The $40-million project that developer Stan Sipos has planned for the base of Government Street’s retail zone is not the cure for the street’s current woes.
But he believes it is a big part of the solution to a string of vacancies and business closings.
Sipos wants to demolish and replace the Canada Customs building at 816 Government and completely gut and renovate the adjoining heritage building that faces Wharf Street. He will replace them with a mixed-use project fusing residential, office space and commercial tenants.
“It will be a catalyst for change. If you think about what happens when you do this [kind of project], instead of dead stores it will be full stores and people here working, eating, shopping, living,” Sipos said.
Sipos said he’s not alone as other developers such as the Jawl family and David Chard are doing similar things. “It’s like a journey of several steps ... the city is resilient, it will recover.”
Sipos said breathing life into the two buildings, empty for years after the federal government and small retailers moved on, will be part of breathing new life into a street that has eight storefront vacancies in just five blocks.
“It’s about putting people onto the street,” Sipos said. He noted the planned 50,000 square feet of office space could translate into hundreds of workers, while the 50 units of rental housing that will command views of the Inner Harbour will add to the vitality of the area.
As for the 16,000 square feet of commercial space wrapping around the base of the buildings, Sipos said that brings life to a building that has been dead for decades.
“The building is not providing anything to the city. It’s empty and it was designed to keep things out, not invite them in,” Sipos said. He intends to attract restaurants and unique retailers.
The plan has not been to the city for approval, though Sipos has worked with the planning department for more than a year on the building’s design. He intends to demolish the newer building (built in the late 1950s) that faces Government Street and replace it with a more open and bright structure, while the heritage building is gutted, seismically upgraded and re-imagined while maintaining its facade.
Sipos is eager to start the project with an eye on demolition in late September, concrete pouring and exterior work done before the tourist season of 2016 and occupancy as early as the spring of 2017.
According to commercial real estate broker Randy Holt, vice president of DTZ Victoria, the Sipos project may be “exactly what Government Street needs.”
“Here is someone who is prepared to make a huge investment to upgrade and expand an old and functionally outdated facility in a high-profile gateway location,” Holt said. “The mixed-use potential is very exciting and could serve as a great catalyst to spur more activity and fill some of the other empty spaces at that end of the Government Street corridor.”
Holt said with new retailers, office tenants and residents, the street would get a year-round market.
It can’t come soon enough for some Government Street retailers who believe high rents, in part caused by high property taxes, are the reason so many storefronts remain empty.
“If both sides of the entry to the shopping street are vibrant, it most certainly will help us all,” said Tom Thompson, owner of clothing store W&J Wilson. “That is the hook that catches the tourists milling around the Empress and Inner Harbour. If they see a vibrant street, they are much more likely to come up.”
Shelley Hird, owner of Artina’s Jewelry, said she is all for new investment in the area as long as the integrity of the street is maintained.
“As locals ourselves we are very proud of the Government Street district and the heritage that it showcases for our city. We feel a building of this calibre, if done correctly, will improve the street and we are always for more residential units in the vicinity to increase walking traffic to the existing retail,” she said.
Darlene Hollstein, general manager of The Bay Centre, said the kind of investment that brings residents and office workers to the area is essential to breathing new life into Government Street. “We need more of it,” she said.
But she said things like tax incentives and other quick-fix solutions are not dealing with the real problems.
“We need a long-term strategy. Let’s look at the issues and deal with them as one as opposed to the bandaid approach that we’ve all tried and doesn’t work,” she said.
