Posted: Jun 14, 2008, 3:10 PM
Join Date: Jun 2008
Centre Block proposal ready for council
Centre Block proposal ready for council
June 14, 2008
City council will be asked Monday to spend another $5.5 million on the redevelopment of a moribund block in the core.
After a year of negotiations with Andrin Investments Ltd., staff will ask council to select the Brampton-based developer for the long-awaited rebuilding of Centre Block.
It will be the latest chapter in the city's nine-year effort to assemble the land -- bounded by King, Young, Duke and Ontario streets -- and persuade someone to redevelop it.
"It continues with the huge momentum we have in the downtown core," said Mark Garner, head of the Kitchener Downtown Business Association and a member of the committee that evaluated the Andrin plan.
Included as part of the deal would be a cash infusion of $5.5 million by the city to pay for the cost of building 250 underground-parking spaces for the public, which Kitchener would own.
"There is a need for increased parking in the core," Garner said. "If we are going to get that growth, I think there is a huge need for that."
If councillors approve the deal, a detailed development agreement must be negotiated with Andrin, which could take up to five months. The company must also pre-sell 60 to 70 per cent of the 384 condominiums it plans for the site before construction begins. Work could start next spring.
It would take four years to finish the $90-million project, which includes two condo towers and shorter buildings that would wrap around Duke, Young and King streets. An underground parking garage with 750 spaces and a courtyard are also planned.
A committee of staff and citizens, formed in early 2007, has evaluated the plan and endorsed it.
"I think it is very important to get some high-quality housing in the Kitchener core," said committee member Rick Haldenby, the director of the University of Waterloo school of architecture.
Andrin wants to convert the historic Mayfair building into a boutique hotel and spa. Retail and live-work units are slated for the three-storey buildings fronting Duke, Young and King streets. The renovation of two other historic addresses on King is also part of the plan. "We need a social and cultural mix in the core, and I think this has the potential to draw people to live downtown," Haldenby said.
The city spent $9.1 million to assemble the land and buy out several businesses. The figure includes $7.65 million for the land and businesses and $1.45 million on legal fees, closing costs and consultants.
Under the proposed deal, Andrin will pay the city $3.1 million -- $2.3 million for the vacant land, $100,000 for a strip of land along King Street and $700,000 for the historic buildings at 11 Young St. and at 156-158 King St.
The 250 parking spaces would cost $35,000 each, for a total of $8.75 million, said Dan Chapman, acting city treasurer.
The city has $5.5 million earmarked for the parking from its economic development investment fund. That, coupled with the funds from the sale of land and buildings to Andrin, would be used to pay for the parking spaces.
"So our estimate right now is that we are about $400,000 short in funding, but we are still in negotiations with Andrin," Chapman said.
The city is on the hook to provide 175 parking spaces to Wilfrid Laurier University students and faculty for $20 a month per space. This was part of the deal negotiated to attract the school of social work to the downtown.
Andrin is no stranger to Kitchener. It partnered with Kimshaw Holdings to convert the former Kaufman factory into condominiums. That project cost more than $40 million.
When the city sought proposals for the redevelopment of Centre Block, three companies submitted plans by April 2007 -- Morguard Investments, the Windmill Development Group and Andrin. Within a few weeks Morguard and Windmill withdrew, leaving Andrin as the sole developer to negotiate with the city.