Bankrupt for-profit charity sells out of downtown Toronto properties

This story was originally published by Quartz.

WE Charity, a leading not-for-profit that seeks to improve life for First Nations families, has sold many of its downtown Toronto properties, for millions of dollars in losses. WE Charity initially bought the properties in 2003 for $36 million. The purchases are believed to have doubled the worth of its headquarters—which now sits empty—to more than $90 million, The Globe and Mail reported.

“Our limited partners were primarily public or charity investments,” said Dale Whitburn, WE Charity’s chief operating officer, in an email. “The proceeds from the properties sold go directly to the families we serve.”

The group could not be reached for further comment, but in a presentation that it gave to a potential investor at a capital markets meeting in April 2015, WE Charity reported that it held more than $60 million in property assets, according to a recording of the meeting first posted on 4th tier.

At the time, the company had the income from its investments from $16 million to $39 million for 2015, reports 4th tier. Later it had about $12 million.

Less than two years later, in December 2016, WE Charity transferred all of its real estate assets to a separate corporation called Building Matters, according to Corporation Canada documents. WE Charity owns more than 11 properties in Toronto’s Dundas and Yonge Street shopping districts, that in total are worth about $36 million.

The downtown properties include several of Toronto’s newest landmarks, which remain vacant. Its former office on Wellington Street West occupies more than 4,000 square metres. On the other side of the street, WE Charity owns the historic Bank of Toronto building that the city council and the Canada Mortgage and Housing Corporation named the most beautiful building in the city in a 2018 survey of architecture.

The company announced on Tuesday that it had sold these buildings.

Winchester Properties Inc., a division of Korea Development Bank, paid just over $10 million for the two buildings along the Toronto River, known as 2 Avenue and 2 Queensway. Winchester Properties chairman and president R.C. Kwon said in a statement, “We hope to rent the space within a year.”

A few floors above Winchester’s offices, WE Charity sold 101 York Street to Dhalla, Ltd. at $5.3 million. Dhalla is a local developer who specializes in waterfront projects, and is affiliated with Sonam Soohee and Thy Jonghee, two owners of 2 York Street and 2 Avenue, which are both owned in various family trusts.

The sale of 123 Bay Street for $5.4 million followed. All three buildings were owned by WE Charity through the Building Matters company. This building is also located along the Toronto River and is a half-block from the riverfront. We Charity had owned it for a decade until recently, but had already been looking to sell before the capital markets meeting when the properties were acquired by Building Matters. The company says it intends to convert the building into something “unique and creative.”

The other nine WE Charity buildings that are not owned by Building Matters have not been sold as of yet.

At least three of the WE Charity buildings are tenants, including a medical clinic and a non-profit that offers palliative care in Edmonton.

Read the original article on Quartz. Copyright 2018. Follow Quartz on Twitter.

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