Toronto investment firm offers $69.9M for Portage Place mall
Starlight Investments would redevelop Portage Place with new residential towers, including student housing
A big chunk of downtown Winnipeg's real estate might change hands as Toronto–based Starlight Investments has made a $69.9-million bid for Portage Place mall.
The deal — the offer is for the building, land and parking garage — must get approval from the city, provincial and federal governments, which are shareholders in the property through the North Portage Development Corporation.
Spruceland Mall Limited Partnership, the owner of the mall building, would receive $22.9 million, while North Portage Development would net $47 million from the sale.
Starlight Investments is involved in 40 projects, encompassing approximately 11.5 million square feet, including 10,000 residential units and commercial space across Canada, says a report prepared for Winnipeg city council.
If the deal is approved, Starlight plans to redevelop Portage Place with new residential towers, including a student housing component.
The mall has struggled for years; it has a reputation for criminal behaviour on the property, and it's been affected by changing to shopping habits.
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The deal effectively means selling off a revenue source for The Forks, which is controlled by North Portage Development.
Money from parking at Portage Place and a lease for the land on which the mall sits generate several million dollars a year to subsidize operations and further development at The Forks.
Claire MacKay, North Portage Development's vice-president of strategic developments, said the $47-million share of the sale of Portage Place would be invested, and the proceeds would replace the lost revenue from the parking lots and lease.
"Any deal that we enter into at this point has to keep our organization whole," MacKay told reporters Friday morning after city councillors were briefed on the potential transaction.
Starlight Investments "has a really good track record of adaptive reuse all over North America," MacKay said, and given the current owner of the mall isn't interested in investing in the mall, the proposed deal could be positive for the downtown.
"Right now there isn't anything that's happening [with the mall] and the status quo isn't acceptable," MacKay said.
Those comments were echoed by North Kildonan Coun. Jeff Browaty after he was briefed on the deal.
"The current owners aren't really looking at making investments in there — to modernize it [and] find the amenities people are looking for in a shopping centre, particularly a downtown shopping centre," Browaty said.
Starlight Investments says there will be more details available on their plans in the near future.
"A proposed redevelopment of Portage Place Shopping Centre presents an opportunity to be a transformative project for the City of Winnipeg. Starlight Investments is in the process of exploring this opportunity and will be providing updates to the public in the coming weeks," Starlight spokesperson Marni Larkin wrote in an email.
The executive policy committee of city council will review the offer next week.