A city staff report recommends that Malleum Properties, owners of an apartment complex at 540 King Street East receive roughly $169,000 in a tax increment grant over the next five years. This despite active opposition by the tenants’ rights group Acorn who accuse the property developer of renovictions. Both Acorn and Malleum provided submissions on the issue that differed widely on the facts. In its submission ACORN said tenants were paying about $825 per month in 2018 when Malleum bought the property and started displacing tenants in order to renovate the units. According to the Acorn submission, the apartments went back on the market at just under $1400 per month. But Malleum’s own website shows properties in the building listed at $1795 per month,
Malleum responded that when they took over the property the complex had six tenants with legal tenancies and 30 without tenancy agreements. Thy claim that one tenant had been living in the property for months without paying any rent, adding that when they finally got the tenant out through a sheriff’s order, “we elected not to pursue any further actions after their departure. “
Malleum contends that most of the units at 540 King were not fit for human habitation and had previously been the subject of numerous bylaw orders from the city of Hamilton. The letter from Malleum referred repeatedly to the company as the ‘manager’ of the properties omitting that they are also the owners, who purchased the properties with the intention of renovating them and putting them back on the market.
Nonetheless Malleum says in its submission that they support groups like Acorn writing, “In any case where a landlord unilaterally ends a tenancy in order to renovate and rerent a unit to a new tenant, this is wrong and there should be harsh consequences. We believe that any landlords found to have taken such actions, should be denied the right to participate in City of Hamilton grant programs and there should be further consequences levied by any level of government with the authority to do so.” Malleum goes on to say that most of the evictions took place before they assumed ownership, and that they have worked to find accommodation for displaced tenants.
ACORN says displaced tenants were put into more costly units that in some cases were in worse shape than the ones they left.
The staff report outlines the dilemma for staff. “Staff are not in a position to independently verify any of the disputing claims made as this would require the exploration of historical claims and facts, and ultimately require determinations of right or wrong, that should be made under the Province’s jurisdiction in a formal tribunal setting via the Landlord and Tenant Board (LTB). As such, staff are recommending that the Hamilton Tax Increment Grant Application in respect of renovations undertaken at the property located at 540 King Street East, Hamilton be approved as the Application has met all applicable HTIG Program terms.”
Part of this matter will be discussed in camera and almost certainly that discussion will involve council being told by legal staff that to deny an application that has already been commenced under the existing rules would expose the city to a lawsuit .