Clarification: $75-million investment in capital repairs

Clarification: $75-million investment in capital repairs

March 04, 2011

Media reports are stating Toronto Community Housing has invested proceeds of $75 million from the sale of Toronto Hydro Telecom rather than funding capital repairs in buildings.

FACT: The entire amount, $75 million, is being used to fund building repairs. That includes the refurbishment of 9,573 rental units in 317 developments.��

History

In June 2008, the City of Toronto announced that $75 million in City of Toronto proceeds from the sale of Toronto Hydro Telecom would go to Toronto Community Housing for the repair of social housing. At the time, it was estimated that the money would result in repairs to 5,000 units.

In late 2008 and early 2009, Toronto Community Housing's investment fund, like most other publicly-run investment funds, was hit by the global economic and market downturn. As a result of investments in high-quality equities the fund suffered a $41.4-million loss.� The loss represented a 17-per-cent decline in the fund�s value, which was in line with the average performance of a balance fund with a mix of stocks and bonds.�

In April 2009, Toronto Community Housing restructured the investment fund on the advice of external financial advisors.� To complete the asset allocation and move to a 100-per-cent bond portfolio, we booked $41.4 million in losses and reinvested in the bond market.

In November 2009, seven months after the investment fund booked the $41.4 million in losses, the City of Toronto delivered the promised $75 million in proceeds from the sale of Toronto Hydro Telecom. The Toronto Hydro Telecom sale funds are completely segregated from the investment fund.� The $75 million is being directly spent in repairing and upgrading our buildings.

As of December 2010, the investment fund had recouped $34 million of the $41.4 million in losses.� The investment portfolio was structured about five years ago to grow from $100 million to a goal of $200 million in 10 years, to generate a future annuity for capital repairs.�

Despite the losses incurred in 2008/2009, we are still in a good position to achieve our overall goal of $200 million by 2015.

 

ABOUT TORONTO COMMUNITY HOUSING

Toronto Community Housing is Canada's largest social housing provider and home to more than 164,000 tenants with low and moderate incomes�about six per cent of the City of Toronto's population. Toronto Community Housing employs 1,400 staff in a broad range of jobs, who deliver its mandate to provide affordable housing, connect tenants to services and opportunities, and work together to build healthy communities.

 

MEDIA CONTACTS

Jeffrey Ferrier, Media Relations, 416-981-4252, Jeffrey.ferrier@torontohousing.ca
Kyle Rooks, Media Relations, 416-981-4347, kyle.rooks@torontohousing.ca�����