Nanaimo council considers six-month extension on hotel

NANAIMO – Councillors won't grant a one-year extension, but will consider six months with conditions.

Hotel developer SSS Manhao could still win a reprieve on the city’s buy-back clause, despite failure to get a one-year contract extension.

Nanaimo city council will consider giving SSS Manhao six more months to apply for a building permit before it decides whether to exercise its right to buy back the hotel property.

The extension would be in exchange for SSS Manhao committing $100,000 to Piper Park improvements, and the loss of the Right of First Negotiation to operate the Vancouver Island Conference Centre.

Council had a three-hour debate on a one-year extension for the hotel Monday, with the majority of politicians stating a dislike of the current contract.

Coun. Gord Fuller wanted to see the property put back up for sale, which SSS Manhao could re-purchase and a new contract struck, while Coun. Bill Bestwick talked about  a performance bond.

Lawyer Perry Ehrlich, speaking on behalf of SSS Manhao, said the suggestion of a new contract means the company would have to start from scratch on everything.

His clients spent upwards of $4.4 million and are committed to moving forward. Project completion dates will remain unchanged, Ehrlich said.

“My client was of the mistaken belief that because of the money they invested and because of their sincerity in coming here and building this project in the first place an extension would not be a problem,” he said.

Nanaimo city council voted 5-4 against the one-year extension, but agreed to look into a six-month extension.

The issue returns to council Monday (June 22). Council plans to meet with SSS Manhao representatives as early as tomorrow.