King St Development: Learn More and Ask Questions

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The City of Fredericton has seized an opportunity to transform one of the largest and highest-profile vacant properties in the downtown into a vibrant engine of economic and cultural growth for the City and region. We're pleased to provide information on this landmark project and answer your questions (below).

The Government of New Brunswick (GNB) and the City recently concluded that a downtown location for a new provincial justice building is essential - which led to City Council's decision to purchase property at the southwest corner of King and Regent Streets from Commercial Properties Limited (see map).

The overall property is divided into 3 smaller lots:

  • King Interior Parcel (location): This is the proposed location for the new Justice Building. The parcel will be conveyed to GNB for the new Justice Building.
  • King/Regent Parcel: This corner parcel is a potential location for the new Performing Arts Centre.
  • Brunswick Parcel: This would be the site of a mix of high-density commercial and residential uses. A right-of-way will be included to provide access to the rear of the buildings on all three land parcels (or new developments).

The deal is slated to close in mid-August, and the Province intends to break ground on the new justice building this fall.

How is this good for the City?

  • This is a massive once in-a-generation investment that fills a gap in our downtown that is currently a parking lot.
  • The justice building, with its 160 + employees and daily visitors, will continue to be an economic anchor in our growing downtown, with more people supporting restaurants, bars, stores, music venues and other businesses.
  • More business and more people will add vibrancy to our downtown, making it an even more attractive destination.

How does this fit into the City's growth plans?

This development satisfies many of the Community Goals laid out in Imagine Fredericton, a comprehensive community engagement carried out a few years ago during which residents told us what they wanted for our City:

  • Strengthening and diversifying the economy
  • Increasing cultural richness and diversity
  • Enhancing downtown and riverfront vibrancy
  • Promoting sustainability and efficiency

How did this deal come about?

  • The project continues to build on the City's strong and positive relationship with GNB.
  • The City worked collaboratively with GNB to secure a downtown location for the new justice facility within the budget established by our provincial partner. Both levels of government shared a future-oriented approach to this challenge: GNB will pay market value for the land it will buy from the City. In return, the City has agreed to relax some municipal bylaw and permit fee requirements. The City has also committed to a future conveyance of land to GNB for a new school in one of the growth areas identified in Fredericton’s Municipal Plan for $1.
  • This innovative intergovernmental partnership locates the justice facility in the prominent location it deserves and also creates a new partnership model to locate schools in the right places consistent with municipal plans for growth.

What are the details of the deal?

The City will pay $8,250,000 for the property and immediately sell the King St parcel to the Province for approximately $2.4M. In addition to GNB’s purchase price, the City will collect $1M in annual property taxes from the Justice Building development (GNB will be acquiring the NB Power land further east on King St in a separate transaction).

The City is funding the project by applying to the Province's Capital Borrowing Board, which will hear the application on July 27th.

What's the business case?

  • The annual loan payment on the approximate $6M balance on the purchase price (after the GNB payment) will be $490K annually. Once the projected revenue of $240k is applied to that amount, the City will be faced with a final amount $250K which will be covered by our annual budget. The $250K amount does not take into account the property tax the City will collect once the justice building has been built.
  • The City will have the ability to directly sell two parcels for development and the tax revenue from all potential development at full build-out has the potential to generate annual revenue to the City. This revenue is projected to be about $1M.
  • The transaction will not affect residents’ tax bill. In the long-term it will generate new tax revenue, which is the strategic priority.
  • In practical terms, the process from the public’s point of view: We buy it, we sell a parcel to the Province and get an immediate return on our investment. Additionally, there’s $1M in property taxes from the new justice building that will flow to the City.
  • The development will also provide a boost in revenue for Downtown Fredericton Inc through the business improvement area levy which supports downtown businesses as well.

Are there any conditions on the sale?

  • The City agrees to restrict development on the King/Regent parcel to only a performing arts centre including any necessary parking. The covenant has a term of 50 years.
  • Despite that, the City can continue to lease the existing building and use the parcel for parking for as long as we want.
  • Other uses can be pursued at any time with the written consent of the vendor.
  • After the 50 years, we can use the parcel for other public or institutional uses owned by any level of government or for not-for-profit interests without consent.
  • If the City doesn't build the Performing Arts Centre at this location, the vendor retains a right of first offer to buy the land back and a right of first refusal if we intend to sell to a third party for the amount we paid for the property.

What does this mean for a future Performing Arts Centre?

This landmark deal also creates an opportunity to return to the initial preferred site for the Performing Arts Centre and avoid a prolonged closure that would cause damaging economic repercussions in the downtown. The design process has accommodated this potential change, and site-specific design work will not start until the final site has been chosen. The City and the Playhouse Board of Directors will work together to determine the best way forward.

What will happen to the existing justice building?

The justice building and land it sits on belong to GNB. As such, GNB will have to determine the process that will ultimately decide what happens to the property.

The current property is a popular parking spot for people attending the Boyce Farmers Market. Where will they go now?

In the short-to-medium term, there will be little impact to the current parking situation on Saturday mornings. In the longer term, however, the Market board and the City will have to discuss how to accommodate parking for the Market. It's also true, however, that an urban farmers market will increasingly rely on the densification of the downtown area to supply its business base - meaning more and more people will be walking, riding, skating, taking the bus, etc to the Market as more and more people choose to live in the downtown.

The City of Fredericton has seized an opportunity to transform one of the largest and highest-profile vacant properties in the downtown into a vibrant engine of economic and cultural growth for the City and region. We're pleased to provide information on this landmark project and answer your questions (below).

The Government of New Brunswick (GNB) and the City recently concluded that a downtown location for a new provincial justice building is essential - which led to City Council's decision to purchase property at the southwest corner of King and Regent Streets from Commercial Properties Limited (see map).

The overall property is divided into 3 smaller lots:

  • King Interior Parcel (location): This is the proposed location for the new Justice Building. The parcel will be conveyed to GNB for the new Justice Building.
  • King/Regent Parcel: This corner parcel is a potential location for the new Performing Arts Centre.
  • Brunswick Parcel: This would be the site of a mix of high-density commercial and residential uses. A right-of-way will be included to provide access to the rear of the buildings on all three land parcels (or new developments).

The deal is slated to close in mid-August, and the Province intends to break ground on the new justice building this fall.

How is this good for the City?

  • This is a massive once in-a-generation investment that fills a gap in our downtown that is currently a parking lot.
  • The justice building, with its 160 + employees and daily visitors, will continue to be an economic anchor in our growing downtown, with more people supporting restaurants, bars, stores, music venues and other businesses.
  • More business and more people will add vibrancy to our downtown, making it an even more attractive destination.

How does this fit into the City's growth plans?

This development satisfies many of the Community Goals laid out in Imagine Fredericton, a comprehensive community engagement carried out a few years ago during which residents told us what they wanted for our City:

  • Strengthening and diversifying the economy
  • Increasing cultural richness and diversity
  • Enhancing downtown and riverfront vibrancy
  • Promoting sustainability and efficiency

How did this deal come about?

  • The project continues to build on the City's strong and positive relationship with GNB.
  • The City worked collaboratively with GNB to secure a downtown location for the new justice facility within the budget established by our provincial partner. Both levels of government shared a future-oriented approach to this challenge: GNB will pay market value for the land it will buy from the City. In return, the City has agreed to relax some municipal bylaw and permit fee requirements. The City has also committed to a future conveyance of land to GNB for a new school in one of the growth areas identified in Fredericton’s Municipal Plan for $1.
  • This innovative intergovernmental partnership locates the justice facility in the prominent location it deserves and also creates a new partnership model to locate schools in the right places consistent with municipal plans for growth.

What are the details of the deal?

The City will pay $8,250,000 for the property and immediately sell the King St parcel to the Province for approximately $2.4M. In addition to GNB’s purchase price, the City will collect $1M in annual property taxes from the Justice Building development (GNB will be acquiring the NB Power land further east on King St in a separate transaction).

The City is funding the project by applying to the Province's Capital Borrowing Board, which will hear the application on July 27th.

What's the business case?

  • The annual loan payment on the approximate $6M balance on the purchase price (after the GNB payment) will be $490K annually. Once the projected revenue of $240k is applied to that amount, the City will be faced with a final amount $250K which will be covered by our annual budget. The $250K amount does not take into account the property tax the City will collect once the justice building has been built.
  • The City will have the ability to directly sell two parcels for development and the tax revenue from all potential development at full build-out has the potential to generate annual revenue to the City. This revenue is projected to be about $1M.
  • The transaction will not affect residents’ tax bill. In the long-term it will generate new tax revenue, which is the strategic priority.
  • In practical terms, the process from the public’s point of view: We buy it, we sell a parcel to the Province and get an immediate return on our investment. Additionally, there’s $1M in property taxes from the new justice building that will flow to the City.
  • The development will also provide a boost in revenue for Downtown Fredericton Inc through the business improvement area levy which supports downtown businesses as well.

Are there any conditions on the sale?

  • The City agrees to restrict development on the King/Regent parcel to only a performing arts centre including any necessary parking. The covenant has a term of 50 years.
  • Despite that, the City can continue to lease the existing building and use the parcel for parking for as long as we want.
  • Other uses can be pursued at any time with the written consent of the vendor.
  • After the 50 years, we can use the parcel for other public or institutional uses owned by any level of government or for not-for-profit interests without consent.
  • If the City doesn't build the Performing Arts Centre at this location, the vendor retains a right of first offer to buy the land back and a right of first refusal if we intend to sell to a third party for the amount we paid for the property.

What does this mean for a future Performing Arts Centre?

This landmark deal also creates an opportunity to return to the initial preferred site for the Performing Arts Centre and avoid a prolonged closure that would cause damaging economic repercussions in the downtown. The design process has accommodated this potential change, and site-specific design work will not start until the final site has been chosen. The City and the Playhouse Board of Directors will work together to determine the best way forward.

What will happen to the existing justice building?

The justice building and land it sits on belong to GNB. As such, GNB will have to determine the process that will ultimately decide what happens to the property.

The current property is a popular parking spot for people attending the Boyce Farmers Market. Where will they go now?

In the short-to-medium term, there will be little impact to the current parking situation on Saturday mornings. In the longer term, however, the Market board and the City will have to discuss how to accommodate parking for the Market. It's also true, however, that an urban farmers market will increasingly rely on the densification of the downtown area to supply its business base - meaning more and more people will be walking, riding, skating, taking the bus, etc to the Market as more and more people choose to live in the downtown.

Page published: 07 Jul 2021, 11:25 AM