Winnipeg | 300 Saint Mary Avenue | 14F | Mixed-use Apartments

[Sheepish]

Disaster! What a mess.
Maybe Ackman takes it over.
2 large unfinished projects downtown. What does that say!

[wags_in_the_peg]

Donmar Properties first development or do they own others?

[zalf]

Ugh. I hope TNRE still has some dry powder.

[trueviking]

^ Covid.

[WinCitySparky]

Wow now that’s sure some bad news. Hopefully the project can be liquidated to a buyer for a relative deal to ensure it will continue to completion in a timely fashion. Bankruptcy proceedings will probably mean a lengthy delay.

[BAKGUY]

I see the B word mentioned above.Is that certain? That could have harmful effects..read on....
I also understood the owner of the Keg in Manitoba was behind this development & The Keg on Garry was the main tenant of the 10,000 ft2 dining space. Does this affect all The Kegs now in Manitoba as well? Between this & Sutton, what a disaster especially when tourists & perspective investors see that, little retail on Portage ave. as well as the meth issues plaguing the area.

[borkborkbork]

Is this a project that is likely to be bought? Are the economics favourable for a developer with deep enough pockets? Or is this a moonshot project that will have to get value-engineered to death for anyone else to touch it?

[trueviking]

That’s the big question I guess. It’s been value engineered for two straight years. Only to see the cost go up as every month passed. If there was another penny to be taken out it would have been.

I don’t have any experience with this but talking to a couple developer friends, the owner will likely have to take a loss until it does become attractive to a buyer. It breaks my heart because he is a really nice man. He didn’t deserve this. A perfect storm of issues all came together.

[WinCitySparky]

Originally Posted by trueviking

That’s the big question I guess. It’s been value engineered for two straight years. Only to see the cost go up as every month passed. If there was another penny to be taken out it would have been.

I don’t have any experience with this but talking to a couple developer friends, the owner will likely have to take a loss until it does become attractive to a buyer. It breaks my heart because he is a really nice man. He didn’t deserve this. A perfect storm of issues all came together.

PLEASE DON’T SAY THE BRICK WAS ENGINEERED OUT lol 😭😭😭

[zalf]

Originally Posted by trueviking

It’s been value engineered for two straight years. Only to see the cost go up as every month passed. If there was another penny to be taken out it would have been.

No one has an oracle to consult, and two years ago was one of the most uncertain times of the last century, but one lesson from this might be that it sometimes might be better to have it fast than having it cheap. The developer might have have a revenue-earning asset right now just as he needed it most.

[borkborkbork]

Originally Posted by zalf

No one has an oracle to consult, and two years ago was one of the most uncertain times of the last century, but one lesson from this might be that it sometimes might be better to have it fast than having it cheap. The developer might have have a revenue-earning asset right now just as he needed it most.

Also a lesson for the city about the permitting and variance processes. When the whole drawn out process of consultation with public works, community, zoning variances, appeals, etc. adds a lot of time, it changes the economics of the project.

A project approved close to its inception probably has a lot better chances of actually getting built than a project that is costed out, then spends a year before being approved, with costs soaring in the meantime...

[thebasketballgeek]

Oh man this is a disaster. Downtown seems to be beyond life support at this point.

[pspeid]

Originally Posted by thebasketballgeek

Oh man this is a disaster. Downtown seems to be beyond life support at this point.

It's a set-back, but the sky isn't falling. There's positive moment on the Bay and PP, two huge pieces of the downtown puzzle. There are some new businesses moving into downtown spaces like the old Birk's building.

I recognize it's a hit for downtown, but shouting "disaster! doom & gloom!" with each piece of bad news really doesn't help promote positive change.

[esquire]

Originally Posted by trueviking

That’s the big question I guess. It’s been value engineered for two straight years. Only to see the cost go up as every month passed. If there was another penny to be taken out it would have been.

Kind of makes me wonder what the earlier iterations looked like vs. the final design. Just how much is being taken out of the design of buildings like this one?

Originally Posted by thebasketballgeek

Oh man this is a disaster. Downtown seems to be beyond life support at this point.

It certainly isn't great. You can sense the desperation in the civic officials hoping that the Jets whiteout parties can breathe some life into downtown. The 2018 parties were arguably downtown's pre-pandemic high water mark, it was the most good press that downtown Winnipeg had received in many years.

[BlackDog204]

Originally Posted by esquire

It certainly isn't great. You can sense the desperation in the civic officials hoping that the Jets whiteout parties can breathe some life into downtown. The 2018 parties were arguably downtown's pre-pandemic high water mark, it was the most good press that downtown Winnipeg had received in many years.

This is happening in every city in north America. It's a direct result of the COVID pandemic. In 2019, one could argue that downtown was in better shape than at any point since the late 80s.

The residential population of down has increased each year since the late 90s.

[esquire]

Originally Posted by BlackDog204

This is happening in every city in north America. It's a direct result of the COVID pandemic. In 2019, one could argue that downtown was in better shape than at any point since the late 80s.

The residential population of down has increased each year since the late 90s.

Yes, I'm not saying that there aren't things going in the right direction. But we were arguably several rungs lower on the ladder than most Canadian cities of a comparable size, and we got knocked down that much lower. We had less to lose.

It's funny, you go to Vancouver, Halifax, etc. and hear people talk about how much the pandemic knocked those cities down. But wandering around the downtown streets there practically looks like a best case scenario dream world compared to the reality in our downtown.

[BlackDog204]

Originally Posted by esquire

Yes, I'm not saying that there aren't things going in the right direction. But we were arguably several rungs lower on the ladder than most Canadian cities of a comparable size, and we got knocked down that much lower. We had less to lose.

It's funny, you go to Vancouver, Halifax, etc. and hear people talk about how much the pandemic knocked those cities down. But wandering around the downtown streets there practically looks like a best case scenario dream world compared to the reality in our downtown.

Calgary was in big trouble by 2016, as there were several skyscrapers being built, and completed after the price of oil and gas collapsed in late 2014. Office vacancies were above 25% by 2017. covid has made the situation worse.

What works in favor of Calgary, is that the city built a slew of residential towers in the preceeding 15 years, so the downtown is more vibrant since it's always been looked as a desirable place to live.

COVID has probably made the vacancy rate worse. Combine that with the out of control meth and homeless problems, and increasing crime, it's definitely not once what it was.

[Biff]

Originally Posted by thebasketballgeek

Oh man this is a disaster. Downtown seems to be beyond life support at this point.

I don't know that this is reflective of downtown. You had a small developer who realistically took on a project that was probably beyond his capabilities. He was first hammered by Covid which no one could have foreseen and then kicked in the junk when he was down with the interest hikes. What does that have to do with downtown other than it's location.

The Sutton project has similar circumstances but has an owner that should be able to develop the project properly but struggled through the Covid shutdowns. Their track record of developments being built quickly is definitely a question mark.

I don't feel that either of these projects failed because they are downtown. I do agree that it doesn't look good having two incomplete projects downtown.

[BlackDog204]

Originally Posted by thebasketballgeek

Oh man this is a disaster. Downtown seems to be beyond life support at this point.

I don't understand this mentality, unless one is new to Winnipeg. There was absolutely nothing being built in tthe 90s. It seemed like the arena was the first big project built downtown in 15 years.

There has been more construction projects being built in the downtown area in the last decade than at any point in my lifetime.

[Jeff]

in a wider view of downtown, it seems it's more of shifting of the deck chairs than actual complete decay and decline. yes there have been recent setbacks and portage place and portage avenue are in the doldrums, but the exchange, the forks, true north square and the area around the WAG are still bright spots. screaming that the sky is falling and that the last person to leave needs to turn off the lights isn't quite true and counter-productive.