As the drive to intensify cities continues, developers are increasingly looking at heretofore neglected assets and new-style relationships to unlock development opportunities, delegates attending the recent CityAge conference in Toronto were told.
An underutilized convention centre, an isolated school in a large park setting or an aging ice rink should all be considered potentially ripe for redevelopment, speakers argued in back to back sessions on the first day of the event held at the Mars Centre Nov. 22 and 23.
“There is a weird synchronicity. Things are coming together,” commented Steve Beatty, Americas head of global infrastructure for KPMG Infrastructure, whose address was titled Islands of Good. He followed a panel discussion on the theme the Wealth of Cities. “People are realizing they have these opportunities.”
Wealth of Cities panellist Brad Ferguson, president and CEO of the Edmonton Economic Development Corporation (EEDC), presented an Edmonton case study.
“What makes Edmonton unique is our unusual level of co-ordination between the city, our organization and proponents in the private sector,” Ferguson explained in an interview.
“We’ve got a very progressive mayor and very progressive city administration that is open to us coming up with ideas.”
Edmonton has two conference centres but neither has a hotel immediately adjacent. And so, Ferguson said, the EEDC began to reconsider the Shaw Conference Centre.
When cities make investments into these major infrastructure pieces, there is value that is created
— Aubrey Kelly
UBC Properties Trust
“We started working with private architects to look at the conference centre and we started looking at the most underutilized parts of it, and they happened to be right over the loading dock,” he said.
“The city is not a developer so what we did was determine what the value of the air rights is and then our job was to go to a request for an expression of interest to the development community, which we are just about to do, in order to get different consortiums, hoteliers, developers, financiers, to basically use the air rights above it, a city asset, to develop a hotel, condominiums. That secures the future of the conference centre and really starts to allow for expansion plans for the conference centre over time.”
Panellist Scott Davey, a councillor for the City of Kitchener, Ont. suggested city planning policies could be viewed as “intangible assets” that could be introduced into development discussions with the private sector. Aubrey Kelly, president and CEO of UBC Properties Trust and the third panellist, picked up on the point, referring to Kitchener’s LRT project.
“When cities make investments into these major infrastructure pieces, there is value that is created,” said Kelly. “Too often we shy away from that. You shouldn’t be shy about saying, ‘how can this be shared?’”
When there is a new transit corridor, said Kelly, “There is a huge increase in land value. I am not saying the city should harvest it all, but that is an asset that cities have and there has to be a conversation started because at the end of the day that is what it is going to take to build some of these projects.”
Two-storey schools on big properties represent another asset that can be repurposed, he said. Why can’t students study math on the 18th floor of a vertical structure with the freed-up square footage on the ground made available for other developments, he asked.
Ferguson also addressed school buildings, saying they are “historically underutilized facilities” but municipalities and school boards tend to speak about looking for other social uses for them after hours.
An old single-pad ice arena needing a new roof should not automatically be designated for renovations in a city’s capital budget, Ferguson said.
“You can redevelop that or make it a twin pad but also add some housing or social housing around that space,” he said. “You need to have the courage to take the risk and use what I call a ‘private-sector mentality’ to achieve a good public-sector outcome.”
Beatty’s Islands of Good address in the next session discussed how cities could convert underutilized single-purpose assets into multi-use developments that enhance public services by involving the private sector.
KPMG conducted an extensive survey of municipalities internationally and Beatty has been engaged in discussions in 10 or 12 countries in the past six months as part of the project, he said.
A library that might be past its peak of utility could be viewed as a candidate for redevelopment, he said.
A city could make a deal with a developer, perhaps granting land rights for 99 years, but requiring the developer to construct a day care, seniors centre or new library, “transforming the city with more services” and letting the developer “bake the cake any way they want” with other profitable uses.
“The closer you can be to major arteries and major transit facilities, the better in terms of making some of the commercial aspects come together,” suggested Beatty.
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