Canadian Tire Real Estate Limited has returned $750,000 that City of Lacombe invested to help spur commercial development.
The deposit, plus interest, was returned by Canadian Tire after it failed to meet deadlines to develop a store that was meant to be an anchor for the Lacombe Market Square development on the east side of the community south of Highway 12.
In 2018, the city spent $3.325 million to buy land, which in turn was sold to Canadian Tire for a new store for $2.575 million. Council voted to borrow $750,000 to cover the shortfall. If Canadian Tire met its deadlines the money would be considered a non-refundable deposit.
City chief administrative officer Matthew Goudy said the goal was to provide an economic development incentive to give the project a boost and attract more investment to Lacombe Market Square and create jobs, draw visitors and generate additional taxes.
However, the pandemic hit and Canadian Tire was unable to meet the agreed-upon deadlines. An 18-month extension was granted in March 2021, but the project still remained in limbo and Canadian Tire agreed to return the deposit.
Goudy said while the timing is apparently not right for Canadian Tire to start building now, the company says Lacombe remains a priority. Canadian Tire representatives told the city it is among the biggest markets in Canada without one of its iconic stores.
“Overall, it just didn’t come to fruition at this time,” he said.
Mayor Grant Creasey said while it is “regrettable” the development has fallen through at this time he thanked Canadian Tire for hononuring the original agreement and returning the desposit to Lacombe.
“Despite this setback, council remains optimistic their property will be developed in the coming years,” said Creasey.
The site remains the property of Canadian Tire Real Estate Limited and is zoned as Regional Shopping Centre District. Canadian Tire could opt to sell or lease the land or develop its store at a later date.
Goudy said while the Canadian Tire would have been a welcome anchor tenant in Lacombe Market Square and fill a local commercial gap development activity has been strong.
A number of smaller tenants have set up shop in Lacombe Market Square and the Midway Centre development on the west side of the city next to Highway 2 continues to grow.
In 2022, a record $42.4 million worth of development permits were issued, boosted partly by $22.3 million in institutional projects, such as schools. Even without any institutional projects in 2022, there was just under $32 million in building permits handed out.
Residential growth has been even more striking. There were 145 residential permits issued last year, compared with 52 a year earlier and 28 in 2020.
The city is also expecting to see a healthy increase in population when it completes its municipal census later this year.