WE Charity still sitting on $40M in Toronto real estate that was to be sold for endowment fund – National Post

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Six months after WE Charity announced it would sell off its Canadian assets to create an endowment fund for its humanitarian programs abroad, more than $40 million in Toronto real estate remains with the charity organization.

Last September, after months of being at the centre of a major government controversy over the outsourcing of a student grant program to WE, the charity announced it was winding down its Canadian operations and selling its Canadian assets.

By far, the most significant of the assets owned by WE Charity in Canada is a large real estate portfolio — a block of commercial properties in downtown Toronto, one of the country’s hottest real estate markets.

“COVID-19 significantly disrupted WE Charity programming. The fallout from the Canada Student Service Grant has placed the charity in the middle of political battles and misinformation that a charity is ill-equipped to fight,” said a statement from the organization back on Sept. 9, 2020.

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The organization will be selling its assets to establish an endowment fund to sustain the charity’s existing international humanitarian programs

“The organization will be selling its assets to establish an endowment fund to sustain the charity’s existing international humanitarian programs and digitize its Canadian educational resources for long-term access.”

The September statement said the assets the charity would be selling included its headquarters — the WE Global Learning Centre in downtown Toronto — as well as nearby properties “acquired as part of a capital campaign to support the organization’s ‘Campus for Good,’ a redevelopment initiative to provide free space to incubate under-35 change-makers.”

But a land records search shows that of the nine properties National Post has been able to link to the charity and its affiliate organizations, none have changed hands since the September announcement.

National Post was also unable to locate real estate records suggesting the properties have been publicly listed for sale, despite searches of MLS by two real estate agents.

Neither WE, nor lawyers working on its behalf, responded to multiple requests for comment from National Post about the properties and their plans to sell them to fund the endowment.

But shortly after publishing a version of this story, WE Charity responded that it remains its intention to sell its properties and has listed them for sale with Colliers International in Toronto.

The charity sent a Colliers brochure of the listing for the WE headquarters building, which did not provide details on pricing, selling or listing dates. The charity declined to provide further information about its property sales, including: prices, dates when the properties would be listed on MLS, or a list of properties that are for sale with Colliers. WE said the charitable properties have been listed since October with Colliers.

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“This is all the information we can provide at this time,” the charity’s press office said.

WE Charity has been asked to appear before two of three parliamentary committees looking into the no-bid contract awarded to the organization by the Liberal government late last spring to administer a $912-million student grant program. The matter is also undergoing investigation by the federal ethics commissioner.

Marc and Craig Kielburger, the co-founders of the WE empire, are set to testify before the House of Commons ethics committee as soon as Monday.

The studies have largely focused on the Liberal government’s — and Prime Minister Justin Trudeau’s family’s — close ties to the charity.

Committees studying the affair have also heard from Reed Cowan, a U.S. donor, who said a school in Kenya that he had funded in honour of his late son later bore another donor’s name.

CBC News has also recently reported on multiple instances where the WE organization allegedly assured multiple donors that they had each funded the entirety of an infrastructure project in Africa. WE has denied these allegations.

The RCMP, the Canada Revenue Agency and the U.S. Internal Revenue Service have been called on to investigate the WE organization.

Last July, National Post reported the charity and its affiliates owned tens of millions of dollars in property in Toronto, which made up the bulk of its assets. The WE empire, founded by the Kielburger brothers 25 years ago, is a complex web of entities, including the non-profit WE Charity, ME to WE Social Enterprises, a for-profit organization to fund WE’s charitable operations, and the ME to WE Foundation, the U.S. wing of the operation. There is also ME to WE Asset Holdings Inc., a private, “non-operating entity, which holds ME to WE’s assets,” according to Victor Li, WE Charity’s chief financial officer.

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According to audited financial statements published in March 2019 — the most recent available — as of Aug. 31, 2018, the land, buildings and properties owned by WE Charity were valued at $42 million. Additional land and buildings owned by ME to WE Foundation were valued at $1.6 million. WE Charity’s total audited assets at the time were $62.5 million.

WE Charity’s website says the release of its 2019 audited financial statements have been delayed because of COVID-19.

Going forward, there will be no new schools, water or agricultural projects, and no expansion to new communities in the nine countries where WE Charity is active

While unusual for a charity to have the bulk of its assets amassed in real estate, the WE organization stated this was a deliberate strategy to operate efficiently and avoid office leasing and rental costs.

The charity confirmed to National Post last July that all of its real estate is within a “single block near Regent Park/Moss Park” in Toronto.

The properties include the WE Global Learning Centre, the organization’s 40,000-square-foot headquarters at 339 Queen St. East and Parliament Street that the latest financial statements said is worth more than $30 million. This was the property on the Colliers brochure viewed by National Post

Other nearby properties owned by the organization include ME to WE’s offices at 319 Queen St. East (also written as 145 Berkeley St), 323 Queen St. East, 329 Queen St. East, 331 Queen St. East, 334 Queen St. East, 135 Berkeley St., 139 Berkeley St., and 141 Berkeley St.

Four of the nine addresses linked to WE — 319 Queen St. East, 323 Queen St. East, 139 Berkeley St., and 141 Berkeley St. — were added to the city of Toronto’s Heritage register in December, a move that could complicate the sale of those properties.

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The addition of the four WE-linked properties to the register came amidst the broader addition of 257 addresses in Toronto’s Corktown, Moss Park and St. Lawrence neighbourhoods, the result of a multi-year study by the city. The charity said it was unaware of the decision to add its properties to Toronto’s heritage register.

“If you’re on the list it’s kind of like having a yellow flag or red flag beside the property,” said Kae Elgie, president of Architectural Conservancy Ontario.

It means that if an owner planned to demolish or renovate the property, the city might get involved to halt it or to further protect the property. The property owners, too, could elect to have the properties protected by the Ontario Heritage Act, which would make them eligible for grants and tax rebates. The WE headquarters at 339 Queen St. East is already a Heritage-protected property, and has been since 2017.

WE told National Post previously that the charity’s real estate investments were funded by “targeted donations” from long-standing supporters of the charity. No program funds or monies from youth fundraising were used to purchase property for WE Charity or any other WE-related entity, the organization said.

The money raised from the asset sales, the charity said in September, would go toward planned projects in Latin America, Asia and Africa, and to fund longer-term projects in Kenya and Ecuador.

“Going forward, there will be no new schools, water or agricultural projects, and no expansion to new communities in the nine countries where WE Charity is active,” the September statement said.

With additional reporting by Christopher Nardi and National Post Staff

Email: tdawson@postmedia.com | Twitter: tylerrdawson