Saskatoon city council unanimously approved spending an additional $17 million to buy three properties near the site of a proposed event center downtown.
Council previously approved $25 million to buy the north parking lot of Midtown shopping center as the future home of the city’s new arena and entertainment district.
According to a city report, the new funding will purchase the former Saskatchewan Transportation Company bus depot across the street for $6.95 million.
The remaining $10 million will collectively pay for building mostly used for medical offices — at 39-23rd St. for $5.2 million and 149 Pacific Ave. for $4.75 million.
“The main reason for doing it right now is that if we wait. the price we will pay will be significantly higher once the council formally approves the project,” said Frank Long, the city’s director of land.
In order to purchase the properties at this time, the city owners said it approached the owners with offers higher than the appraised value.
“Getting these properties now likely results in the best value for the city and the project,” Long said, noting the purchases align with advice from outside consultants.
Properties expected to pay for themselves
The city said the additional spending money will come from the Properties Realized Reserve, which is funded through land sales.
According to a report from the city administration, the three properties are expected to generate $320,000 in revenue a year while the city owns them through a combination of lease arrangements and parking stalls.
Long added that the city plans to hire a property management company to help them secure tenants to fill existing vacancies.
“All of the costs associated with the property management firm will be borne by the revenue that we receive from the properties,” he said.
“So the properties will essentially pay for themselves.”
Council has not given approval to the final project.
Prior to the vote, the city’s director of technical services Dan Willems said the additional land means more room and options for overall district design.
“Providing space to move large volumes of people into and out of the area without overly impacting normal traffic in and around the site,” Willems said.
“Operations such as loading facilities, tour bus parking or access and the like … having more space to fit the various Tetris pieces into place.”
The city has been buying up land near the proposed downtown arena site since 2013. It now owns a combined 8 buildings and parking lots.
Project still pending
The city still doesn’t know how much the arena and entertainment district will cost.
Several councillors have said they would not support any property tax hikes. Saskatoon Major Charlie Clark has also said he doesn’t want the project relying on that funding.
The city administration said preliminary capital cost estimates and a preliminary funding strategy would be in place by the summer.
Willems said previously that city staff expect to have a detailed funding package by November 2023.