Storm brewing in Port of Nanaimo over foreshore lease fees

NANAIMO - Waterfront marina association says businesses could flounder under foreshore lease rate increases.

Nanaimo Port Authority and local marinas are looking for a bridge over troubled waters churned by high foreshore lease rate increases.

According to the Nanaimo Marinas Association, which represents a group of marinas and businesses on the city’s waterfront, its members want the Nanaimo Port Authority to back down from rent increases exceeding 125 per cent that threaten to destroy Nanaimo’s marine businesses.

Odai Sirri, association spokesman, issued a press release Wednesday that said Nanaimo Port Authority rates are among the highest in Canada, which created “an unfair, inequitable and financially debilitating lease rate for businesses and marinas along Newcastle Channel that will shutter businesses and force boaters to other communities.” It also claims the rates were implemented without warning or consultation with industry.

Sirri is also director of operations for Waterfront Holdings Ltd., which owns Waterfront Suites and Marina on Stewart Avenue, where he said fees have gone from $16,000 to $100,000 annually in recent years.

“They said they had a private appraiser give them an evaluation of the land – of the water lots – and that’s what it’s worth,” Sirri said.

He said Waterfront Holdings asked to see the appraisal, which was denied by the port authority.

“There are some private details that they can’t divulge to us,” he said.

Sirri also said the Nanaimo Port Authority foreshore lease rates are higher than provincial rates charged to businesses on the north end of Newcastle Channel and that port authority moorage fees in the downtown boat basin are lower than than those of local private marinas.

Bernie Dumas, port authority chief executive officer, said real estate appraiser Cunningham and Rivard Appraisals was hired to do the appraisals in 2012, that leasees were shown the appraisals and were aware of the assessments and lease rates when they signed their foreshore lease agreements.

Nanaimo Port Authority acts as landlord on behalf of Transport Canada and is required by Transport Canada to appraise or review foreshore properties every five years. Nanaimo Port Authority handles nine properties in Newcastle Channel.

“Real estate in Nanaimo, just like real estate in Vancouver and everyplace else … is going up,” Dumas said. “The assessment came in and it reflected a sizeable change in value and we have rules, through Transport Canada, that we have to lease the property at fair market value.”

The problem, he said, is that some of the leases originally signed around 2005 and 2006 came up for renewal about the same time and were hit with rates based on the 2012 appraisals. He expressed his concern over other leases up for renewal in 2017, the same year Transport Canada will require new appraisals, given rising foreshore values.

“We’re reaching out to Transport Canada. Again, we have rules. We can’t do what we want here. We’re looking at that 2017 assessment to make sure that we’re not going to put these guys in any kind of crippling position,” Dumas said.

Dumas said the port authority and the Nanaimo Marina Association have been in discussions to set up a meeting in October with association members to review the situation.

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