The City of Terrace is putting the largest piece of the former Terrace Co-op property it owns back on the market now that its tentative sale to a Calgary hotel developer, which had been in the works for five years, has fallen through.
Superior Lodging had agreed in 2013 to buy the 2.8 parcel along Greig Ave. between Emerson and Kalum for $877,500 pending the city receiving an environmental clean bill of health but when that was received from the province in June, the company exercised an escape clause in the sales contract.
READ MORE: Old Co-0p lot ready for sale
Superior had plans to build a hotel on the site and other amenities but a city release of July 27 indicated it backed off because other hotels have been built in the meantime, eliminating the business case for development.
The city will soon look for potential purchasers through a request for proposal process, a procedure it hopes will elicit ideas that fit its downtown development plan which is in the final stages of completion.
As of now, the former Co-op property has been identified in the downtown development plan as one of five ‘precincts’, each intended to have its own identity and purpose.
“Key opportunities for urban design improvement include mirroring existing commercial street fronts on the northern side of Greig to complete its edges, as well as contributing to the form and character of the “cultural zone” (associated with the George Little House at the terminus of Kalum),” reads a draft plan released earlier this year for the property.
“The arrangement of buildings around the perimeter of the parcel will frame a south-facing, sheltered interior court for outdoor seating areas with open view to the railway and mountains beyond.”
But the city will also be relying on the findings of a six-year-old advisory report it commissioned for ideas on what should happen at the location.
READ MORE: City moves forward on Greig Ave development
That report recommended a number of options, including a hotel and amenities, retail space, a heritage centre/museum, green space, a brew pub and parking.
There’s no immediate date available as to when the request for proposals will be released or what it exactly will contain but the July 27 release did indicate there’s “significant renewed interest in the property and neighbourhood”.
Superior has not been the only company interested in the property. Grande Prairie, Alberta-based Pomeroy Holdings, the company which owns the Terrace Chances gaming establishment, expressed an interest in the location two years ago.
Pomeroy went so far as to schedule — and then cancel — a presentation to city council promoting a hotel as well as a conference centre for the property. Its proposal included a larger Chances floor space than at its current location.
The city also said the value of the property has increased since the 2013 tentative sale to Superior but it declined to release an appraisal it commissioned, saying that would “conflict with the basis of an objective RFP (request for proposal) process.”
Superior put down a $50,000 deposit as part of the 2013 tentative sale, $10,000 of which it has now forfeited to the city when it backed away from the sale.
The pending renewed sales effort continues a city search for a suitable development, a search that began in 2005 when the city bought the entire former Terrace Co-op property of approximately 4.5 acres for $1 million, a move heavily criticized at the time because it meant forgoing annual property taxes.
At the time of purchase, the property contained a large structure which was once a shopping centre and gasbar belonging to the Terrace Co-operative Association. It had closed in the late 1990s, citing a declining economy and change in shopping habits.
After sifting through and ultimately rejecting proposals to renovate the building, the city had it demolished in 2011 in anticipation that a property empty of the structure would spur buyer interest.
Receiving the environmental clean bill of health has cost approximately $450,000 through a combination of city spending and provincial/federal grants.
Although the city has declined to release an updated appraisal of the 2.8 acres it is putting back up for sale, one it commissioned in 2008 for the entire parcel placed the value then at $900,000 to $1.075 million with the buildings but from $1.075 million to $1.35 million if the structures were removed.
Aside from its renewed effort to sell the property declined by Superior, the city was more successful in selling a smaller lot on the west side of the location to a group which had wanted to build a brew pub there. But that development has not gone ahead.
At the same time, the city has reserved a lot on the eastern end of the Co-op property for public use and has so far committed itself to providing a portion of that lot for an eventual downtown museum.
But that location, which once contained a gasbar as part of the Terrace Co-op shopping centre, still needs environmental clearance from the province and the Terrace and District Museum Society still needs to raise the money to first develop a plan and then finance construction.
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