Report to/Rapport au:

 

 Planning Committee

Comité de l'urbanisme

 

and Council / et au Conseil

 

8 November 2011 / le 8 novembre 2011

 

 Submitted by/Soumis par: Kent Kirkpatrick, City Manager / Directeur municipal

 

Contact Person/Personne ressource : Gordon MacNair, Director, Real Estate Partnerships and Development Office/Directeur, Partenariats et Développement en immobilier

(613) 580-2424 x 21217, Gordon.MacNair@Ottawa.ca

 

Somerset (14)

Ref N°: ACS2011-CMR-REP-0034

 

SUBJECT:

150 ELGIN - AMENDMENTS TO AGREEMENTS - MORGUARD ELGIN LIMITED

 

 

OBJET :

150, RUE ELGIN – MODIFICATIONS DES ENTENTES – MORGUARD ELGIN LIMITED

 

REPORT RECOMMENDATIONS

  

That the Planning Committee recommend Council:

 

1.         Approve amendments to the Development, Parking and Non-Merger Agreements between the City and Morguard Elgin Limited dated 21 December 2005 as described in this report and further outlined in Document 1;

 

2.         Delegate authority to the City Manager to finalize and execute amended Development, Parking and Non-Merger Agreements with Morguard Elgin Limited.

 

RECOMMANDATIONS DU RAPPORT

 

Que le Comité de l'urbanisme recommande au Conseil :

 

1.         d’approuver les modifications aux ententes d’aménagement, de stationnement et de non fusionnement entre la Ville et Morguard Elgin Limitée, en date du 21 décembre 2005, telles qu’elles sont décrites dans le présent rapport et détaillées dans le document 1.

 

2.         de déléguer le pouvoir au directeur municipal de terminer et d’exécuter les ententes modifiées d’aménagement, de stationnement et de non fusionnement avec Morguard Elgin Limitée.

           

EXECUTIVE SUMMARY

 

Morguard Elgin Limited (Morguard) purchased the property at 150 Elgin Street/31 Gloucester Street from the City on 21 December 2005 for $6.6M based on an offer submitted to a Request for Offers to Purchase (RFOTP) process which commenced on 25 November 2003 and closed on 2 February 2004.

 

The purchase was subject to the execution of a Development Agreement, a Parking Agreement, a Non-Merger Agreement (regarding provisions of Agreement of Purchase and Sale that survived closing), and Covenants on closing based on terms and conditions approved by Council on 13 October 2004 and 30 November 2005 which included provisions related to a potential Concert Hall component that would, if developed, be owned and operated by the Ottawa Chamber Music Society (OCMS).

The Development Agreement is based on Morguard’s conceptual design plans, as set out in a design brief prepared by FoTenn Consultants dated 12 August 2005 and on architectural plans prepared by DCYSM dated 29 July 2005. The plans depict a 304,300 sq. ft. mixed use complex including a nine hundred (900) seat, 30,000 sq. ft. concert hall component, a 15,674 sq. ft. interior Community Accessible/Public Benefit Space component (associated with the concert hall component), an exterior Public Benefit Space component (Elgin ‘pocket park’ and fourth and seventh floor roof terraces related to the concert hall foyers and roof), a one hundred and sixty (160) unit, 156,200 sq. ft. residential component (50% small units with 25% costing less than $181,000 per City affordability criteria), a 92,540 sq. ft. leasable office component and a three (3) level below grade parking garage with provision for two hundred and thirty-six (236) parking spaces.

The Development Agreement also provides an option for the City to lease or purchase the concert hall space for an Arts and Heritage Plan use if the OCMS project does not proceed, or for Morguard to redesign and utilize the space for commercial purposes if the City does not exercise its option, but in both cases for Morguard to continue to provide public benefit space at no cost to the City, based on a new design approved by the City under the terms of an amending agreement. The City retained an option to repurchase the whole property until 28 February 2008 if Morguard was unwilling to proceed with the whole development in the event the OCMS or the City was ready to proceed with the concert hall or an alternative Arts and Heritage Plan project.

 

The OCMS did not proceed with the concert hall project and the City did not exercise its option to utilize the concert hall space for another arts and heritage project. The City’s option to repurchase the property lapsed on 28 February 2008.

 

Morguard has now redesigned the project to include the former concert hall space as part of a 362,088 sq. ft. rentable commercial complex (351,615 sq. ft. office tower component and 10,473 sq. ft. ground floor commercial component) which precludes a residential component. The well-designed exterior is consistent with the one shown in the concept plan approved by Council in 2004 and the design endorsed by the City’s Design Review Panel in 2005.

The design also maintains the Elgin ‘pocket park’ and a seventh floor roof terrace as public benefit spaces but the  fourth floor roof terrace now relates to office space and the interior public benefit space has been reduced to an approximately 8,070 sq. ft. ground floor winter garden.

 

In addition, Morguard has indicated that its proposed building is being designed to achieve LEED Gold certification and beyond providing significant energy savings features.  Morguard is also proposing not to provide any parking spaces beyond the minimum requirements of the Zoning By-law and to institute a number of other measures to support the City’s transportation policies for the downtown core.  As a result, Morguard can no longer provide all of the one hundred and twenty one (121) short-term parking spaces on the upper floors of the parking garage as set out in the Parking Agreement.

 

Morguard indicated on 20 September 2011 that its Board has given approval to proceed with the development based on the project being approximately 30% leased to the Canada Council for the Arts and the remaining space being targeted primarily to the private sector market. The design submitted for site plan approval includes for significant presentation facilities within the winter garden area to be programmed primarily by the Canada Council for the Arts as well as including the rear addition of the Grant House at 150 Elgin Street within the winter garden area in a manner supported by the City’s Heritage Planners.

 

Morguard has submitted applications for site plan approval and heritage alterations that fit within the City’s existing planning requirement framework but the site plan approval cannot be issued until Morguard enters into an Amended Development Agreement with the City. Morguard has requested that the Development, Parking and Non-Merger Agreements be amended to be consistent with the redesigned project.

 

Morguard also advised that its leasing requirements for the Canada Council for the Arts require Morguard to obtain City approval for changes to the Development Agreement and related agreements and to obtain a Site Plan Approval by mid-November 2011 with the objective of obtaining an excavation and shoring permit before the end of November 2011 in order to achieve a 1 January 2014 occupancy.

 

In considering Morguard’s proposal, the City must clearly demonstrate the overall benefit to the City in making amendments to the agreements with Morguard.

 

As a result, this report recommends that amendments to the Development, Parking and Non-Merger Agreements as outlined in this report be approved. The framework for the proposed amendments to the Development, Parking and Non-Merger Agreements, as recommended by staff, is described in the Discussion Section of this report and summarized in Document 1.

 

SOMMAIRE

 

Morguard Elgin Limitée (Morguard) a acheté la propriété située au 150 rue Elgin/31 rue Gloucester de la Ville, le 21 décembre 2005, pour 6 millions de dollars à la suite d’une offre présentée dans le cadre d’un processus de Demandes d’offre d’achat (DOA) qui a débuté le 25 novembre 2003 et s’est terminé le 2 février 2004.

 

L’achat était assujetti à l’exécution de l’Accord de développement, de l’Accord de stationnement et de l’Accord de non-fusionnement (concernant les dispositions de l’Accord d’achat et vente demeurant en vigueur après la clôture), et les clauses restrictives de clôture fondées sur les modalités et conditions approuvées par le Conseil le 13 octobre 2004 et le 30 novembre 2005, qui comprenaient des dispositions liées à la création d’une salle de concert qui, si construite, serait possédée et exploitée par la Société de musique de chambre d’Ottawa (SMCO).

L’Accord de développement est établi en fonction des plans de conception de Morguard, tels qu’ils ont été présentés dans le sommaire de conception rédigé par FoTenn Consultants le 12 août 2005 et sur des plans architecturaux préparés par DCYSM le 29 juillet 2005. Les plans décrivent un complexe polyvalent de 304 300 pi. ca. comprenant une salle de concert de 30 000 pi. ca. de neuf cents (900) sièges, un espace intérieur communautaire de 15 674 pi. ca. accessible au grand public, un espace extérieur grand public (« parc de poche » Elgin et des terrasses de toit au quatrième et au septième étages reliées aux foyers et au toit de la salle de concert), un immeuble résidentiel de 156 200 pi. ca. comportant cent-soixante (160) unités (50 % de petites unités dont 25 % coûtent moins de 181 000 $ conformément aux critères d’abordabilité de la Ville), des espaces à bureaux de 92 540 pi. ca. à louer, et trois (3) niveaux souterrains d'espaces de stationnement comptant deux-cent-trente-six (236) espaces de stationnement.

L’Accord de développement donne aussi l’option à la Ville de louer ou d’acheter l’espace de la salle de concert pour la mise en œuvre d’un plan pour les arts et le patrimoine, si le projet de la SMCO n’est pas exécuté, et à Morguard de revoir le concept de l’espace et d’utiliser cet espace à des fins commerciales si la Ville décide de ne pas exercer son option, mais dans les deux cas, Morguard doit continuer à offrir un espace grand public, sans frais pour la Ville, d’après un nouveau concept approuvé par la Ville, conformément aux modalités d’un accord modifié. La Ville a conservé l’option d’acheter toute la propriété d’ici le 28 février 2008 si Morguard n’était pas disposé à exécuter l’ensemble du développement dans l’éventualité où la SMCO ou la Ville était prête à aller de l’avant avec la salle de concert ou avec le projet de plan pour les arts et le patrimoine.

 

La SMCO n’a pas donné suite au projet de salle de concert et la Ville n’a pas exercé son option d’utiliser l’espace de la salle de concert pour un autre projet axé sur les arts et le patrimoine. L’option de la Ville de racheter la propriété est échue depuis le 28 février 2008.

 

Morguard a maintenant reconçu le projet de façon à inclure l’espace réservé à la salle de concert à un complexe commercial locatif de 362 088 pi. ca. (tour de bureaux de 351 615 pi. ca. et espace commercial au rez-de-chaussée de 10 473 pi. ca.) qui écarte l'élément résidentiel. L’extérieur bien conçu est conforme à celui qui figure au plan de conception approuvé par le Conseil en 2004 et au concept appuyé par le Comité de révision de la conception urbaine de la ville en 2005. Le concept conserve aussi le « parc de poche » Elgin et une terrasse au septième étage comme espace grand public, mais la terrasse du quatrième étage est annexée à l’espace de bureaux et l’espace grand public a été réduit d’environ 8 070 pi. ca. comme jardin d’hiver au rez‑de‑chaussée.

 

En outre, Morguard a indiqué que l’immeuble proposé est conçu en vue d’obtenir la certification or de LEED et en plus d’offrir des caractéristiques importantes à haut rendement énergétique, Morguard propose aussi de ne pas fournir d’espaces de stationnement au-delà des exigences minimales du règlement de zonage et d'instituer plusieurs autres mesures pour appuyer les politiques de transport de la Ville pour le centre-ville.

Par conséquent, Morguard ne peut plus fournir les 121 espaces de stationnement de courte durée aux étages supérieurs du garage comme l’indique l’Accord de stationnement.

 

Morguard a indiqué le 20 septembre 2011 que son Conseil d’administration avait approuvé la continuation du projet, sous réserve qu’environ 30 % soit loué au Conseil des Arts du Canada et que l’espace restant soit principalement axé sur le marché du secteur privé. Le concept présenté pour approbation du plan d'implantation prévoit que d'importantes installations de présentation dans la zone du jardin d'hiver soient programmées principalement par le Conseil des Arts du Canada en plus d’inclure l'ajout arrière de Grant House au 150, rue Elgin dans la zone du jardin d’hiver d’une manière qui est appuyée par les planificateurs de la conservation du patrimoine de la Ville.

 

Morguard a présenté des demandes pour l’approbation du plan du site et des modifications patrimoniales qui sont conformes au cadre actuel d’exigences en matière de planification de la Ville, mais l’approbation du plan du site ne peut pas être donnée tant que Morguard n’a pas conclu un accord de développement modifié avec la Ville. Morguard a demandé que les accords de développement, de stationnement et de non‑fusionnement soient modifiés pour être cohérents avec le projet reconçu.

 

Morguard a aussi indiqué que les exigences liées à la location au Conseil des Arts du Canada exigent l’approbation par la Ville de l’Accord de développement et autres accords, et l’obtention de l’approbation du plan du site d’ici la mi-novembre 2011, dans le but d’obtenir un permis d’excavation et d’étayage avant la fin de novembre 2011, afin de garantir que les locaux pourront être occupés au 1er janvier 2014.

 

Dans le cadre de l’examen de la proposition de Morguard, la Ville doit clairement démontrer les avantages que peut retirer la Ville en modifiant les accords avec Morguard.

 

Par conséquent, le présent rapport recommande que les modifications aux Accords de développement, de stationnement et de non-fusionnement décrits dans ce rapport soient approuvées. Le cadre pour les modifications proposées aux Accords de développement, de stationnement et de non-fusionnement, recommandé par le personnel, est décrit à la section Discussion du présent rapport et résumé dans le Document 1.

BACKGROUND

 

Sale of Property and Related Agreements

 

As described in the Project History attached as Document 2 of this report, Morguard Elgin Limited (Morguard) purchased the property at 150 Elgin Street/31 Gloucester Street from the City on 21 December 2005 for $6.6M based on a offer submitted to a Request for Offers to Purchase (RFOTP) process which commenced on 25 November 2003 and closed on 2 February 2004.


The purchase was subject to the execution of Development Agreement, Parking Agreement, Non-Merger Agreement (regarding provisions of Agreement of Purchase and Sale that survived closing) and Covenants on closing based on terms and conditions approved by Council on 13 October 2004 and 30 November 2005 which included provisions related to a potential Concert Hall component that would, if developed, be owned and operated by the Ottawa Chamber Music Society (OCMS).

 

Development Agreement 

The Development Agreement is based on Morguard’s conceptual design plans, as set out in a design brief prepared by FoTenn Consultants dated 12 August 2005 and on architectural plans prepared by DCYSM dated 29 July 2005. The plans depict a 304,300 sq. ft. mixed use complex including a nine hundred (900) seat, 30,000 sq. ft. concert hall component, a 15,674 sq. ft. interior Community Accessible/Public Benefit Space component (associated with the concert hall component), an exterior Public Benefit Space component (Elgin ‘pocket park’ and fourth and seventh floor roof terraces related to the concert hall foyers and roof), a one hundred and sixty (160) unit, 156,200 sq. ft. residential component (50% small units with 25% costing less than $181,000 per City affordability criteria), a 92,540 sq. ft. leasable office component, and a three (3) level below grade parking garage with provision for two hundred and thirty-six (236) parking spaces.

The Development Agreement provides an option for the City to lease or purchase the concert hall space for an Arts and Heritage Plan use if the OCMS project does not proceed, or for Morguard to redesign and utilize the space for commercial purposes if the City does not exercise its option, but in both cases for Morguard to continue to provide public benefit space at no cost to the City based on a new design approved by the City under the terms of an amending agreement. The City retained an option to repurchase the whole property until 28 February 2008 if Morguard was unwilling to proceed with the whole development in the event the OCMS or the City was ready to proceed with the concert hall or the alternative Arts and Heritage Plan project.

 

The Development Agreement also provides for the City to pay up to a total of $1.3M in development charges and building permit fees related to the residential component.

 

An extract of the relevant provisions of the Development Agreement is attached as Document 3.

 

Parking Agreement

 

The Parking Agreement requires Morguard to provide one hundred and twenty one (121) short term public parking spaces year round on a twenty four (24) hour basis on the upper floors of the parking garage at parking rates equivalent to City rates in the downtown for a period of fifteen (15) years from the date of occupancy of the parking garage.

 

An extract of the relevant provisions of the Parking Agreement is attached as Document 4.

 

Non-Merger Agreement

 

As set out in Document 5 of this report,  the Non-Merger Agreement includes and maintains the provisions of the Agreement of Purchase and Sale for Morguard to carry out “immediate repairs” (deferred life cycle work - estimated cost $400K) to the heritage Grant House at 150 Elgin Street; to enter into an Heritage  Easement Agreement with the City prior to requesting the issuance of a building permit for the project; and also for the City to pay up to $276K in tipping fees for existing environmental contamination on the property site (ash / construction debris).

 

 

Current Status:

 

Morguard has completed the immediate repairs to the Grant House at a reported cost of approximately $800K.

 

As set out in the Project History attached as Document 2, the OCMS did not proceed with the concert hall project and the City did not exercise its option to utilize the concert hall space for another arts and heritage project. The City’s option to repurchase the property lapsed on 28 February 2008.

 

Morguard has now redesigned the project to include the former concert hall space as part of a 362,088 sq. ft. rentable commercial complex (351,615 sq. ft. office tower component and 10,473 sq. ft. ground floor commercial component) which precludes a residential component. The exterior design is consistent with the concept plan approved by Council in 2004 and was endorsed by the City’s Design Review Panel in 2005. The design also maintains the Elgin Street ‘pocket park’ and a seventh floor roof terrace as public benefit spaces but the fourth floor roof terrace now relates to office space and the interior public benefit space has been reduced to an approximately 8,070 sq. ft. ground floor winter garden.

 

A comparison of the proposed space and uses for Morguard’s current development concept plan with the concept plans considered by Council in May 2004 and October 2004 is set out in Document 6.  It is noted from this comparison that the amount of Community Accessible/Public benefit Space has been reduced such that the total interior space is now 7,604 sq. ft. from the 15,674 sq. ft. shown on the Development Plan requirements in the Development Agreement.

 

Morguard has submitted applications for site plan approval and heritage alterations that fit within the City’s existing planning requirement framework.

 

Morguard has also entered into an agreement to lease with the Canada Council for the Arts for space on the second, third, fourth floors and the western part of the fifth floor of the office component. The proposed lease is subject to Morguard receiving the required planning approvals before the end of November 2011 and for the leased space to be ready for occupancy by 1 January 2014.

 

The design submitted for site plan approval includes for significant presentation facilities within the winter garden area to be programmed primarily by the Canada Council for the Arts as well as including the rear addition of the Grant House at 150 Elgin Street within the winter garden area in a manner supported by the City’s Heritage Planners.

 

Morguard indicated on 20 September 2011 that its Board has given approval to proceed with the development based on the project being approximately 30% leased, and the remaining space being targeted primarily to the private sector market.

 

Morguard has requested that the Development Agreement be amended to remove the residential component requirements and associated requirement for the City to pay development and building permit fees up to $1.3M; and to provide for the reduced exterior and interior public benefit spaces as now indicated on the redesigned development plans. Morguard has also indicated its willingness to eliminate the requirement for the City to pay up to $276K in tipping fees as currently set out under the provisions of the Non-Merger Agreement.

 

Morguard also requested, because of the requirements for office leasing, that the Parking Agreement be amended to change the requirement for one hundred and twenty one (121) short term public parking spaces at City rates to a minimum of thirty five (35) short term public parking spaces weekdays during the hours of 8:00 a.m.to 7:00 p.m. and one hundred and thirty five (135) spaces from 7:00 p.m. to 8:00 a.m. on weekdays and all day on weekends based at market rates and utilizing ‘valet’ parking operations. Morguard has agreed that the existing provisions related to not offering early bird specials will be maintained.  

 

In addition, Morguard has indicated that its proposed building is being designed to achieve LEED Gold certification and beyond providing significant energy savings features, Morguard is also proposing a number of measures to support the City’s transportation policies in the downtown area. In this regard, Morguard is proposing to provide an additional one hundred and twenty (120) bicycle parking spaces beyond the by-law requirement with the additional spaces being available and provided in locations accessible to the general public; to pay for one hundred (100) transit passes for one (1) year for employees of tenants in the building; and provide two (2) car sharing spaces (VRTUCAR).  Morguard has also indicated that it would be willing to commit to maintaining at least one (100) short term public parking spaces in its facility at 350 Sparks Street (Delta Hotel) for fifteen (15) years from the occupancy of 150 Elgin Street but these are already existing public parking spaces and are located at the other end of the downtown.

 

Morguard has also indicated that its leasing requirements for the Canada Council for the Arts require Morguard to obtain City approval for changes to the Development Agreement and related agreements and to obtain the Site Plan Approval by mid-November 2011 with the objective of obtaining an excavation and shoring permit before the end of November 2011 in order to achieve a 1 January 2014 occupancy.  In this regard, Morguard has also requested that the provision in the Non-Merger Agreement related to not requesting the issuance of a building permit prior to entering into the Heritage Easement Agreement be amended to allow for an excavation, shoring and foundation permit to be issued upon Site Plan approval being granted by the City, subject to the insurance and other financial security requirements contemplated for the Heritage Easement Agreement being in place as part of the Site Plan approval requirement.

DISCUSSION

 

Given the current economic climate, the commencement of the well-designed 150 Elgin Street project targeted to the private sector office market, as now proposed by Morguard would be of substantial benefit to ensuring the viability of the City’s downtown core.

 

In the early 2000’s the City needed to encourage residential growth in the downtown areas.  By the time Council finally approved the sale of 150 Elgin Street and the related project, many residential condominium projects were already under construction or being planned and Council had already discontinued incentives with respect to the waiving of development and building permit fees for residential developments in the downtown core. The provision for 25% of the residential units to be sold at a price of less than $181,000, while meeting the City’s then current affordability guidelines did not assist the City in providing the most needed affordable housing units.

 

The proposed change to include a 351,615 sq. ft. of rentable office space is very much in keeping with the objectives of the Mixed-Use Downtown (MD) Zone which are as follows:

 

1.      support the Central Area as designated in the Official Plan as the central place in the region for employment and shopping while also allowing residential, cultural and entertainment uses;

2.      ensure that the Character Areas in the Central Area, namely the Core Area, the Parliamentary Precinct, the ByWard Market, the Rideau/Congress Centre, the Canal Area, Lowertown, Upper Town, Sandy Hill West, LeBreton Flats and the four Business Improvement Areas, Rideau, Sparks, ByWard Market and Bank Streets continue to serve as primary business or shopping areas and maintain their distinct character;

3.      facilitate more intense, compatible and complementary development to ensure that the active pedestrian-oriented environment at street level, particularly along Bank Street, Sparks Street and Rideau Street is sustained; and

4.      impose development standards that will protect the visual integrity and symbolic primacy of the Parliament Buildings and be in keeping with the existing scale, character and function of the various Character Areas and Business Improvement Areas in the Central Area while having regard to the heritage structures of the Central Area.

 

The removal of the residential component in the 150 Elgin Street project will result in the City not having to pay $1.3M in development charges/building permit fees and up to $276K in tipping fees. This will allow the City to uncommit the $1.5M in the City wide reserve currently being held for reimbursement of development charges, building permit fees and tipping fees. In addition, it is estimated that the conversion of 156,200 sq. ft. of building area from residential to office space will result in approximately $650K in additional Development Charges being received by the City as well as approximately $500K annually in additional property taxes just for the converted area. The overall office development project is now approximately 100,000 sq. ft. larger than the formerly proposed residential development and it is estimated that this additional development will result in approximately another $1.1M in additional development charges and approximately another $800K annually in additional property taxes being received by the City.

 

The changes proposed by Morguard with respect to a reduction in the number of short term public parking spaces at 150 Elgin Street will reduce the supply of short term parking under the direct or indirect control of the City by no more than eighty six (86) spaces during weekdays in the eastern part of the downtown core. It is also noted that, in any event, the one hundred and twenty one (121) existing public parking spaces would be lost during the project’s one (1+) year construction period.  While ‘valet parking’ is not ideal, Morguard has indicated this type of parking operation is needed to maximize the amount of short term parking available at all times while ensuring the parking requirements for tenants can be met. The City’s current Parking Management Strategy appears to be based more on availability than price and the proposal to provide parking at market rates does not appear to be the most significant concern.

 

The potential loss of approximately 7,604 sq, ft. in public benefit space is considered to be significant given that in October 2004 Morguard valued its contribution of 16,850 sq.ft. of public benefit space shown on the concept plans at $3.5M (approximately $208/sq. ft.) as indicated in the 13 October 2004 Council report. On that basis, the 7,604 sq. ft. of potentially lost public benefit space, as defined in the Development Agreement would have a value of at least $1.58M if the lost space cannot be accommodated elsewhere in the development.

 

Morguard has indicated that while its financial pro forma does not allow for a $1.304M contribution over and above not receiving $276K in tipping fees from the City it is prepared to negotiate the leasing of approximately 6,000 sq. ft. base office space in the office tower component for an appropriate use that supports City programs at a reduced rate over a transitional period (e.g. a five (5) year initial term with  a five (5) year option) and to provide some limited amount of “foothold space” for this use in the winter garden area on the ground floor. The intent would be that the City could, from its perspective, receive up to $1.304M in value from such an arrangement.

 

As an alternative, Morguard has also expressed its willingness to consider allocating, from space currently allocated for retail and related uses, an additional 4,000 sq. ft. of finished space on the ground floor, in an area adjacent to the winter garden, as Community Accessible /Public Benefit Space. The intent would be that this higher value space could be programmed and rented for short term use by non-profit groups that would have activities compatible with, and supporting, activities in the winter garden such as arts and cultural groups.

 

From a location standpoint, the best additional space in the office tower for community accessibility and public benefit use might be provided on either the eastern parts of the fifth and sixth floors together with less than 1,000 sq. ft. on the ground floor in, or adjacent to the winter garden area, with nearby access to the elevators serving the seventh floor roof garden.

 

With respect to utilizing office space for public benefit, Morguard has indicated that the Canada Council for the Arts has an option to lease additional space on that floor until 1 January 2014 and, therefore, space on that floor cannot currently be made available for Community Accessible / Public Benefit use. Morguard has also indicated that it has submitted leasing proposals to other prospective tenants for most of the remaining part of the office tower starting from the sixth floor upwards and the provision of additional public benefit space in the office tower would, therefore, need to be considered in terms of fitting within Morguard’s leasing program.  

 

The 10,473 sq. ft. of retail space proposed for the ground floor under the office tower has not yet been leased and, being subject to final leasing and demising plans, might be adjusted significantly before the building is completed.  Given that Morguard has set aside a 3,000 sq. ft. portion of the winter garden to be programmed by the Canada Council for the Arts, and is proposing that the future restaurant tenant of the heritage Grant House building also be allowed to operate up to an approximately 1,000 sq. ft. patio in the winter garden area, it is critical that the final size design and operation of the winter garden provide the degree of community accessibility and public benefit that was intended when Council approved the sale of the property in October 2004.


It is also possible that a yet to be identified City program use (e.g., arts, culture, tourism type use) that is acceptable to Morguard, or some other community accessible / public benefit use proposed by Morguard acceptable to the City, might be better accommodated in a different amount of space and location in the building than described above. In this regard, staff has proposed, and Morguard has agreed, that the amendments to the Development Agreement should also include provisions as follows:

 

·       The City and Morguard will  negotiate provisions for Morguard to provide additional Community Accessible / Public Benefit Space in  a total amount of not more than 7,604 sq. ft., or for Morguard to make a financial contribution of equivalent value from the City’s perspective in amount not greater than $1.304M, and

·         Morguard will not lease any retail space on the ground floor until an agreement has been reached with the City regarding an additional contribution by Morguard related to Community Accessible / Public Benefit Space.  

 

If the City does not agree to amend the agreement with Morguard, and Morguard cannot proceed with the project based on the proposed lease arrangement with the Canada Council for the Arts, it is likely that the development of 150 Elgin Street may not occur for many years. However, in considering Morguard’s proposal, the City must clearly demonstrate overall benefit to the City in making amendments to the agreements with Morguard.

 

As a result, staff is recommending that the proposed provisions for amendments to the Development, Parking and Non-Merger Agreements as described above be approved.

The framework for the proposed amendments to the Development, Parking and Non-Merger Agreements, as recommended by staff, is summarized in Document 1 of this report.

 

ENVIRONMENTAL IMPLICATIONS

 

Under the terms on the Non-Merger Agreement, Morguard Elgin Limited will remain responsible for any environmental contamination on the property and for adherence to environmental regulations. The proposed development is being designed to achieve a LEED Gold certification.

 

RURAL IMPLICATIONS

 

 N/A

  

CONSULTATION

 

The Real Estate Partnerships and Development Office has consulted with Planning and Infrastructure Approvals and Parking Operations staff in carrying out the negotiations with Morguard. 

 

On 28 October 2011, Morguard indicated that it supports the recommendations set out in this report.

 

COMMENTS BY THE WARD COUNCILLOR(S)

 

The Ward Councillor has indicated in the site plan circulation and in subsequent discussions with staff regarding changes to the Development and Parking Agreements that she is not opposed to the elimination of the residential component but is opposed to a proposed change to the parking agreement that would eliminate the requirement for Morguard to provide one hundred and twenty one (121) short term public parking spaces at City rates. The Councillor also remains concerned about the amount and type of Community Accessible / Public Benefit Space that will ultimately be provided in this development.

 

HOUSING FIRST POLICY

 

The Official Plan policy directs that the City make land available for affordable housing and give priority for the sale or lease of surplus City-owned property for this purpose.  The Housing First Policy, approved by Council on 13 July 2005, establishes priority consideration to the Affordable Housing Division in the identification of potentially surplus City-owned property, to be used in achieving the City’s affordable housing program targets. The policy also requires that the Official Plan target of 25% affordable housing, be met on any City-owned property sold for residential development.  Where viable, residential properties are disposed of without a condition requiring an affordable housing component, 25% of the proceeds from the sale are to be credited to a housing fund, to be used for the development of affordable housing elsewhere in the City.

 

The subject property is zoned MD S52&S53, a downtown mixed-use development zone, and therefore the provision of affordable housing, and/or a financial contribution in lieu of affordable housing, will depend on the ultimate use for the components in a development on the site.

 

LEGAL IMPLICATIONS

 

Subject to the City and Morguard reaching agreement on the amount of additional Community Accessible/Public Benefit Space or the amount of the financial contribution by Morguard in lieu of such additional space, there are no legal impediments to the implementation of the recommendations contained in this Report.  Should the City and Morguard not be able to reach such agreement, the issue would be settled by arbitration pursuant to a provision in the Development Agreement.  Further protection is provided to the City in that Morguard has agreed not to lease any retail space on the ground floor until there is agreement between the City and Morguard regarding the quantity of Community Accessible/Public Benefit Space or a financial contribution in lieu thereof as set out in this Report.

 

RISK MANAGEMENT IMPLICATIONS

If the City does not agree to amend the agreement with Morguard, and Morguard cannot proceed with the project based on the proposed lease arrangement with the Canada Council for the Arts, it is likely that the development of 150 Elgin Street may not occur for many years delaying the City receiving significant financial and community benefit. The proposed amendments to the Development, Parking and non-Merger Agreements as recommended in this repot will eliminate this risk.


CITY STRATEGIC PLAN

 

The proposed development of 150 Elgin Street / 31 Gloucester Street is supportive of Council’s Term of Council Priorities as approved by Council on 13 July 2011 with respect to the following strategic directions.

 

·         Economic Prosperity: use Ottawa's unique combination of recreational, social, cultural and business assets, natural environment and physical infrastructure to attract enterprises, visitors and new residents, while at the same time, developing and retaining our local firms and talent;

·        Transportation and Mobility: meet the current and future transportation and mobility needs of residents, visitors and enterprises by improving transit and by emphasizing choice and accessibility of multiple types of transportation including the development of a Light Rail Transit system;

·        Environmental Stewardship: promote long-term sustainability and reduce our environmental footprint by maintaining and improving the quality of our air and water, by utilizing green technology and promoting energy efficiency and by protecting our natural resources and land to enhance the quality of the environment for our residents;

·        Healthy and Caring Communities: help all residents enjoy a high quality of life and contribute to community well-being through healthy, safe, secure, accessible and inclusive places;

·        Financial Responsibility: be financially responsible to the residents of Ottawa by practicing prudent fiscal management of existing resources and by making sound long-term choices that allow core City programs and services to be sustainable now and into the future.

 

TECHNOLOGY IMPLICATIONS

 

 N/A

 

FINANCIAL IMPLICATIONS

 

Council approval of the recommendations of this report and the subsequent execution of the related amendments to the Development and Non-Merger Agreements will eliminate the City’s current financial liability for development charges, building permit and tipping fees, in an amount of $1.5M. 

 

ACCESSIBILITY IMPACTS

 

The development of 150 Elgin Street / 31 Gloucester Street property is subject to site plan approval and review by Planning and Growth Management staff including review of accessibility provisions.

 

While it is not known when the Province will release the final draft Accessibility for Ontarians with Disabilities Act (AODA) Regulation relating to the Built Environment, the City’s Accessibility Office will begin convening a corporate committee this fall to review the draft standards and how the City work is aligned to those upcoming standards. This fall the Planning and Growth Management department will be creating workshops and a built environment accessibility checklist for Planning and Growth Management staff.  This will promote accessibility in the built environment processes and eliminate potential barriers before they happen.

  

SUPPORTING DOCUMENTATION

 

Document 1 - Framework for Amendments to Agreements

Document 2 - Project History

Document 3 - Development Agreement - Relevant Provisions

Document 4 - Parking Agreement - Relevant Provisions

Document 5 - Non Merger Agreement - Relevant Provisions

Document 6 - Comparison of Morguard Concepts 

 

DISPOSITION

 

Following Council approval, Real Estate Partnerships and Development Office will negotiate the specific provisions for the amendments to the Development, Parking and Non-Merger Agreements with Morguard Elgin Limited and then in consultation with the Legal Services Branch finalize the amending agreement documents for execution by the City Manager. 


 

DOCUMENT 1

 

FRAMEWORK FOR AMENDMENTS TO AGREEMENTS

 

Proposed Relevant Provisions for Amending Development Agreement

 

It is recommended that the relevant provisions of the Development Agreement as set out in Document 3 of this report be amended based on the draft wording / actions outlined below:

1.      Provision to be amended to the effect that “The Purchaser agrees to make its best efforts to market the development, as proposed by the redesigned Development Plan submitted to the Purchaser by to the City for site plan approval in July 2011 (the “Development”) for the uses set out in the said Development Plan and more specifically agrees that the retail area shown for the ground floor will be designed and marketed to target the commercial uses as set out in the Concept Plan.”

 

2.      Provision re: residential component to be deleted.

 

3.      Provision re: development charges and building permit fees to be deleted.

 

4.      Provision to be amended to the effect that “The Purchaser agrees to design and construct, at no cost to the Vendor the base building and improvements for the Winter Garden, the improvements for the Elgin Pocket Park and 7th floor Roof Garden for use as Community Accessible/Public Benefit spaces (the “Community Accessible/Public Benefit Space”) all as shown on the redesigned Development Plan submitted by the Purchaser to submitted to the City for site plan approval in July 2011 (the “Development”) and the Purchaser agrees to operate and maintain these spaces as not-for-profit areas at no cost to the Vendor. The Purchaser further  agrees to enter into negotiations with the Vendor with respect to the provision of additional Community Accessible / Public Benefit Space in the Development in  an amount of not more than 7,604 sq. ft., or the provision of a financial contribution of equivalent value from the City’s perspective in amount not greater than $1.304M, and not to lease any retail space on the ground floor, until an agreement has been reached with the City regarding an additional contribution by Morguard related to Community Accessible / Public Benefit Space “

 

5.  Provision re: public art contribution to remain.

6.  Provision re: direct access to Community Accessible / Public Benefit Spaces to remain.

7.  Provision to be amended to the effect that “The Purchaser agrees that the Elgin Pocket Park, Winter Garden, and the 7th Roof Garden areas and the connections between these areas as shown on the Development Plan shall be accessible on a daily basis to the general public for the period from 7:00 AM to 12:00 AM or whenever the commercial facilities in the Development are open, whichever period is greater, except as may otherwise be proposed by the Purchaser and agreed to by the Vendor in writing and subject to the provisions of Paragraph 9 below.”

8.  Provision re: restriction on selling or leasing Community Accessible / Public Benefit Space to remain.

9.  Provision re: public access through proposed Concert Hall space to be deleted.

 

10. Provision re: Concert Hall space on 2nd floor to be deleted.

12. Provision re: OCMS Concert Hall to be deleted.

 

Proposed Relevant Provisions for Amending Parking Agreement

 

It is recommended that the relevant provisions of the Parking Agreement as set out in Document 4 of this report be amended based on the draft wording / actions outlined below:

1.      Provision to be amended to the effect that “The conveyance of the Real Property to the Purchaser is and shall continue after Closing for a term of fifteen (15) years  from the date of issuance of an occupancy certificate for the Parking Facility to be subject to the Purchaser’s obligation to provide, operate and maintain on the Real Property:

(a)    a minimum of 35 short-term public parking spaces in the Parking Facility that shall be available public parking spaces in the Parking Facility that shall be available on a twenty-four (24) hour daily basis for public parking use;

(b)   a minimum of 135 short-term public parking spaces in the Parking Facility that shall be available between the hours of 7:00PM and 8:00 AM on weekdays and on a twenty-four (24) hour basis on weekend and holidays for public parking use;

(c)    the short-term parking spaces as set out in (a) and (b) above (the “designated short-term spaces”) may be provided on the basis of valet parking operations at the discretion of the Purchaser;

(d)   2  parking spaces assigned for car sharing purposes  spaces; and

(e)    120 secure bicycle parking spaces, over and above the amount required under the Zoning By-law for the proposed development, that are available and provided in locations accessible to the general public.

 

2.      Provision re: parking design guidelines to remain.

 

3.  Provision to be amended to the effect that “Except with the prior written consent of the Vendor:

(a)                All short term spaces, as designated from time to time, shall only be used in accordance with the provisions set out in the Parking Agreement;

 

(b)               The Purchaser shall not establish policies or practices, which would be inconsistent with ensuring the designated short term spaces are, in fact, available for short-term parking;

 

(c)                The Purchaser shall not reserve any or all of the designated short term spaces or permit the use of such spaces for monthly parking, without the prior written consent of the Vendor.

 

(d)               The Purchaser shall provide the designated short term spaces at market rates in downtown Ottawa

 

(e)      The Purchaser shall not offer special daily rates before a specified time (e.g. the “early bird special”) with respect to the designated short term spaces;

(f)    The Purchaser shall make available all occupancy and usage records respecting the operation of the designated short term spaces and allow inspections by the Vendor of these spaces when required by the Vendor for the purposes of monitoring the provisions of the agreement.”

4.      Provision re: revenue to remain.

 

Proposed Relevant Provisions for Amending Non-Merger Agreement

 

It is recommended that the relevant provisions of the Agreement of Purchase and Sale as set out in the Non-Merger Agreement as outlined in Document 5 of this report be amended based on the draft wording / actions outlined below:

12.       Provision re: approval to alter heritage building to remain.

13.       Provision to be amended to the effect that ‘The Purchaser agrees to enter into a heritage easement agreement with the Vendor, pursuant to Section 37 of the Ontario Heritage Act, (the “Heritage Easement”) with respect to the Heritage Building  based on terms and conditions as set out in Schedule “E” attached hereto. The Purchaser further agrees that the Heritage Easement shall be entered into and registered on title prior to the issuance of a building permit by the City of Ottawa for the Development save and except for an excavation, shoring and foundation permit in the event that Site Plan approval has been granted by the City and the insurance and other financial security requirements contemplated for the Heritage Easement Agreement as set out in Schedule “E”  are in place as part of the Site Plan Approval requirements. While the parties hereto acknowledge that the Purchaser may have made application to the City of Ottawa for a building permit for the Development, the Purchaser agrees not to request or demand the issuance of any such building permit from the City of Ottawa save and except for an excavation, shoring and foundation permit until the Heritage Easement is entered into and registered on title. The Purchaser further agrees that the area of the Real Property that will be subject to the Heritage Easement, and on which the Heritage Easement will be registered, shall be established by the Vendor based on the Protective Measures prescribed by the Heritage Consultant as set out in Schedule “E” attached hereto.  Provided, that, in no event shall the area of the Heritage Easement be less than, horizontally, the perimeter of the Heritage Building as formed by the outside of the exterior walls, and, vertically, on a stratified basis from immediately below the bottom of the basement floor to the top of the roof and any appurtenances that protrude beyond the roof including chimneys and such area shall not be more than the area designated by By-law Number 21-82.”

17.      Provision to be amended to the effect that “Except as otherwise explicitly set out herein, the Vendor makes no representations or warranties whatsoever regarding the fitness of the Real Property for any particular use, or regarding the presence or absence on the Real Property, or any surrounding or neighbouring lands or the leakage or emission from or onto the Real Property, of any toxic, hazardous, dangerous, or potentially dangerous substance or condition.  The Vendor disclaims any responsibility for soil conditions, subsurface contents, contours, building conditions and site conditions generally.  The Purchaser acknowledges and agrees that the Real Property is being sold on an "as is" basis.”

 

18.       Provision re:  Immediate Repairs to Grant House to be deleted.

 

Schedule “E” to remain

 


DOCUMENT 2

 

PROJECT HISTORY

 

On 24 July 2002, City Council (Report ACS-2002-CRS-RPR-0061) approved the Corporate Accommodations Master Plan (CAMP) for administrative space so that the amalgamated City of Ottawa could reduce the total amount of administrative space it occupies by 25%, dispose of surplus properties, including former city halls, improve service delivery to residents and achieve permanent operational savings of over $3.5 million annually from both the consolidation of space and the co-location of staff into fewer sites.

 

In May 2003, City Council (Report ACS-2003-CRS-0040) approved the acquisition of 100 Constellation in order to achieve these objectives. At that time, four City properties became surplus: 1595 Telesat Court (former Gloucester City Hall), 495 Richmond Road (Denis Coolican Building where the Health Department is located), 580 Terry Fox Drive (former Kanata City Hall); and 150 Elgin Street/31 Gloucester Street (“Friday’s Roast Beef House” property and adjacent City public parking lot). Within 5 months, agreements of purchase and sale had been approved for the two former City Halls and the Health Department building for a total dollar value of $25.1 million.

 

City Council determined that the 150 Elgin Street/31 Gloucester Street property should not be sold in the same way as other surplus properties because of its importance as a key site for the development of the downtown. It is located on Elgin Street, forms part of a gateway to the downtown core, includes a heritage building, and offers 121 parking spaces at City rates. The Official Plan recognizes that the redevelopment of strategically located sites like this one is instrumental in helping the City revitalize the downtown core.

 

Accordingly, Council directed that the sale of the land and building at 150 Elgin/31 Gloucester be carried out under a request for offers to purchase (RFOTP) process based on specific Council-approved criteria to make sure the property would be developed in such a way that Council’s objectives would be met.  The sale price was set at $6.6 million, based on two independent appraisals of the current market value adjusted for the estimated cost of repairs to the Grant House building at 150 Elgin. The purchaser would therefore not be chosen on the basis of who offered the best price, but on who would best meet Council’s direction for a development that would:

 

 

On 19 November 2003 (ACS-2003-CRS-RPR-0072), City Council approved the Request for Offers to Purchase (RFOTP) process for 150 Elgin/31 Gloucester, the Mandatory Requirements together with the Development Criteria Subject to Point Rating and the Point Weightings, and the composition of the Evaluation Team for the RFOTP.

 

The RFOTP was issued on 25 November 2003 and six (6) responses were received on 2 February 2004. Based on the Council approved selection process, the response from Morguard Corporation was identified as the preferred offer.

 

On 12 May 2004, Council considered a recommendation by the Corporate Services and Economic Development Committee (Ref. No. ACS2004-CRS-RPR-0022) to authorize staff to negotiate and execute an agreement of purchase and sale with Morguard Corporation. At that time Council expressed concerns about whether the RFOTP process sufficiently addressed provisions and criteria for public use space at 150 Elgin/31 Gloucester to ensure that this space would not become a commercially-oriented court with little utility for the local arts community.  

In this respect, Council also noted the identified need in the downtown area of a medium-sized performing arts facility (concert hall) (as set out in the Ottawa 20/20 Arts and Heritage Plan approved by Council in April 2003) and that none of the offers meeting all of the Mandatory Requirements of the RFOTP, and subsequently evaluated with respect to the development criteria, included a concert hall.  

As a result, Council considered and carried a Motion directing staff to undertake the following:

 

On 23 June 2004 Council considered a staff report (Ref N°: ACS2004-CRS-RPR-0034) with respect to an offer received from Morguard Corporation in context of a previous report considered by Council on 12 May 2004. At that time Council acknowledged the Ottawa Chamber Music Society as the representative community group for the development of a Festival/Concert Hall, in accordance with the Ottawa 20/20 Growth Plan Strategy, with responsibility for:

a)         Establishing a business plan that demonstrates the viability of constructing and operating a festival/concert hall at 150 Elgin within the parameters of the Morguard offer to purchase;

b)         Providing the necessary performance specifications necessary to Morguard in order that it can assess the construction and operating viability of such a facility within the framework of its proposal;

c)         Undertaking the required fund-raising to support both the construction and the operation of a Festival/Concert Hall.

 

Council then directed that the City Manager negotiate an Agreement of Purchase and Sale with Morguard Corporation and that the Agreement of Purchase and Sale be returned to Council with a report:

 

a) Assessing the viability of the OCMS business plan to construct and operate a “Festival/Concert Hall with acoustics to support performing arts”;

 

b) Assessing whether the proposed Festival/Concert Hall can be constructed within the parameters set out by the offer to purchase as submitted by Morguard, respecting the financial pro forma, the scheduling, the allocation of community benefit space and the physical envelope of the proposed complex.

  

On 13 October 2004 City Council approved the 150 Elgin Street Concert Hall, Business Plan Evaluation Report (ACS2004-DEV-BUS-0007) to:

 

      1.   Support the Ottawa Chamber Music Society (OCMS) in their pursuit of a concert hall at 150 Elgin Street, 

      2.   Pre-commit the 2005 Capital Budget by $5.47M to allow a municipal capital grant for the concert hall in the proposed Morguard building at 150 Elgin Street, with funds to be released to the OCMS upon:

            a.   The City receiving prior to September 30, 2006 satisfactory written confirmation from a Chartered Accountant in good standing representing the OCMS, that all required funding for the construction of the concert hall is in place save and except the City’s $5.47M share;

            b.   The City receiving prior to September 30, 2006 an executed memorandum of understanding between Morguard and the OCMS specifying the terms, conditions and timing of the delivery of the concert hall space; and,

            c.   The execution of a Contribution and Community Access Agreement by September 30, 2006 between the City of Ottawa and the OCMS, which among other matters will establish the specific timing of the City’s contribution and the amount of community access required for the concert hall facility.

 

 On October 13, 2004 City Council also considered a separate report (ACS2004-CRS-RPR-0044), with respect to Morguard’s revised development concept dated the 30th of June 2004 that provided for the OCMS concert hall and approved the terms and conditions for an agreement of purchase and sale with Morguard. The Agreement of Purchase and Sale with Morguard for 150 Elgin was executed on November 25, 2004. The Agreement of Purchase and Sale contained provisions that if the OCMS fails to meet its commitments, Morguard can still proceed with development subject to Morguard providing written notice to City that OCMS will not be proceeding with acquisition and development of Concert Hall Space provided that:

 

            a)   The City has the first option to purchase or lease all or a portion of Concert Hall Space for use as a visual or performing arts facility identified as a priority in Arts & Heritage Plan (e.g. concert hall, theatre, art gallery or heritage display facility).

 

            b)   If the City leases or purchases, the City will negotiate with Morguard provisions of a lease/sale agreement for the City facility but the City is still entitled to comparable benefit to that set out in approved Development Plan for Community Accessible/Public Benefit Space. The agreement will also provide for extension to time limits for commencement and completion of construction as required in order to accommodate redesign and construction of the Concert Hall Space.

 

            c)   If the City decides not to lease or purchase the Concert Hall space, the City and Morguard will negotiate an agreement for the alternate use of the Concert hall Space to ensure the City still receives comparable benefit to that set out in approved Development Plan for Community Accessible/Public Benefit Space and that alternate uses are consistent with those set out in Concept Plan submitted by Morguard. The agreement will also provide for extension to time limits for commencement & completion of construction as required to accommodate redesign and construction of Concert Hall Space.

 

            d)   The City will not be responsible for any costs to Morguard if OCMS does not proceed with Concert Hall and space is used for an alternate use.

  

On 19 January 2005, the Agreement of Purchase and Sale for 150 Elgin/31 Gloucester was executed by the City and Morguard.

 

Morguard submitted its Site Plan application for the development on 9 August 2005 and Development Plan documents on 12 August 2005, in accordance with the provisions of the agreement. City staff, as required by the agreement, reviewed the Development Plan documents and advised Morguard on 23 August 2005 that the Development Plan was consistent with the material filed with the Site Plan Application and also with the Concept Plan dated 24 June 2004, approved by City Council on 13 October 2004 and the Development Criteria set out in the Request for Offers to Purchase (“RFOTP”) document.

The site plan drawings were also submitted to the City’s Design Review Panel on 9 August 2005 and a meeting was held with Morguard on 17 October 2005 to address the Panel’s comments. Morguard then submitted revised site plan drawings on 17 November 2005 in response to agreements reached with the Design Review Panel and also submitted a letter on 8 November 2005 confirming that revised plans respect the height limits set out in Schedules 176 & 177 of the Zoning By-law 1998.

 

On 30 November 2005, Council approved an amendment to the Agreement of Purchase and Sale (Ref N°: ACS2005-CRS-RPM-0047 with respect to the City paying the cost of the tipping fees up to an amount of $276K associated with the disposal of the contaminated material and a restated Agreement of Purchase and Sale was executed on December 5, 2005.  

On 21 December 2005 The sale of 150 Elgin to Morguard closed and, at the same time, a Development Agreement, Parking Agreement, Non-Merger Agreement and Restrictive Covenants were executed and registered on title to preserve the City rights regarding the Concert Hall Space as indicated above.

 

In March 2006, provincial funding in the amount of $6.5M was announced for the Community Concert Hall and was transferred to the City.  At the request of the Ottawa Chamber Music Society, City Council approved the transfer of $500,000 from the $6.5M provincial funding to OCMS on 24 May 2006 to offset project management costs and to finalize the design and building program for the facility. 

 

On 14 February 2007, City Council approved the extension of the City’s endorsement and funding deadline from 30 September 2006 to 30 November 2007 (Ref N°: ACS 2007-CPS-CSF-0003) in order for the OCMS to continue its work aimed at realizing federal government and private sector funding for the Community Concert Hall.

 

On 28 November 2007, City Council granted the Ottawa Chamber Music Society an extension to 28 February 2008 to raise funds for the Community Concert Hall (Ref N°: ACS2007-CPS-CSF-0013).

At the same November 2007 City Council meeting, a letter addressed to the Mayor from the Minister of Canadian Heritage, Status of Women and Official Languages was received, read and added to Council minutes.  This letter indicated that the federal government had conditionally earmarked up to $8M for the Ottawa Community Concert Hall, a contribution that would be the largest to date through the Cultural Spaces Canada program. 

The letter also advised that the deadline for consideration of the federal Community Concert Hall funding file would be extended until February 28, 2008, to allow the OCMS to complete its negotiations with a major sponsor and to ensure that the builder was able to begin construction as planned.  


On 28 February 2008, Ottawa Chamber Music Society advised the City that it would no longer be pursuing the concert hall project at 150 Elgin Street and subsequently, on 26 March 2008, City Council directed (Ref N°: ACS2008-CPS-CSF-000) as follows: that the $5.475M Capital Project for the Community Concert Hall remain open until further options for the development of a mid-sized Concert Hall or other city arts facility, as identified as a priority within the Ottawa 20/20 Arts and Heritage Plan, can be assessed.”

 

The City's unilateral rights to repurchase the 150 Elgin Street property from Morguard expired on 28 February 2008 and, while the City had a first option to lease or purchase the Concert Hall space based on the provisions of the Development Agreement between Morguard and the City for use as a visual or performing arts facility identified as a priority in the City’s Arts and Heritage Plan, the option has now expired as well. Morguard is currently moving forward with alternate development plans for the concert hall space as provided for in the Development Agreement with the City, and so the opportunity to have a concert hall included in the development at 150 Elgin Street appears to be no longer viable.

 

On August 25 2010, Council approved the implementation of the Arts Court redevelopment project as the City’s prime opportunity to fulfill a high priority cultural facility need, as identified in the Ottawa 20/20 Arts and Heritage Plan and, subject to consultation with the Province, directed to this project the City and Provincial funding initially set aside for the concert hall project. 
DOCUMENT 3

DEVELOPMENT AGREEMENT - RELEVANT PROVISIONS

The Development Agreement dated 21 December 2005 sets out the following:

Relevant Recitals

(D)        The Vendor and the Purchaser have agreed that the Purchaser will develop the Property as a mixed-use development including residential, office, retail and cultural components for both community and commercial use as set out in the Report approved by City Council on October 13, 2004 (the “Concept Plan”), all in accordance with the terms and conditions set out in this Development Agreement;

(E)             In accordance with the Purchase Agreement, Morguard carried out detailed design development and studies with respect to the Concept Plan including completion of a Planning Report and Urban Design/Traffic Impact/Site Servicing/Sun Shadow/Wind Studies (collectively, the “Development Plan”) in accordance with requirements and objectives set out in the Purchase Agreement, which was submitted by Morguard to the Vendor by August 12, 2005 as required by the Purchase Agreement to demonstrate that the proposed development shown on the Concept Plan can, in fact, be practically implemented; and

(F)         The Vendor has completed its review of the Development Plan and has satisfied itself that the Development Plan is consistent with the Concept Plan and meets the requirements of the development criteria approved by the Council of the City of Ottawa for the Property.

Relevant Terms and Conditions

1.      The Purchaser agrees to make its best efforts to market the development as proposed by the Development Plan submitted to the Purchaser by the Vendor on August 12, 2005 (the “Development”) for the uses set out in the said Development Plan and more specifically agrees that the retail area shown for the ground floor will be designed and marketed to target the commercial uses as set out in the Concept Plan.

 

2.      The Purchaser agrees that the sale price for at least 25% of the residential units in the Development will not exceed One Hundred Eighty-One Thousand Dollars ($181,000.00) per unit, plus any applicable taxes, unless otherwise authorized by the Vendor.

 

3.      (a) The Vendor agrees, and the Purchaser acknowledges and accepts, that, provided the Purchaser has complied in all material respects with the terms and conditions of this Agreement, the Agreement of Purchase and Sale dated December  5, 2005 and the Parking Agreement and the Heritage Easement Agreement to be registered subsequent to this Agreement:


 

(i)   if Development Charges apply to the residential component of the Development at the time the Purchaser applies for a building permit for the Development on the Property, the Vendor shall pay, on behalf of the Purchaser, that portion of the Development Charges applicable to the residential component of the Development at the time such payment is required; and

(ii)  the Vendor shall pay, on behalf of the Purchaser, that portion of the Building Permit Fees applicable to the residential component of the Development at the time such payment is required,

provided that the total amount to be paid by the Vendor pursuant to  subparagraphs 3(a)(i) and 3(a)(ii) above shall be based on Development Charges and Building Permit Fees charged by the City of Ottawa as of November 25, 2004 and also provided that the amount to be paid by the Vendor shall not exceed One Million Three Hundred Thousand Dollars ($1,300,000.00) if both Development Charges and Building Permit Fees apply and shall not exceed Four Hundred Thousand Dollars ($400,000.00) if only Building Permit Fees apply.

 (b) Notwithstanding the provisions of paragraph 3(a) above, if at any time after November 25, 2004 and prior to September 25, 2006: 

(i)  the amount of Development Charges charged by the City of Ottawa with   respect to the commercial, residential or any other component of the Development and/or the amount of Building Permit Fees charged or imposed by the City of Ottawa with respect to the commercial, residential or any other component of the Development are increased by the City of Ottawa over and above the amount of such charges or fees charged as of November 25, 2004 the Vendor and Purchaser agree to negotiate, each acting reasonably and in good faith, an appropriate adjustment in favour of the Purchaser to such increased charges or fees, provided that any such adjustment shall be subject to City Council approval; and

(ii) the Purchaser increases, with the approval of the Vendor, the total number and/or the mix of residential units such that there is an increase in the amount of Development Charges and/or Building Permit Fees payable to the City of Ottawa with respect to the residential component of the Development, the Vendor and Purchaser agree to negotiate, each acting reasonably and in good faith, an appropriate adjustment in favour of the Purchaser to such increased charges or fees, provided that any such adjustment shall be subject to City Council approval.

4.      The Purchaser agrees to design and construct, at no cost to the Vendor or the Ottawa Chamber Music Society (the “OCMS”), the base building and improvements for the Winter Garden, the base building for the Panoramic Foyers, and the improvements for the Elgin Pocket Park/Panoramic Roof Garden/Concert Hall Roof Gardens for use as Community Accessible/Public Benefit spaces (the “Community Accessible/Public Benefit Space”) all as shown on the Development Plan submitted by the Purchaser to the Vendor on August 12, 2005 (the “Development Plan”) and the Purchaser agrees to operate and maintain these spaces as not-for-profit areas at no cost to the Vendor.

 

5.      The Purchaser agrees to work with cultural services staff of the City of Ottawa to commission, at the Purchaser’s cost, a public art project valued at no less than Sixty Thousand Dollars ($60,000.00) to be incorporated into the design of the proposed buildings and/or other improvements on the Property in accordance with the City of Ottawa’s 1% for Art Policy.  The Purchaser understands that the Selection Committee for this project shall have a total of five (5) members made up to two (2) artists, the Purchaser’s architect, a representative of the Purchaser and a representative of OCMS.

 

6. The Purchaser agrees that direct access for the general public will be designed, constructed, operated and maintained to connect the Community Accessible/Public Benefit spaces as shown on the Development Plan, at no cost to the Vendor.

7.  The Purchaser agrees that the Elgin Pocket Park, Winter Garden, Panoramic Roof Garden and Concert Hall Roof Garden areas and the connections between these areas as shown on the Development Plan shall be accessible on a daily basis to the general public for the period from 7:00 AM to 12:00 AM or whenever the commercial facilities in the Development are open, whichever period is greater, except as may otherwise be proposed by the Purchaser and agreed to by the Vendor in writing and subject to the provisions of Paragraph 9 below.

8.  The Purchaser shall not lease or sell, separate and apart from the building in which the space is situate, all or any part of the Community Accessible/Public Benefit Space without having first obtained the written consent of the City, such consent not to be unreasonably or arbitrarily withheld or delayed. For certainty, the Vendor acknowledges and agrees that the foregoing shall not prevent, limit or impair the Purchaser’s ability to lease or sell the Property as a whole or the entire building and associated lands in which such Community Accessible/Public Benefit Space is situate provided that the use of any or all of the Community Accessible/Public Benefit Space shall continue to be subject to the approval of the Vendor.

9.  The Vendor and Purchaser acknowledge that access to the Panoramic Roof Garden and Concert Hall Roof Garden will be provided within the Concert Hall space to be purchased by OCMS, as shown on the Development Plan, and that access to the general public may be restricted during Concert Hall events and the Purchaser agrees that the sale to OCMS will be conditional upon OCMS permitting access by the general public to these roof gardens on a daily basis from 7:00 AM to 12:00 AM, subject to the foregoing and to the needs of OCMS.  

 

10. The Vendor acknowledges that the provision of Concert Hall space for OCMS on the second floor of the Development replaces and precludes the provision of Artist Lofts space as set out in the Report approved by City Council on June 23, 2004 and the Vendor agrees that the Purchaser shall no longer be required by the Vendor to provide any space for Artist Lofts in the Development on the Property. 

12. (a) The Vendor acknowledges that the sale of the space designated for the Concert Hall (    the “Concert Hall Space”) by the Purchaser to OCMS will be conditional on:

(i)   OCMS committing, by February 2006, to funding the cost of the base building area for the Concert Hall and any upgrades to the base building requirements for the other portions of the Development necessary to accommodate the Concert Hall and OCMS fit-up requirement, and

(ii) OCMS committing, by February 2007, to funding and commencing construction of the improvements for the Concert Hall space.

 

(b)  The Vendor agrees that, should OCMS fail to meet either of the commitments in subparagraph 12(a) above the Vendor will still allow the Purchaser to proceed, or continue as the case may be, with the remainder of the Development.

 

(c)  The Vendor further agrees, and the Purchaser acknowledges and accepts, should OCMS fail to meet either of the commitments in subparagraph 12(a) above, to permit the Purchaser to redesign and market the Concert Hall Space for other uses, subject to:

 

(i)     the Purchaser providing the Vendor with written notice that OCMS has not met either of the conditions in subparagraph 12(a) above and that, as a result, OCMS will not be proceeding with the acquisition and development of the Concert Hall Space;  

  

(ii) the Vendor having the first option to lease or purchase all or a portion of the Concert Hall Space from the Purchaser for use as a visual or performing arts facility identified as a priority in the City of Ottawa 20/20 Arts and Heritage Plan as adopted by the Council of the City on April 23, 2003 including a concert hall, theatre, art gallery or heritage display facility.  Should the Vendor decide to so lease or purchase the Concert Hall Space, the Vendor and the Purchaser shall negotiate and enter into a further agreement which shall include provisions regarding the lease or purchase of the space and to provide that the Vendor receives comparable public benefits to those set out in the Development Plan for the Community Accessible/Public Benefit space. The further agreement shall also include, without limitation, provisions for appropriate extensions to the time limits for commencement and completion of construction as required to accommodate the redesign and construction of the Concert Hall Space and the preparation and execution of the related agreement between the parties; 

(iii)    if the Vendor decides not to lease or purchase the Concert Hall Space, the Purchaser and Vendor then negotiating and entering into a further agreement with respect to the intended alternate use for, and the design of, the Concert Hall Space. The further agreement shall include provisions to provide that the Vendor receives comparable public benefit to those set out in the Development Plan for the Community Accessible/Public Benefit space and that the other proposed uses for the remaining portion of the Concert Hall Space are consistent with the intended mix of uses as set out in the Concept Plan. The further agreement shall also include, without   limitation, provisions for appropriate extensions to the time limits for commencement and completion of construction as required to accommodate the redesign and construction of the Concert Hall Space and the preparation and execution of the relate agreement  between the parties; and

(iv)    the Purchaser acknowledges and agrees that the contractual arrangement for the Concert Hall Space is between the Purchaser and OCMS and that the costs of the Concert Hall Space are the sole responsibility of the Purchaser and OCMS.    The Purchaser further acknowledges and agrees that the Vendor will not be responsible for any costs or losses resulting from the re-design, marketing and/or alteration or construction of the Concert Hall Space to accommodate a new user of the Concert Hall Space and the Purchaser hereby releases the Vendor from any such costs or losses which may be incurred by the Purchaser or OCMS.


DOCUMENT 4

PARKING AGREEMENT - RELEVANT PROVISIONS

The Parking Agreement as provided for in of the Agreement of Purchase and Sales is based on, on terms and conditions as follows:

1.      The conveyance of the Real Property to the Purchaser is and shall continue after Closing for a term of fifteen (15) years from the date of issuance of an occupancy certificate for the Parking Facility to be subject to the Purchaser’s obligation to provide, operate and maintain on the Real Property 121 short-term public parking spaces (the “short term spaces”) on the uppermost levels of the Parking Facility that shall be available on a twenty-four (24) hour daily basis for public parking use.

 

2.      The Purchaser acknowledges that it has received and reviewed a copy of the City of Ottawa’s Parking Criteria Manual (August 2004 draft) and agrees to design and construct the Parking Facility in a manner that is generally consistent with the guidelines of the Parking Criteria Manual.

 

3.  Except with the prior written consent of the Vendor:

(e)                All short term spaces, as designated from time to time, shall only be used in accordance with the provisions set out in the Parking Agreement;

 

(f)                The Purchaser shall not establish policies or practices, which would be inconsistent with ensuring the designated short term spaces are, in fact, available for short-term parking and shall not be inconsistent with the Vendor’s short-term parking policies or practices;

 

(g)               The Purchaser shall not reserve any or all of the short term spaces or permit the use of such spaces for monthly parking, without the prior written consent of the Vendor.

 

(h)               The Purchaser shall provide the short term spaces at hourly rates comparable to public parking lots operated by, or under agreement with, the Vendor in downtown Ottawa, as approved by Council on 10 March 2004 or as amended by Council from time to time, provided that at no time shall the Vendor require that such rates be less than Fifty ($0.50) Cents per twelve (12) minutes except on Saturdays and Sundays at which times the short term spaces shall be made available to the public free of charge unless otherwise approved by the Vendor.  The parking rates shall be applied in the same increments as established by the Vendor from time to time for public parking lots operated by, or under agreement, with the Vendor in downtown Ottawa.  The Purchaser shall not charge a daily parking rate for the short term spaces which is less than the daily rate charged at other parking lots in downtown Ottawa operated by or under agreement with the Vendor;

 

(e)      The Purchaser shall not offer special daily rates before a specified time (e.g. the “early bird special”) with respect to the designated short term spaces;

(f)      The Purchaser shall make available all certified financial records and occupancy and usage records respecting the operation of the short term spaces and allow inspections by the Vendor of these spaces when required by the Vendor for the purposes of monitoring the provisions of the agreement.

4. All revenues from the Parking Facility shall be the property of the Purchaser, its successors and assigns. 

 

 


DOCUMENT 5

NON-MERGER AGREEMENT - RELEVANT PROVISIONS

The following provisions regarding preservation of the Grant House (150 Elgin), tipping fees  were included in a restated Agreement of Purchase and Sale dated December 5, 2005 executed between Morguard, as Purchaser, and the City of Ottawa as Vendor. The sale transaction was closed on December 21, 2005 and the above referenced provisions as detailed below survive the closing under the terms of a Non-Merger Agreement dated December 21, 2005 between Morguard and the City. 

 

12.       The Purchaser acknowledges that the building at 150 Elgin Street, known as the Grant House, (the “Heritage Building”) is designated under By-law Number 21-82 of the former Corporation of the City of Ottawa as being of historic and architectural value or interest under Part IV of the Ontario Heritage Act, R.S.O. 1990, c.O.18, as amended. The Purchaser agrees that any connection to, or alteration of, the Heritage Building required by the Development Plan will require an approval to alter the property in accordance with the provisions of the Ontario Heritage Act and in accordance with the Heritage Easement described in Paragraph 13 hereof. The Vendor and the Purchaser acknowledge that a portion of the proposed new development shown on the Concept Plan will be located on the portion of Real Property designated under By-law Number 21-82 and the Purchaser agrees and the Vendor acknowledges that this portion of the new development will require an approval to alter the property in accordance with the provisions of the Ontario Heritage Act and in accordance with the Heritage Easement described in Paragraph 13 hereof.

13.       The Purchaser agrees to enter into a heritage easement agreement with the Vendor, pursuant to Section 37 of the Ontario Heritage Act, (the “Heritage Easement”) with respect to the Heritage Building based on terms and conditions as set out in Schedule “E” attached hereto. The Purchaser further agrees that the Heritage Easement shall be entered into and registered on title prior to the issuance of a building permit by the City of Ottawa for the Development.  While the parties hereto acknowledge that the Purchaser may have made application to the City of Ottawa for a building permit for the Development, the Purchaser agrees not to request or demand the issuance of any such building permit from the City of Ottawa until the Heritage Easement is entered into and registered on title.  The Purchaser further agrees that the area of the Real Property that will be subject to the Heritage Easement, and on which the Heritage Easement will be registered, shall be established by the Vendor based on the Protective Measures prescribed by the Heritage Consultant as set out in Schedule “E” attached hereto.  Provided, that, in no event shall the area of the Heritage Easement be less than, horizontally, the perimeter of the Heritage Building as formed by the outside of the exterior walls, and, vertically, on a stratified basis from immediately below the bottom of the basement floor to the top of the roof and any appurtenances that protrude beyond the roof including chimneys and such area shall not be more than the area designated by By-law Number 21-82.

17.       Except as otherwise explicitly set out herein, the Vendor makes no representations or warranties whatsoever regarding the fitness of the Real Property for any particular use, or regarding the presence or absence on the Real Property, or any surrounding or neighbouring lands or the leakage or emission from or onto the Real Property, of any toxic, hazardous, dangerous, or potentially dangerous substance or condition.  The Vendor disclaims any responsibility for soil conditions, subsurface contents, contours, building conditions and site conditions generally.  The Purchaser acknowledges and agrees that the Real Property is being  sold on an "as is" basis, **save and except that the Vendor shall reimburse the Purchaser for the full amount of any tipping fees incurred by the Purchaser, up to a maximum amount of Two Hundred Seventy-Six Thousand Dollars ($276,00000), excluding GST, for the off-site disposal of any construction rubble and ash fill removed from the Real Property that is required by governmental regulation to be disposed of at a licensed waste disposal facility as indicated in the report dated March 31, 2005 from Golder Associates Ltd. and titled “Materials Management Assessment 150 Elgin Street Property, Ottawa, Ontario”.  Any amounts to be reimbursed by the Vendor in accordance with the foregoing shall be paid by the Vendor to the Purchaser within forty-five (45) days following the submission by the Purchaser to the Vendor of an invoice for such amounts, together with reasonable supporting documentation to evidence the amount of the tipping fees incurred by the Purchaser.   **Subject to Council approval**

 

18.       The Purchaser further agrees that it will carry out, following Closing, any repairs to the Grant House as required by the provisions of the Dolan Lease and the provisions set out in Schedule “E” for the Heritage Easement. The Vendor shall not require the Purchaser to undertake any repairs or alterations to the Grant House that are required to comply with the requirements of the City of Ottawa Building Permit #0409941, a copy of which has been provided by the Vendor to the Purchaser, to legalize the existing third floor residential unit. On Closing, the Purchaser shall provide the Vendor with an irrevocable letter of credit, in a form satisfactory to the Vendor, in the amount of Four Hundred Thousand Dollars ($400,000.00) to be drawn upon by the Vendor as it sees fit in its sole discretion in the event that the Purchaser fails to carry out or complete the immediately needed repairs identified in the RFOTP documentation (the “Immediate Repairs”). The Purchaser hereby agrees that in the event of failure by the Purchaser to complete the Immediate Repairs within one hundred and twenty (120) days of Closing,   the Vendor shall have the right to carry out or complete the Immediate Repairs and to access the Grant House after closing to carry out and complete the Immediate Repairs.

SCHEDULE “E” - THE HERITAGE EASEMENT AGREEMENT PROVISIONS

The Heritage Easement Agreement (the “Heritage Easement”) as provided for in Paragraph 12 of this Agreement shall be based on, but not necessarily limited to, terms and conditions as follows:

 

 

1.0              PRESERVATION AND REPAIR

 

1.1              The Purchaser agrees to preserve and maintain, or cause to be maintained,  at all times, the interior and exterior of the building known as the Grant House located at 150 Elgin Street in the City of Ottawa, (the “Heritage Building”) more particularly described in Schedule “A” attached to City of Ottawa By-law Number 21-82. 

 

1.2              The Purchaser agrees to maintain, or cause to be maintained, the Heritage Building in as good and sound state of repair as a prudent owner would normally do, so that no deterioration in the present condition and appearance of the interior and exterior of the Heritage Building shall take place.

 

1.3              The Purchaser agrees not to alter, remove, change in any manner, or do any act to the Heritage Building which detracts from or is inconsistent with any provision for the Heritage Easement or the Statement of Reason for Designation attached as Schedule “B” to City of Ottawa By-law Number 21-82, without first making application to Council pursuant to the Ontario Heritage Act and obtaining the prior written consent of Council.

 

1.4              The Purchaser shall utilize the services of a consultant(s), such as an architect, engineer, or contractor with demonstrated expertise in the preservation and restoration of heritage buildings, (the “Heritage Consultant”) in preparing the plans and specifications for any work on or adjacent to, the Heritage Building that will from part of any application for consent from Council.

 

1.5              The Purchaser agrees that the Heritage Consultant shall set out the requirements and scope for all special provisions and works necessary to protect the Heritage Building and adjacent heritage building at 140 Laurier Avenue West (the “First Baptist Church”) during and after construction of the Purchaser’s proposed development (the “Protective Measures”)

 

1.6              The Vendor shall have the right to request the Purchaser to obtain, solely at the Purchaser’s cost, a “Certified Construction Estimate” from the Heritage Consultant to confirm the cost of the Protective Measures.

 

1.7              The Purchaser shall, immediately prior to the registration of the Heritage Easement, provide the Vendor with an irrevocable letter of credit, in a form satisfactory to the Vendor, for an amount equal to the amount of the Construction Cost Estimate. In the event that the Purchaser fails to undertake or complete any of the Protective Measures, the Purchaser hereby agrees that the Vendor shall have the right to undertake or complete such Protective Measures and draw upon the letter of credit accordingly.

 

1.8              The Purchaser agrees not to proceed with any demolition of or construction to the Heritage Building without prior written consent of Council.

 

2.0              INSURANCE

 

2.1              The Purchaser shall, while the Heritage Easement is in place, provide and maintain, or cause to be maintained, adequate All Risk Property insurance coverage to a limit which will affect the replacement and restoration of the Heritage Building.  Such insurance coverage shall include an acknowledgement that the municipality may, at its option, repeal or enact a new heritage designation by-law in the event of a loss.

 

2.2              Evidence of All Risk Property insurance, in the form of a Certificate of Insurance, shall be provided to the Vendor prior to the signing of the Heritage Easement Agreement.  If requested by the Vendor, a certified copy of the insurance policy must be provided.  The Purchaser shall notify the Vendor, as soon as possible, if the policy or policies are cancelled or changed.

 

2.3              The Vendor may request the Purchaser to obtain a “Certified Building Appraisal” to confirm the replacement cost of the Heritage Building, excluding land.  The cost of the appraisal shall be the responsibility of the Purchaser and must be performed by a competent certified appraiser or the Heritage Consultant.

 

2.4              The Purchaser agrees that all proceeds receivable by the Purchaser under the insurance policy, described in paragraph 2.1, must be applied to the replacement, rebuilding, restoration or repair of the Building in a manner consistent with the heritage aspects of the Heritage Building and the Statement of Reasons for Designation attached as Schedule “B” to City of Ottawa By-law 21-82, unless written approval to the contrary has been received from Council pursuant to the Ontario Heritage Act, R.S.O. 1990, Chapter 0.18.  Replacement, rebuilding, restoration or repair shall not be undertaken without the prior written consent of the Council of the Vendor.

 

3.0              RECTIFICATION OF BREACH

 

3.1              The parties agree that in the event of a breach of the provisions herein contained, the aggrieved party(ies) shall give written notice of the breach to the party(ies) committing the breach, requesting rectification thereof within a reasonable period of time, and, in default of rectification, the aggrieved party(ies) may proceed to enforce compliance with the provisions in any manner it may deem appropriate in accordance with the law, at the cost and expense of the defaulting party(ies).

 

4.0              NON-LIABILITY OF VENDOR

 

4.1              The Vendor shall not be held liable for any damage to the Building that may result from the operation of the Heritage Easement save and except for any such liabilities or claims for or in respect of any act or deed done by the Vendor, its agents or servants pursuant to Paragraph 3.1 of the Heritage Easement.

 

5.0              GENERAL PROVISIONS

 

5.1              The parties agree that where there is a conflict between the provisions of the Heritage Easement and any provision of the Ontario Heritage Act, R.S.O. 1990, Chapter 0.18, or any amendment or statute substituted therefor, the provisions of the Heritage Easement shall prevail.

 

5.2              The Heritage Easement shall apply to and be binding upon the Real Property.

 

5.3              The Purchaser agrees that the Heritage Easement will be entered into and registered on title prior to the issuance of a building permit by the City of Ottawa for the Purchaser’s development, as notice to prospective purchasers, transferees or assigns of the Heritage Easement obligations described therein. While the parties hereto acknowledge that the Purchaser may have made application to the City of Ottawa for a building permit for the Purchaser’s development, the Purchaser agrees not to request or demand any such building permit from the City of Ottawa until the Heritage Easement is entered into and registered on title.

 

5.4              This agreement shall not merge on the transfer of the Real Property to the Purchaser but shall survive the closing.

 

5.5              The Agreement and every provision herein contained shall be to the benefit of and be binding upon the parties hereto and their respective successors and assigns.

 

6.0              USE OF THE REAL PROPERTY

 

The Purchaser expressly reserves for itself, its successors and assigns, the right to continue use of the Real Property for all purposes, provided such use is a legally permitted use and is in accordance with the Development Agreement referred to in Schedule “D” of this Agreement of Purchase and Sale, and provided that such use is not inconsistent with the provisions of the Heritage Easement.

 

 

 

 

 

 

 

 

 

 

 

DOCUMENT 6

 

COMPARISON OF MORGUARD CONCEPTS

 

Use/Facility

May 2004 Concept

October 2004 Concept

October 2011

Concept

Overall Development

301,000 sq. ft. (28 storeys)

315,115 sq. ft. (29 storeys)

416,486 sq. ft.

(23 storeys)

Residential

212,700 sq. ft. (170 + units – 68 small)

181, 700 sq. ft. (162 units – 80 small)

None

Leasable Retail Space

10,050 sq. ft. (grnd, & 4th flrs.)

12,790 sq. ft. (grnd. flr. + 5,500 sq. ft. common area)

10,592 sq. ft.

(grnd.  flr.)

Community Accessible

Public  Benefit

Space

16,850 sq. ft. (grnd & 4th flrs.)

*16,850 sq. ft. (grnd, 2nd, 3rd & 4th flrs.)

8,070 sq. ft.

(Winter Garden grnd. flr.)

Saleable/Leasable Cultural Use Space

11,000 sq. ft. (Art workshops & lofts grnd & 2nd flrs.)

27,001 sq. ft.     (Concert Hall 2nd & 3rd flr.) + Community Use space = 9650 sq. ft. of panoramic foyers and lobbies

88,000 sq. ft.

(Canada Council for the Arts - 2nd to 5th flrs.) +

Programming 3,200 sq. ft. of Winter Garden

Leasable Office Space

50,400 sq. ft.

73,725 sq. ft.

351,615 sq. ft.

 Roof Gardens

18,700 sq. ft. (4th & 5th flrs.  5,800 accessible to general public 4th flr. Panoramic roof garden)

14,360 sq. ft. (4th, 7th & 9th flrs.)  12,860 sq. ft. publicly accessible on 4th and 7th flrs.

9,600 sq. ft.

(4th & 7th flrs.)

6,050 publicly accessible on 7th flr.

  

*Note: The August 12, 2005 Development Plan set out in the Development Agreement was based on the design plans dated July 2005 which indicated that the interior areas of the development related to  Community Accessible/Public Benefit Space were as follows:

    580.71 sq. m. - winter garden

    407.71 sq. m. - panoramic foyer 2nd floor

    407.71 sq. m. - panoramic mezzanine foyer 3rd floor

      59.85 sq. m. - panoramic hall 4th floor

  1,455.98 total sq. m.

15,674 total sq. ft. (approximately)