No First Nation organization will likely want to pay $70 million to buy out mall owners and the parkade from Forks Partnership without the same commitment that Starlight was asking for which was $400 million. The private owners of the mall have to be bought out. And The Forks is not giving up the parking lot without getting paid or The Forks itself is in trouble. They need the $2 million coming out of there every year.
The Feds balked at what Starlight was asking for. It was a transfer of ownership of the site with all the money paid by the taxpayer. And the new owners would be able to generate money right away because of the parkade and all their housing and other building funded by the Feds. I think they call this a steal.
I was against this $500 million funding of Starlight Investments and I'm against such a concept here. We don't need to engage a for profit developer to take the mall and parkade off our hands while using taxpayer money. Nor do I see how transferring everything to a non-profit, paying for the mall and handing over the parkade and paying hundreds of millions for housing is the most cost effective thing to do either.
It is painful to see Thunderbird House sit empty now and be stripped of copper or whatever can be torn off of it. Neechi Commons has only now been taken over by an indigenous agency. But it isn't just indigenous groups, Lion's Place a 40 year old non-profit is about to be sold because the Lion's Club cannot afford to renovate it. The common denominator is money. The three levels of government can and should do better but so should non-profits and co-ops. In the case of Neechi Commons, a well run and funded non-profit took over the space. The former Co-Op was shocked but should they have been? Most government funders ask agencies what sort of revenue do they expect from government support. If the answer is a continuous stream that grows because that is the only revenue, the government wonders why they fund that particular agency rather than another.
In the case of Thunderbird House, rentals from use and agencies occupying space was to be a revenue source. But the building struggled, had management problems and then aside from vaccine clinics, was largely under utilized. Housing has now gone up with supports but for last few years the entire section as been a homeless living space. Can Thunderbird House be a vital and sustaining force on Main? It remains to be seen. The people have spoken so far and what they have said is that the land around the culture centre is more important as a place to live.
As far as Lion's Place. It was built in 1983. After 40 years, it probably needs upgrades. Was that never part of the plans? For the 300+ people there it is probably a scary time. What do you do when you are abandoned? For the government, they are left with a head ache as affordable housing increasingly becomes an election issue. It probably won't be a good look as people are evicted from Lion's Place for condos or luxury living. Below is 1986 construction of Portage Place.
How this relates to Portage Place is that no plan has been presented aside from a request for $500 million and vague promises of affordable housing and a community centre. We don't even know any details about who would manage it. Revenue considerations are not mentioned and yet infrastructure will have to be maintained lest it all fall apart. Unless half a billion is only the start. And how is it affordable housing if the the group running the facility ends up having to sell it just as Lion's Club now has to sell Lion's Place?
As mentioned many times in this blog, the key to unlocking value and development at Portage Place lies in the 1000 car parkade. It generates a few million every year and is likely what Starlight and even some of the social agencies covet as an asset that is a consistent performer. Presently, all of revenue goes to The Forks which would have gone bankrupt without it. The parkade subsidized The Forks and kept them from pricing their own parking space for years at market rates. The money still continues to come in and had Starlight been successful, $47 million would have been transferred to The Forks. Below is what the mall looks like now and the pads atop are where new value can be found for apartments but without settling the mall and the parkade question.
Ponder this for a moment. Money meant for North Portage has been going for decades to The Forks and a sale to Starlight would have placed $47 million more with The Forks. Now I love The Forks but there is no way anyone could have figured the plan would be to funnel tens of millions out of one area to fund another. Worse, there has been very little public debate. Had Starlight deal gone through, The Forks would score nearly $50 million all at once.
Interestingly, the mall in the deal was valued at under $23 million. That is down from $50 million the last time it was purchased. The present owners are trying to sell. The mall is not a completely failed business as the social agencies keep suggesting. If it was, people wouldn't gather there. It isn't just because it is warm and dry place to be. Prairie Theatre Exchange has called it home from the beginning. Manitoba Chamber Orchestra is right next door on the third floor. Service Canada has a major centre inside. University of Winnipeg Legal Centre has a robust presence. And let's not forget Shoppers Drug Mart and every cell phone company in the county has a presence in the mall. Add to that a mix of retail and other services and a food court. There may be vacancies but is far from a drop in community centre with no future.
The opening of the Expo Live in the former Staples taking up 20,000 square feet and hosting Rolling Stones Unzipped is a good thing for Portage Place and North Portage. It extends the operating hours of the mall into the evening hours. Staples was more a Monday to Friday day operation and while there is a need for an office supplies store, it probably needs to be closer to Portage and Main. Moreover, if there are other areas of the mall or nearby areas that are operating till 10 PM, there is more impetus for retailers to stay open longer as they did till the early 2000s.
Make no mistake. There will be no return of downtown as the primary retailing area of the city. But there have been some consistent new building of residential units downtown after decades of not seeing much of that. The tallest building in the city will be all residential. The former UGG grain company HQ has been converted to residential on the upper floors. The Medical Arts buildings is now residential. Two new towers on Assiniboine have come on stream. A new apartment on Broadway has been built and a number near the University of Winnipeg. Residential additions at True North Square and across the street have been built and more are coming. The former site of the police HQ and parkade by City Hall will also bring new residents downtown.
Portage Place should not feel too much shame about how long it has taken to get to complete the next planned phases of its development. Trizec at Portage and Main was built from 1974 to 1978 and the office tower was near empty for quite some time as Winnipeg was going through a painful and prolonged recession. Driving down Main Street in 1980 it was quite noticeable that the Trizec tower had mostly unlit floors. The mall and parkade though met with better initial success. The restaurants and food court were well accepted by those who did work in the office tower and the parkade was a cash cow for the city. The mall itself though was a 9 to 5 work day kind of place.
To be sure the pandemic has wounded downtown badly. There are many places closed and are still closing because of the slow return of workers. However, it is very likely going to be improved numbers as universities and colleges have returned to classes and young people are seen everywhere. Jets games and concerts have been frequent in September and will be joined by Moose games in October. The resumption of theatre also supplies more people on Portage as well as Main Street. Edmonton has led North America with strong numbers going downtown. Ottawa experienced excellent numbers as well. The social aspect of downtown life has returned even with Covid still doing damage out there.
The two areas contributing to recovery in downtowns are have been things like sports, theatre and festivals/conventions coming back on stream. Most cities have at least convention centres, theatres and sports facilities centrally located. In Winnipeg, the Jets arena has led to a slowly expanding footprint filling a decades long gap at True North Square which for decades was a surface parking lot and now across the street north of the RBC Convention Centre, the former motel and RWB residence is being transformed into hotel, condos and offices.
Portage Place has housing behind it, the YM/WCA beside it, Investors head office attached by Skywalk and University of Winnipeg legal offices already occupying space in the building. It seems the most logical step is to take requests for proposals for housing atop Portage Place. It does not need Starlight nor a nebulous non-profit to be handed all wanting $500 million. It is quite possible that organizations like the University of Winnipeg housing unit can actually put up housing on the existing pads. But don't look for The Forks as the driving force for that. If the goal is to remove $50 million in a sale to go to The Forks, that is a non-starter. If you really want to kickstart development, keep the $2 million in parkade revenue transferred to the Forks every year use it for projects where it was supposed to be used: North Portage.
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