Decision driven by possible economic opportunities, loan from province
The Town of Grand Falls-Windsor will not be selling the EXCITE building at this time. A motion was passed at Tuesday’s general meeting of council, after some discussion among councilors, to hold onto the commercial rental space for the time being.
© File photo
Councillor Rodney Mercer stands outside the EXCITE building in a photo taken in 2013.
The EXCITE building was constructed in 2001 by the town, with some funding from the federal government and the province, to enhance economic development and create jobs in the town. The building, located on Queensway Park, currently has a number of tenants such as Hockey NL, the provincial government, a call centre and DPSI.
In recent years, however, the building has been a topic of debate among councillors and residents, about whether or not the town should be in a landlord-tenant agreement, and if it should be taking business away from the private sector.
Grand Falls-Winsor Mayor Al Hawkins said while he agrees the town shouldn’t be in a landlord tenant relationship in the long term, there are a number of reasons council wants to hold off on the sale of the building for now.
He said the town is currently in talks with two possible future tenants that would be large economic drivers for the region, and it would be preferable to remain in possession of the EXCITE building as those talks progress.
“We’re working with a major (medical) research company that’s working closely with ACOA (Atlantic Canada Opportunities Agency) for funding. I can’t give the details but its going to be (supported) by ACOA, a private company, and the town will do some sort of in-kind support,” Hawkins. “We’re also working with a company out of New Jersey, looking at the possibility of (a) data centre. They want to come up and do some work,” Hawkins said. “That’s an important piece for us as well.”
A third reason why the town is not in a rush to sell the EXCITE building is due to a $600,000 lien from the province on the building, which the town would have to pay back if it decided to sell the property.
Hawkins said when the building was constructed, the town paid $1.3 million while ACOA provided $500,000 that has since been forgiven.
“The province came in with a $600,000 loan that would be attached to that building,” Hawkins explained. The condition was if the town sold the building, they’d have to get two commercial appraisals, and pay back the province their share. Hawkins said, as far as he’s concerned, the town shouldn’t have to pay that money back.
“We’ve had this now since 2001, we’ve made renovations to it, we’ve made changes to it, we’ve spent money on it, the province has contributed absolutely nothing to that building,” he said.
According to Hakwins, the town has been in contact recently with the province, hoping to come to some sort of alternative arrangement on the loan.
Though the vote to hold on to the building passed after being removed from the minutes for separate discussion, there was one who voted against.
Councillor Rodney Mercer, who is chair of the finance committee, said he thinks the town shouldn’t draw out their ownership of the EXCITE building. He said he would like to the town start the process to sell the building as soon as possible.
“I’ve always been against the EXCITE building. I understand the need for it, originally, but I think it’s lived beyond its expiration date,” he said. “We’re not in the business in being in a landlord tenant arrangement or agreement, we’re in the business of governing.”
Mercer said he also disagrees with the town taking possible business from private property owners.
Another concern Mercer said the town should be considering is that the building is aging. Though it’s less than 15 years old, he said there are already cosmetic repairs needed. He said it’s only a matter of time before more repairs are needed, and more taxpayer dollars would have to be used.
Finally, Mercer said, he believes money from the sale of the building, if used wisely, could result in more money for the town.
“I fully agree with what the mayor and everyone else around the committee table said here tonight. My concern right now is over the past number of years we’ve been making on average around $100,000 in profit (from renting this building), which is good, that’s fantastic.
“But . . . from a financial point of view, if we were to take this money right now from the sale of the building, plunk it down on a long-term debt (like a) bank loan, we could save ourselves maybe $150 or $200 thousand a year in interest payments,” Mercer said. “It’s nice to make $100,000 a year profit, but are profit and savings the same thing? In my opinion they are.”