Background:
In the spring of 2003, St John's met with four developers to discuss the possibility of developing the parking lot in order to provide funding for necessary renovations to the church building. We assumed that the development would be market-priced condominiums. Three developers indicated an interest. Only one developer, Teron Inc, offered both cash and parking, with the added bonus of the condominium units being affordable. Teron proposed to build a 10 storey condominium with 119 one-bedroom apartments on the parking lot. The project was 100% affordable according to the City of Ottawa definition of serving households with incomes less than the 40th income percentile, with prices ranging from $100,000 to $150,000. St John's had the option to purchase up to 40 units to rent to low income households. St John's was to receive $1 million plus one level of underground parking (estimated at 38 spaces) for its land.

In February 2004, at a Special Vestry meeting, the congregation approved the sale of the parking lot to Teron Inc according to the terms set out in a Framework Agreement. Key elements of this agreement were:

• St John's would receive $1 million and one level of parking (estimated at 38 spaces);



• St John's would continue to operate its parking commercially;



• The price of units would range from $95K to $135K;



• A church-related assignee could purchase up to 40 units to rent to low income people. This Framework Agreement was the basis for developing a legal agreement to be signed by the Corporation. This legal agreement has not been signed.

Events Since February 2004:
In the course of finalizing the legal agreement, three important events occurred that have necessitated a change in the project. First, the City of Ottawa has re-introduced development charges and other fees in the downtown core. Second, there have been significant increases in construction costs, particularly related to the price of steel. Third, preliminary feedback from the City of Ottawa Planning Department suggested a number of design changes to improve the street scape. This is reflected in the prices for downtown apartments now being quoted in the newspaper by other developers.

Within these added costs, Teron's objective is still to provide as many units as possible within the City's guideline for affordable housing, ie: affordable by families earning less than $57,000 per annum. At the same time, the added costs imposed on the industry require the project to be even more attractive to be marketable at the higher price levels.

The Present Proposal
St John's would still receive $1 million plus one level of underground parking for the sale of the parking lot. The project will still have 119 units in a 10-storey building. However, there are many improvements. The building has been lowered so the first floor is at ground level allowing gardens at both the front and back of the ground floor units. The building will be slightly larger permitting the north facing units to have a den in addition to the bedroom. There will be a combination of balconies and french balconies and a number of other exterior features to adopt the higher standard as requested by the new design guidelines of the City. Prices will be confirmed over the next few months - present costing indicates that the price will range from $143,000 to $210,000. New buildings downtown by Claridge range from $149,000 to $399,000, with very few units at the lower price levels.

All potential purchasers who indicated their desire to buy a unit in this project will get first chance to purchase these units.

Teron has a proposal to lower the prices for lower income people to provide both affordable rental and affordable home ownership. St John's and Teron are presently discussing this proposal with City officials.

Parking
The original design indicated that 38 parking spaces would be available to St John's on the first of two levels of underground parking. The new proposal assumes three levels of below grade parking (which would require waterproofing because of the water table). The more detailed designs indicate that only 28-30 spaces are available on the upper level. Parking spaces will be sold for $25,000. St John's could purchase additional parking spaces on the second level.

Question to Consider regarding the Parking Lot Development:

• Is it acceptable to sell the parking lot for $1 million plus 28-30 parking spaces to build a market-price condominium?

We are awaiting feedback from the City regarding the affordable housing components - once this is received a parish meeting will be scheduled to discuss the new proposal.

October 31, 2004