Winnipeg Free Press Newspaper Archives Jul 18 2015, Page 82

Winnipeg Free Press (Newspaper) - July 18, 2015, Winnipeg, Manitoba C M Y K PAGE D7 JOHN WOODS / WINNIPEG FREE PRESS For more than a decade, a two- kilometre strip of land called the Fort Rouge Yards has been eyed for transit- residential development. D7 cover SATURDAY, JULY 18, 2015 1 I F you step on to a southbound bus at Osborne Station, there’s not much to see along the Southwest Transitway, a 3.6- kilometre patch of pavement that serves as the city’s only rapid- transit corridor. First, you rumble through a tunnel below some CN Rail lines. Then you travel past the back end of Winnipeg Transit’s headquarters and main garage. For the final two kilometres, you gaze out at a big green patch of nothingness known as the Fort Rouge Yards. For more than a decade, this twokilometre strip of former industrial land has been eyed as the site of Winnipeg’s first transit- oriented development, a collection of new condos and apartments that would allow residents easy transport to work or school without having to rely on cars. Former owner Ken Douma, who bought the decommissioned rail yards from CN, wanted to build 1,375 units on the property. His plan died in 2004, when then- mayor Sam Katz cancelled an earlier iteration of the Southwest Transitway. Current owner Andrew Marquess, who purchased the land from Douma in early 2008, scaled back the development density to 900 townhouses and apartments. His original plan called for construction to begin in 2011 and wrap up this year. Halfway through 2015, all that stands at the Fort Rouge Yards is a single show home, a pair of transit stations and a series of coming- soon signs. This is not just a concern for Marquess, who has borrowed and spent millions to remediate the former industrial site, install geothermal heating pipes below it and build roads ( and one of the transit stations) above ground. Developers are watching with interest, as the Fort Rouge Yards is one of the largest infill projects ever proposed in a city famous for building outward instead of up. A failure here could send a signal Winnipeg isn’t serious about higher- density development. They’re also watching intently at city hall, where Mayor Brian Bowman made an election pledge to complete six transit corridors by 2030. On the campaign trail, Bowman said new developments alongside future bus- ways would help pay for his multibillion- dollar promise. If Marquess fails, so does Winnipeg’s mayor, a man he’s never met. There’s even more skin in the game at First National Financial, Canada’s largest nonbank lender. The Toronto firm, which has been lending Marquess money since 2003, took over the risk of a $ 7- million Fort Rouge Yards loan guarantee from the City of Winnipeg earlier this year. Finally, Winnipeg as a whole has a bet on Marquess, who actually controls two parcels of strategically important infill property. In addition to the Fort Rouge Yards, Marquess owns 59 acres of unserviced city land in the Parker neighbourhood, alongside the future second phase of the Southwest Transitway. He acquired this land in 2009 through the Parker land swap, one of the land transactions vilified by an external audit of major City of Winnipeg real estate deals. Marquess, who moved to Winnipeg from Calgary about 14 years ago, bristles at a narrative he says has emerged about him in his adopted home. “ This guy pops up from nowhere. This guy was at the right place at the right time. This guy has something strategically important,” he said in an interview earlier this month. “ Everything I bought in this town, everyone had a chance to buy.” FORT ROUGE PROJECT’S COMPLICATED JOURNEY BY BARTLEY KIVES ‘ This guy pops up from nowhere. This guy was at the right place at the right time. This guy has something strategically important’ — Andrew Marquess bristling at the narrative that has emerged CONTINUED PAGE D8 FROM FARM TO NEGOTIATING TABLE Marquess, 50, grew up on a cattle ranch near the hamlet of Gem, Alta., a speck on the highway map about 140 kilometres east of Calgary. Before moving to Winnipeg, he worked at wealth- management company Assante, started an agricultural- genetics company in Saskatoon with his brother and worked in real estate in Calgary. Marquess said he started in property at Mainstreet Equity Corp., a Calgary company that buys, renovates and manages rental apartments. This business model served as the template for the real estate projects he pursued in Winnipeg during the first few years of the last decade. “ Buy a property. Fix it up. Raise the rent and move forward. That was the model we had here,” said Marquess, sitting in the boardroom of Gem Equities, the development company he runs out of a one- storey building on an industrial stretch of Spruce Street in inner- city Winnipeg’s Sargent Park neighbourhood. Gem Equities is named after his childhood home, but there’s little of the farm boy at the office. On a sweltering Friday, Marquess is dressed in a light- blue pinstripe dress shirt and charcoal slacks. He’s slim, with a full head of blond hair. After moving to Winnipeg, Marquess started or held an interest in no less than 22 different corporations, most of them numbered companies registered in Manitoba. Prior to Gem Equities, his main Winnipeg firm was B& M Land. Mainly active before the global recession of 2008, it was controlled by Marquess, through a separate numbered Manitoba company, and San Jose, Calif., developer Ben Bingaman, through a numbered company registered in Nova Scotia. Marquess said he met Bingaman while both worked for Assante, in separate cities. “ He grew up on a farm, I grew up on a farm,” Marquess said. The two became friends and decided to work together, he added. By 2008, changes to the real estate market in Winnipeg led Marquess to reconsider the idea of renovating apartments and switch to infill construction. Building new would allow him to take advantage of more tax credits, he said. “ The real estate had started to move and I realized the model wasn’t going to continue to be successful because the prices of buildings were moving faster,” he said. “ There was a point where it didn’t make any sense, and I could see that in ’ 08. So this opportunity came up of buying this piece of dirt in Fort Rouge.” D_ 07_ Jul- 18- 15_ FF_ 01. indd D7 7/ 16/ 15 6: 43: 41 PM