Sudbury

Questions raised about how much rent city is charging Sudbury film studio

The city is refusing to disclose details of the lease, but documents obtained by the CBC show Northern Ontario Film Studios was paying below fair market rent for at least some of the six years it has been in the old Barrydowne Arena.

Sudbury city council to vote on renewing lease for another 3 years later this month

Northern Ontario Film Studios has been leasing the old Barrydowne Arena from the City of Greater Sudbury since 2012, and is seeking to extend its lease for another three years. (Erik White/CBC )

The City of Greater Sudbury is refusing to disclose or discuss details of the new lease with Northern Ontario Film Studios, but documents obtained by the CBC show the private company was paying below fair market rent for at least some of the past six years at Barrydowne Arena. 

Thorneloe University film professor Ben Paquette got a similar response a few years ago when he requested a copy of the lease or information on the rent the city was charging.

"I just found it so strange and I was like 'But it's a public document, can I not see that?' 'Nope'" he says.

At the time, Paquette was looking to set up another film studio with other private companies in the city, where his students could be involved. 

He filed a freedom of information request for the 2012 lease and found that Northern Ontario Film Studios was paying $2,000 a month.
Thorneloe University film professor Ben Paquette (Erik White/CBC)

He asked a commercial real estate agent what would be considered fair market value for the property and was told it would be closer to $14,000 per month.

"The city is missing out," Paquette says. "It's a million dollars, over a million dollars."

He also believes this agreement violates Section 106 of the Municipal Act, which forbids a municipality from leasing public property to a private business for below fair market value.

Paquette complained to the City of Greater Sudbury in Feburary 2017 and received this response in July:

"This complaint was investigated by the Auditor General's Office and is being closed. The lease agreement with Northern Ontario Film Studios has been structured in a fashion that causes the rental charge to increase to the estimated fair value over the lease term which ends on March 31, 2018."

The Northern Ontario Film Studio set up in the old Barrydowne Arena in 2012, saying it was a temporary location until a permanent facility could be built. (Nael Shiab/CBC)

The city declined an interview for this story and refused to disclose any details of the lease agreement, calling it private information.

It did provide the following statement: 

"The City of Greater Sudbury has explicitly committed to developing a sustainable film and television industry in Greater Sudbury and Northern Ontario. 

The use of the former Barrydowne Arena facility by the Northern Ontario Film Studios (NOFS) is an important component of this ongoing support, and ensures a crucial piece of the infrastructure required to maintain the ongoing growth of this dynamic sector.

Since starting their tenancy of the building in 2012, NOFS has made significant leasehold improvements in the facility that have added value to the property and have helped to make it safer. 

What was previously an underutilized City facility plagued by graffiti and vandalism is now an active film hub and business incubator, and nearby residents have also expressed their satisfaction with the studio as tenant and the associated benefits to the neighbourhood. 

Council has approved the lease agreement with the film studio based on their ongoing commitment to the industry and its significant community and economic benefits, and CGS staff continue to work with the studio as part of their overall support for sector development."

Paquette disputes that this arrangement is good for the local film industry.

"This partnership is suppressing growth. So if the objective of the city and the region is to grow the region, this is suppressing it," he says. 

"Like if our goal, our objective as a city and a region is to grow the industry here, then we have to make it a fair playing field."

Criticism based on 'assumptions'

Northern Ontario Film Studios also declined an interview request from CBC, but did provide the following statement:

"It is common for Professor Paquette to base his opinion regarding the Northern Ontario Film Studios on assumptions and not on fact.

The negotiated lease agreement recognizes the significant capital investment NOFS has made into what was, until six years ago, a defunct arena that required taxpayer-funded maintenance on a regular basis, and contributed nothing to the economy of the city.

The nearly $500,000 in private capital investment NOFS has spent bringing the building up to film industry standards has transformed the space into a viable and valuable asset. This added value will remain with the building long after NOFS has left. The lease agreement has resulted in the birth of a stable new industry for Greater Sudbury which has positively affected hundreds of local citizens who now work full time in film.

NOFS generates an annual economic impact to the tune of $35M-$50M. This is a direct result of the mandate the city has envisioned for the industry development in Sudbury, and we are very happy to continue to work with them to achieve these goals."

ABOUT THE AUTHOR

Erik White

journalist

Erik White is a CBC journalist based in Sudbury. He covers a wide range of stories about northern Ontario. Connect with him on Twitter @erikjwhite. Send story ideas to erik.white@cbc.ca

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