The company behind a proposed $400 million redevelopment of Portage Place mall says it may be forced pull the plug on its plans after the federal government missed a Monday deadline to confirm funding for the project.
Toronto-based Starlight Investments plans to add two residential towers with more than 500 rental suites, community spaces, a pedestrian walkway and a downtown grocery store to the beleaguered mall.
But the developer has asked the city, province and feds for help in the form of $20 million each over a five-year construction schedule. After getting the nod from both the city and province, the federal government had until 5 p.m. Monday to let Starlight know if it would join the deal.
Starlight tells 680 CJOB they heard no word from the feds by deadline.
Earlier in the day Monday the company’s chief operating officer, Glen Hirsh, said that may leave Starlight no choice but to back out of the proposal.
“The last thing we want to do is walk away,” he said.
“But if I’m not … engaging in meaningful discussion (with the federal government) then that really leaves me no choice, I can’t go back to our shareholders … and say we need to extend this transaction.
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“We have to request our deposit back and we have to look for other highest, best use of our capital.”
680 CJOB reached out for comment on project’s federal funding from St. Boniface-St. Vital MP Dan Vandal, but was told he wasn’t available.
Last July, after Winnipeg city councillors voted in favour of confirming the city’s share of the public money for the project, Vandal said the proposed redevelopment was “something that our government is seriously looking at.”
“But right now we are doing our due diligence, we are talking to other governments to try to come up with a solution that works for Starlight and the City of Winnipeg,” Vandal said at the time.
A deadline for word on the federal government’s funding originally set in August has already been extended by Starlight.
There was no word from the company Monday on whether or not it will extend the deadline again.
Portage Place was built in the 1980s as part of a revitalization effort in the area. To build it, the North Portage Development Corporation was established as an arms-length government committee and the group announced the building of the mall in 1984.
However, the mall almost immediately failed to live up to its potential.
Less than a year after it opened, store owners complained of a lack of foot traffic and asked for reduced rent, according to a news report at the time.
Earlier in the day Monday, CentreVenture CEO Angela Mathieson said she was disappointed to see the plans to redevelop the mall in danger of falling through.
“What I’m hoping is that some of the posturing isn’t entirely accurate and hopefully there are people in the federal system looking to see what can be done to bring the parties together,” she said.
“Undoubtedly this is a very, very important building not only for the downtown but for the entire city.”
— With files from Elisha Dacey and Richard Cloutier
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