Barrington Street businesses complain of poor Pacific Building upkeep
Landlords DongDu International say everything takes longer with a heritage building
After 17 months of operating her business with scaffolding outside the doors and windows, the owner of a Halifax yarn store on Barrington Street has moved out.
The Loop's Mimi Fautley says the scaffolding dissuaded shoppers to visit her store — and resulted in a $50,000 loss of revenue.
The Pacific Building, built in 1911 at 1537 Barrington St., has heritage status and was once the home of Halifax's first YMCA.
It's now owned by DongDu International (DDI), an investment group based in Shanghai involved in real estate, high tech and financing — and its tenants are not pleased.
"Over the time that DDI has owned this building, it has deteriorated," Fautley said.
She says to her knowledge the only work that's been done is "exploratory" to prepare for the installation of a more permanent awning that will stop pieces of the building from falling on passersby.
'More time than a normal development'
CBC News spoke to the investment company's vice president and North America general manager.
"Since the building has heritage status, it takes more time than a normal development to go through all of the necessary design, planning, and permitting required, which has finally been completed," said Ken Creighton, who is based in Detroit.
He said he "cannot comment whether the scaffolding hurt the business or not."
"It has taken about three to four months just to manufacture the required steel for the awing we are going to install," Creighton said.
Chives complains of leaks
The owners of Chives Canadian Bistro, tenants in the same building for 14 years, also say their business is suffering because of scaffolding.
"All problems with the building started since DDI took over ownership, including the condition of the facade and pieces falling off the building," said Darren Lewis, the restaurant's operations manager.
"There are on-going persistent leaks that DDI doesn't want to do anything about."
Chives' owners are consulting lawyers to see if DDI can be forced to fix the leaks, Lewis said.
HRM $100K grant
Meanwhile, the Pacific Building has been recommended for a grant of $100,000 and a tax credit of not more than $160,500 as part of Halifax's Barrington Street Heritage Conservation District Financial Incentives Program.
This would help restore and renovate the building, including reinstating the original storefronts with new doors, windows and upper facade.
To get the money, DongDu would have to match the grant amount. To get the tax credit, the company must undertake work over $200,000 in value.
The grant money would be released only once the work is complete. There is no word on when DongDu International plans to begin the work.
Attracting Chinese investments
Stephen Dempsey, the company's spokesperson in Halifax, said it's exploring options on how to best revitalize the building.
"Obviously there is a fine balance to be achieved between what will work in the local market here in Halifax and what would attract the necessary investments in China," Dempsey said.
DongDu Investments has purchased other buildings in need of repair in the past.
A few months after the City of Detroit declared bankruptcy in 2013, the company bought three iconic downtown buildings in an online auction. It sold two of its three Detroit buildings in 2015.
Detroit buildings in 'much worse shape'
The Detroit real estate agent who sold two of those buildings — the 38-storey art deco David Stott tower and the former Detroit Free Press building — says the company's promises were broken.
According to Ryan Snoek, DongDu International said it was going renovate the buildings as apartments. But Snoek said he never saw any work on the buildings while DDI owned them.
"Once they sold the properties, they were in much worse shape than when they purchased it," he said.
He said he estimates the company made a few million dollars on the sale of two buildings. According to DongDu Investment's website, the third building was also sold in January 2016.
Company 'really no different'
Business reporter JC Reindl at the Detroit Free Press reported on the purchases and sales of DDI's buildings in Detroit.
"A lot of cynics in the city, they typically say when you have an out-of-state buyer ... that swoops in, they just assume the company's going to hold them for a few years and then try to flip them," Reindl said.
"But DDI — right from the beginning — said they actually plan to redevelop the building."
In the end, those cynics may have been right about the company, the reporter said.
"[DDI's] actions are really no different from some past experiences here in the city, where you have had the out-of-state buyers and they sit for a couple of years — and the prices rise and they sell," Reindl said.
In Halifax, Fautley said she hopes DongDu Investments won't just sit on the Pacific Building and allow it to deteriorate while buildings around it rise in value.
No one from the company responded to CBC's question about whether DDI would sell the building without making improvements if it no longer made economic sense to keep it.