Don Mount project based on the concept of mixed-income housing. Rather than concentrating people in subsidized apartment towers and mid-rise buildings, those areas feature condos, market rentals, and subsidized townhomes.
Similar plans are being developed for Lawrence Heights in North York and Alexandra Park downtown.
However, the TCHC report admits that one of the implications of the proposed sale of the 700 houses will be an “increase in the concentration’’ of rent-geared-to-income units.
Koroneos acknowledged this risk, but said the mixed-income strategy has to make financial sense.
The TCHC report says evicted tenants would be supported with help in finding another unit, moving costs, and costs incurred with relocating utilities and having mail forwarded.
The buildings are thought to be worth just under $400 million, with the value of individual properties ranging from $200,250 to “well over $1 million.”
Coupled with not having to pay for upkeep of the sold units, the sales could free up more than $12 million per year for repairs of other TCHC stock, the report suggests.
TCHC has a backlog of needed repairs of about $650 million. It warns that the tab will rise to $1 billion by 2015. The per-unit cost of maintaining a house is about double that of lowrise apartments.
The properties on the block include single-family homes; properties purchased years ago for “non-housing purposes” and later transferred to Cityhome, a predecessor of TCHC; and houses leased to agencies that used them as group homes.
Donna Lewis, a single mother of four whose TCHC home in Toronto’s east end may be sold, called the proposal a “bad idea,’’ adding that she did not want to move her young family into a community housing complex.
“Right now, we’re on a regular street with regular people,” she said. “I don’t want my kids to grow up in the projects.’’
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