City poised to repeat errors in Rideau Centre pedestrian bridge deal
Joanne Chianello, Ottawa Citizen
Published on: May 4, 2015, Last Updated: May 4, 2015 5:34 PM EDT
Before we get into the convoluted history of the relationship between the city and the Rideau Centre, before we consider the details of a 50-year agreement between the two, before we delve into why negotiations over a pedestrian bridge are coming to council after said pedestrian bridge is already being reconstructed, let’s ask ourselves one simple question.
And that question is: Why should the city want to forgo hundreds of thousands of dollars in revenue from Rideau Centre for a bridge whose sole purpose is to move customers between the shopping mall and the Hudson’s Bay across the street?
The answer: No reason whatsoever.
The plan for the Rideau Centre overpass — known as the Freiman Bridge — was hatched back in 1982 when both the shopping centre and the Transitway were new developments that city leaders hoped would rejuvenate the downtown. Presumably, the city’s thinking behind the enclosed bridge was that it would provide transit riders a protected way to go between the Mackenzie Bridge stop on OC Transpo’s new Transitway and the ByWard Market, via the Rideau Centre and The Bay.
Despite the clear advantage to the retailers, the city agreed to bear 87.5 per cent of the construction costs of the bridge. According to Robin Souchen, the city’s manager for real estate services, the city has also picked up 56.5 per cent of the bridge’s operating costs for the last 33 years. Between 2003 and 2012, the city spent $78,415 on glazing repairs, and a city report going to the finance and economic development committee on Tuesday estimates that the city would likely spend an additional $62,000 over the next three years.
In addition, the original 1982 contract holds the city responsible for the costs of taking down the bridge at the end of the 50-year term.
Agreeing to spend taxpayer money on a pedestrian bridge connecting two private, for-profit retailers does not seem like the city’s finest negotiating moment. But that’s old news — after all, what can the city do about a contract signed more than 30 years ago?
And yet, the city’s real estate staff is recommending that councillors repeat the errors of the past.
Rideau Centre owner Cadillac Fairview is pouring $360 million into the redevelopment of the shopping centre, so it makes sense the company would want a more attractive Freiman Bridge. In fact, Cadillac Fairview wants a renewed bridge so badly that it agreed to assume the risk of starting the reconstruction at its own expense, aware that the approval of council is still required.
So it’s clear that this bridge is a big deal for the Rideau Centre and The Bay. The city? Not so much. The Transitway is being largely replaced by the Confederation Line, which will have direct entrances into both the Rideau Centre and the north side of Rideau, which will provide ready access to the market. There’s no reason to put public money into the bridge today.
That’s partly why the city is recommending paying Rideau Centre owners $400,000 to take over the bridge.
And that makes sense. City staff estimates that its maintenance costs for the bridge over the next 17 years would be $150,000, while the demolition costs would add another $250,000. Taxpayers also spend about $4,000 a year removing snow from the top of the bridge.
But what about city staff’s recommendation that the city waive air rights for the bridge that could be worth $335,000? The real estate staff is suggesting that Rideau Centre owners be charged a symbolic $1 for air rights for the 20 years between 2033 and 2052.
Generally speaking, air rights refers to the ownership of air above a piece of property. If someone wants to encroach on that air space, they have to pay for air rights. For example, the city charged Minto for air rights when the home builder constructed condos at Lansdowne Park, as the towers are on city land.
So why is the real estate department throwing away hundreds of thousands of dollars in future taxpayer revenue? Apparently as a “sweetener” for the Rideau Centre to take the deal, said Souchen.
Boy, he sure drives a hard bargain.
Under the 1982 contract, the city is under no obligation to rebuild, revitalize or reimagine the bridge. We just need to maintain the status quo. The Freiman Bridge is of far more importance to the retailers than to the taxpaying public.
The estimated $335,000 in air rights isn’t a huge amount of money in the big scheme of things. But in principle, it’s hard to see why taxpayers should forgo that revenue.
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East Pedestrian Bridge
Is there anyone this creative?!
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