Local Businesses Around Montreal Are Getting Pushed Out

How Do Threats to Local Commerce Endanger the Character of Montreal?

NewsMarcus Bankuti — Published October 1, 2019

When he started at his father’s sandwich shop over 15 years ago, he encountered an ethnic and cultural mix he says changed him as a person. “It really opened my eyes,” said the self-described “LaSalle kid.”

His affection for the eclectic community helped inspire his decision to spend the rest of his life at the family business.

So where is Clarke Café? It’s not tucked away amongst the clothing boutiques of Laurier Ave., nor nestled on the Clark St. for which it is named.

It’s not in Mile End at all—it’s in Pointe-Saint-Charles, 40 minutes by transit from its predecessor, Boulangerie Clarke, which closed in 2015 after 35 successful years.

“I thought I was going to be there forever,” Servedio said of the establishment founded by his grandfather. “I thought I was going to take over the business. The last day, I didn’t even want to be around the place. It was very upsetting for me.”

His uncle sold the building to Danny Lavy and Stephen Shiller of Shiller Lavy Realties, a firm whose blue signs can be seen in windows around Mile End.

To facilitate the deal, the business was purchased simultaneously to ensure his father also profited, said Servedio.

The bakery subsequently continued its operations as a different company on paper, so the business itself was still family-owned, he explained.

Boulangerie Clarke continued to pay its previous rental rate for one year, after which, said Servedio, its monthly rent would have tripled.

The booming provincial economy has hastened the transformation of Montreal’s commercial streets, inviting speculation linked to empty storefronts and an influx of flashy businesses with the potential to alienate longtime residents. Increasingly, some fear the very character of Montreal is being upended.

As it stands, the commercial market is virtually unimpeded by regulation.

The city recently announced that its committee on economic and urban development and housing will study the situation surrounding commercial vacancies, with a report to come in December and public consultations to follow.

“Almost every iconic street in a neighbourhood is its commercial street,” said Craig Sauvé, a member of the ruling Projet Montréal party and Sud-Ouest city councillor for the district encompassing Clarke Café. “Some of the places we cherish the most are those long-held ‘mom-and-pop’ joints.”

Sauvé’s party promotes a vision for neighbourhoods it calls mixité, or mixity.

“We want different socio-economic, ethnic, and religious cultures to live in different neighbourhoods together and to be able to blend together,” he said.

This requires a balance of businesses and services that fulfil the needs of the whole community, something at risk in many areas of Montreal.

“A lot of money is coming into the city, a lot of investment,” said Sauvé. “That means the people that are speculating are thinking, ‘Oh, it’s going to go up and we’re going to invest in the main neighbourhoods.’”

He explained that commercial landlords do not require vacancy permits, meaning speculators have no strong disincentive to await a “jackpot” tenant willing to fork over unprecedented sums.

What’s more, when a building sits empty, its losses can be written off come tax time.

Some neighbourhoods are particularly threatened by commercial speculation.

“We’re not sheltered from that [in Sud-Ouest],” said Sauvé. “Mile End is probably the best example.”

Boulangerie Clarke on St-Viateur St. W. became a sushi restaurant, but the building again sits empty after that business closed in August.

A block away, another storefront has been vacant for over a year. Its interior is a husk. A wall is peeled from one side and on the other, a refrigerated prep table stands askew. The room looks as though to set foot in it would yield a mouthful of dust.

In rainbow hues, the chalkboard still welcomes you cheerfully—“Bienvenue au Cagibi!”

Le Cagibi was an offbeat café and performance venue.

“Our space was queer, student and artist-friendly, demi-punk, easy-going,” said Jess Lee, a co-owner since its inception in 2007 and a former employee of Pharmacie Esperanza, which occupied the space previously.

“The culture around Pharmacie Esperanza and Le Cagibi contributed to the cachet that attracted the tech community of Ubisoft and, in turn, attracted tourism and corporate real estate interests,” she said.

“Cagibi came to represent the last holdout of a particular time and feeling in Mile End.”

The building was acquired by Jeremy Kornbluth and Brandon Shiller, the son of Stephen Shiller, according to the Montreal Gazette and confirmed by Lee.

The two men are also administrators of Patisserie et Boulangerie Clarke Inc. and are named as its shareholders in the province’s enterprise registry.

Le Cagibi had been paying around $3500 plus GST and QST in rent on a net lease, meaning it also paid a share of municipal and school taxes.

The new landlords demanded a rent of $7500 net, which would have totalled nearly $10,000 each month, according to Lee.

She said Le Cagibi had a host of priorities it placed above profit margins. Such high rent was a nonstarter.

The café has since reemerged as Coop Le Cagibi, a worker-owned cooperative in nearby Little Italy on the outskirts of Mile-Ex.

“[Le Cagibi] was great,” said Servedio. “It sucks that they were in that situation. I’m happy that they were able to relocate right away.”

Its old location is listed on Shiller Lavy’s website. It is also being advertised by Sutton Group, where its asking price is $9800 per month plus tax.

“The space needs a major physical transformation to become a profitable restaurant, and at that rental rate I can only imagine a corporate chain with the deepest pockets to float the vision,” said Lee. “I suspect the space will remain empty for a long time.”

Media coverage of vacancies in Mile End has brought attention to Shiller Lavy Realties, which did not respond to a request for comment.

The company has even inspired a parody account on Twitter, @shillerlavy, which counts Sauvé and his colleague Marie Plourde, Plateau Mont-Royal borough councillor for Mile End, among its 200 followers.

The account’s operator, who declined to share his identity out of fear of litigation, said he was inspired by the reporting of Tim Forster of Eater Montreal, who has repeatedly highlighted the company’s role in Mile End.

The operator said he picked Shiller Lavy as his target but that the firm is no different from others following the same playbook.

The point, he said, is to draw attention to an issue he cares about. “I’m hoping that if I keep screaming into the void, in a way, then maybe someone will listen.”

He particularly worries about the incursion of chains, such as the Lululemon that opened on St-Viateur St. W. in a building owned by Lavy and the elder Shiller, according to the Montreal Gazette, or the David’s Tea across from it.

The person behind @shillerlavy refers to the tapestry of local stores and cafés as the living room of Mile End.

“You’re not going to get that kind of experience at David’s Tea,” he said. “And you’re definitely not going to get that kind of experience waiting for a David’s Tea to open.”

An unscientific survey conducted by the Coalition Commerces—Vie de Quartier, an informal group that arose from the Comité des citoyens du Mile End, was presented to borough council in June.

More than 100 respondents answered a question asking which businesses they would never visit.

Lululemon was ranked number one.

The survey found Le Cagibi was the business most often missed.

Lee, who acknowledged several strongholds she believes carry forward the “old school spirit,” warned that wistful feelings about a neighbourhood’s vibe should not conceal gentrification’s most vulnerable victims.

“I think gentrification is a worldwide process that has the highest impact on racialized, marginalized and low-income communities and spaces,” she said, specifically citing the impact of the Université de Montréal expansion into Parc-Ex as an example of what should be the “highest priority for folks thinking about gentrification in Montreal today.

The Cycle of Gentrification

“Our society values poor artists in a way it doesn’t value poor people who work at Tim Hortons, unfortunately,” said Ted Rutland, an associate professor at Concordia’s Department of Geography, Planning, and Environment.

He described a process by which those with symbolic cultural capital but not necessarily financial capital, such as artists or students, move into a neighbourhood and make it more desirable, after which those with financial capital begin to outbid and displace both the “gentrification pioneers” and historical working-class residents.

“We’re also talking about corporations […] aided by the government to establish in a neighbourhood,” he said.

“Mile End would have very likely gone through some kind of gentrification process regardless, but the arrival of Ubisoft with all its capital and all its government support played a huge role in transforming that neighbourhood into one hardly anyone can afford anymore.”

The sheer number of Ubisoft employees in Mile End, more than 3000 according to its website, is often cited as a driver of gentrification.

Some of them had been among Boulangerie Clarke’s regular customers.

Clarke Café also attracts workers from the technology sector among its broader clientele.

Its customers include, for example, employees of GSoft, a company with between 201 and 500 employees according to its LinkedIn.

Its office building, a 10-minute walk from the café, is home to other tech companies as well.

Another factor driving commercial gentrification, according to Rutland, is a tendency for some new street-level businesses to seek the “gentrification frontier,” where they have the chance to shape a neighbourhood in their own image, he said, citing Saint-Henri, Petite-Patrie, and Verdun.

The result is that longtime residents may no longer see themselves reflected in the community in which they live.

“If you get a bunch of more fancy stores opening up in a neighbourhood that people used to call their own, but they can’t afford to enter, or they feel culturally alienated from, people do really feel that and it’s a big deal,” said Rutland.

Servedio said he is aware of the French-speaking, Irish, and working-class roots of Pointe-Saint-Charles—which has a history of fighting back against gentrification—and prides himself on fitting into the existing neighbourhood.

“We’re not doing pear and brie sandwiches,” he said. “I’ve got customers that come in here that have been living here forever, and they like the place because it’s not pretentious. It’s very simple. You come in here and you can have an affordable lunch.”

He said the neighbourhood reminds him of Mile End when he started at Boulangerie Clarke and that its affordable rent is critical to his business. “I don’t want to look in somebody’s eyes and say $20 for a sandwich,” he said. “I wouldn’t do it.”

His father’s bakery was at Clark St. and St-Viateur St. W. for 35 years he reminded me.

“I want this business to be here for that amount of time.”

The conditions necessary for that longevity may be an open question.

Sustaining the vision of mixity promoted by Projet Montréal requires significant government intervention, argues Rutland.

“If you don’t use political tools to stop the process that’s dominated by the people with the most money, then you’re just not going to have that mix anymore,” he said.

“Change in a neighbourhood can involve new kinds of connections, new kinds of relationships, new kinds of ideas.

Part of the problem is that the new residents ultimately displace all of the old residents unless something concrete is done to stop the process.”

“Part of the problem is that the new residents ultimately displace all of the old residents unless something concrete is done to stop the process.”

— Ted Rutland

He suggests those who reside in gentrifying neighbourhoods should pay attention to the activities of their local housing committees.

Sauvé maintains that mixity is good policy but agrees that housing and community action are critical.

“It’s a matter of public education, public democracy, community work and community development. The whole point, I think, is that every neighbourhood has to have, in terms of housing, affordable housing in it, and it has to be off-market housing,” he said.

He invoked suburban imitations of urban life to illustrate his vision of an interesting city neighbourhood.

“If you want to enjoy the real urban life, if you want to see that social beauty, which is the commercial street with everybody meeting and sitting and walking and smoking and laughing and kids playing, whatever, you’ve got to go into the city. The beautiful chaos that is the city.”

Many of the kinds of businesses that help sustain this kind of community depend on affordable commercial spaces.

The Role of Regulation

“I don’t think you should be able to have a commercial space that’s $2000 a month, and one year to another increase it by 400 per cent,” said Servedio.

“That shouldn’t be allowed to happen.”

Montreal is one of the best places in North America to eat, he said, but high rents threaten that distinction.

“If we don’t control that, it’s going to be garbage. It’s just going to be a bunch of chain places where everything comes out of a freezer or out of a box.”

Rutland believes most people would agree that longstanding local businesses shouldn’t have to close because of large rent increases.

“Can we figure out what really matters to us and craft a policy that ensures that? I think it’s possible, and I think it’s obviously worth doing,” he said.

He cited regulations around zoning, land use and rent control as tools we can use to assert democratic control over our surroundings.

Sauvé said the commission studying the plight of local businesses will look at the possibility of commercial rent control, but like many hypothetical interventions, it would be beyond the city’s authority to institute.

He is hopeful, however, that thoroughly-studied recommendations coming out of a mixed-party commission could carry weight with the province.

Certain actions have already been implemented, at least on a small scale.

Sauvé cited a so-called one-in-six rule implemented in Saint-Henri that he says succeeded in stymying a rash of restaurant openings there.

His party’s 2019 budget cut taxes on the first $500,000 of non-residential property values, effectively cutting costs for local businesses whose leases make them wholly or partially responsible for paying these.

“Hopefully we can find a balance. I’m not against change,” said Servedio, who came back stronger when his life took an unexpected turn.

“I think it’s a positive thing for the neighbourhood.”

As I wrapped up my interview at the modern but humble Clarke Café, several people who looked to be in their early 20s fell laughing through the door.

The café was suddenly bursting with life.

The youthful group took pictures of an employee banging two pieces of bread together. His staff always do that before making a sandwich, Servedio told me.

“There’s nothing worse than biting into a pizza or a sandwich that has a lot of flour underneath, because you get a bitter taste.”

The group said they were from GSoft. They were on a scavenger hunt.

Steps away, Dollar Plus Store—which opened in 1997—is going out of business.

Samina Saboohi, its owner, is angry that for all the taxes she’s paid, the government did nothing to protect her from the Dollarama that moved onto her block.

As she spoke, a man entered holding a plastic broom handle. Saboohi told me she sells the same one at a lower price. Another customer carried a green reusable bag, and with it, the logo of the Goliath next door.

They say big fish eat small fish, Saboohi told me, that this is only natural.

There’s only one problem—“We’re not fish.”