T&T buys Toronto building for Cdn$4.25M

The Consul-General for Trinidad and Tobago in Toronto, Canada, has confirmed to this blog that the Manning government has bought a building in Toronto to house the offices of the consulate.

But Michael Lashley told our correspondent he cannot disclose any other details of the transaction because as a public service officer he is not authorized to do so.

However our sources confirm that the government bought the 16,000 square foot building at 185 Sheppard West for the full list price of Cdn$4.25 million. The sale is to be concluded in 10 days.

The property currently houses the offices of the law firm of Chaitons, which serves major financial institutions, real estate developers and government bodies, among its major clients.

While the sale appears to be a routine business transaction, the offer to purchase was made after the listing agreement with Canada's MLS real estate service had expired.

According to official records the property was listed on the open market from April, 02, 2009 to June 30, 2009 at the price of Cdn$4.25 million. However the "sold" date was July 23, 2009 with a closing date of Sept. 15, 2009.

Now there are serious questions being asked about the details of this sale. Why was it bought for the list price when the Toronto real estate market is in a slump and few people pay list price for anything? Why did the transaction take place when the MLS contract ended?

Our sources say in the current market it is most unusual to pay the listing price, noting that properties usually sell for between 10 and 20 per cent below asking prices. They point out that since this property was on the market since April, it is clear that the asking price was inflated and that it would have been easy to negotiate a discount.

When former Trinidad and Tobago High Commissioner Robert Sabga bought a building in Ottawa for the chancery for Cdn $1.1 million he was was able to negotiate a substantial discount, saving the government more than $Cdn 300,000. The list price on that building was Cnd$1.495 million.

The opposition People's National Movement (PNM) at the time kicked up a storm about the deal. But so far the Manning government is mum on this transaction.

The normal practice for MLS is for the real estate company listing the property to be paid a fee of six per cent of the sale price. This is shared among the listing and selling agencies and their respective agents.

While an MLS listing is active, the sale must be negotiated through the listing agency. However, upon expiry the deal can be done privately with commissions worked out between the buyer and the person handling the transaction, with no limit on how much the commission can be and no obligation to make any details public.

This Toronto deal comes on the heel of reports that government is buying a building in Washington, D.C. for US$17 million for Trinidad and Tobago dignitaries to use while staying in the U.S. capital.

Opposition leader Basdeo Panday has consistently accused the PNM administration of reckless spending and is promising to raise the issue again following Monday's budget presentation.

Panday was quoted in the local media this week as saying that he hopes the government will cut back "on all extravagant and useless expenditure and non-productive expenditure." He wants to see a greater focus on bringing the economy under control and more funding for health and social services as well as fighting crime.

The finance minister has said the 2009-2010 budget will show a deficit.