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Old Posted Jun 2, 2005, 2:57 PM
Saska2ntown Saska2ntown is offline
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Join Date: Mar 2003
Location: Ottawa, Ontario
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I'm tired, hungover, and horny... so fuck it...I'm posting this article.

Stonegate huge retail gamble

Gerry Klein
The StarPhoenix


Wednesday, June 01, 2005

The game, folks, is Saskatoon stud. The pot consists of a $40-million power retail centre, a $10-million to $14-million overpass and -- from those reluctant betters along Eighth Street, Broadway Avenue, in Riversdale and in the downtown -- the potential for retail districts to become as cold and bleak as (horror of horrors) Regina's downtown after hours.

All eyes are now on First Pro Shopping Centres, the developer proposing to turn 41 acres of field and pond south of Circle Drive and east of Clarence Avenue into a regional retail centre called Stonegate, which would be anchored by a Wal-Mart and contain a collection of smaller stores.

Most of the councillors have already shamelessly shown their cards. About half are ready to roll over to the Vancouver developer's desire for a development just a little sweeter than one now in existence in the city's northeast.

Preston Crossing was Saskatoon's first comprehensive big-box retail development. When it was proposed, businesses along Eighth Street, in existing malls, in the downtown and on Broadway expressed fear they would be unable to compete. The council of the day agreed to let Preston go ahead, but insisted the development be phased in, with retail studies done before building continued to be sure there was no damage to the city's existing industry.

Preston Crossing also had strict controls -- set out in a zoning law referred to as a direct control district (DCD3) -- which insisted 63 per cent of the 47-acre plot be big-box stores of at least 100,000 square feet and most of the remainder be stores greater than 10,000 square feet. The developer is now looking to complete Preston Crossing's third stage with those smaller stores.

First Pro initially insisted it wanted to set its own rules, but city hall balked. Councillors sent administrators back to the drawing board, where they came up with a compromise limiting the big box to 50 per cent of the site and allowing First Pro to build nine smaller stores. The return on smaller stores is greater for the developer, and First Pro insisted it needed more small stores in order to pay its $2-million share of a new overpass at Circle and Clarence.

Representatives of the city's vibrant retail sector warned that allowing First Pro to have more small stores would snowball, as Preston Crossing would demand equal treatment, and a third so-called "power centre" development -- this one on a 32-acre, city-owned site on the west side -- would also need small stores to compete.

In fact, when Preston Crossing's third phase is added to First Pro's Stonegate development, the city's west-side site and a new retail expansion planned for University Heights, Saskatoon potentially has 1.3 million square feet of new retail space coming on stream in the next five years -- more than a third of the size of the West Edmonton Mall, a development that dealt a severe blow to that much larger city's downtown.

Saskatoon, unlike the Alberta capital, is going through a period of modest growth at one per cent a year.

So here are First Pro's betting choices: go back to its original position that it alone should determine the rules for development; go with the compromise it reached with city hall for a deal just slightly sweeter than Preston Crossing's; hedge its bets by asking for some smaller stores (that is, seven instead of nine); or take the safe route, ask for the DCD3 zoning deal the city has already agreed to for Preston Crossing and be assured of a successful vote?

As of Tuesday, the die has been cast (pardon the mixed metaphor). First Pro is going for the controversial proposal for nine small stores. It will likely garner support from half of council, and bet the majority won't be swayed by the existing retail representatives, who are now able to lobby relentlessly all month, pointing to the dangers of the West Edmonton Mall and the spectre of Regina's downtown.

The question is will councillors see the big (1.3-million-square-foot) picture or focus on the short-term development? It's an all or nothing gamble. If council votes down its own bylaw, it will have to start over from scratch.
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