The city has rejected a plan to tear down the historic Hotel Waverly and Silver Dollar Room.

At a meeting Wednesday, Toronto and East York Community Council turned down the proposal by the Wynn Group to replace the 113-year-old hotel and attached tavern on Spadina Ave., just north of College St., with a 22-storey mixed-use building which would include a private student residence.

The proposed height is more than four times the 16 metres allowed by zoning and the “proposal in its current form is not supportable,” according to a city planning report which recommended the refusal.

The developer says he will appeal to the Ontario Municipal Board.

“It’s our only avenue of aspiring to get what we want to get,” said Paul Wynn, who came up with the idea to build privatized student housing near the U of T after his two daughters had trouble finding accommodation near McGill University in Montreal.

Wynn said he plans to re-create the Silver Dollar — home to classic blues and rock bands since its opening in 1958 — on the ground floor and build a fitness club, with room for a couple of thousand members, on the second. The company owns a number of Wynn Fitness Clubs around the GTA.

The upper 20 floors would house 200 students in suites with multiple bedrooms off a common area and kitchen.

The developer said a student residence would cost less to build than condos and with multiple tenants in one suite, would bring in more rent than a unit in an apartment building.

In 2011, Toronto and East York Community Council asked city staff to investigate whether the hotel and the Silver Dollar should be listed or designated as heritage properties. The city’s Heritage Preservation Services, which has a significant backlog of properties waiting to be evaluated, is expected to report back this spring.

The Wynn proposal will be the second plan for privatized student housing to go to the Ontario Municipal Board after being rejected by the city.

Knightstone Capital Management appealed to the board to build a 25-storey residence with more than 800 single bedrooms and a second-floor cafeteria on the south side of College St., east of Spadina. Hearings wrapped up in November, but the board has yet to issue a decision.

If allowed by the OMB, the residence would have no official affiliation with U of T and would be run by Scion, a for-profit company that operates 13,000 beds in the U.S. but has yet to enter the Canadian market.

Knightstone had asked the OMB for a new definition of student residence. Toronto bylaws currently require them to be owned and operated by a “public, private school, post-secondary school or educational facility.”

Community groups opposed the College St. proposal at the OMB because of concerns over the building’s height, which they say will dwarf its two- and three-storey neighbours on the south side of College St., as well as residential Glasgow St. to the south.

Neighbours are also worried about the high number of beds and how problems will be managed since U of T will have no official say in operations.

“This is not about whether we do or don’t like students,” said Ceta Ramkhalawansingh, a member of the Grange Community Association which represents residents to the south of U of T. “This is about development: Height and massing and their relationship with neighbourhoods.”

Neighbourhood groups were also outraged because U of T leased the land on College St. to Knightstone for the residence without any community consultation and then refused to divulge details of the deal, citing privacy because the lease was a private commercial venture.

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The community is now dealing with another proposal for a highrise residence at the corner of Spadina Ave. and Sussex St., just west of U of T’s campus.

The university wants to partner with Daniels Corp., which owns an adjacent parcel of land, and build a 22-storey U of T residence that will have 600 to 650 beds, a number the university says will make the project financially viable.

U of T vice-president Scott Mabury estimates the university will require 2,000 more residence spots at the St. George campus by 2020 in order to meet the institution’s first-year student housing guarantee, as well as to provide more beds for increased enrolment, which is expected to rise as the university looks to attract more foreign students.