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Penticton council cuts red tape to spur hotel development

Penticton council unanimously supported the rezoning of 325 Power St. with hopes to attract a high-end hotel.
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Penticton resident Lynn Kelsey shared concerns with city council over the change of zoning at 325 Power St. during a public hearing on May 11 at the Cleland Theatre.

Penticton council unanimously supported the rezoning of 325 Power St., but members were split over how to approach potential bidders.

A public hearing and special council meeting were held on May 11 at the Cleland Theatre, where council passed a bylaw which adds ‘tourism accommodation’ to the property at the Penticton Trade and Convention Centre. The amendment was made in effort to attract developers to build a high-end hotel which will connect to the PTCC, which city staff says is being underutilized due to its lack of adequate accommodations.

A large cause of concern centred around the baseball field behind the PTCC, which will most likely have to be sacrificed if a hotel goes up. Support for a new baseball field was mentioned by council throughout the night, and emphasized right before they voted.

“Don’t take away my baseball field,” said resident Tracy van Rae, who’s eight-year-old son plays there often.

“I live at this field from April to June.”

If the baseball field has to be replaced, van Rae wants to see council commit to a promise in writing.

“Where’s the fire? What’s the hurry?” asked resident Lynn Kelsey.

She stressed the irreversibility of selling parkland and expressed skepticism over promises made by politicians.

While acknowledging the PTCC’s need for quality accommodations she said, “I disagree with rezoning this parcel when there is appropriate land with the appropriate zoning available in the immediate vicinity.

One business in that vicinity expressed frustration over whether the deal will be fair and reciprocal.

“The word that gets out is poison to the business community,” said Richard Wilkins, who was representing El Rancho Motel owner Victor Harrison. He said that El Rancho, which is located beside 325 Power St. and has been for sale for 10 years, was in discussion with two potential buyers before the city considered rezoning.

“As soon as this came out for public process, the guys I’m dealing with in Alberta won’t even return my phone calls.”

Wilkins said there’s a pent-up demand for green space in the city, and proposed the city buy the El Rancho property – which could be used as the site of a replacement baseball field.

Dean Clarke, general manager of Global Spectrum and the South Okanagan Events Centre, shared his point of view.

“The biggest challenge which puts us on a defensive sales mode is when we’re going to seek national conventions.”

He said organizers often ask, “What is the brand of hotel attached to your convention space?”

Additionally, the need for transportation to offsite hotels adds a logistical challenge that repels interest, he said.

Clarke said that Penticton can expect four to six more national conventions each year if a proper hotel were attached.

Resident Lorraine Stephanson conveyed worry over the details of the transaction.

“It’ll all take place behind closed doors and the public won’t know the terms negotiated,” she said. “What is the best return to the city?”

The city’s economic development officer Colleen Pennington said it’s only speculative at this point, and that expressions of interest from potential developers will be non-binding and won’t be pursued if decent offers aren’t presented.

Mayor Andrew Jakubeit said the terms of development will be disclosed to the public before council votes on them.

Stephanson doesn’t want to see the city offer special favours to the site developer, as the “appetite for subsidizing business is really maxed out right now.”

She proposed council instead incentivize existing hotels to upgrade, or perhaps to entice investment on one of the many vacant lots downtown. A hotel at 325 Power St. would further reduce the likelihood of development on those empty lots, she said.

Planning manager Blake Laven said that zoning amendments are currently suited for hotel development on most vacant lots downtown, but interest from the private sector isn’t there.

After inquiring, Coun. Andrew Martin was told that council could backpedal on the zoning change if enough private interest doesn’t come forward. Coun. Judy Sentes said the prospect of a hotel at 325 Power St. has been an ongoing conversation since she was first elected to council in 2008.

“If nothing comes forward then nothing comes forward, but if we don’t entertain the question then we’ll never know, and, the dialogue will go on,” she said, adding if interest is shown it would be astute of council to make sure deal is good for Penticton.

“During the last election campaign we were told over and over again that we need to be bold,” Coun. Helena Konanz said. “We were told that it was time for change. And I was told over and over again that council moves too slow.”

While it’s still hypothetical, Coun. Konanz echoed van Rae’s idea regarding the baseball field: put forth in writing a promise to replace it.

Coun. Campbell Watt went further, saying he wants to see the ball diamond not just replaced, but enhanced.

“That is at the top of my priority list.”

Coun. Martin said exploring the rezoning is a stone that council can’t leave unturned, but added that no further actions will be taken if a good deal isn’t presented.

Also, he won’t support any change that doesn’t include the relocation of the ball field.

Mayor Jakubeit said, in regards to the baseball field, that council is very sport tourism minded, and is already looking into more development of many new green spaces throughout the city.

“There is room to work together,” said Coun. Tarik Sayeed. “I hope this gives all of us the chance to work together.”

While council could agree over the exploration of development, they didn’t reach consensus over how to best issue an Expression of Interest (EOI).

Coun. Watt and Coun. Konanz feel the EOI is too loosely worded and could allow a developer to make use of amenities currently undertaken by Global Spectrum.

Coun. Sentes said that removing that as a possibility from the EOI would be premature.

“I wouldn’t support changing it,” she said. “Until we see what comes forward.”

Support for the EOI passed,but with opposition from Coun. Watt and Sayeed.

City staff will have a six month timeframe to present EOI to suitable hotel chains.