Some artists in downtown Toronto are breathing a sigh of relief knowing they’ll still be able to live and work in a former Artscape building, after the non-profit went belly up in early 2024.
On Thursday, Mayor Olivia Chow, Davenport Coun. Alejandra Bravo and Davenport MP Julie Dzerowicz announced the city and federal government will step in to save 20 affordable apartments at 38 Abell St. in Queen West — formerly subsidized by Artscape — from an uncertain future.
“Life has never been more expensive, especially for artists. It threatens the vibrant arts scene,” Chow said. “In August 2023, Artscape’s financial challenges meant that creatives were at risk of losing their space.”
Artscape provided affordable housing and work spaces to artists in Toronto for decades before financial trouble struck in the late 2010s. After the organization announced it was insolvent in 2023, the city started negotiations with Artscape’s creditors to find a solution and protect the artists’ homes.
Artscape officially entered receivership in early 2024, putting nearly hundreds of affordable homes — at 14 properties across the city — at risk.
The city will spend nearly $5.5 million on the 20 units at 38 Abell St. through the Multi-Unit Residential Acquisition program, a city initiative that purchases affordable housing before it goes to the wider market.
Under the new arrangement, the 20 rental units will “remain affordable forever,” Chow said.
The Propeller Art Gallery, which sits on the ground floor of the apartment complex, will also remain open thanks to nearly $400,000 in federal and municipal funding.
“We are really, really happy that we will soon be our own landlords,” said Michelle Letarte, an artist and board member of the Propeller Art Gallery.
It also means the gallery won’t be sold for at least 10 years, said Pat Tobin, Toronto’s general manager of economic development and culture.
Resident homeowners in 'financial limbo'
With Thursday’s announcement, all the rental homes put at risk by Artscape’s financial problems have been saved, Chow said.
However, some Artscape residents still don’t have answers because Thursday’s announcement only concerned the renters of the building. But nearly 50 artists are owners of their homes at 38 Abell St., with Artscape retaining a 25 per cent stake in their mortgages.
“There are no updates or changes with regard to the homes with shared mortgages,” a city spokesperson said.
As part of the model, artists put up a five per cent down payment and Artscape provided another 25 per cent as part of a shared equity mortgage plan. The homeowner would then get a first mortgage on the remaining 70 per cent.
Shona Kearney, a homeowner at 38 Abell St., said she didn’t pay any monthly amount toward the 25 per cent. But if she wanted to sell, a quarter of the sale would go toward paying Artscape back.
“They were trying to create a perpetual funding circle so that when an artist left here and paid off their shared mortgage, that money would go back into a pot,” Kearney said. “That would then support the next artist coming into the building.”
When Artscape entered receivership, that put Kearney and other owners like her into “financial limbo,” she said.
Major lenders aren’t willing to finance a future owner’s mortgage when 25 per cent is owned by an unstable organization like Artscape, she said.
But Artscape still holds the title on her mortgage and is the administrator. While the city has been working with Artscape to find a new administrator — such as another nonprofit — it has taken over a year, with no end in sight.
“Currently, we would not be able to sell our units, nor can we get new financing on these units,” Kearney said.
That puts some owners in a potentially precarious position.
“If somebody was in financial crisis and needed to sell, they couldn’t sell,” Kearney said. “It hasn’t happened yet but at some point, somebody is going to need to do it.”
