At the regular council meeting held January 27, 2021, Town Council had a delegation in attendance to talk about the purchase of two commercial lots. After the delegation departed, council made a motion to offer two commercial lots to the delegate for $10,000 per lot. This offer would be a typical asking price for a 50ft commercial lot.
The two lots discussed were the lots where the former Clarendon Hotel was located. The hotel burned down in 2016 and the resulting cleanup cost the town $107,671.00 because the previous owner was not properly insured and had no means of paying for the cleanup (See CLEANUP OF THE CLARENDON HOTEL). In 2018 Council made an offer to a buyer for the lots, along with several other lots, at the price of $10,000 per lot for a proposed hotel. The buyer placed a down payment on the lots but was unable to start the project. The lots remained with the town and the buyer's money was returned less a 10% penalty.
Below is the motion that was made at the January 27, 2021, regular council meeting regarding the offer of the property (I have removed the buyer's name and replaced it with "buyer" as it is not relevant to the motions):
Kirk/ Migneault: THAT we offer Lots 7 & 8, Block 1 to Buyer at a cost of $10,000.00 per lot.
Then at the regular meeting held on April 14, 2021, Town Council reconsidered and lowered their initial offer to $1 dollar per lot and included a 4’ x 125’ concrete sidewalk to be placed on the east side of the property once the project is completed. The buyer will not receive any tax concessions but with the price reduction and new sidewalk will receive approximately $30,000 worth of incentives.
Town Council has at its disposal a number of incentives that are used to attract both residential and commercial construction. The current NEW BUSINESS offer (click here to view) is a 100% tax exemption in year one, 50% exemption in year two, and 25% exemption in year three with full taxation in the fourth year. While Council does retain the right to tailor incentives this offer appears to be an entirely new incentive. Even with the buyer paying full tax from the start the $30,000 in incentives will likely make this incentive one of the largest ever offered by a Council.
At this point, we do not know what business opportunity the buyer is planning to bring to town. However, if it is a new business it could help with the problem the Town has struggled with for some time being the number of empty buildings in the downtown. Besides the possibility of new jobs it could bring, it would also likely attract more customers downtown. A busier downtown could help to increase the local business climate and increase the possibilities of other vacant buildings being purchased bringing more businesses to Gull Lake.
Below is the motion made to reduce the offer to $1 per lot:
Kirk/ Migneault: THAT we offer for purchase Lots 7 & 8, Block 1, Plan Q2639 to
Buyer at a price of $1.00 per lot subject to the following conditions: - Buyer agrees to erect a building on the property in accordance with the bylaws and regulations of the Town of Gull Lake within one year of the acceptance of the offer; failing to comply with this provision, the Town shall be at liberty to
Cancel and terminate the option constituted by the acceptance of the offer; - title to the property shall not be transferred until such time as improvements have been completed, inspected and accepted by the Town officials, except in cases where title is required for the registration of a mortgage, which will require the responsible solicitor to provide a letter of request indicating the
reasons for requiring a transfer of title and assurance that the mortgage has been approved for registration;- the property will become taxable in 2022 and will not be
eligible for any property tax incentives;- the property is sold “as is” and there is no warranty as to the environmental condition of the property of any nature or kind;
- Buyer agrees to indemnify and hold harmless the
Town with regard to the environmental condition of the
property;- the Town agrees to construct a 4’ x 125’ concrete sidewalk on the east side of the property(Conrad Avenue) upon completion of the improvements. CARRIED
At this point it appears the one dollar a lot incentive is only applicable this property. We will have to watch and see if this precedent setting decision becomes a new incentive policy to attract new business to Gull Lake.
Blake Campbell
Gull Lake Events