Saanich is looking to partner with the private sector on an estimated $172-million redevelopment of its operations-centre land on McKenzie Avenue.
Council has directed district staff to start work to identify a private-sector partner who will develop a master plan for the site at McKenzie Avenue and Borden Street in collaboration with Saanich.
The district would expect a single payment of about $30 million from a developer for the development lands while retaining ownership of the entire site in perpetuity.
About 300 staff based at the current operations centre look after transportation, parks, water, sewer and solid waste in the district.
The hope is that the redeveloped site will include facilities for municipal services as well as rental housing and commercial spaces, with buildings that could be up to 18 storeys. Ten per cent of the new residential units could be available at below-market rates.
Retaining ownership while generating revenue from the use of the site is a creative solution for a needed facility, said Mayor Dean Murdock, noting Saanich would receive lease payments and tax revenue from the development. “It offsets the cost that would otherwise be fully borne by taxpayers and allows us to generate revenue.”
Coun. Karen Harper said the district would be providing a needed service — a new operations centre — as well as housing, with a component that is affordable. “And we’re doing it in a way that limits the burden on our taxpayers.”
Council is hoping to get elector approval to borrow as much as $150 million for the project, likely through an alternative approval process that’s expected to happen in the next six months. In that process, 10 per cent or more of eligible electors have to submit forms in opposition to the initiative for it to fail.
The $150 million is a significant drop from what had been estimated only a few months ago, as the project has been scaled back to leave the district’s fleet centre, where its vehicles are stored and maintained, on site.
“There will be a future opportunity to look at renewal of that facility, but that’s not going to be part of this project,” said Murdock.
A staff report earlier this year suggested the redevelopment was likely to cost well over $200 million.
Murdock said the project is a priority, as the aging site has been deemed unfit to handle future growth. The buildings are 40 to 70 years old, don’t meet building-code requirements and have been deemed to be past their useful life.
While it’s still a lot of money to borrow, it’s worth it, the mayor said. “There is an acknowledgment there is a long-term benefit to the community to have an operations centre that continues to provide high-quality services, including waste collection for Saanich residents.”
Coun. Colin Plant said he was “struggling with the notion that the private sector would benefit from public land” but he acknowledged the process now underway should allow Saanich to make the best deal for itself.
He also noted having Saanich take on the responsibility and risk of developing the site without a private-sector partner was not an option.
Part of the redevelopment will see Saanich move its parks maintenance group to a three-acre industrial property it bought from Don Mann Excavating in the 4000-block of Lochside Drive. A date for that move has not yet been set.
A full budget for the redevelopment of the McKenzie-Borden site is expected to be confirmed by the end of 2026, with construction to start in 2027. Completion of the work is expected by the end of 2029.
