http://www.canada.com/edmontonjournal/ne...43b8-8796-46ff-b958-8b98fa3ee5bf&k=29457
Silk Hat out of mothballs
Plans for condo-office tower at site called off
Mike Sadava, The Edmonton Journal
Published: 9:23 am
EDMONTON - The aroma of liver and onions will soon come wafting out of the Silk Hat Restaurant once again.
The venerable downtown restaurant was closed in June amid plans for a 40-storey skyscraper on a site that included its building on the south side of Jasper Avenue near 103rd Street.
But faced with a soft condo market, limited prospects for leasing downtown office space and skyrocketing construction costs, Procura Real Estate Services of Calgary has put plans on hold for what it touted as the tallest building in Edmonton, and has leased out the restaurant space.
The long, narrow diner, a Jasper Avenue fixture since 1912, is being resurrected by Yasser Najib Achty, who is known in the hospitality industry as "Danny Boy" and who previously owned the Silk Hat from 1988 to 1993.
Achty and his business partner, Sharon Hazen, had hoped to have it open by the start of December, but plumbing and electrical surprises and the disappearance of basic equipment such as cutlery and plates have delayed the reopening until later in the month.
But at least the neon sign with its hat and cane is glowing once again.
Achty said he has signed a 10-year-lease, which would include temporary relocation to another building for the Silk Hat if the new project proceeds and an option to lease street-level space in the new skyscraper.
"This is the heart, the cornerstone of the city, and it should not be taken out," Achty said Thursday.
"I talk to a lot of people, and they were sad (about the demise of the Silk Hat). I put it in my head and my heart that I want to get this place back.
"It's the heart of Edmonton, a tourist attraction, and I want to give it life."
The plans announced last summer for the big tower included a mix of 200 condominium units and office space.
George Schluessel, president of Procura Real Estate Services in Calgary, said a number of factors have caused his company to go slow on this project.
"We're working on the design for the building, but right now our biggest concern is seeing the absorption of office space in downtown Edmonton, which is quite slow right now," Schluessel said.
According to the latest market report by Colliers International, downtown office vacancy for Class A space slightly increased in the third quarter of this year from 4.50 to 4.53 per cent.
Procura is also rebuilding the Professional Building at Jasper Avenue and 109th Street, which will put another 240,000 square feet of office space into a limited market that could barely absorb that in a year.
Procura also submitted a proposal to provide a new building for Epcor on the Jasper Avenue site, which is also occupied by the old Paramount Theatre.
But their effort only reaped a one-line statement from a real estate agent representing Epcor, saying their bid wouldn't be considered, he said.
The company is also building the first phase of the big Century Park condominium complex on the site of the old Heritage Mall, and the market for condos is much softer than it was a year ago, he said.
Add in high construction costs affecting everything from roads to the lieutenant-governor's mansion, and it is good time to be cautious and take it one project at a time, Schluessel said.
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