Eesti Maja Tulevik. Rahva Infokoosolek. 19 oktoober 2011

Transcription

1 Eesti Maja Tulevik Rahva Infokoosolek 19 oktoober 2011

2 Meeting Objective 1) Informing the community on where we are and what decisions are ahead 2) Get Input from the community on final direction & prepare shareholders to choose which path to take

3 Päevakord Tervitus Eelmise Koosoleku Kokkuvôtte Kôrvaldatud Alternatiivid Eelistatud Alternatiivid Järgmised Sammud Laudkondade Arutus Lõpp Sõna

4 Agenda Welcome & Meeting Objective Recap & Results Options No Longer Being Considered Remaining Options Next Steps Community Activity & Discussion Closing Remarks

6 Community Engagement Process Shareholder vote Community Meeting #1: Inform & Engage community (Needs/Options) + Solicit Feedback Community Meeting #2: Review analysis with community + Present remaining options for input Analyze input/expert Advice Meet with key stakeholders

7 New Eesti Maja - List of Needs (ranked, most votes in top section) Restaurant (with patio) Sufficient parking Classrooms (well set-up and equipped) Gymnasium (multi-use: sports, rahvatants) Meeting rooms / Board rooms (multi-use) Location for Bank (and near the street) Banquet hall (improved, state of the art) Lounge / noorte ruum Internet / wifi (computer room) Accessible library (with coffee shop) Music room / concert hall / stage Space for Scout and Guide activities Art gallery (for exhibits and etnograafia) High quality kitchen Saun / Showers (Hot tub) TTC accessible (subway line) Bar/Café (open longer, patio, pool tables) Commercial rentable space (flexible use) Shooting range estore & Esto boutique Proper wheelchair access Space for Consulate Swimming pool Archive room Condos Movie theatre Improved washrooms (on every floor) Softer floors for folk dancing More storage space

8 SUMMARY Estonian House Requirements Permanently Committed Space and Current User Needs sq-ft Community Space 7,350 Rentable Commercial Space 8,650 Multi-Use Space* (max usage of halls/classrooms) 7,700 Required common areas 2,500 Total 26,200 * Note: used highest space requirement need for calculation of overall total. Estonian House Future Needs estimated sq-ft Restaurant and pub (added to present café space) 1,000 Gymnasium (7, ,800 sq-ft) 9,000 Meeting / board room 500 Youth Room / Lounge (with internet / wifi) 500 Theatre / Concert Hall with Stage 2,500 Required common areas 1,300 Total 14,800 Estonian House (present usage) + (future needs) 41,000 sq-ft

9 People s Most Preferred Options were closely tied

10 Questions Raised How much to build our new facility? Can we afford to do it on the existing property? How will the new building sustain itself long term and generate enough revenue? Where will we get the funds to build our new facility? If we join forces with another cultural group how will we make decisions for our community? Which community would be good to combine forces with? If we move where will the building be located? What about all the other potential partners?

11 Must do something Conclusion No clear direction proposed Community clearly pragmatic about direction Prepared to change based on solid info Still missing info on options to make an informed decision Complex issues need to be resolved

12 What happened next? Analyzed results of Community feedback Detailed assessment of options Compiled a list of prioritized building space requirements Concerns to investigate: Costs of various alternatives Sources of money for renovation Long term revenue generation potential Zoning Design (architecture) & price of project Sub-committees: Project Finance Building Design and Costing Long-term Financial Sustainability Partnership Investigation

14 Option: Do Nothing Analysis: Presented building status & finances to Community Engagement Meeting #1 (Sept 2010). Highlighted non-viability of this status quo option. Quick recap here! Pluses: -Requires no major effort. -It works, for now. -Leaves resources for other endeavours. Conclusion: Minuses: -Declining rentals / increasing costs. -Potential problem looms (leak, fire, etc). -Not a source of pride. Negligible support for this option by the Community vote (Sept 2010). Reason for eliminating: Community & Committee agreed to discard this option in September 2010.

15 Option: Extensive Renovation Analysis: Meetings with Facilities Engineer to review opportunities and challenges. Engineering firm (Turner & Townsend) estimated repair costs for essential infrastructure. Pluses: -Lower operating costs. -Greater compliance and function. -Possible increase in rental income. -Phases might help cash flow & fundraising. Conclusion: Minuses: -Reno seldom cheaper; unknowns, surprises -Significant impact on Users during Reno. -Serious health issues (asbestos, etc). -External of bldg. remains largely the same. Costs for just mechanical, electrical & structural is significant (almost $2 million). Change to aesthetic and space problems requires a more reno budget ($2 million +). Phased approach not feasible if Community & Tenant use is to continue during Reno work. Resultant building still not as efficient or effective, compared to a ground-up re-build. Reason for eliminating: High cost for a sub-optimal outcome (incl. physical building, revenues, expenses). Phased approach is unlikely to succeed without significant added cost expense.

16 Option: Rebuild with new Ehatare Analysis: E&Y evaluation concluded this option was not feasible due to limited land area at 958. Presented non-viability of this option at September 2010 meeting. Quick recap here: Pluses: -Shared costs. -Greater centralization. -Potential for some shared amenities. -Estonian ownership. Conclusion: Minuses: -Not enough land area at 958 Broadview site (Ehatare needs two or more acres, for a low-rise building). Not enough land available to build new Eesti Maja and new Ehatare at 958 Broadview site. Reason for eliminating: Not feasible.

17 Analysis: Option: New Building (Industrial / Vacant land) Visited and reviewed 5 potential vacant properties. Evaluated costs and risks of building a new Eesti Maja on vacant land. Pluses: -Fresh new building. -Potential to inspire community. -Turnkey facility. -Unique design opportunity. -Can apply 958 sale proceeds to project. Conclusion: Minuses: -Costly (land, zoning, design, build, finish). -Still requires major fundraising. -TTC / Subway access impacts cost. -Best value is a remote location. -Competing with developers for prime sites. Sale proceeds may fund purchase, design & zoning; still need fundraising to construct EM. Challenge to agree on a preferred location. Significant logistics and scheduling challenges (selling, building and moving). Reason for eliminating: Costs, risks & logistical complexity are too high.

18 Analysis: Option: Refurbish Old Building (Industrial / Warehouse) Visited and reviewed almost 20 properties that were for sale. Evaluated costs and risks of refurbishing an existing building. Pluses: -More reasonably priced; get existing shell. -Turnkey facility. -Less noise issues if far from housing areas -Cheaper than new build. Conclusion: Minuses: -Costly to buy, if in good location. -TTC / Subway may not be close. -Potential problems of an old building. -Déjà vu 1960 (old school house at 958). Often challenges with re-zoning. Limited number of suitable properties. May still require additional external construction. Potential for limited rental income and rental tenants in more remote areas. Challenge to agree on a preferred location. Reason for eliminating: Costs, risks and potential unknowns are too great.

19 Option: Development with Hungarians Analysis: Met and spoke with Hungarian House Board 4+ times to discuss potential partnership. Hungarians sold their centre and have significant proceeds from sale. Pluses: -They are also a Finno-Ugric group. -Have capital to contribute. -They are looking for a new place. -Seemingly a willing partner. Conclusion: Minuses: Limited commonality, different priorities, many challenges. Reason for eliminating: Feasibility and complex logistics. -They are a much larger community. -Their community is still reviewing priorities. -Limited commonality with Hungarians. -Recent leadership change adds challenges.

20 Option: Development with Finns Analysis: Met and spoke with various Finnish community representatives to discuss potential partnerships. Pluses: -Also a Finno Ugric group. -Our northern neighbours. -No single major Finnish community centre in Toronto. Conclusion: Minuses: -Many small locations; several groups. -Still reviewing alternatives; no definitive partnering group currently identified. -Their primary focus is on Agricola site. Different priorities and time line for potential community centre development. Reason for eliminating: Current timing and logistics.

21 Option: Expand at Tartu College Analysis: Investigated options to partner with Tartu College. Several potential partnering scenarios exist. Pluses: -Esto centre there now; scope to build on it. -Terrific TTC access. -Ample nearby parking. -Central location. -Successful business model. Conclusion: Minuses: -No immediately available land - Parking Lot, Church on Bloor, Tartu s own property. -Potential traffic access at certain times. -VEMU already well underway. -No significantly underused space in Tartu. Tartu College facilities are well used; limited space synergies. Would need to build or acquire significant new space. Adjacent land not easy to acquire (Parking Lot recently repossessed by City; Church has costly Bloor Street frontage, needs refurbishment, may have historic designation. Tartu and EM governance structures are significantly different. Reason for eliminating: Complex feasibility and high costs (despite significant emotional appeal).

23 Two Remaining Options for Direction Today A Stay and Redevelop 958 Broadview B Baltic Option: partner with Latvians Develop a new building on our own, if we can afford it Build with a developer if we must Build a new Baltic Center with the Latvians at DVP & Eglinton

24 STAY Redevelop 958 Broadview

25 A Stay Option: Analysis Work Facilities evaluation: Consulted expert to understand how needs inform space planning Architectural input: Consulted architect to understand how to proceed with new building & RFP process Developers: reviewed condo option with developers 2 sub-options resulted Build a brand new building on our own Build a brand new facility as part of a condo building with a developer Financial analysis: Created financial model to determine build feasibility & operational sustainability Met with bank to review financial model and assumptions Fundraising analysis: Conducted initial fundraising analysis

26 A Stay Option: Proposal Stay at 958 and build new EM on our own build on existing 958 Broadview location brand new beautiful building the community would be proud of and would want to spend time in If we can afford it, we will rebuild on our own If we cannot afford it, we will work with one of the many developers interested in a joint project with condos and retail space

27 A Stay Option: Location Land provides plenty of space for additional parking spot options Subway is walking distance Buses run frequently from the subway

28 A Stay Option: Physical Building Composition On our own: new building designed by an architect bright, clean and attractive contain our current space needs With developer: EM within larger condo tower we would work with architect to determine EM design developer and architect work together to ensure EM built within tower in a tasteful way that results in a beautiful new facility contain our current space needs + opportunity to share condo common areas (eg. gyms, pool) In either case, to maximize leasing income, the building would likely have retail at street level

29 A Stay Option: Tenants Goal is for existing tenants to remain, plus attract new commercial tenants with beautiful facility 958 Broadview is a higher rent location due to it s proximity to subway, the Danforth and downtown Tenants leasing office space in the new building would pay around $30 per square foot Existing tenants provide indication of demand for space in this area

30 A Stay Option: Management & Scheduling Management in Esto control Likely change in legal structure to achieve tax benefits Scheduling remains in Esto control: community activities will be scheduled as per community s needs Opportunity available, if desired, to share some common space (in addition to our requirements) if building EM within condo tower In the case of some shared rooms/gym the Estonian community would likely be treated as a tenant in the condo building and would schedule accordingly

31 A Stay Option: Transition During construction period community would be required to relocate We would work with builder to minimize period of transition Potential places for community activities during transition such as: Tartu, Churches, LCCC, other as required

32 A Stay Option: Timelines

33 A Stay Option: Risks Community does not move fast enough, risking market changes making it hard to strike a deal with developers Ability to fundraise sufficient funds Rental income that we rely on to run the building is not as high as predicted The community get s lost during the time that we are building the new space and doesn t come back

34 A Stay Option: Main Advantages Oma tuba Oma luba New building Familiar location Closer to downtown / higher rental rates Opportunity to work with a developer and not require any fundraising

35 A Stay Option: Dependencies to Success Financing approved for loan Fundraising to cover $ shortfall Reoccurring revenue to be self-sustaining With Condo Option Closing a deal with a developer Hiring an experienced employee to manage the processes with a developer

36 A Analysis: EM & TOWER (Residential/Commercial) Spoke to some developers in confidence to understand rough process Received unsolicited interest from developers Pluses: Minuses: -New start / Turnkey facility -Tower sales / leases help funding -Shared amenities help with costs -Most affordable option -Retail space and tenants ensure ongoing financial sustainability -Challenging project / need to hire skilled analyst/manager -Residents / tenants add new complexities -Potential lossof entire property ownership -Shared building = mixed physical identity Conclusion: Condo s would pay for much of the cost associated with the new building This option is most affordable but we trade off the land ownership to fund EM2 Requires expertise to deal with the developer complexities & to safeguard our interest Reason for choosing: Most affordable option if we want to go it alone

37 A Two Stay Options Summarized Stay build on our own Stay build with developer Proposal Stay & fundraise to build new EM on own Work with developer to build a new & shared facility Location Broadview & Danforth - Transit DVP, TTC (buses & Bloor line), parking - Physical Building Community Center/Office space mix Community Center/Offices within Condo tower Tenants Esto community, businesses (Esto/non-Esto) - Management & Scheduling Esto owned & operated Esto part; self owned & operated Shared facilities require scheduling per condo rules Financials loan + fundraising Essentially trade land value for new EM Transition Temporary relocation during rebuild - Timelines 3-4 years 4-5 years Risks Cost to borrow more than projected Fundraising shortfall EM2 can t generate self-sustaining revenue Lose land ownership? Partnering with developer Ensuring our needs are met by developer Main Advantage Go it on our own Reduce risk factors by staying on-site Most affordable option if we wnt to go it alone Success Dependencies Financing approved for loan Fundraising to cover $ shortfall Reoccurring revenue to be self-sustaining Strong PM working in our interests with developer Carefully defined terms for our unit

38 BALTIC OPTION partner with Latvians

39 B Baltic Option: Analysis Work Numerous meetings with representatives of LCCC & honorary consulate; Evaluated Facilities; Discussed site valuations & availability; Financial analysis.

40 B Baltic Option: Proposal Proposes the Estonians partner together with the Latvians; To build a community centre that neither of us could have built alone; The benefits achieved by partnering outweigh the drawbacks.

41 B Baltic Option: Location The new Baltic Centre would include two main components: (1) The present LCCC; (2) The new Eesti Maja somewhere close by, preferably beside it.

42 B Baltic Option: Physical Building Composition Includes two main components: present LCCC facility new Eesti facility in close proximity The underutilized spaces can be shared; A space usage analysis, confirms that almost all Eesti Maja regular activities can be accommodated in the present Latvian Centre.

43 B Baltic Option: Tenants Estonian & Latvian cultural space; Commercial rental space to professionals (priority to Estonian & Latvian tenants); Tenants leasing office space in the new building would pay close to $26 / square foot.

44 B Baltic Option: Management & Scheduling Management structure of partnership to be established with legal counsel; Proportional representation being fair to both parties; Capitalize on favorable Latvian tax free charitable status.

45 B Baltic Option: Transition Where does our community activities go during construction? We relocate only once. In the interim we carry on in the current Eesti Maja; Without a continuously operating Eesti Maja, our community faces the prospect of declining participation.

46 B Baltic Option: Timelines

47 B Baltic Option: Risks Ability to acquire land; We are fully partnering with Latvians; The joint centre will need to be fair to both; Ability to fundraise sufficient funds; Rental income is not as high as predicted; Our existing tenants don t move with us.

48 B Baltic Option: Main Advantages The current Eesti Maja activities and facilities are maintained without disruption; This will be a facility supported by two like-minded and energized communities; This option provides room for all of our present needs and we also get the majority of our top 25 added wants; The Baltic option will attract & energize Estonian Youth; Provides Older Generations added ways to stay active, and Ehatare could moves right across the street; Our communities will be stronger and more vibrant, together, for the next 50 *plus* years

49 B Baltic Option: Dependencies to Success Land available for purchase; Acquire loan prior to 958 sale to purchase land; Joint board structure and co-operation; Successful community transition & on-going co-operation.

50 A B Two Options Summarized 958 Broadview Baltic Center Proposal Stay & fundraise to build new EM Partner with Latvians to build a new & shared facility Location Broadview & Danforth DVP & Eglinton Transit DVP, TTC (buses & Bloor line), parking DVP, parking, TTC (LRT on Eglinton & buses) Physical Building Community Center/Office space mix Shared Esto/Latvian Center with mixed office space Tenants Esto community, businesses (Esto/non-Esto) Esto & Latvian community, and other businesses Management & Scheduling Esto owned & operated Esto & Latvian owned & operated Financials loan + fundraising fundraising for Extras Transition Temporary relocation during rebuild Stay in 958 until EM2 and added venues built Timelines 3-4 years 3-4 years Risks Cost to borrow more than projected Fundraising shortfall EM2 can t generate self-sustaining revenue Fundraising shortfall Land not for sale, or too expensive Esto Latvian co-management Main Advantage Go it on our own Reduce risk factors by staying on-site Sale proceeds to build bigger shared facility Double the fundraising potential with Latvians Success Dependencies Financing approved for loan Fundraising to cover $ shortfall Reoccurring revenue to be self-sustaining Fundraising to cover $ shortfall Land available for purchase Acquire loan prior to 958 sale to purchase land Latvian & Esto board structure & co-operation

51 The Financials 1. Assumptions and Constraints 2. Current Revenue Generation Capacity 3. Comparison of options Costs and Benefits Funding Strategy Issues, Risks

52 Assumptions and Constraints New building must generate enough revenue to cover operating costs & financing costs Sustainable: generating more revenue than your operating expenses The new building requires at least 14,000 sq ft of commercial space to generate sufficient revenue Most commercial construction lenders require a debt service coverage ratio of at least 1.25, based on the appraiser's estimate of future tenant rents and expenses

53 Financial considerations: A bank loan is needed to build the building (Option A) Fundraising is needed and amount of additional funds for Option B depends. Tenants to support the upkeep of the building for the community to use Community groups do not pay market rates or fully cover associated operating expenses We must utilize our building footprint more efficiently to reduce the cost of the community space We must choose our revenue generating carefully to maximize our revenue per square foot from interests outside the community Although the opportunity exists to generate revenue from event halls and the Estonian Communities activities neither of these are counted as stable income toward a bank loan to finance the building The construction cost of the building depends directly on how many square feet we build for the community and how many for office space and other uses

54 Financials & Viability A 958 Broadview Should be able to replace the building with moderate fundraising ($2-6MM?) Core needs only? (wish list dependent on fundraising ability) Requirement to partner with a developer dependent on further detailed investigation Requires mortgage (sustainable) Revenue from new commercial space will generate sustainability B Baltic Centre Partnering & new space will meet current needs 958 must be sold before purchasing land (or creative financing) fundraising requirements depends on proceeds from sale price & extent of wish list Market risk in buying, selling is a consideration Lower rental rates due to location The costs and revenues will be shared with the Latvians

56 Our Potential Paths Feasibility Assessment Options Analysis Fall-2011 Implementation Spring-2012? Clear Mandate A Stay & Re-develop Ready for use Temporary Relocation? Proposals? Move In Esto House 2 Redevelop Baltic Option Actionable Plans Maximized Value Financials Shareholder Vote Fundraising / Financing Today B 2015?? alidate Option / Negotiate Define Model & Governance with Latvians Viability of Land Purchase? Create BCC / Buy New Site / Sell Existing New Development Temporary Relocation? Baltic Community Center

57 Next Steps Today: Provide Info & determine Community s preferred direction Next: Formalize direction Town Halls to answer any further questions Special Shareholder Vote Hire a full-time Project Manager & professionals to drive the development details Start the fund raising By Spring 2012: Finalize the details & actionable plans Build the detailed business model & finalize the requirements Solicit interest from developers, etc. / begin formal discussions with partners Resolve constraints (building code, any relocations, ownership structure, issues, etc.) Assess options and come up with a recommendation for shareholder decision After That Create the detailed architecture / designs Contracts Build

59 Wisdom of Crowds Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations

60 Activity & Discussion (5 min) Q1: What criteria do you deem most important to make a decision on direction? Financial viability build, sustainment, risk Transition, etc. How important is esto control/ownership What trade-offs (facilities, etc.) are you willing to make?

61 Activity & Discussion (5 min) Q2: What is your current preferred option and why? If you represent a community of organization, what are your key considerations and concerns

62 Activity & Discussion (5 min) Q3: We expect to need to raise about $2-4M (in addition to financing). suggestions options

63 Activity & Discussion Recap Each Table (30 seconds) 1.Most Important Criteria? 2.Preferred Option & Why? 3.Fundraising?

65 Järgmised Sammud Okt. 19 Info koosolek Järgneb Info levitamine ajalehtede ja muu meedia kaudu. Nov. 16 Külastus & arutus koosolek (Läti Majas) Novembris Mitmeid arutus koosolekuid Eesti Majas Palun jälgige ajakirjanduse kuulutusi ja teateid Eesti Majas Jaanuaris Erakorraline peakoosolek (EM) EM Aastapeakoosolek, aprillis 2012 Lõplik ettepanek valmis hääletuseks???

66 Closing Remarks Aitäh! mail questions to

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