Re: Artscape Distillery Studios Closure

Dear Artscape Friends, Supporters and Tenants,

It is with great sadness that we announce the forthcoming closure of Artscape Distillery Studios, located in two of the Distillery District’s most prominent structures: The Case Goods Warehouse and the Cannery Building.

Purchased by Cityscape Development Corporation in 2001, Artscape was among the first to join the Distillery District as an anchor tenant, and soon after engaged 63 sub-tenants in the initiative. Working closely with Cityscape and the City of Toronto, Artscape was able to re-purpose approximately 50,000 square feet of space in two buildings into below-market designer/maker retail spaces, theatre and rehearsal venues, administrative space for non- profit arts organizations and artist studios.

By participating in the Distillery District revitalization at an early stage, Artscape helped build critical mass, credibility, and authenticity around the initiative. These seemingly intangible things were fundamentally important in inspiring confidence among other stakeholders and generating project momentum. The lessons learned at the Distillery about the power of arts and culture to inspire change, growth and transformation were game-changing for Artscape and have formed the foundation of its creative placemaking practice.

While newer generation Artscape projects contain an ownership structure, the partnership agreement at the Distillery was not set up in a way that guaranteed long-term security. Our 20-year head lease was, and is scheduled to end in 2022, with no option to renew. Earlier this year, the owners signalled an interest in terminating early to advance plans on the premises. After months of discussion, we arrived at a mutual agreement that has been informed by tenant feedback, captured through surveys and one-to-one consultations.

Artscape’s goal in these discussions with the property owner has been to explore possible accommodations to assist tenants in navigating this transition with hopes of securing support that would have otherwise not been available if the lease ran its natural course. Additionally, the Case Goods Warehouse has experienced significant vacancy loss throughout the COVID-19 pandemic and further attrition is anticipated by year-end. Carrying the full cost of the rental fees in spite of this vacancy is a tremendous burden on Artscape, a non-profit organization operating on a cost recovery basis.

Weighing these considerations, we agreed to an earlier termination of the head lease for the Case Goods Warehouse premises, advancing the end date by 5 months. Fortunately, the Cannery Building head lease which houses Tapestry Opera and Dancemakers will remain in place until the end of the original head lease term.

To support tenants through this transition, every effort was made by Artscape to explore accommodations that would preserve affordable commercial arts space in the city. We toured 20 different properties as alternatives to the Case Goods Warehouse, however tenant consultation suggested there was not a critical mass to support a head lease at a new building. Property referrals have been offered as an alternate approach to the exit strategy and alternate space for our designer-maker retail tenants has also been arranged through the property owners. Case Goods Warehouse tenants will receive a free rent period at the conclusion of the head lease term.

The COVID-19 pandemic has been difficult for the arts community and vacancy has increased during this time. In 2020, understanding that the COVID-19 pandemic had put additional financial stress on our tenant community, Artscape quickly applied for the Canada Emergency Commercial Rent Assistance (CECRA) program, resulting in $251,000 in rent abatement for our tenants in the Distillery. Despite limited resources as a non-profit organization, Artscape contributed 25% of this value as a requirement of the program.

While Artscape is proud of its work in making space for creativity and transforming communities, we too are impacted by the pressures of the real estate market and the closure of the Distillery community hurts. Loss of affordable commercial space in the city is a reality for artists and arts-based organizations across Toronto. Although there are small pockets of available space throughout the city, having the ability to cluster tenants at a size to build community – like at the Distillery – is important. It’s a dialogue that should continue with those involved in urban development, investment and funding, and it is top of mind for Artscape as we plan for the future. Enabling secure long-term spaces for arts and creative businesses is vital in Toronto as it cements its reputation as one of the world’s most diverse and livable cities.

“My 19 years in the Distillery have been amazing. It’s helped me build a thriving business, have a family, own a home. I will forever be grateful…It’s been great.”

~ Leif Benner
Artscape Tenant, Custom Goldsmith

Despite the sad news of this moment, we will strive for new opportunities and also want to celebrate the opportunities afforded over the past 20 years.

Sincerely,

Grace Lee Reynolds
Chief Executive Officer
Artscape

Kelly Rintoul
Chief Operating Officer
Artscape