Marina owners are squaring off with the Nanaimo Port Authority over what they call exorbitant lease rates threatening their businesses.
Port Authority president Bernie Dumas said the agency is sensitive to the situation and that upcoming rates are unlikely to increase as much as in the past. A meeting between marina operators and the port authority is scheduled next month.
Meanwhile, the nine marinas with lease agreements with the port authority are “scared they won’t be able to survive,” said Odai Sirri, a spokesman for the Nanaimo Marina Association.
“A number of our marinas are at end-of-life. They can’t afford to reinvest.”
The port administers property for Transport Canada, which requires independent appraisals every five years. The most recent was conducted in 2012, triggering rate increases of between 60 and
125 per cent, Sirri said.
Marinas are fearful that they will be hard hit again following the 2017 appraisal.
Rates for the marinas’ foreshore leases, which cover land and water, are determined with a formula based on potential revenues. The marina association says the current rate structure is “based on unrealistic property values,” and does not represent fair market value.
“We just want a fair, equitable solution that is comparable to the provincial model. That’s it,”
Sirri said. Current rates are more suitable to larger centres, such as Victoria and Vancouver, he said.
The marina group is unhappy with what they consider to be an uneven playing field.
Marinas are charged between 15 to 40 per cent of gross potential revenue, but the provincial rate is a fraction of that, the group said.
The Waterfront Marina, where Sirri is the chief operations officer, charges boaters $11.50 per foot per month, under an annual agreement, for vessels up to
30 feet. The Waterfront Marina is newer than many, with $8 million invested in a new facility in recent years.
Lower rates at other locations, including at the port authority’s own marina, are luring boaters elsewhere, meaning Nanaimo marinas are losing business, Sirri said.
Nanaimo marinas charge an average of about $10 per foot, Sirri said.
The port authority charges $9.75 per foot per month for what is called long-term moorage.
Ladysmith Marina’s rate is $8.25 per foot, while the Victoria Harbour Authority charges $12.05 at Wharf Street and Fisherman’s Wharf.
Don Prittie, president of the Boating B.C. Association representing more than 300 members, is calling on the Nanaimo Port Authority to reconsider its lease calculations “to ensure the lots remain profitable to the government while still allowing marina operators to manage viable, professional businesses.”
Sirri said Waterfront Marina’s lease rates are $100,000 per year and gross revenue is $130,000. Factor in other costs and the marina is not profitable.
Dumas said the Port Authority is concerned about the next appraisal and is speaking to the appraisal firm and also asking Transport Canada for some “economic sensitivity.”
The appraiser predicts that values will not increase as drastically as in 2012, Dumas said.
“We are sensitive. We are going to meet with [marina operators]. We are going to find some solutions.”
Dumas is confident that common ground will be found in the coming year, “but we can’t change the past.”
The Port Authority understands the situation, he said. “We are not here to put people out of business.”
Waterfront property values are going up all over the world, Dumas said. “Nanaimo is becoming a busy little place and the values of property are going up.” If marinas “are profitable and successful, then we are too,” he said.
In 2015, the Port Authority’s annual revenue was $8.7 million. Marinas represent six to seven per cent of that, Dumas said.
As far as the provincial rates, Dumas said that those rates are a “little bit behind.” Also, the provincial leases cover water only, not the foreshore, he said.
