The Toronto Parking Authority (TPA) almost overpaid for a plot of land in North York earmarked for a “gateway project” which might have housed parking and a bike share in addition to potentially being home to North America’s largest flagpole.
The City’s auditor general elaborated on the potential deal during the afternoon session of the audit committee on Tuesday in which Green P was about to pay around $12.13 million for a piece of property near Finch Avenue and Arrow Road with a market value of only about $9.5 million.
Beverly Romeo-Beehler said in her 76-page report the discrepancy was based on the value of a large digital sign on the property.
After an initial independent evaluation of the land in August of 2015 put the price at $7.5 million, it was discovered that the purchase price put forward to the city in December was listed at around $12 million.
Urged on by TPA board member and Councillor John Filion, the Auditor General’s 2016 investigation discovered that the person who appraised the value of the sign was the same individual who spearheaded its placement in 2009.
“The sign consultant was essentially valuing his own sign,” Romeo-Beehler told the committee. “He himself said his role in this was not to give an independent value of the sign, but to what’s the maximum value one could possible get for it.”
The TPA’s response came from President Lorne Persiko and VP of Real Estate and Development Marie Casista who said “they always intended” to get an independent evaluation of the sign during the purchase process, but that they had simply not reached that stage by the time the audit of the potential sale began.
The TPA did back out of the deal in 2016 invoking a 60-day due diligence window.
Persiko cleared the air on the sign consultant revealing that he was a lobbyist who became involved in the negotiations to purchase the land in 2010 and knew the owner of the property “really well.”
“We thought, he represents the BIA and we’re both working to make this happen,” said Persiko. “He had the relationship with the vendor.”
When asked about the report during the launch of “YYZ Live” at Toronto Pearson Airport on Tuesday, Mayor John Tory said the thing to focus on was the fact that the land was not purchased.
“It’s not the kind of way we should be doing business in the city,” said Tory. “There are some steps that should be taken to make sure both this situation is adequately addressed and that one can prevent a repeat of this kind of situation.”