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Rising rents driving out small, independent restaurants

PAM SEATLE | posted Thursday, Jun 8th, 2017

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The rising housing costs plaguing Toronto renters are now hitting the city’s restaurants. In neighbourhoods across the city, from the Beach to Bloordale, restaurateurs are facing exponential increases, forcing some to close. And with rent so high, who will move in?

In Queen West, it’s fast food giants. At Queen and Palmerston, a brand new A&W sits next to an independent coffee shop. Matt Basile, who owns Lisa Marie, says his rent has risen more than 50 per cent in the four years since his restaurant opened.

“We came in and the rent was around $7,000 – $7,500,” says Basile, who also operates a food truck and catering business. “Four years later it’s over $11,000 now.”

“If we were just a restaurant, we would not be able to afford to stay here. That’s the truth, with the growing costs, it’s just not feasible.”

John Lorinc, a gentrification expert, says giant restaurant chains moving in is one of the inevitable next steps in the evolution of a neighbourhood.

“The thing about gentrification is that there are waves. The first wave is younger people and artists, and then they get priced out, they go somewhere else,” says Lorinc, who adds Toronto is a victim of its own success.

“There’s this cycle that happens. Toronto has gotten to the point where everything in the downtown core is very expensive. That has implications for retail businesses. A lot of people like these retail strips and want to be near them.”

Downtown councillor Kristen Wong-Tam says there are things the city can do to keep local restaurants in business. She is in favour of eliminating the tax break for landlords with empty store fronts.

“That is one thing that the city is trying to eliminate, I think that’s a very good idea. We’ve heard from property owners that they would like to retain that rebate, of course that would be their objective. The small retail operators would like to see that eliminated so that the building owners holding on to those vacant properties hoping to cash in on that rebate would be more motivated to rent out to the small operators.

The prospect of exorbitant rent costs down the line isn’t stopping Connor Joerin from jumping into the market. In Bloordale Village, a neighbourhood in the early stages of gentrification, Joerin and his partner are getting set to open a little restaurant called Sugo. They say they aren’t fazed by the prospect of rapid rent cost increases. They’re happy to be part of an up and coming neighbourhood.

“Once rents start going up and leases come up for renewal, what it does is it pushes out the people who created that culture, that created that community, that created that neighbourhood.”

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