The Toronto developers who plan to build a new parkade/retail complex on the St. Regis Hotel site have been given another year to finalize their plans and move forward with the project.
CentreVenture Development Corporation president and CEO Angela Mathieson confirmed the downtown development agency has given the developers — Fortress Real Developments Inc. and Edenshaw Developments Ltd.— until April 30, 2018, to demolish the Smith Street hotel and begin constructing the new complex.
Fortress purchased the St. Regis and a nearby parking lot from CentreVenture in 2014 for $4 million. The development agreement gave Fortress until April 30 of this year to demolish the hotel, begin constructing the new complex, and pay off a $3-million first mortgage it had obtained from CentreVenture’s Urban Development Bank. Otherwise, the properties would revert back to CentreVenture.
Mathieson said the developers now have until April 30, 2018, to pay off the mortgage, as well. "The whole deal will be extended for a year," she said.
There were several reasons for extending the deadline, she said. One was the fact Edenshaw only recently became a partner in the project.
It was just last month Edenshaw announced it would be partnering with Fortress on the St. Regis project and the construction of the proposed 45-storey, $200-million SkyCity Centre condominium/commercial tower. The SkyCity tower is scheduled to be built on a surface parking lot on the north side of Graham Avenue, immediately south of the St. Regis property. The partners have said work on the tower is expected to start this spring and take about three years to complete.
The main reason for granting the extension is Fortress had been considering a number of different options for redeveloping the St. Regis site. One hinged on it winning a recent request for proposals (RFP). When someone else won that contract, Fortress reverted back to the original parkade proposal.
Fortress spokeswoman Natasha Alibhai said in an email the RFP process took much longer than expected.
"The team worked for over two years on the RFP, which ultimately went to another site. Once we concluded that process, Fortress moved focus to the alternate plan, which would be a mix of parking and ground-floor retail on the (St. Regis) site," Alibhai said. "The team has begun working on this new development plan and we anticipate the one-year extension will allow the time needed to get this project underway."
She said the development team is expecting updated drawings from its consultants on the revised plan within the next 60 days. After that, it will begin to entertain proposals for the ground-floor retail component, she added.
The original proposal called for constructing an eight-storey complex to include 25,000 square feet of retail space on the ground floor, five floors of parking, and two floors — about 50,000 square feet in total — of office space.
Mathieson said that proposal has since been revamped to exclude the two floors of office space. She noted the SkyCity tower will have 60,000 square feet of new office space, and the massive True North Square project under construction just a few blocks further west on Graham Avenue will have several hundred thousand square feet of office space.
"So it may not be the best time in the market for that (more office space)," she added.
She said CentreVenture officials believe a parkade with ground-level retail space is the best option for the St. Regis site. She noted the SkyCity and True North developments are both being built on surface parking lots, so replacement spaces will be needed.
She said while CentreVenture would like to see more Winnipeggers use public transit to get in and out of the downtown, it also has to make sure there are enough parking spaces available for those who use their own vehicles.
"We want to look for opportunities to put in denser parking... and we think that’s especially important in the SHED (Sports, Hospitality and Entertainment District) where we have so many activities going on," she added. "We think this particular location would have very strong economics for the development of a parkade, and we have the group who is willing to work on that. So we’ll support them."
Alibhai said the developers and a national parking-lot operator are evaluating the demand for parking and have not yet determined how many floors and how parking stalls should be included in the new parkade.
Mathieson said a local group that has been leasing the St. Regis and operating it as a "dry" hotel since CentreVenture acquired it in 2012 will continue operating it until the building is demolished.