Plans for 6-storey downtown Charlottetown apartment building hit major snag
CBC
Plans to build a six-storey, $24-million apartment building in downtown Charlottetown have been abandoned, according to the project's developer.
Tim Banks, the CEO of APM Group, says the City of Charlottetown changed the terms of a tax incentive put in place to help build affordable housing in the city, making his project at 199 Grafton St. unviable.
Sixty of the 84 units would have been designated as affordable units, he said.
In an interview with CBC News, Banks said that just six days before the development agreement was due to be signed, city Chief Administrative Officer Peter Kelly "rounded up council" and the incentive was changed.
Before, you could use either CMHC funding or provincial funding — but Banks said council "changed the 'or' to an 'and' — and you have to have both…
"Unfortunately, the economics under the provincial program for the cost of developing in the downtown core just doesn't work under that program."
Banks said the city's tax incentive would have meant rebates on the municipal portion of the property tax bill, about $1,200 per unit. He said that would have helped offset the costs of the 217 new parking spaces set to be built as part of the development.
"It would cost about $1,200 more a unit just to pay for the capital costs of the difference between creating a parking space here versus a parking space out in East Royalty or West Royalty," Banks said during an interview in the parking lot of the Polyclinic building, where the development was supposed to be built.
"To develop in the downtown core, we have to build three levels of parking garages underground in a superstructure that [would] cost about $95,000 per space."
Banks said the provincial tax incentive provides a standard rate across the province, which doesn't take into account these additional costs of building in Charlottetown's core.
APM Group is spearheading the project for Morris Holdings, owned by Pat Morris. Morris Holdings owns the property where the development was being planned.
Despite Banks saying the development is now unviable, Charlottetown Mayor Philip Brown said he's confident a solution can be found to get the project back on track.
Brown acknowledges the changes to the tax incentive were made while the 199 Grafton St. project was in the middle of the approval process.
"I had some concern when the policy was being changed," said Brown.
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