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Point Hope Shipyard land could be sold to Ralmax by City of Victoria


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#21 VicHockeyFan

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Posted 01 May 2012 - 08:56 AM

People. You keep forgetting that Ralmax has come to the City saying they are interested in purchasing the land they've been on for scores of years. The City has said, make us an offer. So far, so good. Where's the problem?


Well said. If I want to buy the city lot next door, I agree it should be for sale if the price is right. Why not?
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#22 Bingo

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Posted 01 May 2012 - 12:06 PM

How about this scenario. Ralmax buys the land at a preferential price that gets them out of a lease that runs to 2045.

Then over a few years they quietly start winding down their business and sell the property on the open market for a huge profit.


In the meantime, can be grateful that we have a very viable marine industry on that property, that will be providing increased employment to Victorians once the shipbuilding contracts hit the scene.

#23 Mike K.

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Posted 02 May 2012 - 07:22 AM

Ralmax needs to own the land in order to make the new dock they're about to build make economic sense and give investors the longterm security (i.e. own rather than lease the land) they need to proceed.

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#24 VicHockeyFan

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Posted 02 May 2012 - 07:46 AM

Ralmax needs to own the land in order to make the new dock they're about to build make economic sense and give investors the longterm security (i.e. own rather than lease the land) they need to proceed.


That's the way I see it too. Given two options, 20-40 year lease to Ralmax, or sale to Ralmax, I don't think most Victorians would care one way or the other.

But if those two councilors get their way, maybe a movement will start to reclaim all City property for conversion to parks or social housing.
<p><span style="font-size:12px;"><em><span style="color:rgb(40,40,40);font-family:helvetica, arial, sans-serif;">"I don’t need a middle person in my pizza slice transaction" <strong>- zoomer, April 17, 2018</strong></span></em></span>

#25 dasmo

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Posted 02 May 2012 - 08:29 AM

I like their vision to have a floating pub on location and was curious why it had stalled. To me they have really made their operation public friendly. I enjoy seeing the goings on there as I walk buy. To me, it's places like this that make Victoria vibrant and interesting even to tourists, much more than a wax museum or an under sea garden... It's what we actually do here...

#26 Mike K.

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Posted 02 May 2012 - 09:28 AM

^yeah, I'll take that. I agree wholeheartedly.

The City, whether they like it or not, greatly depends on the industry along the harbour for tax revenue. Selkirk Waterfront pays substantially less tax than industrial operations did on that site a couple of decades back.

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#27 Nparker

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Posted 02 May 2012 - 11:16 AM

...Selkirk Waterfront pays substantially less tax than industrial operations did on that site a couple of decades back.


Hmmm...with the huge increase in density both in office and residential properties at this location, I find it hard to believe there is a net loss of tax revenue to the city. Is there evidence readily available to support this?

#28 VicHockeyFan

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Posted 02 May 2012 - 11:43 AM

^ My thoughts too.
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#29 Mike K.

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Posted 02 May 2012 - 12:24 PM

Heavy industry pays the highest taxes. Residential pays the lowest. Commercial pays in between, but closer to industrial in most cases. Therefore if you have industrial occupying a site that site will generate more tax revenue than will a relatively low density residential/commercial development (and let's face it, Selkirk is higher density than an average city lot but not high density).

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#30 Baro

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Posted 02 May 2012 - 01:39 PM

Then just ensure that the residential development is dense enough to generate equal or greater taxes! :teacher:
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#31 VicHockeyFan

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Posted 02 May 2012 - 01:45 PM

Heavy industry pays the highest taxes. Residential pays the lowest. Commercial pays in between, but closer to industrial in most cases. Therefore if you have industrial occupying a site that site will generate more tax revenue than will a relatively low density residential/commercial development (and let's face it, Selkirk is higher density than an average city lot but not high density).


Ya but just the land alone is more valuable as residential, that's why it is sold into residential use. So the land has a higher assessed value right away. Then add high density improvements, but tax at a lower mill rate, but you still come out with more tax money.
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#32 Mike K.

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Posted 02 May 2012 - 02:02 PM

The land has higher value to a developer as residential, for sure, but not necessarily to the City in the form of property taxes.

Bernard should be able to give us a better understanding of this.

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#33 Bernard

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Posted 03 May 2012 - 11:26 AM

I have not done a calculation on it, but the mill rate last year for residential was 10.073 and 37.1308 for major industry. This means the residential land has to be worth 3.7 times as much as the industrial land for the city to break even on the property taxes, though this is not entirely a fair comparison.

On the money the city gets, the ration is 3.6, for BC Transit it is 5

There is then also the difference in costs. Industrial land more or less costs the city almost nothing, there are no services the city provides to industry other than red tape, fire and police. Most services tend to be oriented towards the needs of residents.

For the city bottom line to be roughly the same as before, the residential properties need to have a value of 4.0 to 4.4 times as high as industry.

The Point Hope Shipyard and the lands owned by the city seem to have a value in the range of $40,000,000 to $50,000,000. For the city to get the same taxes on this land as condos, the condos would have to have an aggregate value of $160,000,000 to $220,000,000. At an average value of $400,00 to $500,000 per condo, you would need 320 to 550 condos built on that land to equal the property tax value of the existing shipyard.

#34 Bernard

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Posted 03 May 2012 - 11:30 AM

I should added that the developments in Vic West and Selkirk are not dense enough to bring in enough property taxes to make up for the land if it were in active industrial use.

#35 Nparker

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Posted 03 May 2012 - 11:45 AM

...the development [at] Selkirk [is] not dense enough to bring in enough property taxes to make up for the land if it were in active industrial use.


However at least half of the Selkirk lands are not residential, but commercial (or however office space is classified). This must affect the revenue the city receceives through property taxation, even on relatively low density developments.

#36 Mike K.

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Posted 03 May 2012 - 12:04 PM

Thanks, Bernard.

The majority of land at Selkirk Waterfront is residential, though, and commercial pays a lower rate than does industrial.

My understanding is the Pacific Steel site pays $17-million a year in property taxes. It is also much smaller than the Selkirk Waterfront property. Can anyone confirm the $17-million figure? VHF told me the other day that the Empress apparently pays some $4-million in annual property taxes.

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#37 Bernard

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Posted 03 May 2012 - 02:35 PM

Selkirk commercial pays something close to industrial, so yes this has an impact, but if the buildings are owned by the province, they do not pay taxes.

I suspect that the values of the commercially properties is worth more now than when it was industrial, but the density of the residential is not very dense at all.

The area of the land the city owns is about 11 acres, you need to average 40 condos per acre to get a residential value high enough for it to revenue neutral for the city.

This of course all ignores my big issue, the fact that there is a desperate need for industrial land in the city

#38 spanky123

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Posted 03 May 2012 - 04:55 PM

Thanks, Bernard.

The majority of land at Selkirk Waterfront is residential, though, and commercial pays a lower rate than does industrial.

My understanding is the Pacific Steel site pays $17-million a year in property taxes. It is also much smaller than the Selkirk Waterfront property. Can anyone confirm the $17-million figure? VHF told me the other day that the Empress apparently pays some $4-million in annual property taxes.


I seem to recall a couple of years back that the Jawls were the largest taxpayer in the City and they paid about $17M in aggregate for all of their properties. I suspect then that $17M just for Pacific Steel is too high.

#39 Mike K.

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Posted 03 May 2012 - 08:35 PM

Yeah, I thought $17m might too high. Can anyone confirm what the Pacific Steel site actually encompasses? Is it only that junk pile, or are there any neighbouring warehouses part of the operation?

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#40 Bingo

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Posted 03 May 2012 - 09:09 PM

The land has higher value to a developer as residential, for sure, but not necessarily to the City in the form of property taxes.


When the shipyard is running to capacity I would think the number of jobs that is produced will be greater than the number of jobs produced from condos on the same site.

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