A new arts centre to be built in Ottawa's Orleans neighbourhood has been named after the late Ottawa developer Harold Shenkman, whose family donated more than $1 million for the centre's endowment fund.

The $5-million fund, which is also getting $2.5 million from the province of Ontario, will provide grants for theatre, dance and other arts groups who use the centre's galleries, studios and 500-seat theatre, announced Orleans arts advocate Christine Tremblay at a news conference on Monday.

"It’s a legacy project and it's there to support the artists, to support what happens inside the centre in perpetuity … good budget year or bad," said Tremblay, who is executive director of Arts Ottawa East, one of the groups that will be housed in the centre.

In the 1970s, Harold Shenkman offered to donate $1 million to create an Ottawa art gallery on Wellington Street, but the city refused the offer.

Shenkman's son Bill Shenkman said the new donation indirectly fulfills his father's dream.

"I was always looking for some kind of a project that was similar to what he tried to do," Shenkman said. "This came up."

He added that the family's private property development company, the Shenkman Corp., has prospered largely thanks to the community in Ottawa's east end.

Cumberland Coun. Rob Jellett said he likes the idea behind the fund.

"You know the arts have always been … coming, cap in hand, year after year, to try to get some of the scarce dollars at the city," he said. "And if we can find a new model that helps fund the arts, then I'm all for it.

Construction on the $37-million centre is to start in a few weeks, financed through a public-private partnership between the city and the Orléans Town Centre Partnership, a group of private companies.