NCC board gives RendezVous LeBreton 2 months to resolve ‘internal partnership issues’

“Unresolved issues” between the main business partners chosen by the National Capital Commission (NCC) to lead the redevelopment of LeBreton Flats are the one thing holding back the massive city-building project, the Crown corporation said on Thursday.

Members of the NCC’s board of directors said they were unable to vote Thursday on several key items to help push the major project forward because of internal disagreements within the RendezVous LeBreton Group, a consortium led by the Trinity Development Group Inc. and Capital Sports Management Inc.

Instead, board members voted unanimously on a motion to give RendezVous LeBreton two months, until the board’s meeting near the end of January 2019, to sort out its issues, or else the NCC will “proceed with the next steps” – either under the current solicitation process or a new one.

“We are disappointed to have had to make this announcement and make this decision with regards to RendezVous LeBreton Group,” Mark Kristmanson, CEO of the NCC, told reporters after the board’s meeting. “Our attempts throughout the fall – with the (Ottawa) mayor, with the fairness monitor and so forth – to reach a resolution with those partners have not borne fruit. So now we are looking ahead to January and beyond to what we need to do to get the LeBreton Flats developed.”

Kristmanson said the main RendezVous partners – Ottawa Senators owner Eugene Melnyk and Trinity Group executive chairman John Ruddy – have sought to change their corporate structure but cannot agree on a new governance model. The head of the NCC said he’s limited from sharing further details because of the “commercial confidentiality of the procurement process.”

Ottawa Mayor Jim Watson, who sits as a non-voting member on the NCC board, called the conflict between the RendezVous partners “a setback” for the LeBreton Flats project and “a disappointment” both for him, personally, and the city of Ottawa.

“They have to get their act together, plain and simple, otherwise I think we’re going to have to move on in January,” Watson said. “That meeting, I think, is going to be the most significant of the meetings we’ve had because we’re either going to proceed … or we’ll have to bid adieu and start the process over.

“If they come back with a corporate governance structure that they are both wed to and fully committed to, then we should proceed. But we need to see solid evidence that they have their act together, that it’s an amicable relationship, because we cannot have a dysfunctional partnership construct and build this site over the next 10 to 20 years. It has to be workable.”

In meeting personally with Ruddy and Melnyk, Watson said he witnessed a “challenging relationship.”

Melnyk’s response to the NCC board’s ultimatum on Thursday was brief.

“We’ve championed a downtown sports and entertainment arena, and this important civic project, since initiating our proposal in 2014,” he wrote in a short statement emailed to Global News on Thursday evening. “We continue to be committed to making our vision a reality.”

The Trinity Group has not yet responded to Global News’ request for comment.

Kristmanson and Watson didn’t specify what the board’s next steps would be should RendezVous LeBreton fail to work things out but Watson said they could involve “many other different options,” including a new request for proposals.

After RendezVous LeBreton was tapped as the preferred proponent to redevelop the vacant, 21-hectare site west of Ottawa’s downtown core in 2016, the group and the NCC signed an agreement in principle in early 2018. That preliminary agreement was approved by the NCC’s board of directors on Jan. 24.

The centrepiece of RendezVous LeBreton’s $4-billion redevelopment proposal is a new home for the Ottawa Senators – an 18,000-seat NHL hockey arena – accompanied by 4,000 new housing units across five mixed-use neighbourhoods, a number of public spaces and a French-language public school.

Kristmanson said the NCC had given RendezVous LeBreton a Nov. 1 deadline to resolve its “internal partnership issues,” ahead of today’s board meeting.

The consortium then asked for an extension until Nov. 8; on that day, the Trinity Group and Capital Sports Management advised the NCC that no resolution had been reached.

NCC board members expressed disappointment and frustration with this on Thursday.

“I was very unhappy to see that because of that one thing, we weren’t able to come here to today to make the decision on I think five items … because that business entity is not available,” board member Larry Beasley said.

The items in question included updates and decisions on a soil decontamination plan and consultations with the Algonquin people.

Board members voted on the LeBreton motion during the public meeting after discussing the state of the project behind closed doors on Wednesday.

After the NCC’s board meeting in September, Kristmanson told media the Crown corporation and RendezVous LeBreton were still negotiating a master design plan for the site. That development agreement would then need approval from the NCC’s board of directors and finally, the federal government.

The site in question is on federal land, but the city of Ottawa also has to sign off on municipal planning applications for the redevelopment of the former working-class neighbourhood.

Those planning applications involve public consultation. Watson said on Thursday he’s advised the city’s planning department to hold off on launching public consultations on rezoning for LeBreton Flats until the board decides what next steps to take in January.

Deborah Lynn Morrison, an Ottawa-based NCC board member, emphasized public anticipation of the LeBreton Flats project during the meeting. She said the redevelopment was “by far and away” the topic residents most wanted to talk to her about after she was appointed to the board this past summer.

“Our whole community is waiting and hoping for progress on this item,” she said.