High-time the City of Kelowna introduced a Performance Bond for developers

     

    Image Credit: Westcorp (Accessed via Infotel)

    Kelowna is currently experiencing a high rise boom and that continued with the recent council approval of the new Westcorp hotel and condo project for downtown Kelowna.

    At 33 storeys (131 metres), it is set to be the largest building in Kelowna’s history – as of right now, at least.

    Personally, I am pro-development and I think this project will bring a wealth of benefits to downtown Kelowna and the city at large. Westcorp is a strong developer with a good reputation – they have done quite a lot of work in Alberta.

    The project is in a prime location – one of the most iconic in the city – as it will be located right by the Sails, City Park, Kerry Park, Stuart Park etc. Naturally, this makes it attractive to the developer, and of course, attractive to prospective tenants, guests and homeowners.

    However, with the development being in such a key spot for Kelowna, not just the downtown core, I do hold some concern about what will happen if the market conditions shift and/or funding for the project dries up. This concern is brought into even sharper focus given the new budget the provincial government introduced in February.

    In Kelowna, we already have some significant experience of half-built high rise projects. Many readers will no doubt remember that the current site of 1151 Sunset sat half-constructed for many years. That development was going to be called Lucaya, but the 2008 financial crash put an end to it with the spot becoming a weedy, decaying eyesore for years.

    The Sopa Square development was all stop-start for a number of years too. There are also other examples. I’m not picking on this developments, as this is a fact of construction, it’s an expensive endeavour and sometimes conditions change.

    However, what happens if a similar thing occurs with the new Westcorp hotel? That would be a massive issue for Kelowna, especially given how reliant we are on tourism.

    I have a solution. It’s too late for the Westcop project, but given our newfound, and correct, focus on housing density, it may help for future high rise projects that go before council.

    I believe the City of Kelowna should introduce a Performance Bond for developers who are bringing high rise projects before council. This is a measure that would impose a guarantee that the project will be completed. Currently, the city does not impose such a measure. However, with the high rise boom we are seeing, it’s surely time for the City of Kelowna to take a closer look at such an option.

    I’m confident that the Westcorp project will come together well, but I suggest it’s high-time the city look at imposing a Performance Bond guaranteeing the completion of all high rise projects.

    What do you think? I’d love to hear your opinion.

    If you have any questions regarding the Kelowna real estate market, please feel free to contact me directly. Whether you’re looking to buy, sell or invest, we can help! You can reach the Walker Real Estate office at 250-764-4344.

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