Nanaimo’s mayor wants to head to China on an $11,000 trade mission to advance investment discussions for the proposed Hilton hotel.
Mayor Bill McKay proposed a trip to Shanghai and Beijing to further investment talk for the Hilton hotel project, which is currently seeking financing.
A city agenda showed the mayor had planned to ask council to authorize his trip Monday, but the request could now be postponed.
The bid to go overseas comes just a year after Nanaimo Economic Development Corporation went to China to meet with investor groups, including for the Hilton and conference centre hotels. According to a report authored by the mayor, there has been ongoing communication between the economic development corporation and various parties from that first mission and a request has been received for a small delegation to visit Shanghai and Beijing to further current advancement discussions and establish new introductions.
McKay told the News Bulletin the request came from Charles Koo, owner of Insight Holdings, the company behind the Hilton hotel project, but that he plans to put the trip on hold after comments from council and the public.
He now wants to get the blessing of council to enter into these types of negotiations, he said, adding there’s no sense in going to China if a developer comes and then gets turned down by council.
But the mayor still sees it as “very important” to go to China, calling it a question of whether a community should promote itself.
“I find it hard to believe that there would actually be people within the community that would be concerned that we would spend $11,000 going on a trade mission to China to promote our city,” he said. “I’m having a tough time understanding that particularly when we are not taking any risk on the [hotel] project.”
But Jordan Bateman, B.C. director of the Canadian Taxpayers Federation, doesn’t believe taxpayers should help private corporations and called the report “flimsy” on what the actual return on investment would be for taxpayers.
Then there’s the question of why the Hilton gets the benefit of taxpayers’ money spent to send the mayor on a delegation and the other hotels in town don’t, he said.
“If you have private businesses in your community that are paying taxes there now, if you use some of that tax money to fund or benefit their competitors, that’s an unfair advantage and that’s government picking winners and losers,” he said. "That’s not right.”
Kim Smythe, chief executive officer of the Greater Nanaimo Chamber of Commerce, is under the impression the economic development corporation provided the recommendation for the trip and said it also makes sense because there's been an effort to work on that investment market for the last two or three years.
“If we're just going to drop the ball and turn our backs on it, we've wasted a hell of a lot of money."
Local Hilton hotel project spokesmen Brian Henning and Darwin Mahlum are unaware of a request for the mayor to go on the trip, although the mayor has met with Koo and some of the investors in the project and discussed what was going on.
The company is currently gathering capital to build the $100-million hotel.
Mahlum said the mayor is very important in China and the investment to have the mayor go there is small to gain the benefit of the Hilton hotel.
“It’s going to show support for the project and just bring to light what an opportunity Nanaimo is,” said Henning, although he also notes it’s ultimately the financial and business models that will be the basis of investment decisions.
The hotel was on council's agenda Monday.