Battle lines drawn over old hotel property

The owners of a partially completed hotel in Sylvan Lake are fighting the town’s attempt to rip out a parkade and turn the prominent corner into a temporary park.

The owners of a partially completed hotel in Sylvan Lake are fighting the town’s attempt to rip out a parkade and turn the prominent corner into a temporary park.

Frustrated by the unsightly and stalled construction project, town council ordered the property owners to remove a sagging fence and replace it with a better one. An end-of-June deadline was also set to either sell the property or restart construction. If the property owners were unable to move ahead on the project, they were ordered to dig out the 59-stall parkade, fill in the hole and then grass the site over to create a small green space.

They also had until Dec. 19, 2008, to provide a $500,000 irrevocable letter of credit to the town that could be drawn upon if the municipality wanted to remove the concrete itself.

The property owners were also told to hire a professional marketing agent and keep council informed of all efforts to sell.

The group of owners behind 1118980 Alberta Ltd. have been fighting for months to have the order overturned by a judge.

Last November, the town was given official notice that the property owners want the town to either cancel the order or substitute it with one that does not require the removal of the parkade and concrete foundations.

The originating notice says town council was “patently unreasonable” in requiring the concrete removal “as the property is not in an unsightly condition and if it is, which is not admitted but denied, removal of the foundation and concrete is not necessary to rectify the problem.”

The two sides will be back in Court of Queen’s Bench on Nov. 23.

A brief filed on behalf of the property owners alleges that town director of planning and development Tim Schmidt did not follow proper procedures for issuing orders as laid out under the Municipal Government Act.

It is alleged Schmidt should not have discussed the order with council before he issued it “and in fact this would be inappropriate given that Council may be called upon to review the order. . . .”

That put council in a “position where it then became judge in its own cause once the Applicant requested that it review the Order.”

The order is also opposed on the grounds that the concrete foundations and parkade are valuable assets, into which significant funds were invested by the property owners. Also, an engineer recently confirmed the parkade was structurally sound, says the court document.

The brief also says there is nothing in the development permit issued to the hotel backers in 2005 that requires further development of the property as a condition for allowing the parkade to remain.

An affidavit by Schmidt filed with the court on July 10 provides a chronology of the project beginning with the first development permit application in July 2000 for a seven-storey hotel with commercial and convention spaces.

The permit approved, the existing historic hotel was torn down in 2002 and construction on the parkade began. In April 2003, the parkade was completed and construction came to a standstill.

In 2005, the town approved a revised design for a nine-storey building containing 94 condominium suites, with commercial units on the ground floor and more parking on a nearby lot.

But that project also went nowhere. In early 2006, it looked like the project would be revived under a new developer, but that fell through.

Meanwhile, complaints about the site had begun to pile up.

The town extended a possible lifeline earlier this year with a proposal to jointly develop the building site with the town, which was looking for a new town hall location. A brief proposal was forwarded to the town in April by the owners but it didn’t make the town hall short list.

In his affidavit Schmidt, responds to the allegation that council was improperly consulted before the order was issued.

Schmidt said he made the decision to give the order and then was asked to update council as to what was going on in September 2008.

“Although my report dated Sept. 3 might give the impression that I had not already made the decision to issue the Order, in fact I had already made that decision.”

Schmidt also notes that he commissioned a market analysis from Colliers International last year that confirmed that the unfinished site has a “detrimental effect on the market values and developability of neighbouring parcels.”

The town’s land use bylaw says that if a development is not completed to an acceptable standard within two years after a development permit is issued, or extended, the town can order the site to be returned to its original state or a condition considered acceptable.

Schmidt did not return a call for comment Wednesday.

Sylvan Lake Mayor Susan Samson said she could say little at this time.

“I mean it’s in the hands of the court.

“We have had some discussions with (the owners). Nothing has come out of those discussions that we can make public at this time.”

A message to lawyer Christopher Rickards, who represents the property owners, was also not returned. Several well-known Red Deer doctors, including Lance Bredo, Ray Comeau, Doug Simmonds and Robert Furness, as well as local lawyer David Manning are connected to the project, as is the Wetaskiwin Veterinary Hospital.

pcowley@bprda.wpengine.com

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