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Junction projects progressing, but city still needs to secure $44M

Place des Arts on track to open this summer
260321_JunctionEast

A number of large construction projects in Greater Sudbury are progressing nicely, council was told Tuesday during a large projects update.

The city has a number of projects on the go at the moment, including the Junction East and Junction West projects, Place des Arts and the Kingsway Entertainment District.

Place des Arts is the closest to completion, with construction in its final stages and occupancy expected some time this summer.

The Junction project, which has been split into the Junction West and East, is coming along, with Junction East in the design phase. Once completed, the building will house the Sudbury Art Gallery and the main branch of the Sudbury Public Library. 

City staff are also considering including the Sudbury Theatre Centre and a new home for the Sudbury Multicultural and Folk Arts Association in the scope of the Junction East Project.

Junction West is set to feature a large rentable convention centre and a performance centre.

Ian Wood, executive director of strategic initiatives, communications and citizen services, briefed council on March 23 on the status of the city's large projects, focusing largely on the Junction. 

Wood informed council that staff are actively monitoring investment market conditions with respect to the Junction West project and are discussing optimal timing with a hotel investment consultant.

"I don't want to suggest that we have selected one, but the company CBRE, who assisted us with the business plan is also a hotel investment consultant so we've been discussing timing with them," said Wood. "We haven't offered them a contract in that regard."

To date, the city has spent $686,000 on the Junction West project. 

In terms of the Junction East project, WZMH Architects are well into the functional program phase and a community engagement process has been progressing. Additionally, Ottawa-based First Peoples Group has been engaged in the project in order to provide support to Indigenous consultation.

"It's a 100 per cent Indigenous-owned and operated consultancy and they're supporting our efforts to engage the Indigenous community in this project," said Wood. "This is a first for us as a city and we're excited to have them join and assist us."

On Feb. 8 the federal government committed $500,000 to the Junction project through the Canada Cultural Spaces Fund. The funds have helped support the initial design phase of the project, and the city is seeking further funding options in order to bring the project to fruition.

"We do have existing applications for this phase submitted and under consideration at NOHFC (Northern Ontario Heritage Fund Corporation) and FedNor," said Wood. "We're preparing applications for energy-related grants including FCM at the moment."

The city will also be applying for financial support with capital construction on the project as they get closer to that phase, which is currently expected to get underway sometime between the fourth quarter of 2021 and the second quarter of 2022. Total estimated construction time on the project is between 24 to 36 months.

Costs associated with the Junction East project to date are approximately $873,000.

The combined total cost of the two Junction projects are around $112 million, with the West project slated at $66 million and the East project coming in at $46 million. A large chunk of the costs associated with the project remains unfunded at this time.

Ward 2 Coun. Michael Vagnini raised the question about where the city will be finding the roughly $44 million to cover the costs of the project.

"I know we've borrowed $68 million so we've got $44 million unfunded, do we have an idea of where that $44 million will be coming from?" said Vagnini.

Wood said that staff will be bringing an updated report to council later this year that will have a more detailed breakdown of the project and what funding sources may be available.

The city's executive director of finance, Ed Stankiewicz confirmed that the business case for the project called for $68 million in debt financing and that Wood would be at the helm when it came to securing outside funding sources.

"The business case called for $68 million from debt financing and an additional $44 or $45 million coming from other sources, being provincial grants and subsidies," said Stankiewicz. "As far as how those materialize I have no idea, that would be in Mr. Wood's area, but the debt financing only accounted for $68 million of the total expenditures."

Arguably the city's most contentious construction project of the past five years, the Kingsway Entertainment District is on the back burner for the time being as staff continues to work on a report that was requested by Mayor Brian Bigger in January.

Initially touted as a report aimed to clear the air and tidy up any misinformation that was circulating around the KED, Bigger later stated that the report would look at all arena options, including a new downtown arena and a renovation to the current arena.

The report is expected to be brought to council on June 16.