Advertisement

CentreVenture forced to back down on True North development deal

City council's Executive Policy Committee on Monday, January 26, 2015.
City council's Executive Policy Committee on Monday, January 26, 2015. Jeremy Desrochers/Global News

WINNIPEG – The city’s downtown development agency was on the hot seat at city hall again Monday, defending a controversial hotel development deal, but was forced to back down.

Councillors on the city’s Executive Policy Committee voted to demand CentreVenture invite other bidders to develop the land at the centre of a deal Mayor Brian Bowman described last week as “not cool.”

CentreVenture admitted for the first time that Winnipeg Jets owner True North Sports and Entertainment is the firm with which it has already signed an option agreement to develop 220 Carlton St., the site of the former Carlton Inn.

True North also issued a media release Monday confirming its role in the once-secret deal.

“There is getting it done, and there is getting it done the right way,” Bowman said Monday. “We are all scratching our heads at the lack of transparency on this.”

Story continues below advertisement

CentreVenture inked the deal with True North even though there was already a contract in place with builder Stuart Olson to find a hotel developer as part of the $180-million expansion of the nearby RBC Convention Centre.

That left Stuart Olson on the hook for a $16-million penalty for not finding a developer. EPC also voted Monday to approve a settlement that would see Stuart Olson pay only $3.75 million and the city avoid a potentially costly legal battle.

CentreVenture board member Richard Olfert told councillors Monday that True North approached CentreVenture, wanting to develop the Carlton Inn site into a hotel, office, retail and residential complex. The option agreement was signed by True North on Sept. 24, 2014.

True North said the agreement gives it the right to acquire the property in the future for what it says could be “a very significant mixed-used real estate development for downtown Winnipeg. This development would include office, hotel, retail, residential, parking and public plaza components. During this process, we have considered major mixed-use real estate projects in other cities developed by our industry peers, including Maple Leaf Square in Toronto and LA Live in Los Angeles. It is anticipated that this investment in our downtown will greatly enhance Winnipeg and its (Sports, Hospitality and Entertainment) district.”

“It’s a winning combination,” Olfert said, noting Stuart Olson was having trouble finding a developer for the site.

“The only solution was if we went looking for it not waiting for it to arrive,” said Olfert, who said CentreVenture was encouraged by the city administration to deal with True North, although city councillors said they were unaware of the agreement.

Story continues below advertisement