Land under Cape Breton's Ben Eoin Yacht Club and Marina sold

The land under Cape Breton's controversial Ben Eoin Yacht Club and Marina has been sold. It belonged to the federal government, which built the $4.8-million recreation facility in 2012 through Enterprise Cape Breton.

Land valued at $813,000 for tax purposes, but sold for $150,000

The land under Cape Breton's controversial Ben Eoin Yacht Club and Marina has been sold. (Tom Ayers/CBC)

The land under Cape Breton's controversial Ben Eoin Yacht Club and Marina has been sold.

It belonged to the federal government, which built the $4.8-million recreation facility in 2012 through Enterprise Cape Breton.

The club and marina were then handed over to a private group to run.

They were given a 50-year lease at $1 a year, with an option to buy the land after 20 years, and were required to pay the property taxes.

Development drew criticism

The development drew criticism because the marina group essentially got the $4.8-million facility without putting up any money.

It was also built on the Bras d'Or Lake shoreline, about 20 kilometres west of Sydney on Highway 4, with minimal environmental approvals.

Now, a separate group of businessmen — with a numbered company that operates as Ben Eoin Development Group — has bought the land, but not the buildings and docks.

The land is valued at $813,300 for tax purposes, but was sold for $150,000.

A group of businessmen, with a numbered company that operates as Ben Eoin Development Group, has bought the land, but not the buildings and docks. (Tom Ayers/CBC)

Gerard Shaw, regional director for Public Services and Procurement Canada, said that might seem low, but the appraised value was only $12,000.

"The appraised value of the land is done by a commercial appraiser and it looks at all of the aspects of the property, and because there's a 50-year lease on the property … for a dollar a year, it actually drops the appraised value significantly," he said.

That lease stays with the land, said Shaw.

If the marina ever defaults on its payments or decides to wind up its operation, the lease stipulates that the facility becomes the property of the landowner.

800 parcels of federal land up for sale

Shaw said the marina land is among 800 federal parcels being sold off in Cape Breton.

"The federal government didn't want the liability of owning a marina on their property," he said. "It's not required for ongoing business, so it was divesting of those lands."

John Williams, the marina manager, said the yacht club's board of directors put in a bid, but was not successful.

"Actually, we were encouraged by the government of Canada to bid on the property," he said. "Following the bidding process, we're certainly disappointed in the action the government of Canada took to sell the property, but on a more positive note, we're looking forward to working with the new landlord under the existing land lease, and for us here at the marina it's business as usual."

Ben Eoin Development Group, which bought the marina property, consists of several local businessmen, a physiotherapist and a doctor.

Rodney Colbourne, the group's president, said the company also bought The Birches hotel and Aerie Estates residential subdivision, and the principals also own shares in The Lakes golf club, all of which are near the marina.

Residential subdivision also controversial

The residential subdivision was also controversial because the federal government spent $1 million building a road into the hills above the marina and surveyed and cleared several lots, but only one lot was sold.

The marina land is among 800 federal parcels being sold off in Cape Breton. (Tom Ayers/CBC)

Ben Eoin Development bought the rest of the lots for $445,000, which Shaw said was equal to the appraised value of the land.

He said a 1.6-hectare parcel of land above Aerie Estates, which the federal government had said would be the location of a high-end hotel, will also be put on the market soon.

Long-term lease for $1 per year

With a long-term lease for $1 a year, the marina land is not expected to generate revenue, Colbourne said.

The group bought the marina land to solidify its other investments in the area.

"It was less of a money-making decision and more of a piece of the puzzle ensuring the future operational link to the Bras d'Or Lakes," said Colbourne.

With a long-term lease for $1 each year, the marina land is not expected to generate revenue. (Tom Ayers CBC)

Colbourne said the group is expanding the Birches Country Inn this winter and plans to build condominiums in Aerie Estates after that.

"The vision we have is probably picking up where the government left off and continuing their vision of seeing it as four-season resort," he said.

"So we'll be in operation at the inn this time next year for year-round operations, where it's been sporadic and usually seasonal."

The group also could put up shops in the area and create a village-like atmosphere, like Baddeck, said Colbourne.

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