Empire Living Centre expansion in trouble

Higher than expected construction costs have put the Empire Terrace Suites project “on the precipice,” company president Rod Mitchell says, unless city council can provide some non-financial incentives.

Mitchell and a delegation including North Bay architect Paul Mitchell appeared before council Monday night, asking that the city extend the Empire development some of the benefits of the Community Improvement Plan in order to make it a reality.

A prior request had been made but city staff are recommending it be denied.

Right now the CIP target area is limited to the Downtown Improvement Area, which is bordered by Oak, Sherbrooke, and McIntyre Streets, as well as Algonquin Avenue and a small part of Cassells Street.

On the precipice
The Empire Living Centre, where the $5 million six-storey project will be built next to, is also on McIntyre, but on the wrong side of the street 30 feet from the DIA boundary.

Rod Mitchell, pictured above, said the company needs to reap CIP benefits including the exemption from development charges, planning and building fees rebates, and the phasing-in of incremental tax increases, if it is to proceed with the expansion. The request would mean a future savings to the company of more than $300,000.

“We’re on the precipice because the cost of development here is about 15 per cent higher than in the southern Ontario climes, and the income you’d derive from such a project would be about 15 to 20 per cent less,” Mitchell said.

“And when you take the two together it’s quite a kick to the developer to come and develop such a project.”

Project acheives objectives
Paul Mitchell said the project had been pursued “with great vigour” until “the reality of construction costs in North Bay” became known, and things ground to an abrupt halt.

“We have been struggling ever since to find ways to make the business plan work,” Mitchell said.

Empire also wants to see the DIA boundary expanded to include it.

“The project,” Mitchell said, entirely achieves the objectives of the Community Improvement Plan, "and has the potential to represent the single largest success in downtown created by the CIP.”

DIA chairman offers support
The CIP offers feasibility study grants, façade improvement grants, rehabilitation and redevelopment loans and exemptions from parking requirements.

DIA chairman John Wilson also appeared at council to lend his support.

“It achieves our objectives, it’s a massive development, good for the downtown, increases the residential component of the downtown, so what more can you ask for,” Wilson said.

When asked by Mayor Jack Burrows whether the project would go ahead if council granted the request, Rod Mitchell said, “I’d say it would be 95 per cent guaranteed.

Matter referred to committee
Coun. Susan Church suggested the matter be referred to the committee meeting of council Monday night so staff could obtain more information and council could discuss the request more fully.

“It’s the prudent thing to do and as long as a two week period isn’t going to delay the project, it makes common sense to go and find the answers and then make the decision,” Church said.

Rod Mitchell said if council upholds the staff recommendation to deny the request, "we’ll have to go back and take a real hard look at this thing and see what we’re going to do from here."