Just days after Toronto’s Artscape confirmed that it will be placed into receivership, the City has stepped in to buy the organization a bit more time.
“With support from TD and the City of Toronto, Artscape’s receivership has been delayed for at least 30 days,” said Mayor Olivia Chow in a tweet on Saturday. “We’ve also convened a working group that includes City staff and philanthropic, business, and community leaders to develop a sustainable solution.
With support from TD and the City of Toronto, @Artscape’s receivership has been delayed for at least 30 days. We’ve also convened a working group that includes City staff and philanthropic, business and community leaders to develop a sustainable solution. (1/2)
— Mayor Olivia Chow (@MayorOliviaChow) September 2, 2023
For some context, Artscape’s presence in Toronto dates back 30 years, and over that time, it has grown to operate 14 projects, including the Artscape Daniels Launchpad, which serves 500 members, as well as a number of live/work studios and community cultural hubs.
The organization currently has ownership of four property assets, although they've primarily engaged in projects through a long-term lease and operating arrangements.
However, Artscape admittedly has not been immune to the affordability challenges that are characterizing the time. In a business update published last Monday, the organization described taking on debt to “expand its offerings” over the years, including an additional line of credit taken on during the pandemic “to maintain operations and meet debt payments.”
The level of debt taken on by the organization “was not sustainable,” said the statement, which also revealed that the organization “commenced a financial restructuring plan to reduce debt costs and streamline operations” this year.
“A key part of the restructuring was the targeted sale of Artscape Daniels Launchpad property at 130 Queens Quay East to repay debt owed to its primary lender. Additional lending to maintain operations was also sought. Regrettably, progress to a sale at an appropriate timeline has not materialized and the primary lender has taken steps that will lead to Artscape being placed into receivership.”