'Who the hell is going to pay that?': Longtime Beach business owner blasts rising commercial rents

A longtime business owner in The Beach, who's closing up shop next month, blames the neighbourhood's growing number of empty storefronts on " piggy" landlords who are jacking up commercial rents.

Harold Weisfeld takes CBC Toronto on a tour of The Beach's empty storefronts and blames 'piggy' landlords

Harold Weisfeld says in his 35 years operating a business in The Beach, he's never seen so many empty storefronts.

Longtime business owner Harold Weisfeld was so motivated to show the high number of vacant properties in The Beach, he invited CBC Toronto for a drive along the popular lakeside stretch of Queen St. East.

"Empty, Empty, Empty!" Weisfeld shouted out during the drive, as he pointed to around 35 storefronts that are currently vacant; a phenomenon he said has gotten worse over the past year and a half.

"They all say, 'It's terrible,'" Weisfeld — affectionately known as Zoltz by his patrons—  said of the businesses struggling to hang on in the area. Weisfeld has operated Ends, a discount clothing store on Queen Street East since 1982.

'Landlords have gone a little piggy'

At 73, Weisfeld is in a unique position. He is retiring, so he has sold his properties and is closing his shop next month after 35 years in business.

He blames increasing rents, the rise of online shopping, a short selling season in the lakeside neighbourhood and a reduction in foot traffic as competing struggles for other businesses.

 "They're charging $18,000 a month, so who the hell is going to pay that?" he said as he drove passed one property that he said has sat vacant for six months. "I must admit, the landlords have gone a little piggy ... They've gone crazy with the rents."

Weisfeld said it's harder for landlords who have purchased within the last decade because they are carrying significantly higher mortgages. He said that combines with the fact that fewer people are able to afford shopping at independent retailers.

"[Local residents] are not supporting the local retailers for whatever reason. I think they're mortgage poor," he said.

A growing number of storefronts in The Beach Village, such as this shop at 2052 Queen St. E., sit vacant as rising rents and other factors push merchants out. (Chris Glover/CBC)

The Toronto Association of Business Improvement Areas says many landlords city-wide are struggling with increased commercial property tax assessments, which are assessed on a four year cycle, and come into effect this year for the next four years.

Weisfeld jokingly said he didn't even look at his new property tax rate for 2017.

"You know, I don't look at it, because I don't want to get sick," he said with a wry smile.

'We're done,' says merchant after rent doubles

A couple of doors down from Ends, Bud's Coffee Bar is closing its doors. Owner Ken Galbraith was one of Weisfeld's tenants, but now that he's retiring, Galbraith's new landlord wants to double the rent from about $3,000 a month to about $6,000 a month.

"We were just sort of like, 'Oh, that's it, we're done,'" said Galbraith, remembering the moment he was presented with the new deal. "Different small businesses have gone out because the landlords have wanted a lot more rent. They've just had to close their doors. So, it's sad because The Beach is such a cool area."

After Ken Galbraith's commercial rent doubled at his Queen Street East coffee shop, Bud's Coffee Bar. He's weighing his options. (Chris Glover/CBC)

The shop has operated on Queen Street East for three years, but now Galbraith said he is considering relocating or closing for good.

"Do we go somewhere else? At $6,000, can I get $6,000 somewhere that is a different area that is more fruitful?" he asked.

'Wake-up call' coming for landlords 

The Beach Village BIA said in the past three years its commercial vacancy rate has been unusually high at around nine per cent, or about 30 storefronts out of 320 on the strip.

This week city council is expected to approve a recommendation to seek the province's permission to completely remove the commercial vacant tax rebate by July 2018. Critics have argued the decades-old rebate encourages landlords to let their storefronts sit vacant.

BIA board member Michael Beirne, who is also a co-owner of Skwish — a new restaurant in The Beach Village, said that's one move local retailers are counting on to turn the problem around. 

"I think it'll be a bit of a wake-up call to some of the landlords," he said. "I think empty storefronts don't do anything for the value of their property, nor does it do anything for the interest of the street."

The phenomenon of higher-than-normal commercial vacancy rates isn't confined to The Beach.

Earlier this week, CBC Toronto reported the Queen Street West BIA counted 40 storefronts that are closed in that trendy neighbourhood.

Danforth Mosaic on an 'upswing' 

The rough ride some of Toronto's established neighbourhoods are facing is helping other neighbourhoods, said Billy Dertilis, who is the owner of Red Rocket Coffee on Danforth Avenue. He's also the chair of Danforth Mosaic BIA, which represents businesses on Danforth between Jones Avenue and Main Street.

"We've been traditionally underdeveloped and perhaps under-appreciated, so we're on the upswing," Dertilis said of the often-forgotten stretch of Danforth sandwiched between Greektown to the west and Danforth Village to the east.

Billy Dertilis, who runs Red Rocket Coffee on Danforth Avenue east of Greektown, moved his shop to the 'undervalued' neighbourhood from Leslieville five years ago in pursuit of cheaper rent. (Rob Krbavac/CBC)

The Danforth Mosaic BIA reports its vacancy rate has dropped from 17 per cent about 10 years ago to about six per cent now.

"I think a lot of businesses who can no longer afford to be in those hot spots are looking to move and find spaces that they can afford," Dertilis said.

About the Author

Chris Glover

CBC News Reporter

Chris spent half a decade as a political reporter for CBC Winnipeg, but now that he's returned to his hometown of Toronto, he's excitedly sinking his teeth in all sorts of stories. Discovering new neighbourhoods isn't a 9 to 5 job and after years away, he has a lot to catch up on. When he's not running around the city with a camera, you can find him on the island soaking up the sun or riding the trails along the Don River.

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