City leases out fitness room at community centre

Penticton looks to transform vacant space into potential revenue source

  • Dec. 27, 2011 1:00 p.m.

A whole new group will be getting physical at the Penticton Community Centre.

The City of Penticton announced Dale Charles and Associates Physical Therapy Corp. had signed a lease for the old fitness room at the facility at 325 Power St., to the tune of $27,800 per year for at least five years.

And according to recreation general manager Chuck Loewen, the partnership is the first of many to come.

“When the community centre was expanded, the fitness room was relocated and another number of rooms were consolidated or expanded in the old part of the building,” Loewen explained. “Ultimately what happened was there was some vacant space available for other uses.”

Rather than just using the old rooms for storage, the recreation department cleared out its gear and consolidated storage into one area — leaving a variety of main-floor rooms across from the main administration offices that could be used for other things.

“That offered some fairly decent spaces to be leased out or used in some fashion,” Loewen said.

The city issued a request for proposals (RFP) this past fall to see what kinds of proponents would be interested in leasing space at the Penticton Community Centre, providing the business complemented to the recreation department’s bailiwick.

“We were very flexible with how prospective proponents would want to utilize that space, but we wanted to stay within the mandate of what we want to be in terms of recreation, wellness and services,” Loewen said.

Dale Charles, a physiotherapy practice since 1982 that currently operates from a facility on Winnipeg Street, submitted a proposal to lease approximately 2,067 square feet within the old fitness room at a rate of $13.449 per square foot for five years, with the option to renew three times for five years each.

Loewen said Dale Charles is a natural fit, mirroring the community centre’s current aquatic physiotherapy program called React, which is overseen by nurses and other health-care professionals and used extensively by the community.

“By bringing in other wellness services like Dale Charles, we are able to bring more value to the Penticton taxpayer by getting a greater return on the expansion or capital investment that took place,” he said.

The agreement provides three streams of potential revenue for the city, he added: the lease revenue of $27,800 will go into the city’s general revenue, and the practice will draw in additional people seeking community centre services as well.

“Their clients, who are using our facilities both in the fitness room and the pool, will generate up to $18,000 annually from their client base,” he said. “It will bring more traffic through our community centre. Once they bring our clients in and they’re done their therapy programs, these clients will be encouraged to use these facilities on their own. That just reaps additional usage, participation, activity and of course revenues into the city.”

The third potential revenue driver will be co-op programs. Loewen said the city would sponsor the programs with community centre space, where Dale Charles staff would run them. Both would reap the rewards of program revenues.

“I haven’t even calculated those dollars yet, but just based on user fees and leases and that, we stand to make $50,000, which in the long term is almost a $1 million proposition over 20 years,” he said. “That goes a long way to providing synergistic services in the recreation department and paying down the debt and providing a greater return on these facilities.”

The RFP process only yielded one signed lease, but the recreation GM is optimistic there will be “compatible” businesses coming in.

“We have had interest from other parties. I can’t say the specific businesses, but there has been other interest with no other firm proposals coming forward. … I think we’ll have no problem in the future leasing out the balance of the space,” he said. “We’re also looking for some I’ll say healthy food options as far as food and beverage services go in the community centre.”

The resolution is slated to be ratified at the Jan. 9 meeting of council.