The Wallace St. area between Fitzwilliam and Wentworth streets would be transformed thanks to development plans by TELUS. (City of Nanaimo/NanaimoNewsNOW illustration)

By Jordan Davidson

big tax break

City Council approves substantial tax breaks for downtown Nanaimo developments

Oct 29, 2022 | 9:22 AM

NANAIMO — A new multi-family residential development in Nanaimo’s downtown was just approved for major tax exemption to the tune of over $250,000 a year.

The property at 235 Wallace St. is owned by TELUS Communications Inc., and is being redeveloped into a 195-unit multi-family development.

During the Oct. 24 regular council meeting, Council approved their applications to be added to the Downtown Revitalization Tax Exemption Program (DRTE) for ten years.

Councillors Tyler Brown and Ben Geselbracht were the lone dissenting votes, with Brown saying he doesn’t see how this serves the community.

“Consistent with my previous position on this, I will be voting against it. It only serves the purpose of passing on increased profit to those building the buildings, it does not do anything other than that.”

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Based on the 2023 projected rates for the Wallace St. property, the estimated exemption for the class 1 residential property equates to approximately $255,558.96 per year once construction on the building is complete.

235 Wallace St. is currently assessed as a Class 6 business property, with a current value of $3,796,000 as of 2022, resulting in $46,798.46 worth of property taxes being paid every year. (Jordan Davidson/NanaimoNewsNOW)

TELUS has already received a development permit for this project, and must obtain a building permit on or before March 31, 2023, and have the building operational by March 31, 2026.

Council also approved another tax exemption amendment at the same meeting, this one for a project at 340 Campbell St., the former site of Caledonian Medical Clinic, for the construction of a 163-unit multi-family residential development.

This project was already approved for this tax exemption program, but was unable to meet the deadlines and asked to amend the date for a building permit to April 30, 2023, with a completion date of April 30, 2025.

Based on projected tax rates for 2023, this equates to approximately $94,000 of municipal taxes per year under the class 1 residential bracket with a value of $28,832,744.

The site of the former Caledonian Medical Clinic will be torn day to make way for the new 163-unit multi-family residential development. (Jordan Davidson/NanaimoNewsNOW)

It’s currently paying $34,963.23 as a class 6 business property with a value of $2,846,000.

The goal of the DRTE is to encourage new developments in Nanaimo’s downtown core, in the form of multi-family and commercial investments.

This exemption relates to municipal taxes only, as the owner still has to pay for property taxes charged by other agencies.

The DRTE program runs for a maximum of ten years and applies to all major renovations, additions, demolitions, rebuilds, and new builds in the downtown core with a construction value of over $500,000.

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jordan@nanaimonewsnow.com

On Twitter: @JordanDHeyNow