Tom Clark, Mélanie Joly not involved in purchase of $9M NY condo, committee told

Canada's foreign affairs minister and the consul general in New York did not influence or direct the purchase of a luxury $9 million residence in the city, a Commons committee was told Wednesday.

MPs also heard that the property, which will serve as the official residence for the consul general of Canada in New York, is 50 per cent cheaper to run annually and cost $4 million Cdn less than the old residence, which recently was listed for sale.

MPs on the government operations and estimates committee also heard that, unlike the previous residence, the new condo meets accessibility standards, does not require renovation and comes with fewer restrictions on the types of events it can host.

Since the purchase became public in July, it has been criticized by opposition MPs as overly lavish in light of the cost of living challenges facing Canadians at home.

Conservative MPs suggested Wednesday that the purchase was made to provide a perk to Prime Minister Justin Trudeau's "media buddy," veteran broadcaster Tom Clark, who now serves as consul general.

Multiple officials denied that charge Wednesday.

"This was a smart acquisition. This was actually a process that was sound, policy compliant, well-documented and exempt from any influence, including from Mr. Clark," Stéphane Cousineau, senior assistant deputy minister at Global Affairs Canada (GAC), told MPs.

Cousineau and other senior officials from GAC said that Clark, who served as the moderator for the most recent Conservative Party leadership debate, did not offer advice or have any role in the purchase of the new residence. They also said he was not made aware of the apartments GAC was considering.

Clark is expected to appear before the committee next week.

MPs also heard that the chief of staff to Foreign Affairs Minister Mélanie Joly was informed of the purchase shortly before it was finalized in late June, but the minister was not involved in the purchase.

GAC officials said that while the apartment serves as a residence for the consul general, it is also a work space that has been used to host as many as 50 meetings over the past two years.

Mark Allen, GAC's director general for North America, told the committee that the trade and investment generated by the work done by the consulate, and through the residence, is "directly linked to the economic security of the Canadians."

He said that while the consulate has offices where Canadian officials can meet with investors, "the intimacy and the personal nature of an official residence for a head of a Canadian mission does add to their general tool kit."

He said that a number of investments in Canada can be linked directly to the consul general's use of the official residence in New York.

"This includes an investment of $1.5 billion in the Nemaska mine in Quebec, a lithium mine," he said. 

He said that New York is the epicentre of global financial markets and that "two Japanese banks located there have invested $39 million in other Canadian nickel and lithium projects — again as a result of events that have been held in the residence."

Robin Dubeau, GAC's official responsible for real property and infrastructure, told the committee that the five bedroom apartment at 550 Park Avenue that had served as the official residence was no longer suitable.

He said that the property was purchased in 1961 and had not been updated since 1982. He said it did not meet accessibility standards and much of the infrastructure in the unit was nearing the end of its lifespan. 

Beyond the structural issues, the 550 Park Avenue residence was a co-operative building and members of the board wanted to restrict the use of the apartment for official functions, officials said.

Dubeau said that GAC looked at three possible solutions to the problem: renovating the current residence at a cost of $2.6 million, leasing a suitable unit, or purchasing a new apartment.

Dubeau said the department employed local real estate agents, viewed 21 properties in Manhattan and chose a property on the 11th floor of 111 West 57th Street that he said will cost $115,000 less to operate than the 550 Park Avenue residence.

The new apartment, he said, was more flexible in terms of the events it could host and, because it's new, requires no renovation.

A listing on the real estate website Zillow.com posted in the last week advertises a five bedroom luxury apartment on the 12th floor of 550 Park Avenue for $9.5 million US, about $13 million Cdn.

Dubeau said the sale of the old residence, combined with the lower running costs of the new apartment, will end up saving taxpayers $7.4 million over the life of the property.