SkyCity $6.5M city grant offer remains in limbo

A$6.5-million grant that wouldhelp Winnipeg's tallest building rise above Graham Avenue remains in limbo as talks continue between the city and the tower'sToronto-area developer.

City council's executive policy committee voted Wednesday to give city staff another four months to fine-tune a plan tooffer Fortress Real Developments financial assistance to build SkyCity Centre, a 44-storey tower proposed for a surface parking lot in downtown Winnipeg.

In September, the city offered Fortress $6.5 million over 10 years in the form of an economic incentive grant tohelp build the $200 million project.

That offer was made after Fortress informed the city it could not meet the construction deadlines of a downtown-housing incentive program that would have made SkyCity eligible for $6.5 million from the city and $8 million from the province.

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In a letter to the city in March 2016, Fortress warned the project was in jeopardy without the public money.

"While we are a long way down the road to developing SkyCity Centre, we need your help to keep the project viable," Fortress chief operating officerVince Petrozza wrote in a letter addressed to Bowman and other members of city council.

"To be clear, SkyCity Centre is not a feasible project without the [housing] program grant."

The old grant program offered the money in a lump sum when the project was complete. The economic incentive grant now offered by the city spreads out the payment over a decade.

That led Fortress to ask the city to hold off on a decision, as the developer would prefer to receive the money as a lump sum, property director John Kiernan said last fall.

Negotiations between the city and Fortress have been taking place ever since, property committee chair John Orlikow(River Heights-Fort Garry) said Wednesday.

"We're trying to figure out an agreement that works. The conversations have been positive. The administration believes there is an outcome that is possible. We wanted to givethe parties more time to finalize an agreement," Orlikow said after the city`s executive policy committee voted for a four-month extension on the grant offer.

Orlikow said the old downtown-housing grant program did not anticipate a building of SkyCity'sscale and thus set construction deadlines the developer could not meet.

Both Orlikow and Bowman said say they're not sure whether thecity will revise the grant to allow Fortress to receive $6.5 million as a lump sum.

"It would be a pretty steep hill to climb, but let's let the discussions continue," Bowman said.

SkyCity also was eligible for $8 million from the province under the old downtown-housing incentive program. The Progressive Conservative governmentsaid in the fall that no new grant is on the table to replace that program, which hasdeadlines that will not be met, according to Fortress's letter to the city.