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You are here: Home / Featured / The convention centre is costing governments $11.6 million this year, and no one benefits except Joe Ramia

The convention centre is costing governments $11.6 million this year, and no one benefits except Joe Ramia

Morning File, Friday, August 14, 2020

August 14, 2020 By Tim Bousquet 16 Comments

News

1. NSCAD protest

Dozens of people gathered in Granville Mall on Thursday to call on NSCAD to fire its board of governors and reinstate former president Aoife Mac Namara.— Photo: Zane Woodford

“Dozens of people gathered in Granville Mall on Thursday to call for the removal of NSCAD’s board of governors and the reinstatement of its former president,” reports Zane Woodford:

Former NSCAD president Dr. Aoife Mac Namara was fired without a publicly-stated reason (“personnel matters”) in late June after less than a year in the role. In that short time, Mac Namara made an impression on students and faculty alike with her work around diversity and inclusion.

“We had, for the first time, a president who actually cared,” African Nova Scotian former NSCAD student Jade Peek said during Thursday’s rally.

…

As the Halifax Examiner reported after she was fired, “Mac Namara stepped right into the closed and opaque circle that constitutes Nova Scotia’s managerial and real estate network.”

You’ll recall that NSCAD was nearly bankrupted a few years ago by an ill-conceived purchase of property at the port. Ever since, the Board of Governors has been especially focused on real estate — there was the potential to relocate the Granville campus to the waterfront in a joint project with the Art Gallery of Nova Scotia, but for unknown (to me) reasons, that idea fell through, and now the AGNS is going solo with the waterfront project.

In the 1970s, the university moved from Coburg Road to downtown by purchasing the eastern half of the Granville Street portion of the Historic Properties developed by Ben McCrea, owner of the Armour Group. That sale included a provision that should the university ever sell the property, Armour Group would have first rights of refusal.

Fast forward to the present day. Ben McCrea died some years ago, and Armour is now controlled by his son, Scott McCrea. Saint Mary’s University awarded him an honorary degree last year. In addition to the Historic Properties, the Armour Group owns the Waterside, Founders Square, and the dog-awful Queen’s Marque project now blighting the waterfront.

And NSCAD’s Granville campus could join that real estate portfolio. McCrea has made some sort of offer to the university for the property. Does this make sense? Maybe. As the adjacent Cogswell redevelopment project is about to commence, now might be an opportune time to unload the property to a developer.

The problem, I’m told, is that as Mac Namara saw it, the potential sale of the Granville campus was tied up with conflicts of interest on the Board of Governors. In particular, vice chair Sean Kelly is a lawyer with Stewart McKelvey, where he represents the Armour Group.

I’ll leave it for others to decide if that’s a substantial conflict, but regardless, Mac Namara has been working on a governance review of the board, with the aim of directly addressing potential conflicts of interest and of having the board better reflect the community, especially in terms of its diversity.

The dozens of people who came out on Thursday are calling on the board to reinstate Mac Namara and the provincial government to break up and replace the board.

Click here to read “Protesters call for removal of NSCAD board, reinstatement of fired president.”

(link to this item)

2. Convention centre

Former Trade Centre Limited president Scott Ferguson assured us that the new convention centre would be bold. Photo: Halifax Examiner

In June, Zane Woodford reported that:

Events East, the Crown corporation that runs the Halifax Convention Centre, said it hasn’t finished adding up the toll of COVID-19. The city is budgeting for $2,804,000 in convention centre losses in fiscal 2020-2021 — $109,000 more than its share last year. Convention centre losses are split 50/50 by the provincial and municipal governments, meaning the total loss projected for 2020-2021 is $5,608,000 — $218,000 more than last year.

Today, the CBC reports that:

The Nova Scotia government is planning to spend twice what they were expecting to cover Halifax Convention Centre costs during COVID-19…

After the global pandemic dealt a major blow to the convention industry, the tab is increasing by $3 million for the 2020-21 fiscal year, with the province now looking at spending about $5.8 million of public funds, said provincial government spokesperson Tracy Barron in an email.

That means the convention centre is expecting a $11.6 million loss this fiscal year, half of which will be covered by the province, the other half by the city. That’s $5.8 million each.

(If you’re wondering, that kind of money could have bought the city 15 tanks, or allow it to increase the pay of 414 janitors from minimum wage to a living wage. The province could hire something like 116 teachers.)

This is the very definition of a white elephant, or an albatross around the neck (albeit, no one will cop to guilt over the convention centre).

The convention centre payments are like the Yarmouth ferry: no one benefits from them, except for the vendor, who is providing a completely useless service.

In the case of the ferry, despite the government spending something like $50 million this year and last on it, it has not carried a single passenger, it has not filled one hotel room, it has not brought one penny in added value to any south shore business. Bay Ferries, however, continues to get paid some (for now) secret millions of dollars in management fees for providing the non-service.

In the case of the convention centre, no event manager is making a penny, no Argyle Street bar is bathing in overflow traffic from conventions, there’s no economic impact at all, but it consumes a lot of city and provincial cash that could otherwise go in much more useful directions. Developer Joe Ramia’s company benefits, however, in that the rental payments the governments make for the empty convention centre covers a big part of his mortgage on the Nova Centre, which is itself largely empty.

Every now and then, I go back and read this piece I wrote in 2012, just because I like to see how right I was.

We’re paying for the thing, so maybe we could use it to increase school space, eh? Move some of the classes from Citadel High down the hill and provide better physical distancing opportunities? Who knows, maybe some of the kids will eat lunch on Argyle Street, too. Just a thought.

(link to this item)

3. The Sterling

The Stirling. Photo: CAPREIT

Canadian Apartment Properties Real Estate Investment Trust (CAPREIT) announced yesterday that it has bought “The Stirling,” an 88-unit high-end apartment building in Bedford West, for $22.4 million, or just over a quarter-million dollars per unit.

The Stirling was built by Clayton Developments, whose president is Richard Butts, the former CAO of the Halifax Regional Municipality. Clayton is a subsidiary of the Shaw Group.

CAPREIT notes that:

“We are pleased to be further expanding our presence in the very strong Halifax market with this high-end acquisition,” commented Mark Kenney, President and CEO. “With our recent growth, CAPREIT is now among the largest providers of high-quality rental accommodation in the city, and we look to generate solid economies of scale and operating synergies in the months ahead.”

Rents in the building range from $1,400/month for the smallest one-bedroom to $1,650/month for the largest two-bedroom. The building is now 100% rented, so expect those rents to rise substantially as CAPREIT profits from its “operating synergies.”

There’s nothing surprising here — real estate investment trusts have been picking away at the Halifax rental market for a decade, and stepping up the pace of acquisitions in recent years. The sale of this one building doesn’t represent much harm in itself, but it’s part of the overall pattern that is pricing people out of their apartments.

The deed transfer tax on the sale means the city will get $336,000 from the deal, enough to buy three-quarters of a tank, or to raise the salary of two and a half janitors from minimum wage to living wage — but alas, it will all go to feed the convention centre deficit.

(link to this item)

4. Groundhog

BlockCrushr CEO Scott Burke (left) and CTO Andrew Redden. Photo: Anna-Alexia Basile

Last month, the Halifax-based startup BlockCrushr, which was developing a blockchain app it called Groundhog, filed suit in New York against ConsenSys Inc, alleging that ConsenSys stole its technology.

You can read the lawsuit itself here, or a synopsis of it here:

Founded in 2018, Groundhog has developed an Ethereum-based solution that consists of both a mobile wallet and a payment gateway that can be installed online via API or plugin. According to its website, Groundhog offers a way for users to create pre-authorized, recurring payments with cryptocurrency.

In the court filing, dated July 14, Groundhog alleges that after participating in ConsenSys’ accelerator in the fall of 2018 and giving the company access to its trade secrets and source code, ConsenSys ceased communications with Groundhog and later launched its own offering one day before the Canadian startup’s planned product launch.

ConsenSys’ product, called Daisy Payments, allows recurring transactions, such as monthly payments, on the Ethereum blockchain. In its filing, Groundhog called Daisy Payments an “identical” offering to Groundhog’s.

None of the claims have been tested in court.

But would it be a surprise to discover that a cryptocurrency technology that was developed in large part to defraud, avoid taxes, and deal in illegal goods would attract a bunch of players who defraud, avoid taxes, and deal in illegal goods?

I’m sure there are lots of legitimate reasons to use Bitcoin and other cryptocurrencies, but never in a million years would I invest in or partner with the companies developing the technology because, well, you got to dance with them that brung you.

The best I can tell, most of BlockCrushr’s investors were private venture capitalists in the US, although it did earlier this year get one tiny — $20,328 — grant from the National Research Council Canada’s Innovation Assistance Program.

The Registry of Joint Stock Companies says that BlockCrushr had its registration revoked for non-payment last week, but the company was late paying the registration fees last year, too, and was reinstated after paying up. I’ve found that that simple metric — do companies pay their corporate registration fees on time? — is a pretty good indicator of their financial stability; if they don’t have a process in place to make regular recurring payments to government on time, then they probably don’t have a lot of other processes in place either.

(link to this item)

5. Cue the diddly diddly music

Remember the lobster-themed team mascot for the Atlantic Schooners? Good times.

“A Nova Scotia-set series described as ‘an epic tale of lust, legacy and lobster’ is bound for the CBC,” reports the Canadian Press:

The public broadcaster says production is underway in the province on “Feudal,” which will debut on CBC next year.

The one-hour drama features a dysfunctional family of adult half-siblings battling for control of their ramshackle summer resort, The Moonshine, on the South Shore of Nova Scotia.

I only put this bit in so I could use the Lobster Mascot photo.

(link to this item)


Views

1. Fountains

The Yarmouth fountain. Photo: Stephen Archibald

“The oversupply of real news this summer has virtually blotted out the ‘dog left in a hot car’ stories that are traditional summer fare during slow news doldrums,” writes Stephen Archibald:

Also, mask shaming probably consumes some of that bandwidth usually expended on hot pet shaming. Still, people and animals need to keep hydrated, and that made me remember the water fountains that once quenched the thirst of people and beasts in many Nova Scotian communities.

Two memorable examples are found in Yarmouth. The best known, installed in 1883, is topped with a gold horse (made of zinc, painted gold). The cast iron plinth has water basins for all: the one now overflowing with reddish petunias was for people, the big basins would refresh horses and oxen, while the little trays at ground level would serve dogs or any other ground hugging critter.

(link to this item)


Government

No meetings.


In the harbour

00:30: MOL Emissary, container ship, sails from Fairview Cove for Rotterdam
06:00: ZIM Shekou, container ship, arrives at Pier 42 from Valencia, Spain
08:00: Pacific Constructor, offshore supply ship, sails from Pier 9 for sea

Acadian. Photo: Halifax Examiner

08:00: Acadian, oil tanker, arrives at anchorage from Saint John
14:00: John J. Carrick, barge, sails from McAsphalt for sea
15:30: ZIM Shekou sails for New York
16:00: Algoma Integrity, bulker, sails from National Gypsum for sea


Footnotes

Education Minister Zach Churchill and Dr. Robert Strang are holding a press conference at noon to update us on the Back-to-School plans. Before the event, I’ll be at the courthouse just a couple of blocks away from the media room, but (despite having no numbers to back up the claim) the government and the press gallery have deemed the Examiner too Podunk for me to be at the press conference in person. So, instead, I’ll hang out beneath the statue of Joe Howe across the street, and call in from there.

Send me your ideas for questions.

Oh, also, in our drive to move out of Podunk status, we could use your financial support. Please subscribe, or drop us a donation. Thanks!

Filed Under: Featured

About Tim Bousquet

Tim Bousquet is the editor and publisher of the Halifax Examiner. email: [email protected]; Twitter

Comments

  1. Nick says

    August 14, 2020 at 10:16 am

    It is weird to think that renting a 1 bedroom apartment costs about the same as buying a new car every two years and then setting the car on fire (without trying to collect insurance).

    We’ve created an economy where the prime directive for most people is “outbid other people on housing so that one day you too may sell your property for 5 times what you bought it for”. This is disgusting and far more offensive to me than anything the vulgarian con man in chief does, and nobody serious questions it. Canada is turning into one big company town – I spend 50% of my income on renting from a REIT and taxes to the government that enables that REIT’s predatory behavior.

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  2. aetotten says

    August 14, 2020 at 10:29 am

    Just wanted to note that Richard Butts actually retired from Clayton Developments this spring. The new president is Jason Brunt, who was Clayton’s VP of business development. AllNS reported it on June 11 and it also seems to be on the Chamber of Commerce site: https://business.halifaxchamber.com/members/member/clayton-developments-ltd-4021

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  3. David Frevola says

    August 14, 2020 at 10:32 am

    question for the press conference: minister churchill, by dumping mcneil, does your party hope to rebrand itself as a traditional center left party(at least one that campaigns that way but governs another) and take advantage of the current popularity of the federal liberal party? and if your party does get reelected in the next provincial election with whatever leader, will you return lock step to work exclusively for the business elite in this province and do everything in your power to continue child poverty rates, unlivable wages for working people and maintain the paternalistic attitudes and continue the lies to support your neo liberal agenda?

    Log in to Reply
    • richard starr says

      August 14, 2020 at 11:11 am

      Great question. Go for it, Tim!

      Log in to Reply
  4. trc says

    August 14, 2020 at 11:11 am

    Synergies and economies of scale make sense in some acquisitions, but it’s hard to see how they apply to buying another apartment building. The buyer simply acquires all the maintenance and operating costs of the additional apartments. However, by eliminating a competitor, it’s easier to raise rents and reduce services – and then use the additional profit to buy more buildings and eliminate more competition. Rent controls would stop this cycle, but governments are reluctant to give up their cut from companies flipping buildings.

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  5. ianmckinnon27 says

    August 14, 2020 at 11:54 am

    Every once in a while Tim uses the term “diddley” or “didley” music (as today) which bugs the hell out of me, and I’m sure many of your other readers.

    The “didley” music, I presume you are referring to, is the Celtic traditional music for which Nova Scotia is world-renowned. As a highland piper and member of Rawlins Cross, I am a practitioner of that proud tradition. As a result of the extensive international touring of NS Celtic acts like The Rankins, Natalie MacMaster, The Barra MacNeils, Ashley MacIsaac, Mary Jane Lamond, Coig and Beolach, to name but a few, thousands of tourists are attracted to our province every summer and fall to hear more of our Celtic music. These visitors attend festivals like Celtic Colours, Kitchenfest and The Broad Cove Scottish Concert and contribute millions of dollars to our economy.

    I cannot presume to tell you what music to stream through your Spotify account, but may I, again, ask you to ease off on the disparaging references to our Celtic traditional music?

    Keep up the (otherwise) great work!

    Log in to Reply
    • Dartmouth Oldie says

      August 14, 2020 at 12:39 pm

      Well said Ian! Our so called “diddly diddly” music is something which always has and continues to enrich this province. There are lots of things which warrant disparaging descriptions, but our Celtic tradition is not one of them.

      Log in to Reply
    • Trevor Parsons says

      August 14, 2020 at 2:39 pm

      As a Nova Scotian, and someone who appreciates the pipes, I’m not at all offended by someone calling Celtic music didley music. I’m more offended by the fact that there are so few, if any, pipers being employed by local bands. If Dropkick Murphys can use bagpipes, why can’t someone like Joel Plaskett or Aquaculture get on board and use a piper now and then?
      .https://www.youtube.com/watch?v=A1NZcH2haIM&feature=emb_rel_err

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  6. Dartmouth Oldie says

    August 14, 2020 at 12:37 pm

    Time to say enough is enough for that abominable Nova Centre. No one who did unbiased research ever said it would work and now that has been proven beyond any doubt.
    There are other potential uses it could be converted to, so lets pick one of those and get to it and stop the bleeding of money especially at a time when we can least afford it.
    Can the Art Gallery project and move it into here!

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  7. johnbarry says

    August 14, 2020 at 1:37 pm

    Queen’s Marque has certainly buggered up the harbour view.

    In honour of its blockage, I’d like to see Upper Water Street renamed as
    Tunnel Ave.

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  8. Yulinyhz says

    August 14, 2020 at 1:46 pm

    Can we use all our convention centre subsidies to turn the vacant hotel that appears to be half the building into subsidized housing? Maybe that’s not how this works…

    Log in to Reply
    • Vel says

      August 14, 2020 at 3:26 pm

      I say any vacant space that can be used for housing should be at least until such time as more appropriate can be built.

      And how about using those empty convention centre rooms and spaces for socially distanced online learning?

      Rather than have all these empty spaces just sitting there, let’s try and find creative uses for them. As taxpayers, we are all paying for them. Personally, I have wasted money. Like so many others, I have to carefully budget my funds and find alternative ways to get things done. Lets challenge all places that are not operating at full capacity to do the same.

      Just my opinions, of course, but keep hearing that Covid-19 is a “unique situation, never before experienced” so let’s look for some unique solutions and opportunities. I can say that any politician, regardless of party of level of government, who took the chance to pursue something other than the status quo would be a politician I would be more likely to support at the next election.

      Log in to Reply
      • Vel says

        August 14, 2020 at 3:27 pm

        *hate wasted money (not have wasted money)

        Log in to Reply
  9. nancyg says

    August 14, 2020 at 4:27 pm

    Too bad the CFL hustlers and grifters couldn’t get a team and stadium deal done. Then Halifax would have had two White Elephant bookends on each side of the harbor. Suck and bleed the citizenry dry while the fat, cushy pol pensions mount up.

    Log in to Reply
  10. Clark Richards says

    August 15, 2020 at 3:32 pm

    Did anyone else notice the sweet irony of the Groundhog story and them paying their own registration dues?

    “Groundhog offers a way for users to create pre-authorized, recurring payments with cryptocurrency.”

    “if they don’t have a process in place to make regular recurring payments to government on time, then they probably don’t have a lot of other processes in place either.”

    Log in to Reply
    • Tim Bousquet says

      August 15, 2020 at 3:34 pm

      I thought about that, but I think the trick here is Service Nova Scotia won’t take Bitcoin.

      Log in to Reply

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