While the Squamish Oceanfront Development Corporation’s (SODC) former chair says a sudden change of process took the selection of a developer out of the corporation’s hands, he thinks council made the right decision.
Council members are standing by their decision and say they followed proper protocol.
In January 2013, the district’s wholly owned subsidiary sought expressions of interest on the 59-acre mixed-use development. Cushman and Wakefield, a real estate agency contracted by the corporation, received a good response, the SODC’s former chair Bill McNeney said. All parties were handed a detailed expression of interest document, allowing groups access to the slew of reports regarding the property — ranging on topics from environmental cleanup to its history.
Cushman and Wakefield highlighted three potential buyers that stood out, McNeney said. An offshore corporate group represented by a Vancouver law firm later dropped from the running, leaving two companies in the race — Solterra and Newport Beach Partnership Ltd., he noted.
They filed requests for proposals (RFP) and were invited to present in front of the shareholder — the District of Squamish, McNeney said. This gave council a chance to comment on the proposals and highlight any areas officials thought missing, he said.
From that point, both development candidates were expecting to lay out terms for a contract deal, detailing items such as financial commitments, the company’s ability to deliver and what they would seek from the district, McNeney said. But that never happened. Instead, council selected a candidate after the presentations, leaving the SODC board shocked and Solterra disgruntled, McNeney said.
“They didn’t want us to drag these guys through the mud for another couple of weeks getting out the details of the term sheet. They had made up their mind.”
The district didn’t alter from the process that they had committed to, Coun. Doug Race said, noting the SODC board wasn’t at the meeting. Of the two proposals, there was a clear winner, he added.
SODC members’ notes indicated there had been a bit of back and forth between the oceanfront applicants to clarify points, Race noted. Council had also contracted an independent advisor to help them with the big decision, he added. With all the information in front of them, they decided to move forward, Race said.
Council stands behind its decision, Coun. Patricia Heintzman said, reiterating Race’s statement that one proposal came out on top. Ted Prior didn’t vote due to a conflict of interest — Prior owns property that could be impacted by the development.
The idea behind RFPs is to put one’s best cards on the table, Simon Fraser University marketing professor Lindsay Meredith said. A RFP would provide an all-in price and break down other optional components as outlined in the request, he said. Typically a RFP would highlight all the items required for the project without the need for further inquiry, Meredith noted.
“If you put out a request for proposal and list all the items on a proposal, that ought to cover it,” he said.
RFP’s tend to be unique to each site and depend upon the specific circumstances, City of Vancouver spokesperson Sara Couper wrote in an email to The Squamish Chief.
“Usually RFPs lay out a specific process on how to respond to the RFP. And if respondents wish to be successful, then they need to abide by the terms and conditions of the RFP,” she stated.
The SODC intended to “play a little ping pong” with the candidates through the terms, McNeney said. They would have returned to council with commitments based on the document, he noted.
“[The term sheets] outline what they [the developers] are prepared to support on their own, the dollars that they would commit…You can say that you are going to give us $20 million for property and that is a meaningless number if you want all the services provided by the district,” McNeney explained, using pricing as an example.
McNeney said Solterra was upset that the process was suddenly altered. The district had broken its agreement with the SODC board, giving them little option but to resign, McNeney added.
“They [the district] decided to take a hands-on approach to negotiations and basically go from a shareholder to being an owner,” he said, noting that without the SODC’s expertise, the board members were concerned the district was ill-prepared to negotiate a strong development agreement.
The B.C. municipalities’ guiding policy, the Community Charter, legally limits the details district officials can share with the public because negotiations are still underway, Mayor Rob Kirkham said.
“Even if other people break that, I still can’t,” he said.
Officials “aren’t trying to hide anything,” as council intends to release all the information pertaining to the land sale once an agreement is signed, Kirkham noted. Kirkham was able to confirm that the SODC and council conducted an in-depth review of two applicants. The selected candidate stood out, he noted.
“I have no question that this is the best proponent to deliver the community’s expectations and vision for the oceanfront.”
The oceanfront is not an easy property to develop, Kirkham said. It requires environmental clean-up and infrastructure costs present a “huge hurdle.”
“The chosen developer is fronting all the costs of that,” he noted.
McNeney agreed with Kirkham that officials likely picked the best candidate. The phased development agreement requires a developer with deep pockets. Newport Beach Partnership Ltd. was willing to carry out the community’s vision in the sub-area plan, he noted, which outlines a third of the property be made park, a third go to commercial and industrial uses and a third be developed for residential units.
“It is good to know they are at that point now, where they feel they can sign [an agreement],” he said, adding it’s exciting news for Squamish. “Basically they are going to sign a term sheet.”
It’s an ironic situation, McNeney added. The SODC planned to have a term sheet completed within two weeks and the process has now taken close to a year, he said.
“I think it has cost them more,” McNeney said.
The Squamish Chief contacted Solterra’s vice president, Mike Bosa, who said he was unwilling to comment at this point in time. The Chief tried to reach Michael Hutchison, the principal of Bethel Lands Corporation — one of the Newport partners. He was away at the time.
