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A Toronto Community Housing spokesperson announced on Oct. 25, 2013, that president and CEO Gene Jones had written a letter to the Chair of the Board to formally withdraw a proposal that included leasing additional office space downtown while renovating the Rosedale headquarters at a cost of $2-million.Michelle Siu/The Globe and Mail

The president of Toronto's public housing authority has backpedalled on a proposal to spend $2-million upgrading and expanding the organization's headquarters.

Toronto Community Housing Corp. president and CEO Gene Jones released a letter Friday sent to the chair of the board, Bud Purves, to formally withdraw the proposal that included leasing additional office space downtown while renovating the TCHC headquarters in Rosedale.

"When I saw the information coming back from directors, staff and residents, I decided to sit down and talk to my staff," Mr. Jones said in an interview, adding he will now try to find other options to deal with space limitations at the Rosedale office. "We're going back to square one; we're going to start the process over again."

He said staff would bring back new proposals in 2014, making do with the space they have in the meantime. The housing authority is facing a projected repair backlog of $1-billion, and residents were vocal Thursday in their reaction to priority being given to an office renovation.

Toronto Mayor Rob Ford told Newstalk1010 Friday morning he was "livid" over the proposal. He said the money should be put toward repairs. At a news conference at Etobicoke Civic Centre, where he was meeting with TCHC tenants, the mayor said Mr. Jones's decision to withdraw was the right choice.

"I called him this morning and left a message," the mayor, who was celebrating the three-year anniversary of his election, told reporters. "It's a smart move. Gene Jones is a good guy, but that really bothered me when I heard that kind of money [was] going into the Rosedale operation."

The TCHC's board of directors voted Thursday to postpone deciding on the proposal to see the headquarters at 931 Yonge St. renovated to include more rooms, new furniture and replace fixtures, as well as leasing office space at 777 Bay St.

On Thursday, Mr. Jones defended the proposal, saying the office space was inadequate and compromising the staff's ability to work. "This building was moved into in 2004. There have not been any recent improvements," Mr. Jones said.

"Come look at my office. Look at the CEO's office. It looks like a little manager's office. It's so small, I'm embarrassed to bring anyone up there."

City Councillor Maria Augimeri, who sits on the board of directors, said she has received numerous calls from constituents and TCHC tenants who were appalled by the proposal.

"People are outraged that it was brought up at all and I agree with them," Ms. Augimeri said.

The board had previously voted to sell the Rosedale property and use the money to move into an office space closer to the TCHC community. Mr. Jones said the plan remains to sell the building eventually.

"I've got major things I need to accomplish," he said. "This office relocation is secondary, but it's needed and we'll address that when we have staff look at it again."

Ms. Augimeri said staff should be looking at selling the building now and reinvesting the profits into repairs.

"It's a prime piece of property. It's literally beside Rosedale subway station on Yonge Street north of Davenport [Road]. It's got to be worth a pretty penny."