Will the Downtown Chatham Centre Mall Walls Finally Come Tumbling Down?

June 9, 2022

June 9, 2022

Plans for Chatham’s Downtown Chatham Centre have finally been revealed.  It should come as no surprise that both Phase I and Phase II will involve heavy investment by the Municipality, otherwise known as your taxes, to pull it off.  In this case, that might be the proper way to go. However, before committing to anything, Municipal Council needs to ensure that there will be a proper open discussion with the public and commit to showing, in detail, their homework. 

There is no doubt that the Downtown Chatham Centre is an eyesore.  Built at the wrong end of the shopping mall era, the complex has struggled to retain retail tenants for the last decade while successfully destroying a huge portion of the historic downtown area.  A few stores have been there for a long time, but many come and go, citing high rents and low foot traffic.  At one point, the upper floor of the facility housed offices, the temporary home of many Union Gas employees as their various buildings underwent renovation.  

A group of six investors recognized the opportunity within the failing property.  It was eventually revealed that up to six months prior to the purchase, there had been closed-door discussions between the investors and Council, and within three days of the purchase, Council directed Municipal staff to gin up a feasibility study for moving government operations into that location. The way it all seemed to be happening just didn’t smell right. 

This time around, we have an opportunity for transparency.  Council has been sounding the alarm that the renovations to much of the local government infrastructure were going to be costly.  Last November’s efficiency review, conducted by KPMG, noted that there were potential efficiencies to be found by shrinking the municipal property portfolio.  And recently, Mayor Caniff has been vocal about looking at building new instead of renovating the old. 

It would be naive to think that there has not already been unofficial discussion at high levels between developers, Council members and maybe municipal staff.  After all, ideas need to be proposed, developed, and refined before they can be presented in public.  Connecting the dots between the Mayor’s statements about the consolidation of properties and this proposed redevelopment of the Downtown Chatham Centre with public money is not a tough connection to make. 

The numbers are large and no matter what, Chatham-Kent is looking at footing some major bills. Memorial Arena is in need of about $20,000,000 for renovation and repair work.  The community needs an arena, so this money will eventually be spent. The Civic Centre looks like it needs around $18,000,000 in repairs. The public library, as well, is looking to expand.  The idea generated by the DCC investor group addresses those issues. 

The arena proposal is particularly interesting.  Phase II would see a multi-use entertainment complex constructed, with an ice rink, that will hold about 4,000 spectators.   This is going to cost a pretty penny, for sure.  But with $20,000,000 essentially committed to renovating an old structure, shifting those funds could create a hefty down payment. 

 An interesting case study can be found in Grand Rapids, Mi. That city invested in a public/private partnership to build the Van Andel Arena in 1994.  A milestone was recently reached as the final public bonds were paid off.   They issued $57,000,000 in bonds, and paid out $139,000,000 over 27 years.  What did they get in return?

In a word, transformation–they got a revitalized downtown core.  Prior to the arena construction, the area was the northern end of the run-down section of Grand Rapids.  The property itself was a parking lot. There was not much life in the core of the city.  

The opening of the Van Andel Arena sparked a change that has seen a lot of business growth.  Bars, restaurants, and shops have all sprung up in the area.  Blocks that used to be empty of life and closed by 6 pm are now teeming with people looking to spend money on food, entertainment and “stuff”. In the most recent study, it was shown that the arena generated over $35,000,000 in economic impact. 

At the time, there was a lot of pushback.  Local residents were divided on whether or not the facility was a good use of public money.  Local leaders thought big, outside the box, and ended up providing a reason for people to come downtown. The private industry then gave them the things to do and purchase that kept them downtown. 

Chatham-Kent is now faced with a similar choice.  We have a group of developers, almost all of them local, who have decided to think big.  Surely, if this works out, they will profit–that is the purpose of investing, after all. However, they have spent the time and resources to provide a vision for Chatham’s downtown core that could revitalize and transform the area. 

What we need now is for Council to do its work out in the open. On Monday, they will most likely direct municipal staff to prepare a study that looks at feasibility and does a cost/benefit analysis.  They would be foolish not to.  This time, however, they should allow the study to show all the numbers and all the assumptions made to arrive at the conclusion.  Residents, who will be on the hook for significant spending no matter the path followed, should have the ability to do a deep dive into the information if they choose.  

In the end, this should be a fairly simple and logical choice for each phase.  Phase I, building a community hub on the site of the Sears structure, will either make sense from a financial standpoint or it won’t.  It will make sense from an access and future growth perspective, or it won’t. If all the numbers are on display for people to see, while Council and the Mayor are able to provide a cogent argument one way or the other, the decision should be obvious. 

Phase II, the entertainment centre, would benefit from the same treatment.  Give Chatham-Kent the estimates to build the facility and show us the economic impact it will have. Show us the underlying assumptions made to get those numbers.  Council and the Mayor will need to be clear about why or why not the community should proceed with that project.  

This redevelopment plan for the Downtown Chatham Centre has the potential to allow Chatham-Kent to think big, to punch above its weight. The time for private conversations and closed-door meetings is over.  Municipal staff need to do the homework now and then Council needs to ensure that everything is transparent and detailed.  Information will need to flow freely, both for and against the idea. At that point, the community can have an adult discussion.  

This is an exciting proposal, and it just might work.  Let’s see if the numbers support it. 

 

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