The City of Nanaimo is satisfied with progress on the conference centre hotel at 100 Gordon St. and will waive its right to purchase back the property. (Chris Bush/News Bulletin)

The City of Nanaimo is satisfied with progress on the conference centre hotel at 100 Gordon St. and will waive its right to purchase back the property. (Chris Bush/News Bulletin)

City of Nanaimo satisfied with construction, waives right to buy back hotel property

PEG Developments has passed $1-million mark in construction investment

The City of Nanaimo has seen enough to be convinced that the conference centre hotel project is on a firm foundation.

City council, at a meeting Monday, voted unanimously to waive the city’s option to buy back the Gordon Street property.

Under the original agreement, the city could have bought back the property for $750,000 if PEG failed to meet certain project milestones. Although the project is more than a year behind schedule, the developer has now spent more than $1 million in ground works at the site, the one of the thresholds in the agreement.

“PEG have now met those numbers, they’ve shared their financials with me,” said Bill Corsan, the city’s director of community development, at Monday’s meeting.

A city staff report noted that COVID-19 impacted the hotel’s construction timeline.

“Construction is now well underway with the general site works and concrete foundation near completion,” the report noted, adding that the steel structure of the first four floors will be assembled on site next month.

Corsan said the hotel could be open in spring or summer of 2022 and he recommend the city transfer “clear title” of 100 Gordon St. to the developer.

In addition to waiving the purchase option, council also approved two amendments to the city’s agreements with PEG. The start date of the 10-year tax exemption is being pushed back up to an additional 22 months, and the number of conference centre parking spaces reserved for hotel use is being halved from 60 to 30 with a revised annual rent of $197,100 per year.

Snuneymuxw First Nation is a partner on the $34-million project, a nine-storey hotel with 172 rooms, an indoor pool and a patio restaurant.

READ ALSO: Hotel developer assures Nanaimo city council groundbreaking ceremony is coming

“It’s very nice to be able to look out there now and see that the work of many years is starting to come to fruition,” said Corsan.

He added that city staff has set up a camera on the roof of the Port Theatre so the hotel’s construction can be tracked and eventually made into a time-lapse video. Images can be seen at this link.

Mayor Leonard Krog called the hotel project update “very positive news” for the city.

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