Council has written off $25 million in loans to two city-owned theatres and a west-end hockey arena after senior staff advised the recovery of the money was likely impossible.

Councillors on Tuesday night voted to forgive a $7-million city loan to the Sony Centre for the Performing Arts and a $10-million loan to the Toronto Centre for the Performing Arts in North York.

They also voted to replace $8 million of a $20-million loan to the Lakeshore Arena Corporation (LAC) with an equity stake in the facility, “entitling the city to share in any future net operating income of the Corporation for the purposes of funding capital repairs to the Lakeshore Arena.”

Mayor John Tory said he would “hold my nose” to write off “millions and millions of dollars which could have gone to pay for other things, or honestly given to those institutions.”

Tory said any business analysis would have determined the loans would never be paid back. He warned there could still be trouble with the Lakeshore arena, since “the (staff) report implies . . . by taking equity and having this remaining loan, this thing might be viable. Who are we kidding here?”

If a subsidy or guarantee is needed, the public should be told up front, he said.

As a businessman in the private sector, Tory said he has been part of writing things off “but never in an instance where it was sort of done . . . shortly after the loan was extended, because somebody should have known, particularly in the case of the Sony Centre, that this was going to be a non-performing loan.”