Already, the new public facilities and amenities have created hundreds of local jobs,employed dozens of local companies and created a spectacular waterfront park for residents and visitors. Over 25,000 people have used the new skating rink at the Water Garden Pavilion since it opened in December.
On April 12, we celebrated another important milestone: land was formally transferred to the private development consortium, clearing the way for construction of a hotel and two condominiums over the next five years.
The transfer required numerous legal documents. Preparing agreements for a project of this complexity and magnitude takes time. If you’ve ever sold a house, or a commercial property, you realize all land transactions are complex. Imagine a $65 million land development project and you have some appreciation for the due diligence and hard work that brought the City and the developers to this milestone.
“We believe in Thunder Bay,” said Gisele MacDonald of Winnipeg at the land transfer ceremony. Gisele now calls Thunder Bay her second home and is the lead representative of the development partner, Resolve Group Inc.
Similarly, we believe in the private developers who have already invested significantly in plans, designs and extensive preparatory work for this important development.
Since the closing, there’s been an active public debate about the terms of the sale, how we know it’s a fair deal and what protections are in place for the City. Here are answers to a few key questions we are hearing:
What did the City sell to the developers?
The City sold the developers approximately 2.34 acres of land to develop a hotel and two residential condominium buildings of 102 units in total.
As well, the City leased to the developer the CN Station and a further 0.173 acres of City land for the creation of a commercial marketplace beside the skating rink/splash pad.
What did the developers pay?
The developers paid $690,067.50 – fair market value based on an independent market appraisal of the land.
How else do we benefit as a City?
This private development represents a $65 million to $70 million private sector investment in the City that will contribute to downtown renewal,economic development, job creation and a vibrant gathering place for the community as well as more than $1 million in new City property taxes every year.
What are the deadlines?
As per the agreement, the developer is required to start construction of the hotel and the foundation must be 30% complete within two years of the land title transfer closing date (April 2012). The hotel must be 99% complete within five years of the closing date.
What other protections are in place?
A development agreement is in place to protect the interests of both parties. The hotel must reach 30% completion of the foundation within two years, or the City has legal authority to take back title of the hotel parcel and any improvements made to the lands (such as the foundation and parking garage for the hotel) at no cost to the City.
The development agreement provides that the developers may start construction of the hotel and condominiums at the same time. Contingent on market demand, construction of the condominium buildings can be phased.
Any renovations to the leased CN Station are the developer’s responsibility and must preserve its historic features. In building the hotel and the condominiums, the developer must comply with the City’s approved urban design guidelines and all approved land use requirements such as zoning.
Now that they own the land, when will the developers announce the hotel and start selling the condominiums?
As with any large development including the recent hotel announcements in other areas of the city, those announcements are the developer’s responsibility. The developers will determine the timing based on business decisions.
In closing, this project is helping to build our community. We have truly made Prince Arthur’s Landing a year-round destination that will contribute to the revitalization of the downtown. The addition of a 4-star hotel and condominiums will only further the vision of a park that is year-round,ours to celebrate and a gathering place for the community that is second to none.
Community & Emergency Services for the City of Thunder Bay