The owner of the Dynasty Spa property in Summerside is going to transform the abandoned building into a hotel, according to city officials.
Built in the early 1990s, the dilapidated building sits on 50 acres of undeveloped land on MacKenzie Drive, in the the west end of the city.
It was supposed to be a luxury spa, but it was never completed.
'We're pretty excited and hope that Mr. Liu is able to execute on his vision' —Mike Thususka
Sean Liu, a Chinese businessman living in Toronto, purchased the property in 2005 for $2 million and said he wanted to finish the spa by the following year, but nothing happened with the building.
In November 2011, frustrated Summerside officials went to China, where Liu lived at the time, to convince him to do something with the property.
Now, according to city officials, Liu said he is building a large hotel, called the Prince Alex Resort and Convention Centre.
The city has approved plans to keep the exterior and demolish the interior.
Work is supposed to start in the next couple of weeks.
"For us it's a huge opportunity in terms of trying to add infrastructure to our community, said Mike Thususka, director of economic development for the city.
"We're pretty excited and hope that Mr. Liu is able to execute on his vision."
Summerside already has several hotels and other accommodations, but Thususka said this hotel will be targeting a unique demographic — Chinese travelers.
"He's had some opportunities there that he's indicated to us there's a market there he's willing to explore," said Thususka.
The hotel will take two years to complete, and cost around $9 million.
Liu also plans to build residential housing on the rest of the property, said city officials.
This area of the city has undergone improvements over the past few years with a well-used boardwalk and residential development.
In the early 1990s, $6 million in immigrant investor funds was raised to build an Asian-style resort overlooking the Summerside Harbour called the Dynasty Spa.
But the project went sour.
Construction stopped early in 1992, a few months short of the June opening date.
In 1994, RCMP were called in and investigators spent the next three years tracking down investors and a paper trail. By the end of 2000, four people had been found guilty of theft, forgery and fraud.
Also that year, the Supreme Court of P.E.I. ordered the property be sold at a public auction in an effort to pay creditors.
It was purchased by four of the original investors for $260,000, part of which was borrowed from the Summerside Regional Development Corporation. They defaulted on the mortgage, and the property was due to be auctioned off again.
American developer George Diercks bought it in 1996, saying he wanted to operate it as a resort and health spa. Although he made some improvements to the building, Diercks never finished the project.
Liu bought the Dynasty Spa from Diercks in 2005.