Nanaimo city council considers hotel development

NANAIMO – A land sale deal to build a major hotel downtown went before Nanaimo city council Monday night after press time.

A land sale deal to build a major hotel downtown went before Nanaimo city council Monday night.

A staff report recommends that council approve in principle the sale of city-owned land at 100 Gordon St. to SSS Manhao International Tourism Group, a B.C. affiliate of China’s Suzhou Youth Travel Services, for development of a conference centre hotel. The land would be purchased for $565,000.

Next to the Vancouver Island Conference Centre, the 0.17 hectare piece of land will be used by SSS Manhao to construct a 17-floor, 197-room hotel at an estimated cost of $50 million.

A draft agreement with the company hinges on a number of conditions, including a parking agreement for up to 190 spaces from the conference centre parkade at $95 per month; an option for the city to buy the property back at the original purchase price if SSS Manhao does not obtain a foundation permit and construct the foundation within 18 months of acceptance of the offer; a development covenant that requires the hotel to be built within three years and requires the hotel to be maintained at a four-diamond rating or higher; and easement documents for the company to construct an overhead walkway from the hotel to the conference centre and a walkway from the hotel to Piper Park.

The company will also take advantage of a 10-year tax exemption council passed to lure investors to build on the site.

Bill Corsan, the city’s manager of real estate, said if council gives its approval in principal, a notice of disposition will be published in local newspapers for the next two weeks and the deal will return to city council on July 22 for final approval.

“All work associated with finalizing the deal gets underway in two weeks time,” he said.

Corsan said staff have been working on this deal for some time and it reflects council’s specifications.

Suzhou Youth Travel Services is ranked 13th on China’s list of top 100 travel agencies and was one of the first international travel service providers to be approved by the Chinese State Tourism Administration.

SSS Manhao is developing a business plan for a new tour route from Vancouver to Vancouver Island that includes an overnight stay at the proposed Nanaimo hotel.

The company claims that an estimated 70,000 tourists would be brought through Nanaimo annually, generating about $35 million in revenue for the local economy and creating more than 500 jobs.

SSS Manhao also intends to co-operate with Vancouver Island University to attract international students to the city.