Winnipeg Free Press > Local > City won't sell parkade without a higher offer

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City won't sell parkade without a higher offer

By: Bartley Kives

4/11/2009 7:30 AM | Comments: 7

Whoever covets the Winnipeg Square Parkade may have to dig a little deeper if they want to own the so-called "gold mine at Portage and Main."The first group of city councillors to scrutinize the proposed sale of the city-owned parkade, which generates $1.8 million in annual profits, has decided the downtown facility should be sold for no less than $26.5 million, which is $5.1 million more than the highest offer received by the city so far.

Late last week, city real-estate managers told councillors it's worthwhile to sell the parkade as long as the city receives at least $21 million in net proceeds. Following a search for potential buyers, the highest offer on the table -- $21.4 million -- would only exceed that bar by $39,000, after real-estate fees are deducted.

This week, city council's alternate service delivery committee -- a seldom-meeting council body that oversees special operating agencies such as the Winnipeg Parking Authority -- apparently rejected a cost-benefit analysis conducted by the city staff who evaluated the proposed sale.

According to city documents, the ASD committee voted 2-1 to approve the sale, but insisted the net proceeds be no less than $26.5 million. The committee also voted to prevent the city from spending any cash from the sale until next spring, when the Winnipeg Parking Authority completes a downtown parking strategy that's expected to call for the construction of more parkades.

St. Norbert Coun. Justin Swandel, who used to chair the committee, originally proposed the idea of selling the parkade as a means of generating enough revenue to eliminate the WPA's artificially accumulated debt to the city, repair other city-owned parkades and possibly build new structures.

But a report authored by city real-estate managers recommends using the proceeds from a sale solely to pay off the authority's $12.1 million debt as well as a $9.1 million line of credit.

The same report states the cost of the repairs facing the parkade are in dispute.

It's questionable to sell off a profitable city property at any time, but foolish to do so right now, said St. Boniface Coun. Dan Vandal, the sole ASD committee member to vote against the parkade sale. Couns. Swandel and committee chairman Jeff Browaty (North Kildonan) voted in favour of the sale at the amended minimum price.

"In times of recession, you shouldn't sell off your most valuable asset," Vandal said.

But other politicians believe Winnipeg should not be in the business in providing off-street parking in a premium lot such as the Winnipeg Square Parkade, which charges as much as $265 a month for a reserved spot.

But other city councillors and officials with downtown development agency CentreVenture and the Downtown Winnipeg Business Improvement Zone support the idea of public subsidies to help build parkades, especially if they replace downtown surface lots.

The proposed sale of the Winnipeg Square Parkade will come before city council's downtown development committee on Friday.

bartley.kives@freepress.mb.ca

Republished from the Winnipeg Free Press print edition November 4, 2009 B2

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7 Commentscomment icon

Ah,why are we considering selling this prime parkade, only to use the money to build more parkades? The downtown area needs more parkades? We have enough parking spaces to accommodate the MTS Centre yet we need more?

"....the Winnipeg Parking Authority completes a downtown parking strategy that's expected to call for the construction of more parkades...."

Are the repairs bills for this present one that high? Will the city make more revenue upon expansion than what they do now with this one parkade? Where are these new buildings or lots going to be downtown?

Now that this information is out there, who will buy it? As a potential buyer,I would want to know where the other new locations will be first.

Also,the only way to get the downtown area to thrive is with more people living downtown, and one of the ways is with a more modern transit system. So selling or building more parkades is going to help how? We are spending millions on rapid transit now,only to build more parkades downtown? Doesn't that seem just a tad odd? We also need more apartments too.

In Vancouver the council made a transit decision years ago(cars at the end of the list), and they have remained true to their word even today. They have never wavered and that is why Vancouver has a better system than ours. They have a vision and Winnipeg doesn't.

So many years of experience on council, yet with nothing to show for it.These councilors should be embarrassed. The Chamber needs a serious overhaul.

I agree with Dan Vandal...Why sell your best asset in a recession? The timing is all wrong...Will selling it now and even with the extra 5.1 million more going to be enough...Who is going to benefit from this sale anyways?...Wpg?...Wait a year or so and if our mayor's friends want the property than they should have to pay more...They want it sold now because they know they can get it at a bargain price...We are in a recession...Have any of you sold a property and wished you had waited...I did...2004 and if I had waited until 2006 I would have made an extra $40,000.00...Properties are still increasing in value here in Wpg regardless of the recession...What's the big hurry to sell this property Mayor Katz?...GGF

@Anonymous: It's net income, not gross revenue. Sorry if that was not clear.

In the future, please e-mail me directly at bartley.kives@freepress.mb.ca. You'll receive a much faster response, compared to a post in the comments section. Thanks.

Bartley Kives

Ah yes the "gold mine at Portage and Main.", Waiting on a higher offer so someone can jack up the price of parking even more for all the downtown workers, then jack up bus fees higher so they don't get tempted to switch to mass transit. Why not just level the whole area and make one big parking lot, huge profit in that.....Or we could try the eco/green thing and open things up for more businesses and jobs.

$1.8 million in annual profits reported.
To be sold for no less than $26.5 million

Roughly 15-20 years to completely pay off, provided there are no outrageous repair/maintenance fees that manifest with this aging building. What value will this have in 15-20 years? By then it will be quite old (for a parkade's standards) and will most likely require very costly upgrades.

Quite a gamble, considering the city is migrating toward a more pedestrian/cyclist/bus eco-friendly transportation network (because parking is near impossible and always expensive).

The place is a dump! They charge $225 per month to park in that dungeon...give me a break, they should pay me to park there. Every other lot in the area is clean, well kept and without the smell of vomit.

Last article you wrote that the parkade generated $1.8 million in revenue. This article you write that it generates $1.8 million in profit. Can you clarify which is accurate?

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