True North Real Estate seeks yet more time to finalize Portage Place purchase

Posted on June 25, 2024 by Peggy

The real estate wing of the company that owns the Winnipeg Jets is asking for another extension before it decides whether to proceed with a $650-million proposal to purchase and redevelop downtown Winnipeg’s Portage Place mall.

True North Real Estate Development has asked the city for three more months to conduct due diligence on its option to purchase the beleaguered mall and embark on a multi-year redevelopment that would see a 12-storey medical tower rise above the east side of Portage Place and a 15-storey residential tower above the west.

“This is a remarkably complex undertaking that continues to be approached with the greatest of diligence and thought prior to closing,” True North Real Estate Development president Jim Ludlow said in a statement Tuesday.

“The process, documentation and planning for the purchase of the land, the building and the redevelopment is in an advanced stage of completion and this time period will be well used to finalize agreements, complete reviews and obtain the necessary approvals.”

In addition to the construction of two towers, True North’s redevelopment plan for Portage Place also calls for the glass-enclosed atrium at Edmonton Street to be dismantled, while the middle of the mall would be converted into community centres, offices for community organizations and a small amount of retail space and food services.

True North announced in March 2023 it had signed a purchase option that required the company to make a decision on the project by Dec. 31 of that year. In November, the company asked for six more months to complete the transaction.

According to a report that will come before a special meeting of city council’s executive policy committee on Wednesday, True North is asking the city to extend that due diligence period to Sept. 28.

True North needs the additional time “to finalize the terms” of its agreement to purchase the mall, Winnipeg economic development manager Matt Dryburgh said in a report to the committee.

The city, the province and the federal government must approve the extension, because all three levels of government are stakeholders in the non-profit Forks North Portage Partnership, which owns the parkade below the mall and the air rights to build towers above it.

True North’s option calls for the purchase of these assets for no less than $34.5 million. The company has a separate deal to purchase the mall itself from Vancouver’s Peterson Group for an undisclosed price.

“The scale of this project includes design, engineering and construction, legal, financing and complex health planning, as well as multi-government participation and community consultation,” Ludlow said.

“We remain confident in our abilities and those of our public partners to successfully [complete] the final package of materials within this timeline.”

Mayor Scott Gillingham said Tuesday in a statement he will vote for the extension. CBC News has asked the provincial and federal governments to comment as well.

In April, Premier Wab Kinew said he signed a letter of intent that would see the province lease space within the health-care tower. That will serve as the province’s main contribution toward the project.

Ludlow said at the time True North plans to ask the city and province for property tax breaks to assist the project. Ludlow also said True North will ask the city to assist with streetscaping at the development.

True North is also expected to ask the federal government for assistance with the housing component and public spaces. Federal cabinet minister Dan Vandal said in April that Ottawa is amenable to some form of support.