City to consider tax incentives to help transform vacant heritage building into 148 apartments
Winnipeg's Keewayden Block, scorched by fire in 2019, poised to become East Block Lofts
The City of Winnipeg is poised to provide property tax incentives to a downtown revitalization project that would transform a vacant heritage building and an empty surface-parking lot into 148 apartments.
On Tuesday, Mayor Scott Gillingham's inner circle will consider a plan to rebate up to $1.4 million worth of property taxes over 10 years to help finance the $36-million redevelopment of the Keewayden Block, a 114-year-old office building at 138 Portage Ave. E, between Main and Westbrook streets.
The seven-storey structure, also known as the Jacob-Crowley Building, was slated to be redeveloped into a Hyatt Place hotel before a series of calamities sidelined the project.
In 2017, the Law Society of Ontario suspended a lawyer involved in financing the hotel project for allegedly providing inflated property appraisals to investors.
Two years later, the building was badly damaged after it was infiltrated by squatters and ravaged by a fire.
The new owners, Mark and Shelley Buleziuk of Winnipeg's Space2Developers, plan to expand the office building from seven to nine floors and build 93 rental apartments within the heritage structure. It will be connected to a new apartment tower to the immediate east, where 55 more apartments will replace a surface-parking lot.
Mark Buleziuk said there are some benefits that come with taking over a troubled project from a previous owner, especially since some of the redevelopment work had already started.
"They basically cleaned out the building for the most part and majority of the demolition was already done. So that helped," Buleziuk said Wednesday in an interview.
Space2Developers have a track record when it comes to converting heritage buildings into residential apartments. Previous conversions at 272 Main St. and 216 Princess St. are fully occupied, Buleziuk said.
"Affordable housing in good locations just seems to work right now," he said. "We've just been sticking with what we do know and we haven't veered beyond downtown as a result."
Most of the apartments in the new project will rent for $1,100 to $1,650 a month, he said. A handful of larger suites will command higher rents, he added.
The plan also calls for 40 stacked parking stalls and both a bike-storage space and a bike shop on the main floor, he said.
Tax incentive plan
In a report to city council's executive policy committee, Winnipeg economic development manager Matt Dryburgh said the East Blocks Lofts project qualifies for tax incentives because it will restore a heritage building and redevelop a surface-parking lot.
"It also addresses the critical priority of creating more rental housing downtown," Dryburgh writes.
The tax rebates that could be granted to the developer represent about 80 per cent of the municipal property tax revenue that could flow from the project during the first decade after it opens.
The city expects to receive about $35,000 in property tax revenue every year during that 10-year period — and then about $217,000 in property tax revenue every year after the rebates stop flowing back to the developer.
Buleziuk said construction on the project should start before the fall and tenants should be able to move in in 2025.
After two previous heritage building transformations, he said he expects the project to be both difficult and rewarding.
"That's why you don't see a lot of the really big players involved in this market. It does require a boutique effort and a little bit of passion for these buildings," he said.
