Academy faces triple rent increase

Bullettproof baseball asked to pay $189,840 annually after paying $58,760 under current lease

A one-time National Leaguer who has dedicated his post-playing career to helping youth take their skills to the next level will have to increase his registration fees substantially if he wants to continue operating out of a building at the fairgrounds in Welland.

Under a five-year lease that is expiring May 31, Niagara Regional Agricultural Society is giving Bullettproof Baseball Academy the option to renew the lease for the 4,460square-metre facility for another five years. A clause in the lease stipulates the rent beginning on June 1 will be based on fair market value.

Scott Bullett, who owns and operates the year-round skills development program, paid $58,760, including HST, in the final year of the contract.

However, that rent will more than triple — to $189,840, including HST — after the agricultural society had the facility assessed to determine what that fair market value is.

Bullettproof academy, which employs four full-time and 20 parttime workers when it’s fully operational, was “floored” when it learned about the rent increase. However, relocating to another facility in Niagara Region is not an option.

“We looked all over. There’s nothing comparable available,” said John Azzoli, the academy’s director of baseball operations. “This is it, we have to sign here.”

“If we don’t sign the lease, we will have 482 kids on the streets as of May 31. We will have no place to go,” Bullett said. “We are going to sign the lease.

“We just have to work even harder. We just have to run more programs.”

Azzoli and Bullett suggested there’s a “hidden agenda” to evict the academy with a replacement tenant waiting in the wings, but NRAS president Michael Gill said that’s not the case.

“There is no one earmarked to replace him,” Gill said. “The property was assessed to get full market out of it.

“If I can’t get a tenant to pay what the building is worth, I’d rather it be empty.”

Gill, while conceding the building needs repairs, including replacing sections of the roof that leak, said market conditions justify the increase.

“The building was properly assessed and we’ve come to find that we’ve been undercharging rent for a long time.”

Clark Peddle, the agricultural society’s legal counsel, was asked if removing all tenants was clearing the way for the sale of the agriculturally zoned property.

“If you’re asking me if they’re just going to sell the place, I’ve never heard anything of that nature,” Peddle said. “Our intention is to re-rent that space if Mr. Bullett chooses not to stay there.”

Bullettproof baseball said it appreciates a lease renewal would include an increase, but it had hoped it would be phased in over the full five-year term.

“We’ve done our due diligence as well. We may not have brought a company in to do what they did, but we asked around, we asked very educated people who can tell us about this building,” said Katy Vicuna-arcuri, the academy’s facility manager as well as team co-ordinator.

“We never argued that part. We asked can you give us time to get to that point and flat-out the answer was no.”

She said the timing for a more than threefold increase couldn’t be worse given that COVID-19 restrictions had a devastating impact on the academy’s revenues.

“I can tell you last year we ran zero of our academy, which, by the way, is a business that brings in $40,000 to $60,000. We lost most of it in 2020 and we lost almost all of it in 2021,” Vicuna-arcuri said. “But we still had to pay our fees.

“They gave us no help in that, and neither did the government.”

Unlike many for-profit businesses, Bullettproof wasn’t eligible for commercial rent relief because it operated out of a property that was zoned agricultural.

Bullett acknowledged the academy was getting a good rate under the previous lease.

“And that’s why we kept the prices to play cheap. We didn’t gouge people,” he said.

“I’m going to tell you right now, what I charge for my kids to play here, they can go across that Burlington Bridge, to the other elite programs, they double their prices, triple their prices.”

He currently charges the 140 players on his 10 showcase teams an average of $3,500 annually.

Peddle conceded the size of the increase appears “shocking,” though only at first glance.

“Well, it may seem like that on its face, but he was in there paying a lot less than fair market value rent at the time he went in there, so he got five years of really cheap rent,” he said. Now it’s time to pay what the fair market value is, and the fair market value was determined just a few months ago.

“Obviously, he’s taking into consideration COVID and all those things because that’s what an expert would do.

“Fair market value, by definition, means it’s ‘fair,’ that’s what the market is paying for those types of spaces.”

Flavio Volpe, president of the Automotive Parts Manufacturers’ Association and coach of the Toronto Cubs under-16 team, doesn’t buy the argument the increase could be justified because of the lower rent Bullett has paid since relocating his indoor training facility from a smaller building at the fairgrounds.

“You don’t play catchup by putting a cliff in front of a business that is adversely affected — and directly affected — by pandemic restrictions all at once,” he said. “The test of reasonability here fails.”

Volpe suggested “there’s nothing gradual going from $52,000 to $168,000, especially if the Consumer Price Index or the cost of rent increases in the area are taken into account.

“There is no comparable property. This is kind of a semirural setting in a repurposed building that the landlord uses to rent out for heavy truck and bus storage on-site,” he said.

“There is nothing gradual about what they have done here.”

Volpe, whose son Alessandro, 16, has trained with Bullett for the past five years, suggested it would be “very interesting” to ask Premier Doug Ford in question period whether “this was the intention of the government when they changed the regulations on commercial rent.”