Winnipeg Free Press - PRINT EDITION

Havixbeck seeks hold on city real estate deals

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MAYORAL candidate Paula Havixbeck is calling for a moratorium on city real estate deals until an RCMP review is completed.

Havixbeck said Tuesday all land deals should be put on hold pending the outcome of the review, singling out the proposed sale of the former Kenaston snow dump to the firm that's converting the Canada Post warehouse into the new police headquarters building.

Havixbeck said questions surround Caspian Construction and its involvement in the downtown police headquarters, adding it's improper for Caspian's offer for the Kenaston property to be considered until the firm's involvement has been cleared by an RCMP investigation into the city's real estate deals.

"Winnipeggers expect us to get these decisions right, and we must act when all the information is available to us, rather than blindly signing off on mega-projects," Havixbeck said.

Caspian president Armik Babakhanians didn't respond to phone calls.

The provincial government announced last week the RCMP will review the findings of three independent audits -- the fire hall-replacement program, the police-headquarters project, and a third review examining 33 real estate transactions during a five-year period -- and other related material.

Questions had been raised over how Caspian, a small local construction firm, had been awarded the contract for the police headquarters ahead of several national firms.

The Kenaston snow dump has been on the market since April. The offer period closed Aug. 8. According to the email sent to Havixbeck, which she distributed to media, the bidders are eager to know which offer is being recommended. Havixbeck's endorsement was being sought because the property is in her ward.

The city's real estate division said it had received seven offers, with Caspian's bid of $5.2 million being the highest.

The email states Caspian is proposing a mixed development for the site but contained no information about what the other bidders had offered or proposed for development.

Havixbeck said she was presented with only limited information on Caspian's offer and no information about the other six bidders.

The email from the real estate division said its request is urgent because the department wants to include her endorsement in a report that must be prepared by the end of the week.

"What this says to me is again, as a councillor, our council is held hostage. We have a gun to our heads in terms of coming up with approval when we have parts of information and other processes (the RCMP investigation) underway," Havixbeck said.

Havixbeck had originally called a news conference to talk about her proposals to improve the 311 system but she said she opted to put that issue to another day so she could expose the continuing questionable activities of the city's real estate staff.

Havixbeck said the division was repeatedly identified in three independent audits as acting improperly.

"This department was named repeatedly for mismanagement," Havixbeck said, adding it appears department officials have learned nothing from the findings and recommendations of the three audits.

Havixbeck said she would not disclose if she had specific concerns with Caspian Construction, adding she remains concerned about the actions of the real estate division.

"There is nothing saying we need to rush a process and rush a deal," Havixbeck said.

In her email response to the real estate division, Havixbeck states: "I recommend you put this process on hold until we know the findings (of the RCMP investigation) and whether the city has appropriately implemented the recommendations of the three audits.

"I have not reviewed all of the other proposals or your process to know whether I agree with the recommendations (to accept Caspian's offer)," Havixbeck wrote.

Republished from the Winnipeg Free Press print edition August 20, 2014 B1

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