Tax incentives for downtown
Will encourage more housing units
Winnipeg Free Press
By: Jen Skerritt
April 16, 2011
The city and province have pledged to double the size of a downtown housing program aimed at bringing an additional 1,300 residents to Winnipeg’s core.
On Friday, the city and province each committed an additional $10 million to extend tax incentives that encourage developers to build new housing units downtown.
The pledge comes one year after both levels of government first offered $20 million in tax incentives to developers to encourage new housing projects downtown. The financing was expected to last for three years, but was quickly used up in less than eight months for 16 proposed housing projects.
A number of developers have said they have downtown projects waiting in the wings for the new tax incentives to be approved.
The program helps stimulate new housing developments in buildings where the cost of renovations and the subsequent property-tax hike resulting from the new investments would normally make the projects unprofitable. Under the incentive program, extra taxes triggered by property reassessment are returned to the developer as a grant to a maximum of $40,000 per rental or condo unit.
The financing model has been used for projects such as the Avenue Building, where 70 new apartments are being built in the 107-year-old building and the adjoining Hample building.
Under the first $20 million of the program, 135 rental units and 606 condo projects have been approved or conditionally approved. More than half of the planned developments are considered affordable, with rents ranging between $500 for a bachelor suite and $975 for a three-bedroom apartment.
Mayor Sam Katz called the program a success and said the incentives are working to increase the number of Winnipeggers living in the area.
The first wave of incentives will result in an additional 1,200 people living downtown and the additional $20 million in tax incentives is expected to bring another 1,300 residents to the city’s core. Katz said the idea is to make downtown a vibrant, safe place to live and have sidewalks “so full of people you can’t see the storefronts.”
CentreVenture CEO Ross McGowan said the additional housing units will result in a dramatic increase in the number of people living downtown.