A creative resolution to a long-stalled land sale in downtown Toronto has meant a three-fold increase to the charitable foundation of the Catholic Children’s Aid Society (CCAS), in a move that could serve as a model to other non-profits looking to maximize the benefits of valuable land across the city.
Last year the CCAS closed a deal to sell its headquarters at 26 Maitland St., near the Church and Wellesley neighbourhood, to Toronto’s Plazacorp, a major property develop that builds high-rise, low-rise and commercial projects. Plaza and CCAS initially came to terms on the land in 2011 and Plaza had announced plans for a potential condo tower on the site. But the conditional offer languished without finalizing until along came Rob Tkatch, senior vice-president at Devencore Realties Corporation Canada Ltd., which acts as a broker and advisor for organizations looking for commercial space.
“Our job is to keep our ear to the ground and I heard from other developers [the land] had sold, but there was something going on with the developer. So I said maybe I can help get this closed for you,” Mr. Tkatch said in an interview. He said he knew the Maitland site was slated for development and that the CCAS would need a new home and he had some ideas for where they could end up. As a buyer’s broker, he said, he was in a unique position to represent the CCAS. “For a public organization, we are able to represent their interests without any biases and without any conflicts.”
Mr. Tkatch said what had been holding Plaza up was a desire to buy an adjoining lot. But while they negotiated, land prices in Toronto escalated rapidly. Initially, the deal would have paid CCAS about $17-million, but by 2019 Mr. Tkatch felt he could find bidders to do better. Devencore drummed up some alternative bids to present to CCAS and Plaza, which resulted in a new higher price of $27.9-million. The deal was closed in the summer of 2019.
At the same time CCAS had hired a new executive director, Mark Kartusch, who was looking at all the charity’s operating costs. The organization was spread across four office sites in the city, but when Mr. Tkatch presented a proposal for a lease to relocate the Maitland staff to a mid-rise office tower at 2206 Eglinton Ave. – formerly occupied by Aviva insurance – Mr. Kartusch pushed to consolidate his entire 450-person staff in that new location this past November.
The move to Eglinton also shaved millions off CCAS expected moving costs (they had initially budgeted $11-million to move back into a reconfigured Maitland space after construction). The new deal plus the lower costs ended up netting CCAS about $26-million in profit, which was transferred into the capital fund of the organization’s charitable foundation, which leapt from about $9-million in endowments to close to $35-million.
“That was one of the big selling features of this,” Mr. Kartusch said. "Basically, we convert some capital tied up in a building and property, and put it to good use. The approach we’re taking at the foundation is not to deplete that, but to use the investment proceeds for the good deeds and good efforts we want to use in the community. Together at any one point we are directly supporting about 580 children and youth but working with around 6,000 [5,957 last year] children in their families in the community.”
The CCAS is a 125-year-old organization that focuses on children in families of the Catholic faith. The 2011 national household survey pegged Toronto’s Catholic population at 725,565 with 111,370 people up to the age of 15, represented roughly 26 per cent of the city’s child population.
In an odd twist, the rising land values that enabled the sale are connected to some of the issues CCAS manages. “The problems we encounter, only 20 per cent of the cases are pure and direct allegations of child abuse. Usually when were involved it’s a collision of a whole bunch of issues: housing and poverty among them.”
On a recent field visit, Mr. Kartusch met with a father who had been “renovicted.” “He ended up having to be placed in housing in a hotel for four months with three kids. The affordable apartment options were one-bedrooms. A three-bedroom was $3,500 a month … that’s almost cruel.”
The new money in the foundation can’t solve that problem, but Mr. Kartusch said it can help in other ways. “That was one of the things the foundation did … helping the dad out with some Christmas stuff, ‘Here you go, you can have some gifts for the kids.’”
The new foundation funds will also go to bursaries and education grants and other programs for children in CCAS care. “We become their de facto parent, and as they transition to adulthood we can fund things when needed on an emergency basis. We’re hopeful [with this money] the future of child welfare is going to better and stronger.”
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