Oxford Properties has reportedly chosen a proposal from the Ontario Centres of Excellence (OCE) to take over recently closed incubator OneEleven, BetaKit has learned.
Multiple sources familiar with the process told BetaKit that Oxford is no longer entertaining proposals from other interested parties, and at this point has chosen to move forward with the OCE, notably a OneEleven founding partner. The general expectation is that OCE would have to wait for approval from the provincial government prior to publicly announcing its plan to take over OneEleven.
Sources familiar with the process told BetaKit that Oxford is no longer entertaining any other proposals, and at this point is only moving forward with the OCE.
An Oxford spokesperson declined to comment on the winning bid, instead referencing the statement it shared with BetaKit on Tuesday.
“We are committed to finding a long-term solution for OneEleven’s members but, as these negotiations are ongoing, we cannot comment on any specific proposals that we have received,” the Oxford statement reads. “We can assure you that all received proposals have been given due consideration. Our intention is to move forward with the proposal that is best suited to support the interests of members of OneEleven and all stakeholders.”
An OCE spokesperson also declined to confirm it had won the proposal, telling BetaKit, “until we are further along with the partner discussions, our public position continues to be the OCE statement I shared yesterday.”
“We are exploring all options, with a variety of partners, to achieve a positive outcome that best supports OneEleven companies,” the spokesperson added. “We look forward to providing more details as they are confirmed.”
BetaKit was first to report yesterday that multiple organizations have submitted proposals to acquire the shuttered tech incubator, noting the involvement of both OCE, MaRS, and another unidentified party with a proposal of its own. Late in the day, The Globe and Mail revealed that party to be Paramount Fine Foods founder Mohamad Fakih. A decision on which proposal would be chosen to relaunch OneEleven was expected from Oxford this week.
When pressed for details of its proposal yesterday, an OCE spokesperson revealed little beyond an interest in utilizing a not-for-profit model to support OneEleven companies. OneEleven was initially founded as a non-profit in 2013 by the OCE, Ryerson University, and OMERS Ventures. It was incorporated as a for-profit entity in July 2018 by Oxford and OMERS.
A copy of the proposal submitted by Fakih, obtained by BetaKit, was adamant in recommending OneEleven continue as a for-profit entity, possibly with B-Corp status.
“The days of government funding, subsidies, and investments are over,” the proposal reads.
The deal for OneEleven would include a transfer of the OneEleven brand as well as its office space, located at 325 Front Street in a building owned by Oxford Properties. The Oxford spokesperson noted to BetaKit “OneEleven is not being sold,” and Oxford is not set to receive any proceeds from the deal.
“The business is being wound up and the naming rights will be transferred to the organization that goes on to run it,” the spokesperson said.
“It is just too bad Oxford closed the doors before exploring this option.”
Both Oxford and OCE declined to comment on whether the proposals in question include a new potential leasing agreement for the 325 Front Street space. Notably, OCE is also a tenant at 325 Front Street.
Questions still remain about the current value of the incubator. Since OneEleven closed down in April, one-third of the desks at the incubator have been vacated, per an Oxford spokesperson. Questions also still remain as to why Oxford opted to shut down OneEleven in the first place given its eventual home under an organization located in the same building.
Sources close to OneEleven told BetaKit that, prior to the shutdown, staff had presented a plan to OneEleven’s board to keep the accelerator operational throughout the year without evicting tenants or laying off staff, with an option pursue new ownership of the incubator. That plan was rejected by the board, notably comprised of OMERS and Oxford representatives, including board chair and former OneEleven CEO, Dean Hopkins, in favour of a winddown approach.
BetaKit confirmed with both OCE and the City of Toronto in April that no requests for aid were made by OneEleven or Oxford to either organization prior to the Toronto incubator’s shutdown.
“It’s great to hear there is interest from other parties in taking over OneEleven,” Chris Rickett, director, COVID-19 business mitigation and recovery, City of Toronto, told BetaKit. “I think the interest speaks to the value OneEleven and its team provided to tech companies in Toronto – and what it meant to the broader tech eco-system in the city.”
“It is just too bad Oxford closed the doors before exploring this option,” Rickett continued. “If they had, OneEleven’s member companies wouldn’t have been left in the lurch and the brand of the organization wouldn’t have been tarnished. I hope whoever takes it over, can rebuild the strong reputation the OneEleven team had built supporting Toronto tech.”