The new owners of the Mackenzie Place highrise in downtown Hay River made their first trip to the North to see their purchase on April 26.
Manjit Gauba and Ed Siffledeen, partners with Heritage Valley Capital, an Edmonton-based real estate development company, visited for about five hours for a first walk-through of the property, bought from Satdeo Inc. in January.
They joined several construction consultants and Bradley Gingerich, senior managing director of investments with Institutional Property Advisors, who helped close the building’s sale.
The transaction price is not being disclosed by the company, but they acknowledged in an interview that major renovations need to be done on the 16-floor, 116,000-square-foot building.
Gingrich said the new owners are aiming to begin work over the next two months that will entail a top-to-bottom overhaul that will include “windows, doors, kitchens, cabinets, bathrooms, roofs, countertops — a complete renovation.”
The soft target for completion is about a year, pending permitting or any other delays, such as Covid-19 restrictions.
Gauba and Siffledeen said they are attempting to make positive inroads in the community from the start and are aiming to serve the town’s chronic housing needs with a “high quality” building.
“Heritage Valley Capital is a very community-oriented entity,” Gauba said. “The main thing is that we looked at this community and we felt that we can add value by changing this building — refurbishing it, making it viable and making it usable.
”I don’t want to say anything super negative about where (the highrise) stands at the moment but there is an opportunity for us to contribute, and we want to bring it back where it can be used like how apartments are built in Edmonton or Calgary.”
Although the company has housing developments in Saskatoon and Edmonton, they are entering the Northern market for the first time.
There are some positive aspects of the 122-unit highrise, damaged in a March 2019 fire, that drew Heritage Valley to take on the project, Gauba said.
“We like the idea that the structure is already there,” he said. “So the construction risk from a development angle is lower and the timeline for completion is shorter, relative to doing a new development.
“Honestly, from my first walk-through and speaking for myself, we’ve got work to do. That is obvious, and it’s going to take some time.”
Gauba and Siffledeen met with officials from the Town of Hay River on Tuesday afternoon and intended to meet with representatives from Canada Mortgage and Housing Corporation and Housing NWT to get a sense of how the project can best serve the community.
The next immediate steps will include a peer assessment from the company’s construction consultants and then drafting a vision to best reflect the community’s housing needs.
Siffledeen said that establishing a plan and getting to work right away is top of mind as the temperature rises.
“We’ve realized there’s going to be challenges on some of the work that we need to do with weather-related limitations,” he said. “So we want to try and take advantage of the season that’s available and that’s right around the corner here for us.”
The Heritage Valley Capital team said that a big part of the project is capturing the full context of housing needs in Hay River and how their building can best serve a growing population in the coming years.
Gingerich pointed out that there are differences in the North, where workers often come from larger centres in the south and bring with them expectations for amenities in an apartment building. Sometimes, the North just doesn’t offer what people want, he added.
“There’s nothing stopping that building from having a gym, having a theatre, having a quartz countertop and being the same that you would get in Toronto, Montreal, Vancouver, Surrey or wherever,” he said. “These guys are leading edge coming up here looking for opportunity, to say hey, the North is servicing now.”
Some employers in town have said lately that the lack of rental units has been a major turnoff for some workers and contributed to reduced services.
Erin Griffiths, CEO of the Hay River Health and Social Services Authority, told town council on April 4 that a shortage of rental units for short-term health workers has led to difficulty retaining employees.
“Housing is a huge issue for our staff,” she said last month. “We have a lot of staff that are sharing accommodation at this point in time.
“So it is housing for rental, not so much for purchasing. A lot of our folks are young and are coming up there looking for rentals, and that’s been tough.”
Siffledeen acknowledged the team is under pressure and said the biggest challenge for the project is likely to be getting the building up and running while attracting workers.
“As developers, we are looking at what comes first, the chicken or the egg. You’re trying to build the building, but you’re trying to get the workers up here to do it,” he said. “We really have to put in all our resources, all of our expertise, all of our connections, and all of our networks and work as a team and collaborate and make that happen.
“That’s not going to be an easy process, but we’re up to the task and we’re choosing to do it.”