The owner of a downtown building, that was recently converted into a new medical office, will receive a break on property taxes.
Council, at its Monday meeting, approved the incentive which is part of city council’s tax exemption bylaw aimed at revitalizing the downtown core. The initiative applies to targeted areas to entice business owners to invest in the city’s downtown.
The most recent application came from the owner of the former Sinnott and Co. law office building at 480 10th Ave.
Kevin Brooks, the city’s development services supervisor, said the owner has transformed the building into a new medical clinic.
“This (required) a full remodelling of the interior of the building to establish eight exam rooms and the associated support services,” Brooks said.
It is those building renovations that are eligible for the tax exemption.
The property and existing building was assessed at $311,000 in 2016. The estimated construction value of the renovation project, however, is $399,000.
Brooks said that based on that more expensive figure and last year’s city property tax rates, that the estimated tax exemption will be $5,020 annually.
The city will forfeit that revenue in each of the next five years, which is a total of $25,100.
Throughout the five-year exemption period, however, the building owner will still pay annual property taxes of $3,910, based on its pre-construction assessed value, Brooks said.
The city will collect the full $8,930 worth of property taxes on the property starting in 2022.
The 10th Avenue property is just the latest in a string of local businesses that have taken advantage of the revitalization tax exemption since it was established by council in 2011.
The first businesses to come forward were CR DanceXtreme & Fitness and Tyee Chevrolet Buick GMC, which both applied for the tax break in 2012.
Tyee Chev’s application was based on a brand new showroom that it built on its property on the corner of Dogwood Street and 13th Avenue while CR DanceXtreme’s savings came on construction costs incurred while building its dance studio downtown.
Berwick by the Sea retirement home and Seymour Pacific are also currently locked into the five-year tax exemption program for construction costs on their new buildings.
Prior to the 10th Avenue site, the most recent development to benefit from the incentive program was the new apartment building in Tyee Plaza that has gone up on the former SuperValu site.
In that case, the city is exempting taxes worth $27,446 per year for a five-year total of $137,228.
