Capital seeking capital assessment
Halifax asks for estimates on development potential of municipal properties
By AMY PUGSLEY FRASER City Hall Reporter
Fri. Nov 28 - 5:46 AM
The city wants to know how many millions it can make off the sale of its downtown landholdings.
The four parcels of land potentially on the block include the old regional library on Spring Garden Road and two surface parking lots on Clyde Street.
The lands have been in the speculation phase for years, says the director of the Spring Garden Area Merchants Association.
But the city’s recent ad, looking for "pre-development assessment," really moves up the timeline on development, says Bernie Smith.
His group is interested in making the city an offer for the two merchant parking lots, but says they’d let city hall keep ownership.
"We proposed to the city that we would develop it," Mr. Smith said Thursday, listing off a potential price of around $6 million.
In return, they’d pay the debt servicing charges.
"We would pay the equivalent of the borrowing cost of the money," says Mr. Smith, who was for years the treasurer for the old city of Halifax.
Parking is definitely part of their proposal, he says, because the merchants all along the street have an interest in providing spots for their shoppers, he says.
"It’s not important to keep it in the present form as it’s not really acceptable to have surface lots anymore . . . nor can anyone afford them," he said.
Instead, the association would like to see the lots redeveloped into first-floor retail, second-floor offices and an indoor parking garage, either underground or at grade.
There are tenants already earmarked for the space, he says.
"The retail is pretty vibrant around here," he says of the demand.
Recently, the area has welcomed Lululemon yoga-inspired athletic wear and Aigle, a French clothier.
Over the years, stores like H&M clothing and Chapters books have expressed an interest in setting up shop, too.
And the attraction with H&M, which listed employment ads just this week for its upcoming Dartmouth store – still exists.
"We keep trying to find them a spot," he said of bringing the business to the Halifax side of the harbour.
But there’s lots of space for everyone.
The total downtown land availability, which includes a piece on Queen Street coming from the province in a swap, constitutes close to 2.5 hectares.
Collectively, the parcels are assessed, for tax purposes, at about $13 million.
However, knowing what the land is truly worth is a bit tricky, says a local real estate appraiser. That’s because vacant land is hard to evaluate, says the professional, who didn’t want to be identified because their firm would likely apply to do the work for the city.
Instead, appraisers must rely on what could be built there, with higher-density buildings bringing in more value for the land they sit on. And although the tender outlines that the pre-development assessment is being undertaken so the city can put out a proposal for the sale of lands to the private sector, Mayor Peter Kelly says the city isn’t putting any restrictions or requirements on the land.
"It has valuable potential," he said Thursday. And the options are open, he says, through its sale — strategic infrastructure partnerships (formerly known as "P3"), a lease-to-purchase, or design-build.
"There are many different opportunities," he said.
He says the city will likely advertise for development opportunities once the assessment of the land is determined.
"Until you test the waters, you don’t know what you’ll get back."