The Broadview Planning study is about densification so that the city can accommodate the expected growth in population. The concept of the avenues plan is to put density where the city has the service, business and transit infrastructure to support more people. A critical foundation to that is the cost efficiency of a walkable city.
Walking is nearly free for a city to support. Add the health benefits of walking to and from work, groceries etc and a walkable city is the best financial investment the city can make.
So while Broadview plan is all about adding density, along comes the Toronto Parking Authority with a proposal to build a 12 space parking lot at 811-813 Broadview avenue. The density of a parking lot is zero. So much for an aligned plan unless there is something else going on.
Let’s just put aside the fact the TPA said the building is a Victorian cottage from 1890. Clearly historical buildings didn’t factor into the TPAs logic because they were proud to show artistic renderings of the proposed parking lot with the old building demolished.
The TPA cares about revenue. The TPA representatives were very proud to point out that their activities didn’t rely on tax dollars and that they generated a $45 million dividend back to the city in addition to pay taxes. The specific proposal has been green lighted by the TPA board as it will generate the required return on investment (apparently – no financial figures were shown at the open house).
The surface lot must be revenue positive. On the cost side: purchase price is about $2.1 million plus about $500K in construction for a total of $2.6 million investment. On the revenue side: the site will have 12 spaces at $1.50 per half hour. At 48 half hour time slots a day at 365 days a year the absolute maximum the lot could generate $315k if it was 100% full all the time. Let’s assume it will be about half full so $157k is closer to a realistic top line revenue number. Operating expenses are about 37% of the revenue number (not including tax paid to the city). So the city will recognize the 63% or just under $100k annually on this lot through a dividend and taxes paid to the city. That’s a return on investment of about 3.8% annually.
The TPA in addition to parking lots has these things called joint ventures. The TPA explained that if a developer bought the adjacent property perhaps there was some kind of deal that could be arranged for a mid-rise development where the TPA operated the below grade parking garage. The TPA receives the parking revenue and the developer purchases the “air-rights”.
From the TPAs 2013 annual report: “We also continued to advance four new joint venture agreements involving the sale of development rights at existing Toronto Parking Authority properties. These include Carpark No. 5 (15 Wellesley Street East), Carpark No. 650 (16 John Street), Carpark No. 15 (50 Cumberland Street/ 37 Yorkville Avenue) and Carpark No. 664 (1607 Eglinton Avenue West). The resulting mixed-use developments all retain a public parking component, allowing the Authority to meet local parking needs while establishing a long- term income stream at the same time.”
So I guess the real story here is that the TPA can generate revenue by playing in the real estate market knowing that the Broadview planning study is will push and allow for greater densities. Perhaps a developer will jump in to buy the adjacent property and then make a deal to create some like the picture below. In the meantime it can be cash flow positive through selling parking. The whole argument about serving the neighbourhood with parking is just a side story.
Thing is, who is to know if this is the real plan or not?