Former Ontario finance minister Greg Sorbara's family owns apartment buildings and commercial properties on land near a proposed new subway stop in Toronto, leaving it poised to reap the benefits of higher real estate values if the expansion goes ahead, a real estate executive says.
The family's real estate development companies own the properties just south of the intersection of Finch Avenue West and Keele Street, according to land registry documents and corporate records. The land houses 575 units in four nine-storey apartment buildings and a Midas Muffler shop.
It is also the site of a planned Kentucky Fried Chicken fast-food outlet. KFC is moving into the site once leased by McDonald's Restaurants of Canada Ltd., which opened its first outlet in Toronto there in 1969. McDonald's relocated a few doors north along Keele in January, closer to where the subway station would be at Finch and Keele.
Mr. Sorbara's older brother, Edward, manages the day-to-day operations of the Sorbara Group, which was founded by their late father, Samuel, more than 50 years ago, and today owns more than 6.5 million square feet of property in the Greater Toronto Area. Samuel's four children each own a 25-per-cent interest in the Sorbara Group.
In a telephone interview yesterday, Edward Sorbara disputed assertions by real estate executives that the long-promised subway extension would enhance the value of real estate in the area.
"I don't think the subway's going to do magic for my apartments, and make them all of a sudden that much better," he said. "I think you're trying to write an article to embarrass my brother."
The Sorbara Group acquired the properties in the 1960s, according to land registry records. Greg Sorbara himself has not been involved in the family business since he was sworn in to Premier Dalton McGuinty's cabinet in October, 2003. But he has long pushed for the extension of the Spadina subway to York University and is at the centre of a controversy over a leak of the provincial budget, which will be unveiled today.
The Toronto Star reported this month that the government plans to spend $1.5-billion expanding the subway line to York University. Michael Di Biase, Mayor of Vaughan, has said he concluded that the government was poised to announce the much-anticipated expansion after an informal chat with Mr. Sorbara at a Liberal Party fundraiser.
He recalled Mr. Sorbara telling him a "good news story" would be coming up in the budget. Mr. Sorbara could not be reached for comment yesterday, but he has previously denied this, saying he has no idea what's going to be in the budget.
Mr. Sorbara was forced to resign from cabinet last October when he was named in RCMP search warrants in connection with a criminal investigation into Royal Group Technologies Inc. He has professed his innocence, saying he has been wrongly accused.
A real estate developer who asked not to be named because he has done business with the Sorbara Group said the proposed subway extension would be a boon to the area.
"Everybody's real estate is going to go up in value," he said.
Edward Sorbara disagreed. "The value [of the apartment buildings owned by the family]is based on the rent that they generate and the fantasy of the people who own them thinking that some day they'll be worth more," he said.
He said the apartments were built in the late 1960s and are in what he termed the less ideal "have-to-rent" market as opposed to the more desirable "want-to-rent" market.
With a report from Celia Donnelly