Carwash owners look to make deal with city about lot price
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Carwash owners look to make deal with city about lot price

ESTEVAN, Saskatchewan — According to www.estevanmercury.ca, Rock-N-Wash purchased a lot on Nesbitt Dr. in 2013 with the intention of building a multi-bay, eco-friendly carwash.

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However, the property was never developed, and the owners, Darryl Mack and Sylvain Blouin, came to the city council for assistance.

 In a letter to the council, Blouin wrote that the lots adjacent to their property in the Glen Peterson Industrial Park are currently selling for $1 CAD, while they paid $590,105 CAD (plus goods and services taxes (GST)) for their lot.

“The lenders/underwriters are no longer considering our $590,105 plus GST as equity into the project, as they know the asset is not worth that kind of value on the market, with similar lots selling for $1 adjacent to our property,” said Blouin.

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Their lot has been given a taxable value of $843,7000 CAD since 2017, resulting in annual taxes in excess of $17,200 CAD, which Blouin said is unjustifiable considering the economic downturn, a wide 10-meter easement in the middle of the property and the available lots for $1 CAD.

The easement reduces the value of the property and increases the construction cost.  

Blouin asked for a tax abatement on the property retroactive to 2018, since the $843,700 CAD valuation was “unrealistic,” given the circumstances.

In addition, since they did not start construction within the 180 days outline in an enclosed purchase agreement, they requested a return of the balance of the purchase price.

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“We would purchase the lot back from the city for $1 and leverage the remaining capital as equity towards construction,” Blouin wrote.

Blouin admitted they could have asked for a refund in 2014 or 2015, but instead the owners tried to find investors for the project.

Furthermore, Blouin is not angry at the city selling the lots for $1 CAD; rather, he applauds it for thinking creatively to bring business to the city.

“We are dealing with a very abnormal situation here. The fact that we bought from the city — the city back then was not selling the lots for a dollar, obviously. We’re not dealing with the same economic fundamentals back then that we are now,” said Blouin.

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Blouin told the council they have had to scale back their original plans for the wash, which called for a $7 million CAD facility with an automatic truck wash and 16 bays; now, they are looking to have a $2 million CAD project with 10 bays and one truck bay — possibly adding a second if the economy improves.

Blouin noted that they still wanted to pursue the project, which would be eco-friendly with water recycling and net-zero electrical consumption, but at this point, they only had two options: go bankrupt or work with the city council to find a solution.

The council tabled the request and will have the Rock-N-Wash representatives work with the economic development division and committee to come to an agreeable solution.

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Read the original article here.

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