The Boards of Estonian House, Estonian (Toronto) Credit Union, Estonian Foundation of Canada and Tartu College (Madison group) organized a town hall style meeting to unveil their plans for the new Estonian community center at Madison Ave. The plans have been worked on behind closed doors and funded by contributions from the above organizations since 2013. This alternative approach was undertaken in parallel to the mostly public approach taken by the EM board alone.
The tight message control favoured by the above boards was carried over to the town hall meeting, ostensibly due to confidentiality agreement between Build Toronto and the Madison group. Only community members were permitted to the meeting and all filming and photography was initially prohibited. This request was later relaxed to cover only part of the meeting. The desire for such secrecy is highly questionable, as the purported goal of the town hall was to disseminate the information within the community and to build community support for this alternative solution. It is well understood that certain degree of confidentiality has to be maintained and this understanding has been part of the process throughout the EM development saga. This understanding has always been maintained by at least this publication (EWR). One can only speculate that such secrecy is partially fueled by the goal to minimize any neighborhood NIMBY type interference. But information always leaks, either from the board itself or through publicly available documents. One only has to look at the severe reduction to the scope of the Madison project from the initial and much larger 12 storey building to a considerably more modest two storey concept built over an open public square, mainly due to opposition initiated through the local ratepayers’ association, without any media involvement.
During the meeting, EM board members Raivo Remmel and Kia Puhm provided an exhaustive review of the work already undertaken by EM board and summarized the development process at 958 Broadview during the past 10 years. The key message during the review remained the same as in the past: EM in its current form is not viable, the rental revenues are falling, the debt is growing and the backlog of required maintenance work has become insurmountable. Since the EM and developer partnerships have fallen through (it was alluded that both the developer and EM were unwilling to assume the growing risks that came with the heritage designation, zoning restrictions and neighborhood opposition), it was time to offer an alternative solution.
The alternative solution offered by the Madison group and conveyed through presentation of conceptual drawings by the project manager David Kalm and architect Alar Kongats is essentially to sell the current EM and use the proceeds of the sale to finance the new community center at 9 Madison (currently the parking lot north of Tartu College).
Due to the confidentiality requirements cited by the Madison group, the more thorough and detailed review of the proposal has to wait for some unspecified future date. Since we respect the request for confidentiality, we cannot report about the development proposal itself, we can only offer some highlights of reactions to the proposal from the community members present at the meeting.
Reet Marten-Sehr on behalf of the EKN thanked the Madison group for their hard work, even if the work hasn’t been seen publicly and then invited everybody to EKN’s upcoming AGM.
Anne-Liis Keelmann asked about the proposed ownership structure for the new development. Ellen Valter answered that the question is still unresolved, but indicated that the Madison group does not want to saddle the new development with the current unwieldy share structure. The guiding principles for the new ownership structure will be that it is legal, in the best interests of the community and that it respects the interests of current EM shareholders. She added that in her personal opinion, the ownership should be based on personal, rather than organizational membership, but cautioned that this is still in early stages of development.
Kristi Sau-Doughty on behalf of EstDocs thanked the Madison group for their work in general and thanked them for remembering EstDocs in their plans.
Silvi Verder thanked the Madison group for their good intentions. She added that based on her long-time experience with lasteaed, kool and guides and despite the appealing design, the proposal does not meet the needs for the community. Neither the planned space nor the location is suitable for school or other community activities.
Tauno Mölder asked about Madison Group plans to fill the large expected gap between the proceeds of the sale of current EM and the proposed budget of the development. David Kalm answered that in addition to the money available from the sale of current EM, the financing is available from three other organizations, although the amounts are confidential. He added the plan is to proceed with phased development, so the fundraising can keep up as the building progresses.
Tauno Mölder then asked the question as a representative for the Toronto Estonian Rifle and Pistol Club whether the Madison plan includes any provision for the shooting club operation. David Kalm answered in the negative, citing mainly regulatory restrictions. Tauno Mölder then presented a statement that declared TEPP's opposition to the Madison proposal. TEPP also pledged to contribute $25K towards the renovation of the current EM, along with 500 hrs of labour. TEPP also challenged all community organizations to match this pledge.
Robert Keegan (sp) asked about noise and vibration coming from the subway system. Alar Kongats replied that this has been a consideration during design and appropriate measures have been utilized to minimize the interference.
He also asked about possible cooperation between Madison group and Ehatare (Eesti Abistamiskomitee Kanadas). Raivo Remmel answered that it has been looked at, but since the needs of Ehatare are very different from the needs of the rest of the community, the cooperation or joint build is not possible.
Mihkel Jaenes asked if it is possible to obtain the money necessary for the new Estonian centre without selling the EM first. David Kalm answered that there are numerous ways to finance the new centre, but typically you make the down payment first and then borrow the rest of the money while the EM sale process is under way. The interest costs have been included in the budget.
Thomas Koger was impressed with the presentation, proceeded to talk about value generation in general, lauded the underlying value of TC and and stated that he would be able to get the full multimillion dollar budget cost for almost free by using TC as a backstop and by consolidating and cost cutting.
Rita Komendant claimed to represent all the architects and artists. She was disappointed that there was no design competition. She stated that the proposed design is just following current trends and would be dated after 20 years. She would prefer to see some real Estonian characteristics in the design, including paekivi, instead of modern glass building.
Miku Linkruus represented Vironia and asked about any impact to current users of TC, e.g fraternities during building process. David Kalm answered that he does not expect major disruptions, but it is too early to tell.
Erika Jõgi brought attention to the fact that there are presently two condo buildings proposed to either side of the TC. The 42 storey (twice the height of TC) proposed condo tower west of the TC at 316 Bloor St. West would have garbage collection and garage entrance facing the TC and bring major traffic into the immediate area. The proposed development would have approx. 500 units with only 50 parking spaces. Alar Kongats answered that this condo development is still under OMB review and will likely be scaled back to 25 stories (still higher than TC). The proposed condo tower would house students and the traffic impact would be minimal. The shadow would not impact the 9 Madison after 1pm, as there is open space directly to the west. The proposed development on the current United Church plot is still under very early development.
Erika Jõgi responded that according to the development study, the new condo tower would cast a shadow on the park from 10am to 2:18pm from March to September.
Linda Veltmann, a current EM board member, but representing herself, expressed the sentiment that it is time to move out of the old building built by the former generation and it is time for the younger generation to move on.
Katariina Jaenes asked about the possibility of making available background information that has been accumulated during the almost 10 years of development. This information would help the younger generation understand the history and gain some perspective about the current state. Kia Puhm answered that the amount of documents is staggering and that the board has been very open about the process and has in generally summarized and publicized all important steps in the process. Individuals can also come and look at relevant documents in the office. EM Board does not have the resources to develop a central document repository for public access, but any help to do this is welcomed with open arms.
The plan offered by Madison Group hinges on EM shareholders approval to sell the current EM and use the proceeds to finance the Madison proposal. The vote will take place during the EM AGM on Apr 25th.
After the meeting, retired architect Guido Laikve offered his take on the meeting.
Representatives of the Madison group were offered a chance to appear on camera, but the offer was declined due to the late hour. However, the Madison group provided answers to three written questions posed by EWR the following day.
1. What type of ownership structure is considered for the new Estonian community centre on Madison?
Ultimately the intent is to have the centre be a member-based not-for-profit organization. We are working on the means for getting there but it is a very complicated set of questions. We are getting legal and tax advice with the goal that the sale of EH will have minimal taxation consequences, enable the proceeds of the sale to be directed to the new centre, respect shareholders rights and create a governance structure that is both manageable and represents a broad cross-section of the community. As you might imagine this is a tall order and legal experts are working this through.
2. Since the projected budget for the new centre exceeds the approximate sale value of the present EM by an approximate factor of 2-3, what are the plans for obtaining the rest of the money?
We are working with conservative estimates and so the factor that you’ve cited will depend entirely on the proceeds of sale. Because we’re being conservative, we are confident that this development is feasible. In addition to the EH sale proceeds, each of ECU, ESK and TC have pledged startup capital to help with the financing. Remaining funding needs will be addressed through various financing structures that make sense as well as soliciting community based fund raising. We are under no illusions but we believe that paying for this project is very feasible.
3. EM is planning to put forward a resolution during their AGM on Apr 25th, essentially asking for shareholders to approve the sale of the current EM to finance the new development. Do you think it is fair to ask the shareholders to vote on this so soon, based on the information that was provided today by the Madison Group?
We are working through the issues one at a time but admittedly in a compressed time frame as the increasingly harsh realities of the physical and financial situation of the current house cannot be overlooked. EH directors hope to have a resolution for the shareholders which allows adequate time to consider its implications in advance of the EH AGM and it must be said that they have an established track record of being true to the resolutions that shareholders have approved. To emphasize what was said at the townhall, the resolution will be drafted to respect the rights of the shareholders, be in the community’s interests and meet all legal and regulatory requirements. Bear in mind that proceeding with the Madison Development is also contingent on the results of favorable due diligence on our and adequate funding. These conditions would be built into the resolution too.
Thank you Tauno, for asking these questions. Meeting the challenge of keeping the community informed and properly consulted is critical to getting a successful outcome at Madison Avenue. No solution will please all of the community all of the time and the facts are such that the Estonian House has arrived at the end of its useful life and this new opportunity on Madison is real and viable. So here’s question back to each EWR reader: how can you help secure a viable home for the community for successive generations?
