When the Ottawa Citizen printed “City of Ottawa, developers agree to preserve 12 acres of Beaver Pond Forest” (2010-11-12) , a cynic might believe that they only printed the part of the story that makes Urbandale and City staff look good. That same cynic might observe that both the City and Urbandale advertise heavily in the Ottawa Citizen.
What the Citizen didn’t disclose is that the City and Urbandale are discussing acquisition of allof the Beaver Pond Forest and some people might believe that Urbandale is dragging its feet on reaching a deal in what might appear to be a tactic to get a higher price.
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The Citizen didn’t disclose that City staff originally identified that roughly 1/2 of the 73 acre area could be obtained via land swaps if the City were to consider all available land for a swap – not just land within the South March Highlands.
Some of the available City land, such as at the Kanata Town Centre, is already serviced and worth considerably more to a developer than unserviced land since the developer would not need to spend the extra time and cost to service it.
However, according to Marianne Wilkinson, Urbandale declined these other swaps and agreed only to swap unserviced open space west of Goulbourn Forced Road (GFR) for the 12 acres of unserviced land east of GFR.
The implication of this is that acquiring the remaining land will need to financed through a future purchase at taxpayer expense. Those who oppose protecting the forest are possibly hoping that the new City council will balk at the higher price.
Although swapping green land to protect green land is odious, the Citizen is accurate in reporting that this part of the swap is a good deal. The land being swapped west of GFR is currently cleared farmland that is slated to be used as soccer fields if the Urbandale-Richcraft consortium (KNL) is allowed to proceed with development. With the upcoming construction of the nearby Kanata North Recreation Centre, these playing fields would be unnecessary. So swapping them to save old growth forest east of GFR is a no-brainer that even City staff can figure out.
The one line quote at the end of the article attributed to Chris Busby pales in comparison to what he actually said:
“Does the Richcraft-Urbandale consortium think it is offering the citizens of Ottawa an early Christmas gift by agreeing to a land swap to save 12 acres of the Beaver Pond forest?
Seems more like a cruel Halloween trick.
There is an unprecedented level of community support for the protection of the Beaver Pond forest. And that energy has generated the Stewardship Plan, which was presented to City Council October 6 by Councillor Wilkinson.
The plan proposes to create, among other things, a centre for ecotourism for this environmentally highly significant old-growth Canadian Shield upland that will be responsibly managed by the community itself—if the land can be put into public ownership.
I have only one Christmas wish: for Urbandale to see the light, as did Ebenezer Scrooge, and join the effort to ensure that the Beaver Pond forest becomes the great gateway to the spectacular South March Highlands, Ottawa’s own Algonquin Park.
If Ottawa’s developers want us to believe in them, they should give us–and our children’s children–something significant to believe in.”
A previous blog posting has already questioned the fairness of Urbandale’s expectation of being paid $18 Million for 110 acres of land that has been only appraised at $5.9 M for tax purposes.
And another blog posting described how deducting the 40% allowance and other requirements for open space means that 110 acres contains only 74 acres of developable land. Deducting the land swap of 12 acres leaves 62 acres of developable land in Beaver Pond Forest.
If, as the Citizen article suggests, Urbandale is paid $18 M for the 62 remaining acres, this will represent a $290 K price per acre!
According to an unpublished appraisal conducted for the City, a fair market price for unserviced land inside the urban boundary is closer to $200 K per acre. Hence the fair market price for buying the remainder of Beaver Pond Forest is approximately $12.4 M.
$12.4 M financed at 6% interest via a debenture which is paid off over 30 years works out to annual payments of less than $1 M per year.
What the Citizen didn’t tell you is that an $18 M price is barely justified even if the City were to expropriate the land in the scenario where negotiations with Urbandale cannot agree on a price. In a similar case, 747926 Ontario Ltd. v. Upper Grand District School Board, the developer received less than 1.5x market value as a result of an expropriation.
If Urbandale is dragging its feet on a sale price for the remainder of Beaver Pond Forest in expectation of triggering a much higher expropriation price, they are playing a risky hand.