City council approves $10-K rebate for Exchange condo purchase

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This article was published 17/07/2013 (3539 days ago), so information in it may no longer be current.

The City of Winnipeg will write $10,000 cheques for anyone who buys a new condo in the Exchange District or along Waterfront Drive as part of a $7.8-million plan to revitalize the northeastern third of downtown.

Council voted 13-3 today to allow the CentreVenture Development Corp. to funnel new property-tax revenue from across Winnipeg’s downtown into neighbourhood enhancements on both sides of the Exchange District as well as in Chinatown, the Civic Centre neighbourhood and the western fringe of South Point Douglas.

The plan, dubbed the Exchange Waterfront Neighbourhood Development Program, will see $7.8 million in future city and provincial property-tax revenues spent on safety improvements, foot patrols, new patios, retail planning and possibly incentives for an Exchange District grocery store.

Of that cash, up to $2.3 million of city property taxes will be devoted to a new incentive program for Exchange-Waterfront condo buyers, who will receive a $10,000 cheque toward their down payment.

The cash amounts to a forgivable loan, provided the new owner lives in the condo and remains there five years. Flipping the property will not be allowed and early sales will require the buyer to return the cash to the city.

Although there was no recorded vote, Couns. Brian Mayes (St. Vital), John Orlikow (River Heights) and Russ Wyatt (Transcona) say they voted in opposition.

Orlikow said the city has already subsidized condo development and is now subsidizing the sales. The developers should lower their prices, as the market dictates, he said.

 

Buy new condo, pick up $10K

The City of Winnipeg plans to hand $10,000 cheques to anyone who buys a new condo in the Exchange District or along Waterfront Drive as part of a $7.8-million plan to revitalize the northeastern third of downtown.

The city is poised to allow the CentreVenture Development Corp. to funnel new property-tax revenue from across Winnipeg’s downtown into neighbourhood enhancements on both sides of the Exchange District as well as in Chinatown, the Civic Centre neighbourhood and the western fringe of South Point Douglas.

The plan, dubbed the Exchange Waterfront Neighbourhood Development Program, was approved by two council committees earlier this month with little fanfare. Pending council approval today, it will see $7.8 million in future city and provincial property-tax revenues spent on safety improvements, foot patrols, new patios, retail planning and possibly incentives for an Exchange District grocery store.

Of that cash, up to $2.3 million of city property taxes will be devoted to a new incentive program for Exchange-Waterfront condo buyers, who will receive a $10,000 cheque toward their down payment.

The cash amounts to a forgivable loan, provided the new owner lives in the condo and remains there five years, said Ross McGowan, CentreVenture’s president and CEO. Flipping the property will not be allowed and early sales will require the buyer to return the cash to the city.

“To our knowledge, this has never been done before,” McGowan said, referring to financial incentives for downtown condo purchases.

An existing city-provincial program has provided developers with tax breaks up to $20,000 per unit to build new condos and apartments. That sparked a flurry of warehouse renovations and there is now an abundance of condos on the market. They must be occupied to create the critical mass needed to transform the Exchange-Waterfront area into a residential neighbourhood.

“We’re trying to bring the market to the supply,” said McGowan, insisting the incentives for condo buyers are just one part of the plan to build an entire neighbourhood.

Incentives for condo buyers are needed to move the existing supply, said Martin Maykut, manager of Streetside Development Corp., which has created 34 new downtown condos in a pair of renovated heritage buildings and is about to market 49 new units in a third building.

“There definitely is a pending potential glut of inventory in the downtown market,” he said, referring to his company’s properties and projects by other developers.

“As a proud Winnipegger, I think we need a great downtown. It’s an absolute necessity for the city,” he said. “I just want to see successful things happen.”

The creation of an East Exchange parkade will also attract people to the area, he said. Three years ago, the city set aside $5 million for a low-interest loan to help build one on James Avenue. That money is separate from the Exchange-Waterfront plan, which also calls for $3 million worth of safety improvements, a $425,000 downtown marketing program, $400,000 worth of heritage investments, $250,000 in retail planning and recruitment, $150,000 in image improvements, $120,000 for new patios and $110,000 for parking and car-sharing co-operatives.

The province is prepared to fund half the program, but not one penny of the incentives for condo buyers. So far, two councillors — Russ Wyatt (Transcona) and Brian Mayes (St. Vital) — are opposed to the entire plan.

“I’m not sure this is the best use of funds to promote downtown development,” said Mayes, who voted against the plan at executive policy committee last week. “I have problems with some of the details, like money for patios.”

But Coun. Jeff Browaty (North Kildonan) said the cash injection is only for the short term. Incentives for condo buyers will increase the momentum of residential development, he said.

“Once that happens, this program disappears and there will be a critical mass,” Browaty said.

bartley.kives@freepress.mb.ca

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